DISTRICT OF COLUMBIA
         3   CARA LESLIE ALEXANDER    :
             et al.,                  :
         4                            :
                        Plaintiffs    :
         5                            :
                       v.             : Civil No. 96-2123 (RCL)
         6                            :
             FEDERAL BUREAU OF        :
         7   INVESTIGATION et al.,    :
         8              Defendants.   :

        10                                      Washington, D.C.

        11                                Friday, March 15, 1998

        12   Deposition of

        13                   KENNETH BACON

        14   a witness, called for examination by counsel

        15   for Defendants, pursuant to notice and

        16   agreement of counsel, beginning at

        17   approximately 10:09 a.m. at the Offices of

        18   Judicial Watch, Inc., 501 School Street,

        19   S.W., Washington, D.C., before Evadney M.

        20   Rogers, notary public in and for the District

        21   of Columbia, when were present on behalf on

        22   the respective parties:


         1   APPEARANCES:

         2      On behalf of Plaintiffs:

         3         LARRY KLAYMAN, ESQUIRE
                   Judicial Watch, Inc.
         4         501 School Street, S.W., Suite 725
                   Washington, D.C.  20024
         5         (202) 646-5172

                On behalf of Department of Defense:
                   ANNE L. WEISMANN, ESQUIRE
         8         BENJAMIN M. LAWSKY, ESQUIRE
                   U.S. Department of Justice
         9         Civil Division
                   901 E Street, N.W.
        10         Washington, D.C.  20530
                   (202) 514-3395

        12      On behalf of the Federal Bureau of
                       Investigation (FBI) and Executive
        13             Office of the President (EOP):

                   U.S. Department of Justice
        15         901 E Street, N.W., 9th Floor
                   Washington, D.C.  20004
        16         (202) 514-5302

        17      On behalf of the Witness:

        18         WILLIAM J. MURPHY, ESQUIRE
                   Murphy & Shaffer
        19         100 Light Street
                   Baltimore, MD  21202-1019
        20         (410) 783-7000




         1   APPEARANCES (CONT"D):

         2      On behalf of Hillary Rodham Clinton:

         3         ROBERT M. CARY, ESQUIRE
                   Williams & Connolly
         4         725 Twelfth Street, N.W.
                   Washington, D.C.  20005
         5         (202) 434-5175

                             *  *  *  *  *

















         1                  C O N T E N T S

         2   EXAMINATION BY:                            PAGE

         3      Counsel for Plaintiffs                     5

             No. 1 - Letter, Bacon to Thurmond           117
             No. 2 - Notice of Deposition Duces          185
         7             Tecum, Attachments

         8   No. 3 - The Washington Post Article         255
                       by Nat Hentoff
             No. 4 - The Washington Post Article         256
        10             by Jane Mayer

        11   No. 5 - Letter, Lawsky to Klayman           260
             No. 6 - Fox News Sunday Transcript          345

                             *  *  *  *  *









         1              P R O C E E D I N G S

         2   Whereupon,

         3                 KENNETH H. BACON

         4   was called as a witness and, having been

         5   first duly sworn, was examined and testified

         6   as follows:


         8             BY MR. KLAYMAN:

         9        Q    Will you please state your name,

        10   sir.

        11        A    My name is Kenneth H. Bacon.

        12        Q    When were you born?

        13        A    I was born in November 1944.

        14        Q    Where were you born?

        15        A    I was born in Bronxville, New York.

        16        Q    Where did you attend high school?

        17        A    Phillips Exeter Academy.

        18        Q    Where is that located?

        19        A    Exeter, New Hampshire.

        20        Q    What year did you graduate?

        21        A    1962.

        22        Q    What, if anything, did you do at


         1   that time?  Did you go to a university?

         2        A    I went to college.

         3        Q    Where did you attend?

         4        A    Amherst College.

         5        Q    Did you graduate from Amherst

         6   College?

         7        A    I did.

         8        Q    What year was that?

         9        A    1966.

        10        Q    What was your major during Amherst

        11   College?

        12        A    English.

        13        Q    During the time that you attended

        14   Amherst College, were you ever subject to any

        15   disciplinary proceedings?

        16        A    I was not.

        17        Q    What, if anything, did you do after

        18   you graduated from Amherst?

        19        A    I went to graduate school.

        20        Q    Where did you attend?

        21        A    Columbia University.

        22        Q    What was the nature of the graduate


         1   school?

         2        A    Business and journalism.

         3        Q    Did there come a point in time when

         4   you graduated from Columbia?

         5        A    Yes.

         6        Q    When was that?

         7        A    1968.

         8        Q    In 1968, did you then seek

         9   employment?

        10        A    I did.

        11        Q    Did you find it?

        12        A    I did.

        13        Q    Where did you obtain employment?

        14        A    I worked at the U.S. Senate.

        15        Q    The U.S. Senate?

        16        A    Yes.

        17        Q    Who did you work for?

        18        A    Thomas J. McIntyre.

        19        Q    What was your position?

        20        A    Legislative Assistant.

        21        Q    Mr. McIntyre was from which state?

        22        A    New Hampshire.


         1        Q    He was a Democrat?

         2        A    He was.

         3        Q    What was your position with

         4   Mr. McIntyre?

         5             MR. MURPHY:  Asked and answered.

         6   You can answer.

         7             THE WITNESS:  Can you repeat it

         8   again.

