conflict of interest

When checking on potential financial conflicts, a good place to start is the judge’s investment list. Every federal judge and magistrate judge must submit a report of their financial interests every year to the Administrative Office of the United States Courts in Washington D.C. Filings from the last six years are kept on file there. Apart from annual reports, judges file a nearly identical financial disclosure form when nominated for a judgeship.

Start with his or her financial disclosure forms, which list stock holdings.

Reporter Sheila Kaplan examines the impact of campaign financing on the judicial election process The story describes changes brought on by the influx of money into politics, and how the media has helped to fuel the influx. This CIR story appeared as a companion to the CIR Frontline co-production, 'Justice for Sale,' with correspondent Bill Moyers.

Last year the Senate rejected former mining and cattle lobbyist William Myers for the Court of Appeals. Now Bush is trying again -- and this time Myers' business pals are waging a multimillion-dollar campaign for him.

Last year, when the Senate considered William G. Myers III for the U.S. Court of Appeals for the 9th Circuit, Democrats blocked his nomination with a filibuster after questions arose about his work as a lobbyist for mining and cattle interests. Sen. Charles Schumer, D-N.Y., described Myers' environmental record as being "off the deep end," and environmental and Native American groups opposed Myers for his criticism of laws such as the Endangered Species Act and his alleged disrespect for Indian lands and rights. On Tuesday, Myers' nomination goes back before the Senate Judiciary Committee, the opening battle in Washington's on-again partisan wars over President Bush's judicial nominees. This time around, Myers has the full support of his friends in industry.

On Feb. 14 Bush renominated Myers and 19 other unsuccessful judicial candidates, seven of whom were blocked by Democrats in the last Congress, hoping that the four-seat Republican gain in the 2004 election would help push the nominees through. Myers is the test case. If Myers' nomination is blocked again, the GOP leadership might resort to what is known as the "nuclear option," whereby it would try to change the Senate's procedural rules and ban filibusters. Senate Judiciary Committee chairman Arlen Specter, R-Pa., apparently believes that Myers has a good chance of reaching the 60 votes that would ensure a filibuster-proof Senate. Two Democrats voted with Republicans to try to end the first filibuster of Myers, and Colorado's new Democratic senator, Ken Salazar, whose state went for Bush in 2004 and has big mining and cattle interests, has indicated he might vote for Myers.

To help Myers and the rest of Bush's nominees get those votes in the Senate, Myers' former clients in the National Association of Manufacturers plan to wage a multimillion-dollar campaign. The manufacturers hope to provide the critical boost the Republicans need by employing television advertising and grass-roots lobbying to pressure moderate or red-state Democratic senators to help prevent any filibusters. A spokesperson for the business group says that securing approval of Bush's appellate court nominees is now its top priority. This unparalleled effort by big business to influence the judiciary by promoting nominees such as Myers who owe a great deal to the industry lobby raises potential conflict-of-interest questions and poses a new threat to the traditional independence of the judicial branch. And if the Democrats manage to filibuster Myers' nomination again, the pressure on them by outside groups like NAM is only likely to increase.

NAM, the principal lobbying group representing U.S. companies, from multinationals to small manufacturers, is campaigning for Bush's nominees because it believes that the biggest problem facing manufacturing in its race to compete in the global marketplace is non-production costs like tort litigation and regulatory compliance. It presumes that most of Bush's nominees, if approved, would be inclined to stop what it considers frivolous lawsuits, whose costly litigation and awards, it says, are a drag on economic development and discourage job growth and risk taking. NAM president and CEO John Engler, a Republican and a longtime friend of Bush's, says the NAM wants a "fair, impartial and predictable legal system," with fewer delays and appeals.
To accomplish its goals on the national stage, NAM is promoting the package of litigation legislation endorsed by the White House, including the bill to curtail class-action lawsuits signed by the president on Feb. 18 (which will increase federal jurisdiction over such suits), as well as coming bills on asbestos litigation and medical malpractice, which aim to put caps on financial awards to those claiming damages. On the state level, NAM is backing sympathetic political and judicial candidates and trying to sway voters on the issues of frivolous lawsuits and costly verdicts. But NAM also has recognized that much of judges' work concerns commercial and economic matters, and says that the confirmation of federal judges sympathetic to its goals is a "matter of utmost importance." According to Engler, NAM's membership believes that it is vital to confirm judges who "get it right" to replace those who "are negating the work of elected officials in the executive and legislative branches."

NAM's interest in judicial selection parallels the emergence of the courts as a principal battleground on the issue of government regulation. Business is no longer interested simply in educating judges to be more sympathetic to the cost of regulation on commerce but in selecting those already familiar with business through their prior connections. A study conducted by the Center for Investigative Reporting of all of Bush's appellate court nominees in his first term revealed that a significant number had close ties to the energy and mining industries as lobbyists or counsel and that many, like Myers, were nominated for federal judicial districts where battles over natural resources are frequently fought in the courts.

NAM's assessment of the importance of judicial selection was recently validated by an unlikely source. A study released last October by the Environmental Law Institute concluded that a federal judge's political affiliation is a decisive factor in how he or she will rule on key environmental cases. It found that there is a wide gulf in the positions taken by appointees of Democratic and Republican presidents in environmental suits.

NAM's lobbying campaign will focus on politically vulnerable or receptive Democratic senators. Five of the 16 Democrats up for reelection in 2006 come from states that went for Bush in last year's election, and two of those previously voted with Republicans to stop some of the judicial filibusters in Bush's first term. (One, Nebraska's Sen. Ben Nelson, voted to end the filibuster against Myers.) All these senators are undoubtedly aware that fellow Democratic Sen. Tom Daschle's support for the filibusters, particularly that of Myers -- who is seen as a friend to agriculture because of his cattle industry connections -- was an issue in his losing South Dakota campaign last year. His opponent John Thune, who ultimately defeated Daschle, charged that in voting on judicial nominations, Daschle had sided with liberal extremists against the state's farmers and ranchers.

