HLF breach, cont..

The government's Dallas prosecutors in April 2005 thought they were handing over authorized discovery material the defense team needed to prepare for trial and mistakenly included over 14 volumes of sensitive classified intelligence.

The potentially embarrassing unauthorized release of the material was not discovered until four months later, in August 2005, during which time the defense team read the material and decided to keep it. Records unsealed this week detail the dispute for the first time, although redactions obscure what kinds of intelligence was involved.

The mistake occurred, according to one government account, because prosecutors and FBI agents in charge of the records were deeply involved in a related terrorism trial as a deadline approached for handing records over to the Holy Land defense team. Responsibility for copying the files was hastily given to FBI agents and support staff not familiar with the case, and they copied some of the wrong documents, which were never reviewed before being handed to the defense attorneys.

"Counsel deeply regret that this occurred and have taken steps to ensure it will not be repeated," one government-written brief states.

It remained unclear this week what damage, if any, the mistaken release wrought to national security or foreign policy, or whether the defense attorneys revealed any of its contents to their clients. Knowledgeable top government officials in Dallas and Washington declined to answer questions.

What is known is that the protracted secret legal dispute erupted over the records between the defense team and prosecutors. It played out in sealed motions beyond public sight and, from August through the last day of 2005, seriously obstructed progress in bringing the high-profile Holy Land Foundation case to trial.

The trial was scheduled to begin this month, but the reason for its delay was not revealed until this week when records related to the dispute were unsealed. As of now the setting of a new start date for the case remains an unresolved point of contention.

Following more than a decade of surveillance and intelligence-gathering operations here and abroad, the U.S. government in July 2004 unsealed a 42-count indictment against the Holy Land Foundation charity and seven North Texas men. The 2004 indictment accused them of illegally raising and laundering tens of millions of dollars to the U.S.-designated terrorist group Hamas.

Dallas-based U.S. Attorney Richard Roper was out of town this week and could not be reached for comment. The case's supervising prosecutor, Jim Jacks, said he was authorized only to refer reporters to the unsealed government briefs representing the government's position.

"Our pleadings speak for themselves," Jacks said.

A spokesman for U.S. Attorney General Alberto Gonzales referred calls to the Dallas U.S. Attorney's office.

The material was provided to defense attorneys who hold government security clearances which allow them to examine some evidence gathered over the many years of government investigation, in preparation for trial. In addition, the defense attorneys have all signed agreements sharply restricting their handling of them under penalty of criminal prosecution.

For trial preparation, the defense team had been given a special secured room on the 10th floor of the Earle Cabell federal building, set aside for them as a controlled space where they can examine often-secret material the government believes the defendants are entitled to see but do not want outside.

But government prosecutors contended that the defense lawyers did not have security clearances sufficient for them to legally examine the material in the 14 volumes mistakenly delivered to the room.

Three members of the Holy Land Foundation Defense team declined invitations to comment about the dispute. Fort Worth Attorney Tim Evans, Albuquerque attorney Nancy Hollander and Dallas attorney Marlo Cadeddu said they would let their court motions speak for them.

They and other attorneys argued that the materials at issue were not off limits and in fact were highly useful to the defense. In one letter to the judge, New York defense attorney Joshua L. Dratel questioned the capabilities of government prosecutors.

"It is inconceivable that the government did not prepare and does not continue to maintain a thorough and detailed inventory of exactly what CLASSIFIED material it was producing to the defense," Dratel wrote. "The government's failure to discharge that responsibility cannot be transformed into some dereliction on the part of the defense..."

The government's lapse was not discovered for four months, on about Aug. 12, leaving plenty of time for the defense attorneys to read the material.

Fearing that classified material may have been passed on to their clients or someone outside the case, Assistant U.S. Attorney Jim Jacks in August tried to enter the room to retrieve it. But Jacks was stopped by security, records show. He later tried to enter again but defense attorneys working inside the room repulsed him, claiming they had a right to the documents.

This set off a five-month legal fight.

That August, Jacks sought and obtained an emergency court order to seal off the room from everyone until the matter was settled by the presiding judge, U.S. District Judge A. Joe Fish. The room and all of the materials inside remained sealed, the locks changed, until the matter was resolved toward the end of January.

In an Aug. 16, 2005 plea to Judge Fish arguing for immediate court intervention, Jacks insisted the defense attorneys were jeopardizing national security.

"Despite the fact that defense counsel have a certain level of clearance in this case, the documents in question should not have been disclosed to defense counsel and are privileged and classified for national security reasons," Jacks wrote. "The information in these documents exceeds the security clearances of defense counsel. The information…is particularly sensitive and its disclosure and dissemination could have profound national security and foreign policy implications."

In January, Judge Fish allowed prosecutors to take possession of the classified material, redact what they wished, and then return what was left to the defense.

Unsealed records of the dispute contain negotiated redactions and purposefully do not disclose much detail about the intelligence that was at issue.

But among the 14 volumes of intelligence, according to other records and a confidential source close to the case, were transcripts of intercepted telephone calls and "surveillance discs."

Tino Perez, a retired FBI supervisor who oversaw much of the Holy Land Foundation investigation, said he worried that the intelligence material might have identified informants and revealed secret relationships between American agencies and foreign intelligence services whose help with the case needs to remain a secret.

"The release of the information in this manner has the potential to damage relationships with other intelligence services in foreign countries," Perez said. "Many times, when information is shared with the United States it's with certain understandings or certain caveats that the information would not be released nor would its source be released to any third parties."

Perez also said he worried that informants close to the defendants might have been revealed, endangering their lives.

"If there was an individual who was providing this sensitive information," he said. "There's a great potential that the individual could be harmed, based on all the other activity that's now taking place in the Middle East."

Mark Briskman, director of the Anti-Defamation League, which has closely followed the Holy Land case, expressed disappointment with the government's error.

"It's extremely disappointing that greater care was not taken concerning information vital to the security of the United States and to insure the success of this critical trial," Briskman said.