         9             BY MR. KLAYMAN:

        10        Q    What were your duties and

        11   responsibilities?

        12        A    My duties and responsibilities were

        13   basically to answer mail and to handle

        14   certain legislative issues.

        15        Q    Who was your immediate supervisor

        16   in that office?

        17        A    Allan S. Novans.

        18        Q    Do you know where he is today?

        19        A    Tel Aviv.

        20        Q    What's his position?

        21        A    Retired.

        22        Q    Did there come a point in time when


         1   you left Senator McIntyre's office?

         2        A    Yes.

         3        Q    Where did you go at that time?

         4        A    United States Army.

         5        Q    What year was that?

         6        A    1969.

         7        Q    What was the capacity that you

         8   joined the United States Army?

         9        A    I went to basic training as a

        10   reservist.

        11        Q    How long did you spend in the Army?

        12        A    I spent four months in active duty.

        13        Q    Were you drafted into the Army at

        14   that time?

        15        A    I was not.

        16        Q    You enlisted voluntarily?

        17        A    Yes.

        18        Q    You spent four months of active

        19   duty where?  In Vietnam?

        20        A    No.  I was at Fort Dix.  I was in

        21   the reserves.

        22        Q    I take it you enlisted in the


         1   reserves to avoid being drafted?

         2             MR. MURPHY:  Objection.  You can

         3   answer that.

         4             THE WITNESS:  I enlisted in the

         5   reserves to satisfy my duty to my country.

         6             BY MR. KLAYMAN:

         7        Q    How long did you stay in the

         8   reserves?

         9        A    Six years.

        10        Q    Did you do anything else during

        11   that period of time?

        12        A    Yes.

        13        Q    What did you do?

        14        A    I worked for a newspaper.

        15        Q    Which newspaper?

        16        A    The Wall Street Journal.

        17        Q    Did you leave the reserves with an

        18   honorable discharge?

        19        A    Yes, I did.

        20        Q    Did you ever have any disciplinary

        21   issues while you were in the reserves?

        22        A    No, I did not.


         1        Q    How did you obtain your job with

         2   the Wall Street Journal?

         3        A    I applied and got the job.

         4        Q    What year was that?

         5        A    1969.

         6        Q    Who did you apply with, the person?

         7        A    Well, I had worked for the Wall

         8   Street Journal during two summers when I was

         9   in school and I applied with Allan Otten, who

        10   was then the Bureau of Chief in Washington.

        11        Q    What specific position did you

        12   obtain with him?

        13        A    I was a regulatory reporter.

        14        Q    Which meant that you wrote about

        15   regulatory issues in Washington, D.C.?

        16        A    That's right.

        17        Q    You were based here?

        18        A    Yes.

        19        Q    How long did you stay with the Wall

        20   Street Journal?

        21        A    25 years.

        22        Q    Did your position change during the


         1   course of those 25 years from regulatory

         2   reporter?

         3        A    Yes.

         4        Q    Tell me what were your different

         5   positions and when you received those

         6   different positions.

         7        A    Well, I don't think I can recall

         8   with great precision.

         9        Q    Just roughly.

        10        A    I covered a variety of things,

        11   regulatory agencies.  I covered the treasury.

        12   I covered the Pentagon.  I covered education,

        13   banking and the Federal Reserve Board and I

        14   worked as an editor.

        15        Q    During those 25 years who did you

        16   work most closely with at the Wall Street

        17   Journal?

        18        A    Well, it changed over time but I

        19   worked always with my bureau chief.  There

        20   were four bureau chiefs during the time I was

        21   there, and I worked very closely with the

        22   reporters in my section, whatever my section


         1   was at the time.

         2        Q    Who were the bureau chiefs while

         3   you were at the Wall Street Journal?

         4        A    Allan Otten, Norman C. Miller,

         5   Albert Hunt and Allan Murray.

         6        Q    Are many of them still there?

         7        A    Two are still there.

         8        Q    Do you know where the other two

         9   are?

        10        A    Yes.

        11        Q    Which ones and where are they?

        12        A    Allan Otten is retired and lives in

        13   Maryland and Norman C. Miller is retired and

        14   lives in Pasadena, California.

        15        Q    Up to what point did you cease

        16   working for the Wall Street Journal?

        17        A    1994.

        18        Q    Now, in the course of your work for

        19   the Wall Street Journal, did you get to know

        20   people associated with Governor Bill Clinton?

        21        A    No.

        22        Q    Did you get to know people


         1   associated with Governor Bill Clinton in some

         2   other way?

         3             MR. MURPHY:  Let me just ask you,

         4   Mr. Klayman, you mean while President Clinton

         5   was governor?  During the term of his office

         6   as a governor?

         7             MR. KLAYMAN:  Right.  Up to him

         8   becoming president.

         9             THE WITNESS:  I should revise my

        10   answer.  I briefly covered education, and

        11   during that period I had occasion to talk

        12   with people on the staff of Governor Clinton

        13   who was then an official with the National

        14   Governors Conference and interested in

        15   education.