NAM's rallying of corporate muscle around judicial nominations is not unprecedented. In 2002, C. Boyden Gray, counsel to the first President Bush from 1989 to 1993, established the Committee for Justice and a companion foundation and ran a grass-roots and ad campaign similar to that planned by NAM concerning blocked judicial nominees. The committee lists on its Web site the Democrats who have sometimes voted with Republicans to stop a judicial filibuster, along with the Democrats it considers the chief barriers to confirmation. The group credits its television ads with helping to defeat Texas Democratic senatorial candidate Ron Kirk in 2002 over his stand opposing Bush's nominees. Business groups and Republican supporters have donated tens of thousands of tax-exempt dollars to the committee's foundation. And one of the committee's members is Engler, a former Michigan governor and now NAM's chief executive.

Myers has never served on the bench. He was the Department of Interior's top lawyer in 2001-03 and is currently a lawyer in Idaho with the same firm that employed him as a lobbyist for mining interests. He ran into organized opposition to his first nomination from environmental and Native American groups for actions he took at the Interior Department and as a lobbyist in the 1990s for the cattle and mining industries, which are major Republican donors. This time he will benefit from the membership on NAM's executive committee of the president and CEO of Arch Coal. Myers' lobbying of Congress in 2000 helped pave the way for Arch's recent expansion of its federal coal leases despite the opposition of federal regulators and six state attorneys generals who considered the increase potentially anticompetitive and harmful to consumers.

One example of the potential negative impact that judges' rulings favorable to business can have on consumers is a case highlighted last April in Salon. Representing Arch Coal and two other major coal producers, Myers helped push through the Coal Market Competition Act of 2000, which allowed the producers to expand their federal coal lease holdings. The Federal Trade Commission subsequently challenged a consolidation of Wyoming coal producers allowed under the new law, and was soon joined by attorneys general from six states that rely on power from plants fueled by Wyoming coal. They argued that combining the substantial federal coal leases would make anticompetitive coordination among the remaining Wyoming coal producers more likely and thus hurt consumers by increasing their electric utility costs.

"If allowed to go through, this merger would combine two of only four major producers of Powder River Basin coal," Missouri attorney general Jay Nixon warned. But last August a U.S. district court judge nominated by President Bush denied the FTC's request for a preliminary injunction, and the U.S. Court of Appeals for the District of Columbia Circuit then declined to issue a stay pending an appeal.

At the end of January, prior to organizing its initiative on federal judges, NAM launched the American Justice Partnership to push for legal changes in state courts and influence the selection of state judges and politicians. Its success with state judicial campaigns is what helped persuade the NAM's Engler to develop a federal judicial strategy. Engler told a National Press Club audience on Feb. 10 that his interest in influencing the selection of federal judges came from his "assessment back in Michigan of how important the legal climate can be to a state and to a business climate, and therefore extrapolating that to the nation."

Legal experts and the public have sharply criticized the growing involvement of special interests in state judicial elections. A 2003 poll for the New York state court system indicated "an alarming 83 percent of New York voters believe that campaign contributions have some or a great deal of influence on judges' decisions." Survey respondents also believed that political party leaders, campaign contributors and special-interest groups have the most influence over who becomes a judge. And Supreme Court Justices Anthony Kennedy and Stephen Breyer have voiced their concern about the trend that has leading business and Democratic supporters such as trial lawyers and unions pouring millions of dollars into state judicial races.

Underlining the worries about mixing justice with special interests, a committee headed by Breyer is reviewing the status of federal judicial ethics as provided for in a 1980 law that permits anyone to file a complaint alleging a federal judge has engaged in misconduct. But the committee's report is not expected for several years.

Meanwhile, while waiting for his judicial fate to be decided, Myers practices law in Boise for Holland & Hart, which calls itself the largest law firm in the Rocky Mountain West. Its Web site touts its roster of nearly 300 lawyers, 49 of whom were selected for inclusion in the latest edition of "The Best Lawyers in America," the "definitive guide to legal excellence in the United States." Myers' name, however, is not among them.

About the writer: Dan Noyes is a reporter at the Center for Investigative Reporting. The Open Society Institute supports the center's reporting on the federal judiciary.

On Tuesday, July 19, 2005, President Bush nominated John G. Roberts, Jr., to the Supreme Court. As part of its ongoing investigation into Bush’s federal court nominees, CIR has made Roberts’ 2003 financial disclosure statement and Senate confirmation questionnaire freely and easily accessible to the public on the Courting Influence web site.

During Bush’s first term, our investigation focused on the administration’s 59 judicial nominees to federal courts of appeals and the U.S. Court of Federal Claims, which hears major property rights claims and land disputes. This reporting revealed that more than a third of President Bush’s nominees to these federal courts -- including Roberts -- has a history of working as lawyers and lobbyists on behalf of the oil, gas and energy industries.

In a 2004 article on www.CourtingInfluence.net, “Former Energy Industry Lobbyists Among Nominees,” CIR recounts Roberts’ experience supporting the mining industry:

“Another Bush judicial appointee with experience representing the mining industry is John G. Roberts, Jr., a former colleague of George Miller's at the Hogan & Hartson law and lobbying firm. Roberts was one of the co-authors of Miller’s amicus brief on behalf of the National Mining Association’s challenge to the government ban on ‘mountaintop removal’. In 2003, Roberts was confirmed to the powerful D.C. Circuit Court of Appeals, where earlier this year he ruled against environmentalists who were pushing for more restrictive government regulations of copper smelters--many of whom are members of the National Mining Association that Roberts once represented. As a lobbyist in the 1990s, Roberts worked on behalf of the peanut industry, pushing federal legislation that maintained government subsidies which the GAO estimated cost consumers $500 million a year. Agricultural and mining interests are often involved in regulatory cases that come before the DC Circuit Court where Roberts now sits.”

"I have no platform," said Chief Justice-designate John Roberts to members of the Senate Judiciary Committee when hearings convened Monday on Capitol Hill. "I come before the committee with no agenda."

But what Roberts does bring before the committee is a long list of ties to corporate America from his years of working as a lobbyist and an attorney in Washington on behalf of business and special interest groups. He also gives the Judiciary Committee a golden opportunity to shed light on a thorny but still largely ill-defined issue: how Supreme Court justices should contend with potential conflicts of interest, including whether they should recuse themselves from a case.

Within minutes of the White House announcement of Roberts' nomination in July, U.S. Chamber of Commerce president Thomas J. Donohue praised him as "highly regarded and well-respected by the legal and business communities." On its Web site, the National Association of Manufacturers prominently features a photo of Roberts (along with a new blog on judicial nominations), accompanied by the headline "The Business Case for Supreme Court Chief Justice Nominee John Roberts."

