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Judge Rules In LaRouche Case

April 29, 1986

NEWARK, N.J. (AP) _ A bank that sued organizations connected with political extremist Lyndon H. LaRouche failed to show it was harmed by posters distributed by his supporters, a judge has ruled.

But U.S. District Judge Harold A. Ackerman also said Monday he would reserve decision on the lawsuit by the First Fidelity Bank N.A. alleging that the posters defamed the bank and Chairman Robert R. Ferguson Jr.

The bank has said it lost more than $550,000 from two accounts opened by groups connected to the LaRouche organization.

Ackerman ruled that the bank did not show exactly how it suffered, as the law requires.

First Fidelity said the losses occurred when people told the bank they never made campaign contributions or donated less than the campaign billed their credit card accounts.

The bank then ended the credit card arrangements and placed $200,000 from the accounts in escrow. The LaRouche campaign sued First Fidelity in 1984 over the actions and began distributing posters that the bank, in its countersuit, claimed were defamatory.

The bank had one account each for The LaRouche Campaign and Independent Democrats for LaRouche. LaRouche has run for president three times and is expected to run again in 1988.

First Fidelity said in court papers that it ended the credit transactions and placed the $200,000 in escrow after the number and volume of credit card transactions involving the accounts increased dramatically and ″exceeded tolerable limits.″

The bank also said it had been informed by the FBI that the bank’s records may be subpoenaed in connection with an investigation into the organization’s fund-raising practices, First Fidelity said in the court papers.

Bank attorney Albert Besser said outside court Monday that credit card holders had questioned alleged contributions and loans of nearly $1 million.

When they received their credit card statements, he said, the customers said they had contributed less than the amount noted or nothing at all. In other cases, he continued, the card holders said they had made a loan, not a donation, to the organization.

After the credit card arrangement was halted, the LaRouche organization embarked on a poster campaign that accused the bank of ″grand larceny″ and of using the organization’s money at its own discretion.

The posters, which LaRouche attorneys said on Monday were written by the Independent Democrats for LaRouche, included a mock ″wanted″ poster with Ferguson’s face.

Arthur D’Italia, an attorney for the IDL, said the posters were ″an obvious lampoon,″ and it was unlikely that anyone viewing the ″wanted″ poster would conclude Ferguson was sought by authorities.

Attorney Joel Reinfeld said The LaRouche Campaign was not responsible for the posters. But Besser said both groups were sued because the bank believes both played a role.