        16             BY MR. KLAYMAN:

        17        Q    Who did you have occasion to talk

        18   with?

        19        A    I'm afraid I cannot recall their

        20   names.

        21        Q    Were any of them people who since

        22   have become known in the public domain?


         1        A    No.

         2             MR. MURPHY:  Maybe in Little Rock.

         3             MR. KLAYMAN:  Possibly, yes.  After

         4   the president became the president, after

         5   Governor Clinton won the election in 1992,

         6   did you have occasion to have contact with

         7   anybody in the Clinton Administration either

         8   in terms of your duties and responsibilities

         9   for the Wall Street Journal or privately?

        10             THE WITNESS:  As a reporter or

        11   editor for the Wall Street Journal, I did

        12   have occasion to talk with people in the

        13   administration.

        14             BY MR. KLAYMAN:

        15        Q    Who did you talk with and get to

        16   know?

        17        A    I talked with Lloyd Bentsen, who

        18   was Secretary of the Treasury, and I talked

        19   with Larry Somers, who was Deputy Secretary

        20   of the Treasury.  These were all in my

        21   capacities as a reporter.  I talked with

        22   Frank Newman, who was Undersecretary of the


         1   Treasury, and a variety of other treasury

         2   officials.

         3        Q    Can you name them for us?

         4        A    Not with any degree of accuracy,

         5   no, at this stage.

         6        Q    Well, either you know somebody or

         7   you don't.  I'm not asking for pinpoint

         8   accuracy.

         9        A    Well, you're asking me to go back

        10   through my rolodex as a reporter 6 years

        11   after the time, 5-and-a-half years.

        12        Q    Well, are there any other people

        13   that come to mind right now?

        14        A    Roger Altman, Josh Diner, David

        15   Knight, Eugene Ludwig, who was comptroller of

        16   the currency; William Seidman, who was the

        17   head of the FDIC.  I dealt with people on a

        18   fairly regular basis on the Federal Reserve

        19   Board, including the Chairman, Allan

        20   Greenspan, and Larry Lindsey, who is a member

        21   of the Federal Reserve Board, dealt with

        22   banking issues.


         1             I dealt with a number of staffers

         2   in all of these agencies, the FDIC, the

         3   Office of Thrift Supervision, the Regulation

         4   Trust Company, the corporation, the Treasury,

         5   Office of the Comptroller of Currency, et

         6   cetera.

         7        Q    This was in the course of your

         8   duties and responsibilities at the Wall

         9   Street Journal you came in contact with these

        10   people?

        11        A    Yes.

        12        Q    Forgive me if I'm going over ground

        13   that you covered.  Is this because you were

        14   covering financial matters?

        15        A    Yes.

        16        Q    You were the editor of financial

        17   matters?

        18        A    Well, I had several jobs.  For a

        19   period I was a reporter and I was covering

        20   banking and finance, and after that I became

        21   an editor.

        22        Q    During the period that you were


         1   still with the Wall Street Journal and got to

         2   know these people in the Clinton

         3   Administration in your professional capacity,

         4   did you get to know anybody else in your

         5   personal capacity who worked for the Clinton

         6   Administration?

         7        A    No.

         8        Q    Specifically, did you ever have a

         9   chance to meet or talk with Sidney

        10   Blumenthal?

        11        A    I've never met Sidney Blumenthal.

        12        Q    Have you ever talked with him?

        13        A    No.

        14        Q    James Carville?

        15        A    I have never met James Carville and

        16   I have never talked to him.

        17        Q    Ann Lewis?

        18        A    I have never met Ann Lewis.  I may

        19   have spoken to her once on the telephone.

        20        Q    Mike McCurry?

        21        A    I have spoken to Mike McCurry.

        22        Q    Did you get to know him during that


         1   period at the Wall Street Journal?

         2        A    No, I did not get to know Mike

         3   McCurry until 1994.

         4        Q    We're just talking about the period

         5   at the Wall Street Journal.

         6        A    I did not talk to Ann Lewis while I

         7   worked for the Wall Street Journal.

         8        Q    Anybody else who was in the White

         9   House before or currently in the White House

        10   now under the Clinton Administration, a

        11   lawyer with the Wall Street Journal that you

        12   talked with?

        13        A    I did talk with Gene Spurling from

        14   time to time.  I talked with Robert Rubin

        15   from time to time.  I talked with Joe

        16   Steigletts from time to time.  I talked with

        17   Laura Tyson from time to time.  I talked with

        18   Phil Laeder.

        19        Q    Who is Phil Laeder?

        20        A    Phil Leader is the ambassador to

        21   London.

        22        Q    L-a-e-d-e-r?


         1        A    Yes.

         2        Q    Anyone else?

         3        A    I'm sure there were other people I

         4   talked to.

         5             I talked to a fellow called Paul

         6   Diamond from time to time, a person named

         7   Ellen Sideman from time to time.  These were

         8   all people I talked to in my capacity.