Roberts is the beneficiary of the organization's first-ever lobbying campaign for a Supreme Court nominee. Two members of its executive committee represent corporate interests that Roberts himself represented as an attorney: Toyota and the coal mining industry.

As the Senate deliberates whether Roberts should lead the nation's highest bench for what may be decades to come, the issue of judicial conflict of interest is relevant like never before. With respect to corporate America, Roberts' career and financial-investment profile stand out among sitting judges: His 2005 financial-disclosure form lists 78 stock holdings, which range from high-tech to healthcare, to mass media and corporate real estate. His net worth has been listed at roughly $5.3 million, and his earnings at law firm Hogan & Hartson were more than a million dollars in 2003.

It's difficult to predict what cases will come before the court in the coming years, but Roberts' personal investments in numerous top companies across a variety of industries make him a prime candidate for appearances of impropriety. Companies whose stock he owns in the high-tech and telecom sectors include Dell Computer, Microsoft, Texas Instruments, Intel, Agilent, Cisco, Novellus, Hewlett-Packard, Lucent and Nokia. In healthcare: Pfizer, Merck, Johnson & Johnson, AstraZeneca, Hillenbrand, and Becton, Dickinson. In big media: Time Warner, Disney and Blockbuster. In finance and real estate: Citigroup, State Street and Washington REIT. (Experts will presumably advise Roberts to avoid recusals related to his extensive stock holdings by placing his assets in a blind trust.)

Specifically, Roberts' Pfizer stock presents a potential conflict with an upcoming high-court case for which the drug giant has filed a friend-of-the-court brief. Meanwhile, his work for Chrysler and Toyota could be a conflict in an upcoming case involving the National Automobile Dealers Association, while a mining company has a case on the docket with potentially significant implications for the industry -- another for which Roberts worked. Such cases, with industry-wide implications, may explain why the National Association of Manufacturers' head, John Engler, has asserted that Roberts is a jurist who "get[s] it right."

Roberts' mentor, the late Chief Justice William Rehnquist, expressed in 2000 his widely held but stringent take on one facet of the matter: "[A] judge should recuse himself whether he holds one share or a thousand shares of stock in a corporation that is party in a case before his court."

But that may be just the beginning of the issue. Rehnquist's approach, which is based in federal law, lets judges avoid grappling with messier potential conflicts -- including, in Roberts' case, those involving business clients that helped him finance his investment portfolio.

Beyond his stock holdings, some of the corporate clients Roberts represented while in private practice at Hogan & Hartson, where he was a partner for 12 of his 13 years, could also present the appearance of impropriety if Roberts were to rule on a high-court case involving them. They include Fox Television, Digital Equipment, Peabody Coal and the National Mining Association, Litton Industries, Rush Prudential HMO, Toyota, Chrysler and NBC. In addition, Roberts lobbied successfully for the peanut industry in 1996 and 1997 to keep huge federal peanut farming subsidies intact; he was a registered lobbyist for the Cosmetic, Toiletry and Fragrance Association; and he represented the cattle industry.

As chief justice Roberts may also run into conflicts of interest with a former colleague from Hogan & Hartson, Gregory G. Garre, who worked with Roberts for years and succeeded him as head of the firm's Supreme Court and appellate practice. Garre has two cases on the court's lineup this fall, one involving the real estate industry (in which Roberts, as noted above, is also an investor).

Garre has been generous in his praise of his former colleague. He told the Los Angeles Times that Roberts' arguments were "difficult to tear apart. To do that over and over, where you might have gotten 50 questions from different justices, was what made John extraordinary."

Recusal is part of a huge -- and largely unresolved -- ethical debate: During a recent five-year period, 3,673 complaints against federal judges' actions or conflicts were closed by the judiciary with action taken against a judge in only six cases, an average of one response for every 600 complaints filed.

Federal law requires any federal judge to "disqualify himself in any proceeding in which his impartiality might reasonably be questioned" and most have interpreted this to mean judicial disqualification should come "with even the appearance of impropriety." The law specifically states that federal judges should recuse themselves in cases they worked on while in private practice or in practice for the government and in cases where they have a direct financial interest. This law has been interpreted in dramatically divergent ways by the various justices.

The rules on Supreme Court recusals are less defined than for lower federal courts. Supreme Court justices are not subject to the Code of Conduct for U.S. Judges, which has stricter standards, although some have agreed to voluntarily abide by the code. It's up to the individual Supreme Court justice to decide if he should recuse himself from a case, and there is no mechanism for challenging that decision. This arrangement was evident most recently when Justice Antonin Scalia went duck hunting in 2004 with Vice President Dick Cheney while the court was considering whether the Bush administration should be required to release information about the private meetings of Cheney's energy task force.

Scalia saw no need for recusal then. "If it is reasonable to think that a Supreme Court justice can be bought so cheap," he said, "the nation is in deeper trouble than I had imagined."

Roberts' own history of dealing with potential conflicts of interest as a sitting justice is far from transparent. A request for his current list as an appellate court judge was denied by both Roberts' office and the clerk's office of the U.S. Court of Appeals for the District of Columbia Circuit. According to the clerk's office spokesperson, information about recusals in the federal courts is traditionally not made public. Each judge submits a list to the clerk, and those lists are reviewed privately by the judges' own clerks as part of the assignment process. At least two federal district courts voluntarily post recusal lists for their judges on their Web sites.

The spokesman at the clerk's office said the court does not give out information about recusals unless a judge announces it or makes it public. Roberts did so recently in once instance, concerning the case of the American Bar Association v. the FCC. Presumably Roberts saw a potential conflict of interest in making a ruling on the bar association at the same time the group was conducting its standard evaluation of a nominee to the high court.

But another hint of Roberts' narrow view of what constitutes a conflict of interest comes from a case he helped decide earlier this year, Hamdan v. Rumsfeld, regarding the Bush administration's war on terrorism. Since the decision was handed down, Roberts has admitted that he was already discussing his possible nomination to the high court with Bush's attorney general -- six days before oral arguments in the case. And two and half months before Roberts took part in the Hamdan decision, he was interviewed by a group including Vice President Cheney, Karl Rove, Cheney's chief of staff, Scooter Libby, Attorney General Alberto Gonzales, White House chief of staff Andy Card, and White House counsel Harriet Miers.

