By Jim Schutze
By Rachel Watts
By Lauren Drewes Daniels
By Anna Merlan
By Lee Escobedo
In a pleading filed under seal July 6 with the U.S. 5th Circuit Court of Appeals in New Orleans, the Justice Department said a Dallas judge had wrongly exonerated Belo of criminal conduct. Belo and its news staff broke federal criminal wiretap laws in the 1994-1995 wiretapping of former Dallas school board member Peavy and should be punished under those laws, according to Justice Department pleadings.
Last October, U.S. District Judge Jerry Buchmeyer in Dallas ruled that Channel 8 investigative reporter Robert Riggs and Belo had violated portions of the federal wiretap law. But Buchmeyer further ruled that Belo and Riggs were protected from prosecution by the First Amendment. The civil suit in which that ruling was made, brought by Peavy against Riggs and Channel 8, is on appeal at the 5th Circuit.
Reno's intervention against Belo in the lawsuit has not yet been reported in Dallas because the case is under seal and the Belo Corp. was the only media company in Dallas that knew of the intervention until a source informed the Dallas Observer last week. If the court in New Orleans agrees with Reno, criminal charges could be brought against Riggs and Belo executives. Penalties under the federal wiretap statute range from a fine to five years in prison, according to Assistant U.S. Attorney Philip Umphres in Dallas.
Justice Department officials in Washington declined to discuss the Peavy case because it is under seal, but they provided the Observer with information about similar cases elsewhere in the country in which Reno has intervened. Basically Reno's argument in these cases is that information stolen through wiretapping doesn't become "clean" when someone passes it on to a reporter, especially if the reporter has some knowledge or complicity in the actual wiretapping.
U.S. Magistrate Jeff Kaplan had found that Belo violated two-thirds of the statute by using information from illegal tapes of Peavy's phone conversations to develop stories about him and by letting the public know what was on the tapes. But Kaplan said Belo had not participated in "procuring" the tapes, meaning the actual making of the tapes. Peavy's former neighbor Charles James Harman pleaded guilty in August 1996 to charges that he had taped Peavy's private conversations on a cordless phone and passed them on to Riggs and to a producer who did some of Riggs' reporting. Harman was fined $5,000.
Kaplan's argument, endorsed by Judge Buchmeyer in ruling against Peavy, was that using and divulging information on the tapes was a basic speech issue under the First Amendment. Kaplan said the federal "Title III" wiretap law was unconstitutional in its attempt to punish the press for using information reporters themselves did not steal.
Mike Quilling, Peavy's attorney, says he felt there was a strong argument to be made that Riggs had encouraged Harman to tape Peavy and thereby had participated in procuring the tapes under the definitions in the statute. "You don't have to do the taping yourself," Quilling says. "You can pay somebody else 50 bucks to make the tapes, and you have still procured them."
Quilling did not imply that Riggs had paid Harman, only that a jury should have been allowed to decide whether Riggs and other Channel 8 employees had encouraged Harman to tape or even told him how to do it.
Any ruling by a judge holding a federal statute to be unconstitutional triggers an automatic review by the U.S. attorney general, according to Scott McIntosh of the Justice Department. But according to documents provided by McIntosh from other similar cases, the attorney general's language in these cases has been especially tough, accusing media companies like Belo of "reprehensible conduct" in their complicity with wiretappers.
Peavy also had sued the Observer, which was the first media outlet to publish the actual content of tapes in which Peavy was overheard using racial epithets. That suit was dismissed because the Observer had obtained a transcript of the tape from Dallas school district documents, not from an illegal wiretap.
In 1995, Riggs authored a series of investigative reports on Channel 8 outlining alleged double-dealing between Peavy, then a member of the Dallas school board, and insurance agent Eugene Oliver. Eventually Peavy and Oliver were indicted in a case brought by U.S. Attorney Paul Coggins, but a Dallas jury found them not guilty in November 1996.
Lawyers for Belo did not respond to the Observer's request for comment on Reno's intervention against them. Belo corporate spokesman Harold Gaar did not return calls. Riggs declined to comment on the legal case because the filings are under seal at the request of Peavy's lawyers. But Riggs did say he wished the full facts of the case could be made public.
"I wish that everything in this case could be unsealed so that everyone who has a child in DISD and everyone who pays taxes to DISD could see the facts of what went on at DISD and at the highest levels of the political establishment and also in the U.S. Attorney's Office," he says.
Lurking beneath the surface of this case and all those that preceded it is the mystery of the "Sandy Kress tapes," in which Kress, a former Dallas school board president, is alleged to have made damaging remarks. Sources on all sides of the case now on appeal in New Orleans say tapes of Kress talking to Peavy are part of the evidence in the case and suggest that keeping the case sealed may be part of an effort to keep the Kress tapes out of public hands.
After Peavy and Oliver were acquitted of insurance-fraud charges, Coggins' critics complained that the Harman tapes could have been introduced to help make the case against them but for some reason were not. Some critics suggested the tapes were not used in order to protect Kress. Kress, Buchmeyer, and Coggins are friends and political allies.
Peavy declined to comment on the content of the Reno intervention itself, citing the seal, but he said he felt strongly vindicated by the attorney general's overall position. "In a general sense, without discussing the contents of the pleading, the way Dan Peavy feels," Peavy says, "is that his rights to privacy were violated by a conspiracy between my neighbor and Robert Riggs and WFAA. I believe the law ought to apply to everyone."