         9        Q    Have you ever talked to George

        10   Stephanopoulos during that period?

        11        A    During that period, I did not.

        12        Q    Mack McLarty?

        13        A    Not during that period.

        14        Q    Bruce Lindsey?

        15        A    No.

        16        Q    Harold Ickes?

        17        A    Wait a minute.  Bruce Lindsay?  I

        18   don't believe I ever spoke to him.

        19        Q    Harold Ickes?

        20        A    Not during that period.

        21        Q    Alexis Herman?

        22        A    Not during that period.


         1        Q    Leon Panetta?

         2        A    Not during that period.

         3        Q    Hillary Clinton?

         4        A    Not during that period.

         5        Q    Now, there came a point in time

         6   when obviously you left the Wall Street

         7   Journal.  What did you do then?

         8        A    I went to work at the Defense

         9   Department.

        10        Q    What was your position when you

        11   went to work for the Defense Department?

        12        A    I was Assistant to the Secretary of

        13   Defense for Public Affairs.

        14        Q    Let me back up a little bit.

        15   Before you left the Wall Street Journal and

        16   joined the Defense Department, had you ever

        17   talked or met President Bill Clinton?

        18        A    I may have met him once at a

        19   National Governors Conference meeting in

        20   Washington.

        21        Q    Tell me how it is you got your job

        22   as Assistant Secretary of Defense for Public


         1   Affairs.

         2        A    I was asked by an acquaintance if I

         3   was interested in the job.  That query came

         4   in the spring of 1994.  I said I would be

         5   interested.  I then had a series of

         6   interviews and was selected for the job.

         7        Q    Who was the acquaintance?

         8        A    Thomas Ross.

         9        Q    Who is Tom Ross?

        10        A    Tom Ross is an executive for Loral

        11   Corporation.  At the time he handled the

        12   press for the National Security Council.

        13        Q    How did you get to know Tom Ross?

        14        A    When I covered the Pentagon in the

        15   late 1970's, he was the Assistant Secretary

        16   of Defense for Public Affairs.

        17        Q    You had covered the Pentagon in

        18   the 70's?

        19        A    Yes.

        20        Q    What was your capacity at the Wall

        21   Street Journal at that time?

        22        A    I was a reporter.


         1        Q    You were dealing with military

         2   affairs?

         3        A    Yes.

         4        Q    Who contacted who?  Did you contact

         5   Tom Ross and say, "I'm interested in this

         6   job," or did he contact you?

         7        A    Tom Ross called me.

         8        Q    What did he say to you when you

         9   spoke with him specifically, as much as you

        10   can recollect?

        11        A    Well, I have an imprecise

        12   recollection, but he asked me if I would be

        13   interested.  He said that he knew that I knew

        14   Bill Perry and that Bill Perry, who was then

        15   Secretary of Defense, thought highly of me.

        16   Would I be interested in putting my name into

        17   the ring as one of the candidates.  I said

        18   let me think about it for a day or two.  I

        19   called him back and said I would be.

        20        Q    How had you gotten to know Bill

        21   Perry before?

        22        A    When I covered the Defense


         1   Department during the Carter Administration,

         2   Bill Perry was the Undersecretary of Defense

         3   for Acquisitions Research -- for Research and

         4   Acquisitions.

         5        Q    Did you come into contact with

         6   Mr. Perry in a close context?  I mean, did

         7   you work closely with him on certain issues?

         8        A    Well, I wrote a number of stories

         9   about programs he was directing.  One was the

        10   Cruise Missile Program.  One was the MX

        11   Missile Program.  He was somebody that I

        12   interviewed on a fairly regular basis as a

        13   reporter.

        14        Q    Had you ever gone out to lunch with

        15   Mr. Perry or dinner or anything like that?

        16        A    No, not at that time.

        17        Q    Was there anybody else who

        18   contacted you about the job at the Pentagon?

        19        A    Well, after I talked to Tom Ross in

        20   May or June, I was asked to -- I was called

        21   by the office of John Deutch, who was then

        22   Deputy Secretary of Defense, and asked to


         1   come in for an interview.

         2        Q    Did you come in for an interview?

         3        A    I did.

         4        Q    Did you obtain recommendations for

         5   your job application?

         6        A    I did not.

         7        Q    You interviewed then with

         8   Mr. Deutch?

         9        A    Yes.

        10        Q    Did Mr. Deutch then explain to you

        11   why they were interested in your

        12   qualifications?

        13        A    Not with any specificity.

        14        Q    What was discussed during that

        15   interview, as much as you can remember?

        16        A    Well, it was about half an hour

        17   long.  He basically told me what the

        18   challenges of the job were, asked me what my

        19   philosophy for the job would be.  We talked

        20   about some of the public affairs issues

        21   facing the Pentagon and what my approach

        22   would be to them.


         1        Q    Of course he mentioned to you that

         2   they wanted to hire somebody who not only

         3   understood military affairs but somebody who

         4   would be loyal to the administration,

         5   correct?

         6        A    He did not.

         7        Q    They were not interested in

         8   loyalty?

         9        A    He did not mention loyalty to me.

        10        Q    You assumed that obviously they

        11   wanted people that they could trust; correct?

        12        A    I did not assume anything.  I went

        13   to the interview and answered his questions.

        14        Q    So is it your understanding that

        15   they wanted to hire somebody that they would

        16   not trust?