This unusual scenario -- with Roberts presiding over a case critical to the Bush administration at the same time he was being recruited by it to serve on the nation's highest bench -- has some critics thinking of the Watergate era. Peter Young, a lawyer in the landmark Pentagon Papers case, has written for a legal blog comparing Roberts' refusal to recuse himself from Hamdan with a similar refusal by Judge William M. Byrne Jr., whom the Nixon administration was actively recruiting, at the time of the Pentagon Papers case, to head the FBI.

Sierra Club senior attorney David Bookbinder, who was involved in the Cheney energy task force case and who filed an unsuccessful motion to prompt a Scalia recusal, says Roberts should have recused himself on the Hamdan case "in a New York minute," since there were plenty of other judges who could have taken his place and helped the court avoid an appearance of impropriety. He worries that the case reveals Roberts' insensitivity to the recusal issue. "As chief justice, he will be the justice most in the public eye," says Bookbinder, "yet in a key example he avoided making sure there was no impropriety."

Roberts has stated, "If confirmed, I would resolve any conflict of interest by looking to the letter and spirit of the Code of Conduct for United States Judges ... I would recuse myself from any matter involving my former law firm or former clients for whom I did work, for the periods specified in the Judicial Conference Guidelines."

"Periods specified" apparently means he can rule on any case involving former clients if he didn't work on the case himself. Otherwise, there seems to be no timeline or specific set of criteria. Given Roberts' career and investment history, will the Senate Judiciary Committee take that into account this week? The stakes are high: A justice who recuses himself from a case threatens the power of the Supreme Court by increasing the chances of a tie vote and therefore the possibility of a nonruling or a rehearing from the highest court in the land. But a justice who has reason and does not recuse him- or herself risks undermining the court in an even more drastic way.

A judge nominated by President Bush to one of the highest courts in the nation apparently violated federal law repeatedly while serving on the federal bench. Judge James H. Payne, 64, who was nominated by Bush in late September to join the 10th U.S. Circuit Court of Appeals, based in Denver, issued more than 100 orders in at least 18 cases that involved corporations in which he owned stock, a review of court and financial records shows.

Federal law and the official Code of Conduct for U.S. judges explicitly prohibit judges from sitting on cases involving companies in which they own stock -- no matter how small their holdings -- in order to uphold the integrity of the judicial system. (Judges' financial filings typically don't differentiate ownership between the judge and immediate family members.) The clear-cut, objective standard aims to prevent even the appearance that a judge may be taking into consideration his or her personal financial interests.

Payne's financial filings show holdings of up to $100,000 in SBC Communications stock, up to $50,000 in Wal-Mart stock and up to $15,000 in Pfizer stock, among others, while he presided over lawsuits involving the companies or their subsidiaries. In fact, it appears that since he was appointed by Bush in 2001 as a federal district judge in Oklahoma, Payne has been sitting inappropriately on at least one case at any given moment for nearly his entire federal judgeship.

Last fall, Payne's nomination to the 10th Circuit got little public attention while the media focused on the president's Supreme Court nominations. But Chief Justice John Roberts and current nominee Samuel Alito have tripped over the conflict of interest issue as well. Roberts, who holds an array of blue chip stocks and has unprecedented corporate ties for a sitting Supreme Court justice, has already recused himself from numerous cases and admitted a mistake in not recusing himself earlier from another. Alito was grilled in Senate hearings this month about why in one instance he didn't follow through on a pledge to recuse himself from any case involving the mutual fund company Vanguard, in which he held investments.

Payne refused to answer repeated requests by Salon for comment regarding conflicts of interest in the cases over which he presided. When reached by phone for comment on Dec. 20, Payne said, "I do not have time ... I can't do it," before abruptly hanging up. He did not respond to a subsequent call, or to a follow-up letter delivered to his office on Dec. 22, detailing the problematic cases and asking for an explanation.

Praised for his integrity by a number of Oklahoma lawyers, Payne did eventually recuse himself in some cases and kept himself off others from the start. In the cases in which he didn't recuse himself, most of his actions were routine and procedural. Most of the cases were settled, rather than going to trial.

But informed of Payne's reported stock holdings, plaintiffs in some of the cases say that the judge may well have been swayed by those holdings. Whether he was or not, legal experts say he should have never presided over the lawsuits.

"If I was suing Wal-Mart and I knew the judge held stock in Wal-Mart, I'd be concerned about that," said professor Leslie W. Abramson, a legal ethics expert at the University of Louisville's law school, after reviewing Payne's cases. While there is no proof of malfeasance on Payne's part, Abramson says, the letter of the law is clear on judicial conflict of interest -- and Payne's conduct, he says, leaves the impression that Payne has run his court in a "sloppy" fashion. "He took an oath to follow the law. The judge is supposed to recognize these things himself. If he owned the stock, he shouldn't have been sitting on the case. That to me is a clear call," Abramson said. "I think it speaks to whether a judge has been doing his job responsibly and is likely to do his job responsibly in the future."

"There's no wriggle room here," says professor Stephen Gillers, a scholar of legal ethics at the New York University School of Law. "It's not just an ethics rule, it's a congressional statute -- a law." Even if he doesn't make any orders during the proceedings, he can't be the judge on such a case, Gillers says. "He's disqualified, period."

Linda Chambers, a resident of Muskogee, Okla., says she certainly wouldn't have wanted to go before a judge who owned stock in Pfizer when she sued the pharmaceutical giant for the death of her mother. Chambers' case was one of thousands of lawsuits provoked by the diabetes drug Rezulin, which was withdrawn from the market after being linked to liver damage and deaths. Chambers' mother, Margaret Owens, died at age 65 after liver and kidney failure while taking Rezulin. Chambers' case happened to go before Payne in 2002 and again in 2003, when he reported holdings of up to $15,000 in Pfizer stock. The lawsuit later moved to another court, bundled with similar suits, and was settled. Chambers' attorney, Tony Edwards, said Payne made no significant decisions in the case -- but Chambers said she would have asked for a different judge if she had known of his conflict of interest at the time.

"Sounds like the judge is deciding this case on his best interest also," said Chambers. "I wanted a judge that was impartial. That's what I thought the judges are supposed to be."

