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Friday, Oct. 21, 2005 9:45 a.m. EDT

NY Times: Karl Rove, Lewis Libby Likely Cleared on Leakgate Charges

Special prosecutor Patrick Fitzgerald has likely decided not to indict top White House aides Karl Rove and Lewis "Scooter" Libby based on allegations they "outed" CIA employee Valerie Plame, lawyers close to Fitzgerald's Leakgate investigation have told the New York Times.

Instead, the paper said, conflicting accounts given by Mr. Rove and Mr. Libby have been the focus of Mr. Fitzgerald's probe "almost from the start" - raising questions about whether the respected prosecutor continued his investigation after determining that no underlying crime had been committed.

It's not clear whether Fitzgerald believes that Rove and/or Libby had indeed violated the 1982 Intelligence Identities Protection Act, but couldn't prove his case. Or whether he realized early on that the law didn't apply to Ms. Plame, who doesn't qualify as a covert agent because she hadn't served abroad within five years of her "outing."

Instead, the Times said: "Among the charges that Mr. Fitzgerald is considering are perjury, obstruction of justice and false statement" - raising speculation that the Leakgate case may devolve into a Martha Stewart-like prosecution, which drew howls of derision from legal critics.

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  Stewart was sentenced to jail in 2003 for lying to investigators after the Justice Department abandoned its insider trading case against her for lack of evidence.

Unlike the Stewart case, however, it's hard to see how Fitzgerald could have ever believed that the 1982 law in question had been violated, when a quick check of Ms. Plame's work history would have rendered his investigation moot from the start.

Even the Times noted: "Possible violations under consideration by Mr. Fitzgerald are peripheral to the issue he was appointed in December 2003 to investigate."

In Mr. Rove's case, Fitzgerald's prosecution may rest, not on any false testimony, but instead on Rove's failure to tell the grand jury early on about a conversation he had about Ms. Plame with Time magazine reporter Matthew Cooper.

"Mr. Fitzgerald has remained skeptical about the omission," the Times said.

It's still not clear that Rove and Libby would be indicted even if Fitzgerald could prove they gave false testimony to the grand jury.

In 2000, Independent Counsel Robert Ray concluded that then-first lady Hillary Clinton had provided materially false testimony in the Travelgate investigation.

Mr. Ray declined to indict, however - explaining that he could not prove that Mrs. Clinton's false statements were intentional.

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