        17        A    As I said, I didn't think about it,

        18   one way or another.

        19             MR. KLAYMAN:  I'll take a

        20   one-minute break.  I'll be right back.

        21             MR. MURPHY:  Just one minute.

        22                  (Recess)


         1             MR. KLAYMAN:  So you're saying that

         2   it was your understanding that the Clinton

         3   Administration really didn't care whether or

         4   not you could be trusted or were loyal when

         5   they discussed employment with you?

         6             MR. MURPHY:  I object to the

         7   mischaracterization of his testimony, but you

         8   can answer the question.

         9             THE WITNESS:  I did not say that.

        10             BY MR. KLAYMAN:

        11        Q    Well, did that come across in the

        12   interview, that loyalty and trust certainly

        13   was a qualification for the job?

        14        A    It did not.

        15        Q    You assumed, of course, that was

        16   the qualification for the job?

        17        A    As I said, we talked about Defense

        18   Department issues only and we talked about

        19   how I would deal with certain public affairs

        20   problems.  It was really more a question of

        21   philosophy of dealing with press problems

        22   than anything else.


         1        Q    Well, my question was whether or

         2   not you perceived that that was a

         3   qualification for the job.

         4        A    I understand your question.  I've

         5   answered it.

         6        Q    Did you perceive that to be a

         7   qualification for the job?

         8        A    As I said, we talked about Defense

         9   Department issues.

        10        Q    This is a legal proceeding.  I'm

        11   sure you know that.  It's not an issue of

        12   whether or not you may perceive my question

        13   in a different way.  Let me be very precise

        14   in the questions and we'll move this thing

        15   along faster if you actually answer the

        16   question.

        17             My question was whether at the time

        18   you were being interviewed for the job you

        19   perceived that the Clinton Administration,

        20   you, Ken Bacon, understood that one of the

        21   qualifications that the Clinton

        22   Administration was looking for was whether


         1   they could trust you and whether you were

         2   loyal.

         3             MR. MURPHY:  Objection,

         4   Mr. Klayman.  He didn't seek a job with the

         5   Clinton Administration.  He sought a job with

         6   the Department of Defense.  Maybe if you

         7   would characterize your question more

         8   appropriately, he would be able to answer it

         9   more precisely.

        10             MR. KLAYMAN:  Well, that's your

        11   opinion.  Please do not feed testimony to the

        12   witness.

        13             MR. MURPHY:  I'm not doing that,

        14   Mr. Klayman.

        15             MR. KLAYMAN:  We have a number of

        16   motions pending with regard to that kind of

        17   conduct, Mr. Murphy.

        18             Please certify it.

        19             MR. MURPHY:  Not against me,

        20   Mr. Klayman.

        21             MR. KLAYMAN:  Well, I hope we don't

        22   have to.  So far we've had pleasant


         1   discussions.

         2             MR. MURPHY:  I'll be very pleasant

         3   as long as you are.

         4             MR. KLAYMAN:  I'm pleasant.  I just

         5   want an answer to the question.

         6             MR. MURPHY:  Ask a question.

         7             MR. KLAYMAN:  If you want to

         8   instruct your client in terms of how

         9   questions have to be answered at depositions.

        10             MR. MURPHY:  I'm advising you to

        11   ask a question that makes more sense and

        12   perhaps he can answer.

        13             MR. KLAYMAN:  I will ask the

        14   questions as I want to ask the questions.

        15             MR. MURPHY:  Fine.  If you want to

        16   ask nonsensical questions.

        17             MR. KLAYMAN:  I ask that you not

        18   interrupt.  It's not nonsensical, and I

        19   resent that characterization.  We're not

        20   going to meet the press here where you get to

        21   dodge the answer.  We're in a situation

        22   called a deposition.


         1             MR. MURPHY:  Mr. Klayman, we're

         2   aware of where we are.

         3             Mr. Bacon would like to have your

         4   question repeated.  Would you, please, repeat

         5   it.

         6             MR. KLAYMAN:  I'll repeat it again.

         7   Did you, at the time that you were being

         8   interviewed for a job by the Defense

         9   Department, which is part of the Clinton

        10   Administration, perceive that loyalty and

        11   trust were two of the criteria that they were

        12   looking for?

        13             THE WITNESS:  That is a very

        14   complex question.  I would like to

        15   deconstruct it.

        16             First, I was having an interview

        17   with the Department of Defense.  This was the

        18   first time I had met Secretary Deutch.  It

        19   was a relatively brief interview.  I would

        20   say about 30 minutes.  We spoke exclusively

        21   about Defense Department issues.

        22             At the time I had this interview I


         1   did not believe that I would ultimately end

         2   up in this job in the Defense Department.

         3             He made it very clear to me that

         4   there were a number of other candidates they

         5   were looking at and I concentrated only on

         6   thinking about and talking about Defense

         7   Department issues.  The element of trust

         8   between me and Mr. Deutch, between me and

         9   Dr. Perry obviously was in my head, but trust

        10   did not flow any higher than Dr. Deutch or

        11   Dr. Perry during that conversation.

        12             BY MR. KLAYMAN:

        13        Q    Did the concept of loyalty, was

        14   that also in your head at that time?