Payne's track record illuminates how conflict-ridden cases can slide through the cracks of a system that relies primarily on judges to regulate themselves. The financial disclosure forms that Payne signs and submits each year show a consistent core group of stocks year after year, including those in his most recent filing last September. Since 1999 (as far back as his filings are publicly available), court records show Payne participated in cases involving SBC, Tricon Global Restaurants, Pfizer, Williams Cos. and Wal-Mart while reporting stock holdings in those companies. Some of the lawsuits explicitly name the corporations, while others name subsidiaries, like Taco Bell and KFC (owned by Tricon) or Williams Oil Gathering (owned by the Williams natural-gas giant).

In the wake of the Watergate scandal, Congress passed a law in 1974 during an era of reform that made the rule for recusals unequivocal: Judges should monitor their finances and must disqualify themselves if they, their spouses or their children have a financial interest in the case -- "however small."

Enforcing the law is another matter.

Payne, for example, apparently broke the rules several times in 1999 as a magistrate judge -- yet the Senate confirmed Payne unanimously to become a district judge in 2001, without any mention of the issue.

Judges must fill out financial disclosure reports every year, identifying potential conflicts like stocks. But the filings are kept in an administrative office of the court system in Washington, and if anyone wants to see them, the judge is notified exactly who is asking. This requirement could intimidate lawyers who don't want a judge to find out they are snooping.

Tulsa lawyer Jeff Martin sued Tricon Global Restaurants on behalf of a former KFC restaurant manager who claimed he was owed disability benefits, a case that went before Payne in 2002. Martin says the judge didn't play a significant role in the case, which ended up being settled. But Martin had no idea that Payne's reported stock holdings included up to $50,000 in Tricon (now called Yum Brands). Martin says that if he had known, he would have informed his client -- but probably wouldn't have challenged the judge over it. "I'm not a greatly experienced, big-time lawyer where I think I can push judges around," he said. "I probably would have left it at [Payne's] discretion."

In December 2005 the American Bar Association gave Payne a unanimous "well qualified" rating, its highest mark. The ABA rating committee evaluates a nominee's integrity and reputation, but its guidelines don't say whether it reviews a judge's cases for conflicts of interest. The committee chair declined to comment further.

Payne's Senate confirmation hearing has not yet been scheduled. He currently presides as chief of the U.S. District Court in Muskogee, Okla.; if confirmed to the 10th Circuit, Payne would serve on the court of last resort (except for those relatively few cases that make it to the Supreme Court) in a region covering Colorado, Kansas, New Mexico, Oklahoma, Utah and Wyoming.

Senate Judiciary Committee staffers perform a thorough screening of judicial nominees, but don't always review every case a nominee ever sat on, according to Tracy Schmaler, a spokesperson for the ranking committee Democrat, Sen. Patrick Leahy. Finding possible conflicts among hundreds of lawsuits can require a lengthy, exhaustive comparison of a judge's financial interests to all of his cases.

Most district courts now have computer programs that can monitor a judge's caseload for conflicts. But it's up to the judge whether to plug in financial information and use the system. A few federal courts have pioneered reforms: The Northern District of Iowa went so far as to disclose judges' financial interests on the Internet and to require parties in a lawsuit to file a list of all related financial interests. The clerk's office then looks over a judge's cases, and if it identifies a conflict, it automatically reassigns the case before the judge even sees it.

But neither of the clerk's offices in the Northern or Eastern District of Oklahoma, where Payne presides, gets involved with monitoring a judge's conflicts.

University of Louisville's Abramson argues that all judges should be required to use the computer system, and that every clerk of the court should reassign cases with conflicts before they reach the judge's chambers. "The integrity of the process is on the line," he said, pointing out a "systemic failure" that goes beyond Payne. "The U.S. Supreme Court has said that the appearance of impartiality is as important as the fact itself of impartiality."

And yet, in Oklahoma, some lawyers don't see it that way.

Harold Witcher, now retired from practice, helped bring a case against Southwestern Bell Telephone, among others, while Payne reported stock holdings in parent company SBC (now renamed AT&T). Payne issued a couple dozen orders over five months before recusing himself in March 2002. Moreover, Southwestern Bell and other defendants were represented by fellow members of Payne's church, where Payne sits on the board.

Though federal statute requires a judge to recuse himself when "his impartiality might reasonably be questioned," the circumstances surrounding Payne in that case didn't trouble Witcher. "That Judge Payne, I tell you -- he calls it like he sees it. He doesn't care who's sitting where."

One of Witcher's clients, however, said she didn't think Payne should have presided.

"If he is invested in SBC, he's going to rule in favor of SBC and not the ordinary people," said Kathy Lamon, 52, who sued the company and others because of high phone bills charged to families of prison inmates. "I would think it would be a conflict of his interest to be seated on a case like that."

Witcher said he vaguely remembered that Payne mentioned the stock conflict -- and then proceeded with the case because the attorneys didn't object. Oklahoma City lawyer Carrie Hoisington, who was involved in a separate case over which Payne presided, recounted a similar scenario in which Payne may have raised the issue and the case proceeded nonetheless.

Professor Steven Lubet, a legal ethics authority at the Northwestern University School of Law, argues that Payne is guilty only of careless mistakes that are not particularly meaningful "in terms of assessing someone's career or someone's integrity."

Other experts say Payne is clearly in the wrong, regardless of intention. "It doesn't matter whether his rulings were mundane or major, and it doesn't matter that the attorneys agree -- this is a conflict that's not waiveable," said Gillers of NYU. "Maybe the judge just didn't realize that. But he's the judge –- he should read the statutes."

The law does not include a specific penalty for violations, but judges can be censured by a committee of colleagues or, in extreme circumstances, impeached and removed from the judiciary by Congress.

Curiously, Payne recused himself from many cases that intersected with his reported stock holdings, only to later sit on cases concerning the same companies. In March 2002, for example, he suddenly jumped off several lawsuits involving SBC and its subsidiaries after issuing numerous orders. Court records show he cited his SBC stock ownership as the reason in one case; the suit against Cingular Wireless also named SBC, which owns roughly 60 percent of Cingular. But in 2004, Payne presided over another case against Cingular -- and received yet another Cingular case last spring. After being contacted for this story, and without the prompting of attorneys working on the case, Payne recused himself Jan. 3.

