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Simon Due to Testify in S&L; Case 3 Days After Election

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TIMES STAFF WRITER

Republican gubernatorial candidate Bill Simon Jr. will not be called to testify at a savings and loan trial in Washington until three days after the Nov. 5 election, a federal judge has ruled.

The ruling Thursday by Judge Emily C. Hewitt of the U.S. Court of Federal Claims spares Simon from testifying during the crucial final days of his campaign.

The U.S. Justice Department had said it might call Simon to the stand Oct. 16, less than three weeks before the election.

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Simon’s testimony would have drawn new attention to what Gov. Gray Davis cites as one of his rival’s biggest failures as an investment banker. The trial stems from a lawsuit filed against the government by Simon and other investors in the defunct Western Federal Savings and Loan Assn. of Marina del Rey.

Simon was on Western Federal’s board of directors for two years, then served for the next two years on the board of its parent company, Westfed Holdings.

Regulators seized Western Federal in 1993 at a cost to taxpayers of $122 million. The Simon investment group contends the seizure was improper. Simon’s family lost its $40-million investment in the savings and loan and is trying to recoup the money.

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Last week, the Justice Department asked Hewitt for permission to subpoena Simon to testify at the trial. But government lawyers also offered to prepare written statements that “would eliminate the need to call Mr. Simon” and another potential witness, Gerald Parsky, President Bush’s chief political operative in California. Parsky was a Western Federal investor who sold his stake the year before regulators seized the savings and loan.

After hearing arguments on the matter Thursday, Hewitt revised the trial schedule. From Sept. 17 to Oct. 25, she ruled, both sides will present their cases, then the trial will conclude Nov. 8 with testimony by Simon and Parsky.

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Times staff writer Robert Patrick contributed to this report.

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