A federal judge yesterday dismissed the tax evasion charges brought by the independent counsel Mr Kenneth Starr against Mr Webster Hubbell, an old friend of President Bill Clinton and Mrs Hillary Rodham Clinton.
In a major setback for Mr Starr, the judge also dismissed the tax charges he had brought against Mr Hubbell's wife, Suzanna, his attorney, Mr Charles Owen, and accountant, Mr Michael Schaufele.
US District Judge James Robertson wrote in the 36-page ruling that the charges in the indictment "neither relate to nor arise out of" Mr Starr's original jurisdiction to investigate the failed Whitewater land deal in Arkansas involving the Clintons.
Therefore the indictment was "outside the jurisdiction" of the independent counsel, he concluded.
Second, the judge, who was appointed to the federal bench by Mr Clinton, said Mr Starr improperly built his case against Mr Hubbell by using financial and tax records which he had been forced to turn over under a grant of limited immunity.
On Tuesday a grand jury investigating the White House sex scandal heard from Ms Linda Tripp, the woman who triggered the inquiry by taping Ms Monica Lewinsky's talk of alleged intimacies with President Clinton.
Ms Tripp looked drawn and tired as she left the federal courthouse where the grand jury is meeting. Her lawyer said she would return today for further questioning.
As Ms Tripp was giving her closed-door testimony in Washington, a federal judge in Little Rock, Arkansas, ordered the release of previously sealed depositions and files in Ms Paula Jones's sexual harassment lawsuit against Mr Clinton.
The Jones case was dismissed in April.
Mr Starr is investigating if Mr Clinton had sex with Ms Lewinsky, lied about it under oath to lawyers and, with the help of his friend Mr Vernon Jordan, got Ms Lewinsky to join in the cover-up.