"I have absolute complete faith in him as a judge," said David Blades, an attorney who brought the recent case against Cingular. "If he had come and said to me, 'I own stock in Cingular,' I would say, 'So what?'"

But Abramson warns against participating in even the most routine procedures, because it's impossible to predict the twists and turns of a case. In Payne's situation, the various settlement conferences over which he presided could've been particularly problematic: Judges can act as "some of the greatest arm-twisters in the world" in these conferences, Abramson said, actively pushing for resolution of the case rather than having it go to trial.

As a nominee for the federal bench in both 2001 and 2005, Payne did in fact pledge to the U.S. Senate to adhere to conflict-of-interest rules. "In general, I plan to comply with Canon 3 Code of Judicial Conduct and the provisions of 28 U.S.C. 455 concerning disqualification of United States District Judge or United States Magistrate Judge," he wrote in a 2001 questionnaire.

But apparently his willingness to follow through on recusing himself was a different matter. "If it happened routinely," said Gillers of NYU, "then that shows a lack of awareness of his professional responsibilities that I think warrants an explanation."

A federal judge nominated by President Bush to one of the nation's highest courts disqualified himself from two cases against a corporation in which he has held personal investments, after a report revealed that his career on the bench has been riddled with conflicts of interest.

On Jan. 23, following the Salon story "Bush Nominee Broke Law," Judge James H. Payne recused himself from two product-liability suits against drug titan Pfizer, which had been assigned to him since November, according to court documents. Payne has reported stock holdings of up to $15,000 in Pfizer since 1999. Federal law and the official Code of Conduct for U.S. judges explicitly prohibit judges from sitting on cases involving companies in which they or members of their immediate family own stock.

Payne was nominated by Bush last fall to the 10th U.S. Circuit Court of Appeals, based in Denver, and is awaiting a confirmation hearing. The chief judge of the 10th Circuit Court and a member of the Senate Judiciary Committee staff told Salon they plan to look further into Payne's reported violations of federal law, while senators from the judge's home state have reaffirmed their support of the nominee.

Payne, who is currently chief judge of the federal district court in Muskogee, Okla. (he was elevated by Bush from magistrate judge in 2001), recused himself without the prompting of lawyers, according to lawyer Laurie Koller, who helped bring the cases against Pfizer.

Payne declined to comment on either the initial Salon story or his subsequent recusals. The judge decided that "out of respect for the Senate confirmation process it's not appropriate for him to make any comments," said his secretary Linda Ambrose, who referred questions to the White House and Department of Justice.

Bush administration officials did not return repeated calls for comment on the Salon story, which revealed that since 1999 Payne has issued more than 100 orders in at least 18 cases that involved corporations in which he reported stock holdings.

"I, of course, would first want to talk to Judge Payne and I haven't been able to do that yet," Chief Judge Deanell Reece Tacha, the Reagan-appointed judge who heads the 10th Circuit Court, told Salon. "I want to get the facts first."

The chief judge of any circuit court can call a special committee of judges to investigate misconduct and potentially censure a judge.

Lawmakers may raise the conflict-of-interest problem at Payne's confirmation hearing before the Senate Judiciary Committee, which has not yet been scheduled. "It's too soon to make any determination on the nomination," said Tracy Schmaler, a spokesperson for Sen. Patrick Leahy, the ranking committee Democrat. "Staff is looking into it, and it will likely come up at the hearing."

The office of Republican Sen. James Inhofe of Oklahoma provided this statement: "Senator Inhofe continues to strongly support Judge Payne's nomination and knows of no instances where Judge Payne has been involved in any conflict of interest. The Senator has full faith in the exhaustive background checks performed on these nominees and will comment further when the facts surrounding this internet story are known."

Oklahoma's other senator, Republican Tom Coburn, who sits on the Judiciary Committee, did not return Salon's calls. However, a story in the Oklahoman newspaper last week reported that "spokesman John Hart said Coburn is not inclined to consider the Salon.com report credible."

To date, no one has disputed any details of the Salon report.

Professor Monroe Freedman, an expert on ethics at the Hofstra University School of Law, said controversy over conflicts of interest could very well torpedo a nomination like Payne's. He pointed to the case of Judge Clement Haynsworth, a Nixon nominee to the Supreme Court who was rejected by the Senate largely because of his financial conflicts. "If you've got a case of multiple offenses, or one or more blatant ones, I would hope that [the Judiciary Committee] would pay attention to it and I think they probably will," he said. Based on Payne's record, "a fair prediction can be made that this is a judge who cannot be counted on to abide by his ethical obligations."

"We're not only talking about public servants -- we're talking about members of the judiciary," Freedman added. "I'm no less concerned about the message it sends to other judges."

Meanwhile, in Tulsa, one of the cities where Payne presides, some lawyers said their trust in Payne's integrity has not been shaken.

"Nobody in the legal community in Tulsa or Northern Oklahoma is probably going to care," said lawyer David Blades. "Tulsa's a small town, by national standards. We all know each other, we all know the judges and go to the same bar meetings, and it's just not going to make a difference." Blades added, "He may have made some administrative error ... but I haven't ever seen it affect his job."

Tulsa lawyer Tracy Cinocca said she would be surprised if Payne hadn't considered his recusal decisions carefully. "I think that a lot of the legal community would be supportive of Judge Payne, but at the same time I think the article is one that brings questions to light that would be of concern to the public," she said. "Because everybody wants to make sure that access to the courts is safeguarded. They want to make sure that the judges there are beyond any appearance of impropriety."

Safeguarding that public confidence in the system could be much more difficult once a judge with a tarnished track record has secured a position on the federal bench -- or in Payne's case, is elevated to a higher one -- according to Hofstra University's Freedman. He notes that impeachment, a rarity, is the only way for Congress to discipline a federal judge, making it all the more important in a case like Payne's to consider the issue when deciding whether to confirm him. "It would be a disgrace if it does not preclude his confirmation," said Freedman. "He should not be confirmed."

*****

Click here for the original story, along with documents used in this investigation and tips for how to check on judicial conflicts of interest.

In a rare move, the American Bar Association revoked its top rating of a Bush judicial nominee last week, after CIR revealed in a Salon.com story his repeated conflicts of interest while on the bench.