        15        A    No.

        16        Q    That is a basic requirement for any

        17   employer/employee relationship, trust and

        18   loyalty, is it not?

        19        A    Sir, this was the first interview

        20   that I had in a job process that I basically

        21   assumed was not going to go anywhere.  So I

        22   said, as I have said several times, talked


         1   and thought about press issues facing the

         2   Pentagon.  Those were the questions that were

         3   put to me by Dr. Deutch.  Those were the

         4   questions I answered.  This was really a

         5   get-to-know-you interview for Dr. Deutch.

         6        Q    At any point in the interview

         7   process leading up to your job, you did

         8   perceive, did you not, that it was necessary

         9   that you be loyal to the employers that were

        10   going to hire you?

        11        A    No.  That was never explicitly

        12   stated.

        13        Q    No.  I asked whether you perceived

        14   that, whether you understood that.

        15        A    I perceived that if I got this job,

        16   I would be joining a team at the Defense

        17   Department and that they would expect me to

        18   work with them in a trustworthy relationship,

        19   yes.

        20        Q    Which you equate trustworthy with

        21   loyalty?  My question was loyalty.

        22        A    I thought in terms of


         1   trustworthiness.

         2        Q    My question was whether you equate

         3   trustworthiness with loyalty.

         4             MR. MURPHY:  I think the Boy Scouts

         5   treat them separately.

         6             MR. KLAYMAN:  I've never been in

         7   the Boy Scouts, as you probably guessed.

         8             THE WITNESS:  I guess I never

         9   really thought of it in those terms.

        10             MR. MURPHY:  Trustworthy, loyal,

        11   helpful, friendly, courteous, kind, obedient,

        12   service, thrifty, brave, clean and reverent.

        13             MR. KLAYMAN:  I was a Cub Scout.

        14             MR. MURPHY:  I can tell.

        15             MR. KLAYMAN:  I decided it wasn't

        16   my style.

        17             MR. MURPHY:  I can tell,

        18   Mr. Klayman.

        19             THE WITNESS:  Yes.  Do you have

        20   another question?

        21             MR. KLAYMAN:  Was the answer yes?

        22             THE WITNESS:  The answer was I


         1   never really equated, I never thought in

         2   terms of trustworthiness or loyalty.

         3   Clearly, when you accept a job you accept a

         4   degree of trust.  You expect a degree of

         5   trust, both the employer and the employee do.

         6             BY MR. KLAYMAN:

         7        Q    I'm just trying to get your

         8   understanding of what an employment

         9   relationship is all about.  Is not loyalty to

        10   the employer a factor in the

        11   employer/employee relationship, based on your

        12   experience, your many years in the

        13   professional world?

        14        A    Yes.  I think loyalty comes with

        15   working closely with people you trust.

        16        Q    So they are two factors, as your

        17   counsel pointed out kindly, in any

        18   relationship, is it not, trust and loyalty?

        19        A    In good relationships, yes.

        20        Q    Now, after you met with Mr. Deutch,

        21   did you then meet with others?

        22        A    I assume he did.


         1        Q    Not him, but did you meet with

         2   others in order to interview for that

         3   position at the Pentagon?

         4        A    I did not meet with anybody else

         5   until July.

         6        Q    Did you talk to others during that

         7   period?

         8        A    Not within the Defense Department,

         9   no.

        10        Q    Who did you talk to outside of the

        11   Defense Department?

        12        A    I talked to two people.

        13        Q    Who?

        14        A    My Bureau Chief, Allan Murray, and

        15   my wife.

        16        Q    I won't ask you what you said to

        17   your wife, but I will ask you what you said

        18   to Allan Murray.

        19        A    I told Allan Murray that I had been

        20   approached by Tom Ross, that I hadn't thought

        21   much of it when the approach came in the

        22   spring, March or so, but when I went in and


         1   interviewed with John Deutch there was a

         2   possibility that I would get the job.  I

         3   wanted him to know about it.  I still thought

         4   the chances were remote.

         5             We decided mutually that at that

         6   point I should stop working as a reporter

         7   covering financial matters.  Then I was

         8   working on international finance, I believe,

         9   the dollar/yen ratio, things like that.  That

        10   I should stop covering those matters and

        11   worked exclusively as an editor, which I

        12   started doing.

        13        Q    In the course of your discussions

        14   with the Pentagon or others in the Clinton

        15   Administration leading up to your actual

        16   offer of employment, who did you meet, speak

        17   with or communicate with in the Clinton

        18   Administration?

        19        A    Well, my second interview was with

        20   Dr. Perry and that was in early July.  After

        21   that, I was notified a day or two later that

        22   I was his candidate for the job.


         1        Q    Where did you interview with him?

         2        A    I interviewed in the Pentagon.

         3        Q    In his office?

         4        A    Yes.

         5        Q    During the time that you were being

         6   considered for employment, you did write

         7   stories, however, that somehow touched on the

         8   Clinton Administration, correct?

         9        A    Well, I would have to go back and

        10   check the record on that.  My recollection is

        11   that after I told Allan Murray, I moved

        12   pretty quickly into an editorial position and

        13   stopped writing.  I may have written a story

        14   or two after that.  I may have written

        15   several stories, for all I know.  There may

        16   have been stories in the pipeline that ran,

        17   but I would have to go back and check the

        18   record.

