Judges are among the most powerful people in government. Federal judges are appointed for life and are not subject to election. It is a system designed to insulate them from political pressures. To make sure their conduct is above reproach, judges follow strict rules of ethics including financial disclosure. In a Focus Five report, investigative reporter Robb Leer tells us how some federal judges wound up with conflicts of interest in their courtroom.

Most of us never expect to go to federal court. But every year thousands of Minnesotans end up there. Gloria Schibursky worked for IBM for over 22 years. "I loved my company. I would have done anything for that company," she told us. Then in 1992, she lost her job. She claimed age discrimination and sued in federal court. Gloria said, "It's been some pretty penniless years to go from the salary I was making to starting over again. It was tough." Schibursky's lawsuit lasted four and a half years. In the end she lost her case. David Doty was the presiding judge. His wife owned stock in IBM for 14 months during the case. Judge Doty declined our request for an interview. But, he did tell us that it was both an embarrassment and a mistake. Doty says he didn't know about his wife's purchase. But according to federal law the judge is still responsible. Judges shall disqualify, if he "or his spouse" has a financial interest. Judge Doty says his wife's financial interest did not influence his decision. But, Schibursky says the conflict of interest shakes her confidence in the courts: "Hopefully, the United States under the constitution will help all of us that have been victims of this type of conflict of interest." She wasn't alone.

Verlin Vedders owned a light fixture company in Roseville. Today you'll find him making pizzas in Champlin. "The expectations that I had when I went into it, that I really didn't have the lawsuit coming,” he told us. In 1992, General Electric sued him for price fixing. Vedders agreed to settle the case for a total of 375-thousand dollars. Then he went out of business. He said: "Needless to say, when you fight a giant like that it's very difficult." Vedders didn't know Judge Richard Kyle inherited stock in General Electric while the case was assigned to him. He said: "Finding out that the judge handling the case has a financial interest in the giant that is suing me makes me angry. I should know that."

Law professor Jeffrey Shayman specializes in judicial ethics at DePaul University. For ten years he taught ethics classes to judges. He told us: "Judges are required to keep themselves informed about their ownership." He continued: "Judges are required to disqualify themselves no matter how small their financial interest is."

How often can mistakes like this happen? Every year, federal judges are required to disclose their financial investments. Last summer, we requested their records from Washington D.C. We cross checked the past six years of financial disclosures against more than 25,000 cases assigned to the judges. When we found a match, we began to ask questions.

Judge Richard Kyle agreed to sit down for an interview with us. He said: "If I pick up a conflict early, I get out." Kyle was appointed to the federal bench in 1992 and has his office in St. Paul. Our research found he owned stock in companies that appeared before him. He said: "Well, I didn't consciously put myself in that position. I don't think I picked up on the fact that I had a disqualifying interest in one of the parties." One of those companies was Tandem Computer. Andrew Clark is an attorney. He represented a salesman who worked for Tandem Computer. Robb asked him: "Did you know the Judge owned stock in Tandem?" Clark responded: "No. Not at the time." Robb asked: "Would it have made a difference in this case?" And he replied: "I don't know if it would have made a difference." Clark sued his client's employer for a breach of contract. We found Judge Kyle ruled on the case while he owned stock in Tandem. The judge's disclosure forms show he purchased stock three times during the case. Then later, after his final ruling, Kyle sold the stock. Judge Kyle said: "I'd say that I made a mistake. I wouldn't say I made a mistake in the decision that I reached. I'd say I made that decision not knowing I had a financial interest." Judges can and do disqualify themselves from cases. Judge Kyle did it over 200 times. But who decides when? Who oversees these conflicts? Jeffery Shayman told us: "The judges and the federal judicial councils need to be more careful about policing." For clarification, judges are required to keep track of their stock for possible conflicts of interest but that does not apply to mutual funds.

Legal scholars and judges agree even one conflict of interest is too many in terms of the damage it can do to confidence in the judicial system. Chief Judge Paul Magnuson gives us his view. Robb asked him: "Judges Doty and Kyle told us they made a mistake. Are you OK with that?" He answered: "Yes, I know judges Doty and Kyle, they don't make many mistakes, ah unfortunately they really did." Judge Magnuson and the other judges were accessible and forthcoming throughout our investigation. The chief judge says our findings heightened their awareness of these issues. We wanted to find out what is being done to make the system more accountable.

William Just used to work behind the counter at this Marketplace Deli in Daytons. But when he got in a dispute with his employer, William sued in Federal court. He eventually settled. Robb asked him: "Have you ever seen this before?" He answered: "No, I haven't." This is Federal Judge Richard Kyle's1995 financial disclosure form. He bought stock in Dayton-Hudson while he was assigned to the case. Judge Kyle said: "If I pick up a conflict early I get out. If I don't pick it up I am still going to have another opportunity to do that." Judge Kyle says he would have had that opportunity if he made an essential ruling, like issuing an order. But the judge says there wasn't one in this case. William told us: "I just wish this would have been brought to my attention."

An Eyewitness News investigation searched over twenty five thousand Federal Court files. We initially raised questions about 27 instances where judges assigned to a case appeared to own stock in one of the parties. The judges provided reasonable explanations for some of these conflicts. Earlier we showed cases where judges holding stock in IBM and Tandem Computer should have disqualified themselves, Judge Richard Kyle: "I'd say that I made a mistake. I wouldn't say I made a mistake in the decision that I reached."

Paul Magnuson is the Chief Federal Judge in Minnesota. He reviewed our list of cases and then agreed to sit down and talk with us. He told us: "All of our judges do the very best to be aware of the financial holdings that they may have." He added: "I don't think you can point of any situation where any judge in this district knew that he had any kind of difficulty." Federal law says a judge "should inform himself' about his "financial interests." The intent is to avoid even the appearance of a conflict. They even sign a disclosure form stating "to the best of my knowledge" I did not "perform any adjudicatory function" on a case in which I had a financial interest. But the chief judge says with so many cases, there are bound to be errors: "300 cases ...300 defendants are on a case, you do your best to catch it, but sometimes it just simply doesn't happen. And... therefore it ah a case will go through the process and if there is no judicial action on it, ah I don't see any conflict at all." James Turner is an attorney who heads an organization called Americans for Legal Reform in Washington D.C.: "This is not a complicated situation, if you have financial interest in one of the parties, you shouldn't be sitting on the case." He asked Congress for easier access to financial disclosures: "The way to really solve this problem is to have readily available access at the courthouses or on the internet. So that if you appear in Federal Court you're assured you're getting a fair shake."

So where do you go to find out if your judge has a financial investment in the company you're battling? You won't find it here in federal court. You'll have to do what we did -write Washington. It took us six weeks to get our request filled from the U-S Courts in Washington, but it only took two days for them to notify the judges of our request. Judges are informed of each request and who made it. That can be intimidating to the attorneys who appear before them. Judge Magnuson told us: "That is done to protect the judges, their families from inappropriate use." Judges file their financial disclosures in May for the previous year. That means there could be a 17 month lag before you can find out if your judge owns stock in the company you're fighting. Judge Magnuson said: "I think the disclosure process that we have is about as good as we can get." But the chief judge also says that even one conflict of interest is too many. And Turner agrees: "Judges are not disqualifying themselves, and as a result public confidence in the impartiality in the judiciary goes down the tubes."

Anyone who has a complaint about a federal judge can write the office of the U. S. courts in Washington. Last year for the eighth circuit there were 67 complaints ranging from conflict of interest to abuse of power. Of those 67 complaints, 21 were dismissed by chief judges, 20 dismissed by judicial councils and so far, in all cases no disciplinary action was taken. The other 26 are still pending.