U.S. Judge Asked to Reject North’s Attack on Inquiry

Independent counsel Lawrence E. Walsh, accusing Lt. Col. Oliver L. North of “a transparent attempt to disrupt the ongoing criminal investigation,” urged a federal judge Monday to quickly reject North’s constitutional attack on Walsh’s probe into the Iran- contra affair.

U.S. District Judge Barrington Parker immediately set an accelerated timetable for the case, as the Reagan Administration demonstrated that it wants all the facts to be brought out by moving ahead with plans to formally appoint Walsh as an executive branch official should the constitutional challenge succeed. An announcement of that decision is expected in President Reagan’s speech Wednesday evening, an Administration source said.

But the Administration plan could still leave clouds over Walsh’s investigation and those by four other independent counsels. Unresolved would be questions on the admissibility of evidence a counsel gathered before a presidential appointment was made.

After hearing Walsh’s plea for dismissal, Parker ordered the attorneys to argue the case next Monday.

Walsh argued that the constitutional attack “may irreparably injure” his inquiry by encouraging witnesses not to cooperate.

‘Collateral Attack’

He said that the challenge “represents an illegitimate collateral attack upon an ongoing criminal investigation,” adding that courts have consistently held that such attacks must wait until indictments are returned or defendants convicted.

North’s suit alleges that Walsh, appointed by a three-judge panel under the Ethics in Government Act, has no constitutional authority because the prosecutorial and investigative functions belong exclusively to the executive branch of government.

But Walsh contended that his appointment did not violate the separation of powers principle because the Constitution provides for courts to appoint “inferior officers” and said that he is such an official.

Moreover, he said the challenge by North, a central figure in the Iran arms affair, is curious because both Atty. Gen. Edwin Meese III and President Reagan, representing the executive branch, have welcomed his inquiry.

Watergate Ruling Cited

The attacks on his authority, he said, were “equally true of the Watergate special prosecutor,” whose status was upheld by the Supreme Court in United States vs. Nixon in 1974.

Walsh’s office sought to distinguish a difference in legal basis between Walsh’s probe of the Iran-contra affair and independent counsel Whitney North Seymour Jr.’s investigation of former White House official Michael K. Deaver.

In the Deaver case, in which a similar constitutional challenge has been filed, U.S. District Judge Thomas Penfield Jackson last week issued a temporary restraining order blocking any attempt to indict Deaver until the counsel’s authority is resolved.

Walsh assistant Guy M. Struve said that an independent counsel was appointed for Deaver’s case because he is covered by the act’s provisions relating to the conduct of former high Administration officials. Deaver is accused of improper lobbying activities.

Possible Interest Conflict

But, Struve said, an independent counsel was necessary for the Iran-contra case in part because the Justice Department had some involvement in the affair and “had a possible conflict of interest.”

Among those who will debate the issue Monday is U.S. Atty. Joseph E. diGenova. Although the Justice Department has voiced its own constitutional doubts about the Ethics in Government Act, diGenova said he also would call for the dismissal of North’s suit, but he said no decision had been made on the grounds he would cite.

Lawyers for some individuals being investigated by the five independent counsels now operating said Monday that legal questions will remain even if Reagan or Meese now choose to officially appoint the counsels to make them agents of the executive branch.

Authority Questioned

“I don’t know what authority an attorney general would have to convert a possibly unconstitutional act by a court into an acceptable one,” one of the lawyers said.

“We might well challenge actions taken by the independent counsel while he was working under court appointment,” said another.

None of the lawyers were willing to be quoted by name, contending that any comments for the record could cause them problems with judges.