        19        Q    How long was your meeting with

        20   Secretary Perry?

        21        A    It was probably 45 minutes.

        22        Q    What did he say to you during that


         1   meeting?

         2        A    He basically described what he

         3   thought his public affairs problems were,

         4   what his public affairs challenges were.  He

         5   described the type of person he was looking

         6   for and he described the circumstances, the

         7   conditions under which he felt the job could

         8   be done successfully and what a person had to

         9   bring to that job to be able to do the job

        10   successfully.

        11        Q    During that interview he explained

        12   to you that good relations with the White

        13   House were necessary for this job?

        14        A    He said to me that he wanted a

        15   person who kept the White House informed of

        16   what he was doing and also kept him informed

        17   of what the White House priorities were at

        18   any given time.

        19        Q    You understood that to be your

        20   duties and responsibilities if chosen for

        21   this job?

        22        A    I understood that to be part of my


         1   duties and responsibilities.

         2        Q    He wanted a person that would also

         3   maintain good relations with Congress, I take

         4   it?

         5        A    That's not my job.

         6        Q    In terms of maintaining or at least

         7   keeping the White House informed of what was

         8   going on at the Pentagon, was it understood

         9   or stated expressly that you would be in

        10   communication with the White House Press

        11   Secretary?

        12        A    I don't believe he stated that

        13   expressly, but it was certainly assumed.

        14        Q    Who else was it assumed that you

        15   would be in contact with to keep the White

        16   House informed?

        17        A    I think it was only the Press

        18   Secretary through basically the press

        19   reporting side.

        20        Q    You are the equivalent of the White

        21   House Press Secretary currently as Press

        22   Secretary of the Defense Department, correct?


         1        A    I hold the same job; that is,

         2   dealing with the press, yes.

         3        Q    Are there meetings of the press

         4   secretaries in the different departments of

         5   the Executive Branch from time to time?

         6        A    It is extremely rare.

         7        Q    But it has happened?

         8        A    There have been meetings at which

         9   several of us have been present.

        10        Q    Getting back to your meeting with

        11   Secretary Perry, you said he explained to you

        12   the type of person he was looking for?

        13        A    Yes.

        14        Q    What did he tell you?

        15        A    He told me that he wanted a person

        16   who understood issues, who understood the

        17   press, who was a straight shooter and shared

        18   his philosophy for dealing with the press and

        19   somebody who could keep him informed of

        20   stories that were developing, stories that

        21   were on the horizon, somebody who could

        22   select media opportunities for him and


         1   prepare him for those opportunities, and

         2   somebody who could accurately explain what

         3   the Pentagon policies were to the public and

         4   the press.

         5        Q    He also told you that it was very

         6   important that what you say and do as Press

         7   Secretary of the Defense Department not be in

         8   conflict with the White House?

         9        A    He did not explain that to me, no.

        10        Q    But you understood that to be

        11   obviously part of the role?

        12        A    It did not come up in the

        13   interview.

        14        Q    It came up later, though, didn't

        15   it?

        16        A    Not in the terms you've described

        17   it.

        18        Q    In what terms did it come up?

        19        A    Well, one of my jobs is to inform

        20   the White House of what Secretary Perry has

        21   said on various issues, particularly if he's

        22   traveling -- now Secretary Cohen, then


         1   Secretary Perry.  I also talk daily with the

         2   White House press operation in a noon

         3   conference call to find out what they're

         4   saying on certain issues.  I inform the

         5   Secretary of Defense if I believe he needs to

         6   be informed of what's being said on certain

         7   issues.

         8        Q    Particularly in the area of defense

         9   matters, it's very important that the

        10   Pentagon not be in contradiction with the

        11   White House and vice versa.  Close

        12   synchronization is required, is it not?

        13        A    We do try to speak with the same

        14   voice on defense and foreign policy matters,

        15   yes.

        16        Q    For that matter, on all issues for

        17   which you're speaking, you don't want to come

        18   in conflict with the White House because of

        19   the very nature of what the Pentagon does?

        20        A    Well, the issues I speak on are

        21   different issues.

        22        Q    Correct.  When you speak about


         1   employees, obviously that's related to

         2   defense issues, correct?  Indirectly?

         3        A    I have never talked about matters

         4   of employees with the Pentagon press

         5   office -- with the White House press office.

         6        Q    That wasn't my question.  My

         7   question was whether or not if you did make a

         8   statement about an employee, since that

         9   employee works for the Pentagon there would

        10   be an indirect relationship between defense

        11   matters and that employee?

        12        A    Very indirect.

        13        Q    But a relationship does exist

        14   because obviously employees of the Pentagon

        15   are there to further defense, correct?

        16        A    Yes, that's true.

        17        Q    Now, what else did Secretary Perry

        18   tell you?

        19        A    I would like to amend one thing I

        20   said.  I said that I had never talked about

        21   an employee matter with the White House press

        22   operation.  That is not the case because


         1   there have been matters that I have discussed

         2   with them.