The ABA originally gave Judge James H. Payne its highest mark – a unanimous “well qualified” - after he was nominated to the 10th U.S. Circuit Court of Appeals by President Bush last fall. After conducting a special reevaluation, which included a talk with Payne, a large majority of the committee now finds him “qualified,” while a minority voted him “not qualified.”

“We received information that had to do with whether or not he had any conflict issues,” said Stephen Tober, chair of the ABA committee.

The Salon.com story on Jan. 23, "Bush Nominee Broke Law," www.salon.com />showed that Payne, currently chief judge of a federal district court in Oklahoma, had issued more than 100 orders in at least 18 cases that involved corporations in which he reported stock holdings. Federal law and the official Code of Conduct for U.S. judges explicitly prohibit judges from sitting on such cases.

Payne has so far declined to comment on or dispute the original story.

Since the story, the chief judge of the 10th Circuit Court and a member of the Senate Judiciary Committee staff said they plan to look into Payne’s reported violations of federal law. Oklahoma’s senators, meanwhile, have continued to support the nominee.

The ABA issued its revised rating Feb. 21. Because of the ABA committee’s confidentiality rules, Tober said he couldn’t elaborate unless he is called to testify before the Senate Judiciary Committee during Payne’s confirmation hearing. A hearing has not yet been scheduled for Payne, who was nominated in September.

Tober said that while the ABA has revoked and lowered ratings before, “it’s not a common occurrence.” The ABA rates all federal judicial nominees based on their integrity, professional competence and judicial temperament.

“I think that’s unusual and a sign that they have some serious reservations about him,” said Amanda Frost, assistant professor at American University Washington College of Law, who specializes in the federal court system.

“As people start expressing more doubts it could become a problem. It’s sort of a chipping away of his credentials,” Frost said. “It certainly sounds to me like they’re telling the Senate to look at him closely.”

Key Democrats denounced Terrence Boyle on Capitol Hill Monday and Tuesday, after a Salon report revealed that the controversial judge, nominated to one of the nation's highest courts by President Bush, violated federal law on conflicts of interest. As the debate over Boyle heated up, the White House acknowledged that Boyle should have recused himself in cases involving companies in which he owned stock -- but continued its support of the nominee.

Sen. Patrick Leahy of Vermont, the ranking Democrat of the Judiciary Committee, blasted Boyle on the floor of the Senate Monday, calling him "somebody who has violated every judicial ethic you can think of."

Leahy called it "chutzpah beyond all understanding" that Boyle, in one case, bought stock in General Electric while presiding over a lawsuit against the company -- and just two months later threw out most of a disability claim against the company. "Now, in the first year of law school you might get an example like this because it is so clear-cut and easy to understand," Leahy said. "This is amazing -- amazing -- notwithstanding all the other conflicts of interest he had in other cases. Whether or not it turns out that Judge Boyle broke federal law or canons of judicial ethics, these types of conflicts of interest have no place on the federal bench."

Also on Monday, the liberal advocacy group Alliance for Justice called on Bush to withdraw Boyle's nomination, citing the conflicts of interest.

Minority Leader Harry Reid of Nevada added to the onslaught on Tuesday, saying of Boyle, "I can't imagine how President Bush could bring him to the Senate for confirmation." Reid ran down a list of Democratic objections to Boyle, including his rulings on civil rights cases, but called the Salon report revealing Boyle's record of judicial conflicts of interest "the clincher."

"If this guy deserves to be a federal district court judge, I don't know what a federal district court judge is all about," Reid said. "He not only shouldn't be a trial court judge as he is, but to think that he should be elevated to a circuit court of appeals is outrageous."

The White House will stand by Boyle's nomination, said spokeswoman Jeanie Mamo.

"There were a handful of cases over the years where it appears that recusal was warranted," she told Salon. "These are mistakes that happened to many judges ... Judge Boyle has an excellent reputation for fairness and integrity -- that shouldn't be destroyed by mistakes in a tiny fraction of the thousands of cases on which he has sat."

Mamo called Salon's report "an effort to distract from the merits of his nomination," saying that Boyle "never intentionally participated in any matter in which he should have recused himself."

But if Boyle didn't know he had financial interests in a company when he sat on the case, he wasn't complying with another part of the law that instructs judges to monitor their finances to avoid conflicts, said professor Leslie W. Abramson, a legal ethics expert at the University of Louisville's law school. "Some people forget that, in the words of the Supreme Court, the appearance of impartiality is as important as the fact of impartiality itself," Abramson said.

Nevertheless, North Carolina's Republican senators also reaffirmed their support of Boyle.

"Senator Dole was just made aware of these allegations through press reports," according to a statement released by Sen. Elizabeth Dole's office Monday. "Everything she knows about Judge Boyle suggests that he is a man of integrity who abides by the highest ethical standards, and she continues to be strongly supportive of his nomination."

The longtime North Carolina federal district court judge, a one-time Jesse Helms staffer, was first nominated to the 4th Circuit Court by President George H.W. Bush in 1991. But he has been blocked for years by Democrats, who regard him as an unwavering foe of civil rights. George W. Bush nominated Boyle again in 2001. In 2005 he was approved on a party-line vote by the Senate Judiciary Committee, and awaits a vote on the Senate floor, which could come soon. The new revelations about his ethics record, however, appear to have added a new dimension to the long-running ideological battle over his court appointment.

A Judiciary Committee staffer who was not authorized to speak on the record said that of all the conflicts of interest that have come up with judicial nominees, Boyle's record seems "worse than most" because he bought stock in General Electric in the middle of a case against the company.

The lawyer who sued General Electric in that case, Andy Whiteman, was quoted in the Raleigh News & Observer Tuesday as saying Boyle was fair to his client, and that Boyle had indicated how he would rule in the case before he bought the stock. "To say he would be somehow conflicted by that is, really, kind of silly," Whiteman said, also noting that he is a Democrat.

But the widow of the G.E. employee who hired Whiteman to sue General Electric told Salon that the lawyer doesn't care about the ethical conflict because he and the judge are just part of an "old boys club." Martha Bursell, who described herself as a proud Republican, added: "If it's not legal, wrong is wrong and right is right. The rules should apply to everybody the same."

