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Karl Pleads Not Guilty in Campaign Case

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Times Staff Writer

Newport Beach video entrepreneur Stuart Karl Jr. pleaded not guilty Monday to a 12-count federal indictment accusing him of funneling nearly $200,000 in illegal contributions to former presidential hopeful Gary Hart and several congressional candidates.

Karl, refusing to discuss the case, walked briskly past reporters who had gathered outside the federal courthouse in Santa Ana.

“He is not saying anything to anybody,” said John Vardeman, one of three attorneys who accompanied Karl.

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Karl is accused of asking employees to contribute up to $1,000 each--the maximum under the federal law--to various candidates, with the promise that they would be reimbursed. Federal authorities claim that Karl reimbursed the employees in cash. Karl has refused to discuss the case.

The 12-count indictment was handed up by a federal grand jury in Los Angeles two weeks ago. Federal authorities said the indictment followed testimony before the grand jury by 13 of Karl’s former employees, who said they were reimbursed in cash for contributions made in their names to Hart and others.

U.S. Commissioner Ronald W. Rose set an Aug. 23 trial date for Karl before U.S. District Judge Alicemarie Stotler in Santa Ana.

Karl posted $25,000 bail as agreed by his attorneys and the U.S. attorney’s office.

Federal officials say the grand jury is continuing to investigate whether anyone in the Hart camp may have helped set up the scheme. But U.S. Atty. Robert C. Bonner said after Karl’s indictment that there is no evidence yet that anyone in the Hart campaign knew of the allegedly illegal contributions.

Karl made a fortune in the video market after producing Jane Fonda’s physical fitness tapes.

Karl has refused to discuss the campaign contributions since former employees told reporters about them and a federal inquiry began six months ago.

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Besides Hart, recipients of campaign contributions involved in the indictment were U.S. Sen. John F. Kerry (D-Mass.), Orange County congressional candidate David O. Carter and Colorado U.S. Senate candidate Timothy Wirth in 1984 and 1986.

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