WASHINGTON - A federal judge in Texas has accused the Federal Deposit Insurance Corp. of pursuing a fraud case against the chairman of Dallas' Bluebonnet Savings Bank for political reasons.

"This is simply a case of people 'seeing the light' when they 'felt the heat,'" U.S. District Judge Joe Kendall wrote late last month in an extremely detailed opinion. "The court finds the FDIC's counterclaim without merit, and pushing the envelope" of a frivolous suit.

The judge said that at the time James M. Fail applied to buy Bluebonnet, regulators knew of criminal charges against him and a company he owned. Nevertheless, the judge said, the government later pressed ahead with a fraud investigation - to appease political leaders who were furious that it had sold the thrift to Mr. Fail.

Bluebonnet president R. Brad Oates said the June 28 district court decision vindicates the bank and Mr. Fail.

"We are extremely pleased with the way the judge ruled," Mr. Oates said. "We felt all along that the (suit) shouldn't have been filed."

FDIC officials, however, took issue with the ruling.

"We disagree with the judge's decision," said Thomas A. Schulz, the agency's assistant general counsel. "We believe he got only part of the facts and based his decision on that. We believe there are other facts that support our position."

Mr. Schulz declined to disclose those facts, saying the case was still in litigation. The judge's ruling allows the bank's breach-of-contract suit against the FDIC to proceed to trial. Attorneys said they expect jury selection to start in early August.

The judge's harsh words could return to haunt the agency, said Thomas Vartanian, a partner at the Washington law firm Fried, Frank, Harris, Shriver & Jacobson.

"When you get a case like this, it gets cited in every case because it stands for the principle that from time to time the agency abuses its discretion," he said.

Bluebonnet has been a political lightning rod ever since the now defunct Federal Savings and Loan Insurance Corp. sold it to Mr. Fail in 1988 at a rock-bottom price.

The deal, and similar transactions, prompted a series of congressional hearings in 1989 and 1990, and led to charges that Mr. Fail misled regulators about his past and his cash resources in order to acquire the failed Dallas thrift.

Congress, as part of the 1989 thrift bailout law, ordered the regulators to void the sale of Bluebonnet and similar deals made during FSLIC's dying days.

Before regulators could act, Bluebonnet and Mr. Fail sued them in 1991, charging that they were not providing regulatory relief as required in the contract. The FDIC countersued, claiming Mr. Fail committed fraud by not disclosing that a company he controlled pleaded guilty to fraud. The agency asked Judge Kendall to cancel the sale.

However, the judge said the Federal Home Loan Bank Board had the criminal history disclosure in three other filings Mr. Fail made. Also, the judge quoted Office of Thrift Supervision officials as saying that Mr. Fail made no effort to conceal his criminal history.

"Fail may not have highlighted the criminal history, or put it in capital letters, or in bold type, but the information was there," the judge wrote.

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