(2 of 2)
Walsh's effort to try North on the broad charge of conspiracy was probably doomed from the start. For months the special prosecutor navigated between the fears of the intelligence community that North would expose secrets and Gesell's insistence that North be given great latitude in his use of evidence. Walsh's defeat became inevitable last month when Gesell laid down rules for handling the secret data contained in the 300 classified documents the special prosecutor had planned to use. The judge would permit excision of the covert sources and methods by which the data were obtained. However, the information itself had to be presented virtually verbatim at trial.
Intelligence officials feared that exposure of intercepted messages could tip off a hostile power that its communications channels had been penetrated. Though Walsh promised to avoid unneeded exposure of secrets during the trial, there was no way he could ensure that North would do the same. The New York Times reported last week that on Dec. 21 a high-ranking review board, which included Secretary of Defense Frank Carlucci, Secretary of State George Shultz, CIA Director William Webster and National Security Adviser Colin Powell, refused to release key classified documents covered by Gesell's order even though Walsh had warned that such actions would undercut the prosecution.
To salvage his case, Walsh appealed to Gesell to modify his directive. The judge turned him down last week, leaving the prosecutor with little alternative to dropping the theft and conspiracy counts. The dismissal of those charges makes it virtually certain that Walsh will withdraw similar accusations against former National Security Adviser John Poindexter, retired Air Force General Richard Secord and businessman Albert Hakim, though they too still face a range of charges such as obstructing Congress and offering illegal gratuities to North.
Legal experts are divided on whether the narrower case against North will have better odds for conviction. North's threat to use graymail against the remaining charges could backfire, according to some lawyers. "Right now Oliver North is not viewed as a graymailer; he is viewed as a patriot," says former Watergate assistant prosecutor Richard Ben-Veniste. That outlook could change, Ben-Veniste suggests, as the focus of the case shifts from the unauthorized conduct of foreign policy to the seedier allegations of shredding documents, lying to Congress and diverting money for North's own use.
President Reagan pronounced that Walsh's decision "satisfies our problem, which has been . . . concern about national security." Reagan's critics claim that the President, who has praised North as a "national hero," may have let the ex-Marine off the hook without taking the politically risky step of formally pardoning him. Late last week Senate Majority Leader George Mitchell indicated that he wanted a Senate committee review of Walsh's decision. Already the judge has postponed the planned Jan. 31 start of the trial in the wake of these new developments. If the rest of Walsh's case collapses, the most embarrassing scandal of Reagan's presidency will end as it began -- in confusion and controversy.