FOR IMMEDIATE RELEASE                                                    AG
TUESDAY, SEPTEMBER 27, 1994                                  (202) 616-2777
                                                         TDD (202) 514-1888

                        RECOMMENDS MATTER BE CLOSED

     WASHINGTON, D.C. --  Affirming findings of a special counsel
appointed in the previous Administration, the Department of
Justice today concluded that there is no credible evidence that
Department officials conspired to steal computer software
developed by INSLAW, Inc. or that the company is entitled to
additional government payments.
     The report also reaffirmed police findings that the death of
J. Daniel Casolaro, a free-lance journalist investigating the
INSLAW matter, was a suicide.  It said there is no basis for
asking for the appointment of an Independent Counsel, and
recommended that the affair be closed.
     The case began in 1982 when the Justice Department awarded a
$10 million contract to INSLAW to install case management
software called PROMIS in U.S. Attorneys' offices around the
country.  Since then, a series of disputes led to allegations by
INSLAW that resulted in several lawsuits, two Congressional
investigations, a number of internal Justice Department reviews
including one by the Office of Professional Responsibility and
another by the Public Integrity Section, the appointment of
Nicholas Bua, a former federal judge, as special counsel whose
six-member legal team issued a 267-page report in March 1993, and
today's review of that report which runs another 187 pages.
     Today's report states that the evidence compiled by Judge
Bua fully supported the findings and conclusions he reached that
there was no criminal wrongdoing in furtherance of the Department
on the part of any past or present Justice Department employee.
     Says the report, "(T)here is no credible evidence that
employees of the Department of Justice conspired with anyone to
steal PROMIS or to injure INSLAW in any other way."
     The report also concluded that the use of PROMIS by the
Executive Office of United States Attorneys and in U.S.
Attorneys' offices conforms with the contractual agreements that
were made, and that INSLAW is not entitled as a matter of law to
additional compensation for the use of its PROMIS software.     
     The report says INSLAW's contention that Justice Department
officials conspired to destroy INSLAW and secretly profit from
its work was based largely on alleged statements of anonymous
sources, in and outside the Department.  None came forward
despite assurances from Attorney General Janet Reno that they
would be protected from reprisals.  Individuals who were
identified as sources denied making the statements attributed to
them by INSLAW.  Two primary sources relied on by INSLAW were not
credible: Michael Riconosciuto, currently serving a 30-year
sentence on methamphetamine charges, and Ari Ben-Menashe, found
by two Congressional investigations into the alleged "October
Surprise" conspiracy to be totally untrustworthy.
     Additional investigation was conducted into several
relatively recent claims by INSLAW, and into matters which a
House Judiciary Committee report recommended be subject to
further review.  For example, an MIT professor, Dr. Randall
Davis, was hired to compare the computer code in INSLAW's PROMIS
software with the code in the FBI's FOIMS software, which INSLAW
contends is a pirated version of PROMIS.  Dr. Davis concluded
that there was no relation between FOIMS and PROMIS.
     The report also concluded that there was no credible
evidence that INSLAW's PROMIS was being used elsewhere in the
government, or had been improperly distributed to a foreign
government or entity, or that INSLAW related documents had been
destroyed by the Justice Department Command Center, or that the
Department had obstructed the reappointment of a bankruptcy judge
who had ruled favorably to INSLAW and was later overturned.  
     The report rebuffed claims that PROMIS was stolen to raise
money to reward individuals working for the release of American
hostages in Iran, or to penetrate foreign intelligence agencies,
or as part of a U.S.-Israeli slush fund connected with the late
British publisher Robert Maxwell, or in aid of a secret U.S.
intelligence agency concealed within the Office of Special
Investigations Nazi-hunting unit which INSLAW asserts
participated in illegal trafficking of PROMIS software and in the
alleged murder of Mr. Casolaro.
     The death of Mr. Casolaro was extensively investigated
because of the allegations that he was murdered and because Judge
Bua did not address the issue in significant detail.  Today's
report concurs in the conclusion of the Martinsburg, W. Va.,
Police Department that Mr. Casolaro committed suicide.  
     Extensive forensic evidence, including the autopsy, a blood
spatter analysis and the toxicology report, strongly supports
that conclusion.  Many of Mr. Casolaro's friends described him as
depressed.  He also appeared to be greatly concerned about his
professional failures, including his inability to generate income
from his investigation into the INSLAW matter.  He was suffering
from multiple sclerosis.
     Says the report, "There is no credible evidence that Mr.
Casolaro was murdered."
     In recommending that no additional compensation be paid to
INSLAW, the report said the Department had adhered to the terms
and conditions of its contract with INSLAW.  Furthermore, it
said, INSLAW had allowed some of its claims to languish for eight
years before they were finally dismissed in late 1992. 
Currently, INSLAW is asking Congress to relieve it of the
statutory time bar on the basis of an alleged conspiracy by the
government, a conspiracy for which no credible evidence exists. 
     "INSLAW was provided a full and fair opportunity to litigate
its claims," says the report.  "The ability of INSLAW and its
counsel to keep this matter in the public spotlight by making a
series of unsubstantiated allegations linking this affair to some
of the major alleged conspiracies of the last 15 years should not
be rewarded by acquiescing to their money demands."