Whiteman, who has not responded to repeated requests for comment from Salon about Boyle's role in the case, also told the Raleigh News & Observer that he would not have asked Boyle to recuse himself even if Boyle owned the stock at the beginning of the case.

The law, however, mandates that a judge recuse himself from such cases even if the lawyers don't mind his conflict of interest. The only way a judge can stay on the case is for the judge to get rid of his financial interest.

"It's a violation of the law. It's not waiveable and it's the judge's responsibility to take himself off the case," said Cynthia Gray, director of the Center for Judicial Ethics of the American Judicature Society. "There are newspaper stories every year about judges not [recusing themselves] and every year they say it's a mistake … but nothing's being done to prevent these mistakes from happening," she said. "Mistakes can be made but that they're not taken seriously is something of more concern."

Frist reportedly wants a floor vote on Boyle and other controversial nominees to energize the conservative base heading into the November elections. But with revelations of Boyle's conflicts, the Republican leadership might back off now, said Jennifer Duffy, editor of the nonpartisan Cook Political Report in Washington.

"If Boyle hits a snag, somebody else will go ahead of him," she said. "If Boyle has problems other than something ideological in nature, that might not be worth fighting about. Frist has shown he's been willing to fight on nominees that Democrats oppose strictly on ideological grounds, but if Boyle has other problems it makes it a different case."

On April 18, a Frist aide told Washington publication CongressDaily that the majority leader plans to push through a floor vote on Boyle and another controversial nominee, Brett Kavanaugh, in May. On April 19, Boyle received a letter from Salon and the Center for Investigative Reporting, detailing the cases involving his conflicts of interest, and asking for a response. On April 26, Frist's office announced that the majority leader would move forward on scheduling a May vote for Kavanaugh, but would wait to schedule Boyle.

Frist's office has not yet scheduled a vote on Boyle, and has not responded to Salon's requests for comment on Boyle's conflicts of interest.

One of President Bush's most controversial judicial nominees has admitted to presiding over several cases in which he held a financial interest, in violation of federal law. In his first public response to the ethical violations revealed by the Center for Investigative Reporting and Salon on May 1, Judge Terrence W. Boyle of North Carolina said the conflicts were inadvertent, minor mistakes. In a letter to Senate Majority Leader Bill Frist and Judiciary Committee chairman Arlen Specter, made public July 12, Boyle said that hearing charges of conflicts of interest "surprised and upset me." He nevertheless disputed several of the charges.

The Salon/CIR investigation showed that Boyle issued orders in at least nine cases involving corporations in which he reported stock holdings. "In approximately four cases, the screening system in place at the Clerk's Office and in my chambers missed the appearance of a potential conflict," Boyle wrote. "Accordingly, I unknowingly and unintentionally participated in these cases while I held a minimal number of shares in one of the parties." He added: "While my stock holdings were relatively insignificant, I regret that the oversight occurred. It certainly was not my intention to participate in a case where I held stock in one of the parties."

The conflicts of interest have thrown into doubt Boyle's confirmation to the 4th U.S. Circuit Court of Appeals -- second only in judicial authority to the U.S. Supreme Court. Frist indicated in April that he would push for a full Senate vote on Boyle, a favorite of conservatives, in May. After the report on his ethical violations, however, top Democrats called for Boyle's nomination to be withdrawn. On Wednesday, Vermont Sen. Patrick Leahy, the ranking Democrat on the Judiciary Committee, reaffirmed his opposition.

"These breaches and his avoiding full accountability compound the already compelling reasons why this nomination has become so controversial, including strong opposition from many law enforcement groups around the country," Leahy told Salon. "The White House should withdraw this nomination instead of pushing for this promotion to a lifetime seat on one of our highest courts."

Specter, who had labeled the conflicts potentially "disqualifying," had conducted his own investigation. He and Frist wrote to Boyle asking for a written explanation of the ethical conflicts. (Frist and Specter did not return Salon's calls for comment Wednesday.) In his letter, Boyle mounted a defense of his record that mirrors one made by North Carolina Sen. Elizabeth Dole, and one spelled out in a memo circulated by the judge's former clerks. As Salon reported on May 23, the defense contains inaccuracies and ignores the letter of federal ethics law.

Boyle wrote that the conflict involving Quintiles, a pharmaceutical-services company, is "categorically untrue." The case occurred in 2001, when Boyle denies owning any stock in Quintiles. However, Boyle's official financial disclosure report covering the year 2001 lists stock in Quintiles. His 2002 filing shows that he sold his Quintiles stock after the case was over. Boyle did not address this inconsistency in his letter.

Boyle also denied that he had any financial interest in three cases involving Midway Airlines. Boyle was a trustee of one of his children's trusts, which held Midway stock. The law on judicial conflicts of interest makes it clear that a judge who is a trustee does have a financial interest in the trust.

Although Boyle regretted his lack of oversight in four cases, he went on to write that "whatever minor financial interest I may have had in the case in no way affected my decision-making or the outcome of the case."

Nevertheless, federal statute since 1974 does not allow judges to sit on cases in which they have a financial interest, no matter how small, and no matter how the case may turn out. Leslie W. Abramson, a judicial ethics expert at the University of Louisville's law school, said, "Did he violate the statute? Yes." Professor Monroe Freedman of Hofstra University School of Law added that Boyle was "trying to fudge the language" by calling clear-cut violations "the appearance of a potential conflict."

In his letter, Boyle stated he always makes a "conscientious effort" to screen cases for possible conflicts, and informs his court clerk's office of his financial interests for additional screening. "This method was the best practice available over time, but it was not flawless," he wrote. "Some cases were missed by the screening process."

But Michael Brooks, the acting clerk of Boyle's court, told Salon in April that the clerk's office does not screen for financial conflicts, leaving that to the individual judge. Brooks said the court didn't use a computer system to catch conflicts because "you get some false positives that way, and we've been successful with the current situation." Boyle, however, apparently contradicted Brooks and wrote that the computerized system wasn't even available "until recent weeks."

Neither Brooks nor Boyle returned calls Wednesday seeking comment. Boyle has not responded to numerous calls and a detailed letter from Salon, asking for an explanation before the original report on his conflicts was published. He did state in his letter to Frist that he wrote a letter of explanation to the Chief Judge of the 4th Circuit and President Bush.