Lawyer's Libel Suit Against Publisher, Writer Settled : Courts: Barry Tarlow said 1986 Doubleday book wrongly implicated him in several crimes. He terms payment to be made in the case 'substantial.'

TIMES STAFF WRITER

On the eve of opening arguments in a multimillion-dollar libel case that pitted one of Los Angeles' best-known lawyers against one of the nation's most prominent publishing houses, both sides announced Wednesday that they had reached a settlement.

The settlement comes after more than five years of litigation in a lawsuit filed by criminal defense lawyer Barry Tarlow against the author and publishers of "The Underground Empire: Where Crimes and Governments Embrace."

That book, written by James Mills and published by Doubleday & Co., purports to tell the story of a group of undercover enforcement agents who were aggressively rooting out drug criminals until the FBI forced their organization to close down. The 1,165-page book was released to great fanfare in 1986 and later released in paperback by Dell Publishing Co.

Soon after its release, however, the book was faulted by some critics for factual errors.

A 1986 analysis of the book by The Times raised numerous questions about its accuracy and about Mills' reporting techniques in preparing it. Forty-three people involved in the events depicted in the book told The Times that what Mills wrote about them was untrue.

Among those people was Tarlow, who charged that the book libeled him by implicating him in several crimes, including a contract murder and a plan to launder $60 million in drug money.

As part of the settlement agreement, both sides released a statement clearing Tarlow's name but admitting no liability on the part of the author and publishers.

"Mr. Mills and the publishers believe the statements were published in good faith and fully in accord with the rights afforded by the First Amendment," the statement said. "Mr. Mills, Doubleday and Dell never intended that the statements show Mr. Tarlow in a negative light, nor do they claim that Mr. Tarlow engaged in wrongful activity of any kind."

Barry B. Langberg, Tarlow's lawyer, said the statement represents an admission that the information in the book is wrong. "There was not one shred of evidence that Mr. Tarlow ever did anything wrong," Langberg said.

The amount of the settlement was not disclosed, but Tarlow called it "substantial" and "significant."

Lawyer Stephen G. Contopulos, who represented Mills and the publishers, agreed with that characterization and added: "Both sides have expended enormous resources on this case, and the settlement reflects that."

Tarlow said he would use the money from the settlement to make a donation to Centurion Ministries, a free detective service for inmates who say they have been wrongly accused. In addition, Tarlow said he will use some of the money to "buy a house on the ocean in Malibu so that it might help me erase the unpleasant memories of that hack Mills and his book."

After five years of fighting the case in court, Tarlow added that he was relieved to have the matter finally behind him.

"I'm not sure anyone can ever really recover from something like this," he said. "Hopefully, settlements like this will force irresponsible journalists to live up to their responsibilities under the First Amendment."

Contopulos declined to respond to Tarlow's comments, saying it was "not appropriate . . . to try this lawsuit in the press." Mills did not respond to a request for an interview made through his lawyer.

A few passages of the book became the subject of the lawsuit, which was filed in 1987. In one section, Tarlow was accused of helping to launder millions of dollars in drug money for one of his clients, Albert Sicilia-Falcon.

"While agents searched the world for the hollow tree containing Falcon's cash, Tarlow had moved $60 million in bearer bonds from a Swiss bank account to another bank somewhere in Asia," one passage in the book states.

At another point, the author asks federal drug agent Rich Corman why Tarlow was never indicted.

"Unfortunately, Barry Tarlow's got a good reputation in the legal profession, and for some reason attorneys aren't inclined to go after attorneys," the book quotes Corman as saying. "They're afraid to take him on."

Tarlow--a criminal defense lawyer who has represented many defendants, including some accused of drug crimes--vehemently denied he was involved in anything improper. He says he was not indicted because he is innocent, not because of his reputation as a lawyer.

Lawyer Alan Dershowitz, who critically reviewed "The Underground Empire" in the New York Review of Books, said Wednesday that "no matter how much Barry Tarlow got, it wasn't enough."

"The book unfairly accused him of things that honest lawyers just don't do," Dershowitz said. "This guy (Mills) crossed some very serious lines. I hope this sends a powerful message to publishers and writers--that the First Amendment is an important shield . . . but it is not a sword dipped in poison."

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