         3        Q    What did you discuss with them?

         4             MS. WEISMANN:  I'm going to discuss

         5   to that question and direct him not to answer

         6   to the extent it calls for information

         7   outside of that which he has been authorized

         8   to speak to; namely, information concerning

         9   the recent disclosure of information

        10   contained in the Federal Security Clearance

        11   Form of Linda Tripp.  To the extent he has

        12   information within that area, he may answer;

        13   otherwise, he's directed not to answer.

        14             MR. KLAYMAN:  Well, let's get the

        15   answer first and then I'll quibble with your

        16   objection.

        17             THE WITNESS:  I'm sorry.  She just

        18   objected so I can't answer.

        19             MR. KLAYMAN:  You can answer if

        20   you've ever talk to the White House, anybody

        21   in the White House.

        22             MS. WEISMANN:  I will direct him to


         1   what he can answer.

         2             You can answer to the extent that

         3   you have information in response to his

         4   question concerning the release of

         5   information about Linda Tripp.  To the extent

         6   that that subject matter has been part of the

         7   discussions you've had in response to his

         8   question, you may answer.  To the extent that

         9   the subject matter is something other than

        10   that, you are directed not to answer.

        11             THE WITNESS:  I have not discussed

        12   Linda Tripp with the White House Press

        13   Office.

        14             BY MR. KLAYMAN:

        15        Q    Have you discussed Linda Tripp with

        16   anyone at the White House?

        17        A    Not that I can recall.

        18        Q    Well, does that mean yes or no?

        19        A    I don't believe that I have.

        20        Q    But you're not sure?

        21        A    I'm 99 percent sure.

        22        Q    Have you ever discussed Monica


         1   Lewinsky with anyone at the White House?

         2             MS. WEISMANN:  I object to the

         3   question as calling for information outside

         4   of that which he has been authorized to

         5   testify to and direct him not to answer.

         6             MR. KLAYMAN:  Certify it.  That

         7   issue is pending.  We may have a hearing

         8   later today on that.

         9             MS. WEISMANN:  Counsel, if you have

        10   any information from the Court, I'll ask that

        11   you share it with all the counsels here

        12   present.

        13             MR. KLAYMAN:  Well, all the

        14   information I have is that we filed a motion

        15   and we requested a hearing.

        16             MS. WEISMANN:  Have you heard back

        17   from the Court, counsel?

        18             MR. KLAYMAN:  No, we have not.

        19   It's my understanding that Judge Lambert will

        20   not be coming into the office until 2 p.m.,

        21   so we have requested a hearing if that's what

        22   the Court decides to do after 2 p.m.  That's


         1   the information I have.

         2             In addition, we obviously do take

         3   issue with the fact that we were not provided

         4   with these instructions until about 2:30

         5   yesterday afternoon after we had asked for a

         6   response from the Department of Defense and

         7   from the Clinton Justice Department by close

         8   of business on Wednesday, the 13th of May.

         9   We view this as yet another way to try to

        10   back these issues up against the wall right

        11   up against the deposition.

        12             It's very similar conduct to what

        13   occurred with trying to get Mr. Bernath to

        14   testify timely, but we'll leave that for the

        15   hearing.

        16             MR. MURPHY:  Is there a question

        17   pending?

        18             MR. KLAYMAN:  Yes.  You're

        19   instructing him not to answer on the Lewinsky

        20   question?

        21             MS. WEISMANN:  That is correct.

        22             MR. KLAYMAN:  We'll come back to


         1   the issue of Linda Tripp and communications

         2   with the White House, but for right now tell

         3   me what, if anything else, did Secretary

         4   Perry tell you about the type of person he

         5   wanted.

         6             THE WITNESS:  I think I have

         7   basically given you my recollection of the

         8   conversation.  The bulk of the conversation

         9   was his description of what he thought to be

        10   his public affairs challenges, what his goals

        11   were and what he was looking for, and he

        12   asked me if I thought I could meet those

        13   challenges.

        14             BY MR. KLAYMAN:

        15        Q    What did he tell you that the

        16   conditions of the job were such that it could

        17   be done successfully?  That was another major

        18   area that you said was discussed with

        19   Secretary Perry.

        20        A    He basically said that to do this

        21   job well a person has to get into the head of

        22   four people and he named the four people.


         1   Then he said well, basically, since we tend

         2   to all agree, you probably only have to get

         3   into the head of one or two of us.

         4        Q    Who are the four people?

         5        A    The four people were the Secretary

         6   of Defense, the Deputy Secretary of Defense,

         7   the Chairman of the Joint Chiefs of Staff,

         8   and the Vice Chairman of the Joint Chiefs of

         9   Staff.

        10        Q    Who are these people at the time

        11   that Linda Tripp's information from her

        12   personnel file were released?  Who were in

        13   those positions?

        14        A    The people in those positions then

        15   were Secretary Cohen, Deputy Secretary Henry,

        16   Chairman Shelton and Vice Chairman Ralston.

        17        Q    During the meeting with Secretary

        18   Perry, I take it you told him --

        19        A    I must tell you, sir, that I don't

        20   see the relevance, however, of that question

        21   to the previous question.

        22        Q    There doesn't have to be relevance


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