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BUCHANAN v. AP

June 23, 1975

Henry M. BUCHANAN and Henry M. Buchanan, C.P.A., P.A., Plaintiffs,
v.
ASSOCIATED PRESS and Steven Cohen, Defendants



The opinion of the court was delivered by: FLANNERY

 FLANNERY, District Judge.

 This matter is before the court on defendants' motion for summary judgment and plaintiffs' opposition thereto. The court has considered the extensive memoranda, exhibits, and depositions submitted by counsel and has heard oral argument. This case involves an alleged libel and invasion of privacy based upon an Associated Press wire report of a judicial hearing. For the reasons set forth in this Memorandum Opinion, defendants' motion should be granted.

 I. Factual Background

 Counsel have set forth in their papers most of the relevant factual background in this case. Thus, the following will be only by way of summary. Plaintiff Henry M. Buchanan is a certified public accountant with offices in Bethesda, Maryland. Plaintiff Henry M. Buchanan, C.P.A., P.A., is a professional association of accountants of which Mr. Buchanan is the principal shareholder and president. In March, 1971 Mr. Buchanan and his firm were retained to perform accounting services for the Finance Committee to Re-elect the President. Thereafter Mr. Buchanan and his firm assisted the Committee in setting up its charge of accounts, books of account, and its disbursements journal and assisted generally in its overall accounting system. Mr. Buchanan also on several occasions advised the Committee when reports of expenditures and contributions by political committees were required to be filed under the Federal Corrupt Practices Act. Mr. Buchanan and his firm also allowed the Committee to use Mr. Buchanan's agency account for purposes of making disbursements. The Committee sent Mr. Buchanan four checks totalling $11,000. He deposited these checks in the agency account and thereafter withdrew sums of money or drew checks on the account. Then he would give the Committee the checks that had been drawn or the cash he had withdrawn. Mr. Buchanan was told that some of the checks he gave to the Committee were to supplement the salary of a certain Committee employee and that other checks were to pay invoices. However, he was never told and never asked the purpose of the cash which he forwarded to the Committee.

 During the entire pre-1972 election period there was extensive public interest in the problem of campaign financing. Under the existing law and under the law as amended, 2 U.S.C. §§ 242, 243 (1970), repealed, Pub.L. 92-225, tit. IV, § 405, 86 Stat. 20 (1972), 2 U.S.C. § 432 (Supp.1975), records had to be kept of virtually all campaign contributions and of all campaign expenditures. Criminal penalties were provided for violation of these provisions. See 2 U.S.C. § 252 (1970); id. § 441 (Supp.1975).

 In 1972 Common Cause brought suit, Common Cause v. Finance Committee to Re-elect the President, Civil Action No. 1780-72 (D.D.C.), to force the Finance Committee to report its contributions and expenditures during the period prior to April 7, 1972. It brought this suit under the Federal Corrupt Practices Act of 1925, 2 U.S.C. § 241 et seq. Expenditures and contributions occurring after April 7, 1972 were covered by the Federal Election Campaign Act of 1971, 2 U.S.C. § 431 et seq. which repealed the previous law. In the course of discovery in the Common Cause suit, Common Cause discovered that Mr. Buchanan had served as an accountant for the Finance Committee during the pre-April 7, 1972 period. Thus, Common Cause noted and took his deposition. The deposition revealed the type of accounting services that Mr. Buchanan had performed for the Finance Committee. In particular, the deposition revealed that on a number of occasions the Finance Committee had requested Mr. Buchanan to cash checks written on funds in his agency account, funds which previously had been supplied to him by the Finance Committee. Mr. Buchanan would cash the checks and send the cash to the Finance Committee. He admitted that he was a little disturbed by this procedure but that he complied with the request because he finally determined that there was no impropriety. Nevertheless, this was a strange procedure for the Finance Committee, especially since the Committee readily could have cashed checks itself at the bank in its own building rather than have its agent cash checks in Maryland and send the cash by messenger to downtown Washington. At one point Mr. Buchanan guessed that one purpose of this arrangement was to prevent the press from tracing the source of certain Committee funds.

 The day after Mr. Buchanan was deposed in the Common Cause suit he, through his attorney, filed a motion for a protective order before Judge Joseph Waddy, seeking to have the deposition sealed. His reasoning was that disclosure of the contents of the deposition could only cause embarrassment to him. Pursuant to his motion a hearing was held and the Associated Press on May 8, 1973 issued a wire release concerning that hearing. The wire release read as follows:

 
WASHINGTON AP -- The Nixon re-election committee used a Bethesda, Md., accounting firm to convert campaign checks into cash during 1971, it was revealed in U. S. District Court today.
 
In a hearing before Judge Joseph C. Waddy, it was disclosed that the firm converted 11 checks into cash and turned them back to the campaign committee.
 
It was the second revelation of checks being converted to cash and then fed back to the campaign. The earlier case involved $114,000 which passed through the Miami bank account of convicted Watergate conspirator Bernard L. Barker.
 
The hearing today was in connection with a deposition given by Henry Buchanan, head of the accounting firm which handled the books of the Finance Committee to Re-elect the President.
 
Buchanan's attorneys asked the court to keep under seal a deposition given by Buchanan in a suit filed by Common Cause, a citizen's group trying to force disclosure by the Nixon committee of pre-April 1972 contributions and expenditures.
 
Waddy deferred a decision until he reads the deposition.
 
But also disclosed during the hearing was that the accounting firm cashed five checks to supplement the salary of someone on the re-election committee staff and it ...

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