Imagine a big, big case in which prosecutors in the proudest U.S. attorney’s office in the land are presented in midtrial with strong evidence of perjury by their star witness.

Imagine the witness then privately admitting to the prosecutors that he has just told a false cover story and offering them a revised story so preposterous that a child could see through it.

Imagine the prosecutors putting the witness back on the stand to tell this story while omitting the details most devastating to its plausibility. Imagine them persuading the rabidly pro-prosecution judge to bar the defense from putting before the jury records that conclusively proved the witness’s perjury. Imagine them vouching for the witness’s truthfulness in their summations.

That is essentially what Assistant U.S. Attorneys Baruch Weiss and Elliott Jacobson of the Southern District of New York did three years ago-with what Weiss claims was high-level approval-to convict E. Robert Wallach (former Attorney General Edwin Meese III’s close friend) on charges involving the Wedtech Corp.

And that is what prompted the U.S. Court of Appeals for the 2nd Circuit last year to overturn Wallach’s conviction as tainted, holding that "the prosecutors may have consciously avoided recognizing the obvious"-that former Wedtech official Anthony Guariglia was lying about his gambling activities.

But it didn’t end there. Now Weiss and Jacobson are pressing with self-righteous zeal to try Wallach again. And despite-or perhaps because of-the questions this case raises about the institutional integrity of his office, U.S. Attorney Otto Obermaier defends the handling of Guariglia as "fully consistent with the high ethical standards I expect" and the reprosecution of Wallach as "the right thing to do."

The prosecution has the full support of U.S. District Judge Richard Owen, a former prosecutor who ran Wallach’s first trial like a grotesque kangaroo court. (See my "Wallach Appeals From Rampant ‘Rudyism,’ "Nov. 5, 1990, Page 31. ) The judge seems to be itching for another crack at him.

Only the 2nd Circuit or the Supreme Court can stop the juggernaut now bearing down on Wallach, a San Francisco lawyer who traded shamelessly on his friendship with Meese, but who does not deserve to be crushed under the wheels of successive federal prosecutions.

So eager is Judge Owen to get on with it that he has jet a Sept. 14 trial date and has seized upon the prosecution’s suggestion that he cut off Wallach’s right to pretrial appellate review of the defense claim that a retrial would amount to double jeopardy, by dismissing it as ”frivolous.”

Far from frivolous, the double-jeopardy claim is based on a novel but compelling contention that may well attract the interest of the Supreme Court:

When the prosecution gets a conviction by knowingly sponsoring perjured testimony, the exposure of which would probably have led to an acquittal, not only should the conviction be reversed, but further prosecution should be barred-as it would be if the prosecution had done its duty by disclosing the perjury to the jury.

A retrial of Wallach would let the government "benefit from the prosecutors’ failure to disclose Guariglia’s perjury to Wallach’s jury," as defense attorney Robert Giuffra has told Judge Owen. This follows from the 2nd Circuit’s holding last year that "had the jury been aware of Guariglia’s perjury it probably would have acquitted" Wallach.

Now the defense team, headed by Robert Bork and working pro bono (Wallach being broke), has expanded Giuffra’s argument into a powerfully reasoned brief in the 2nd Circuit.

The force of Wallach’s double-jeopardy claim, and the seriousness of the cloud this case casts over the U.S. attorney’s office, can only be appreciated in light of the detailed trial chronology on the perjury question.

The essence of the prosecution’s case was that Wallach had (1) defrauded Wedtech (at the request of its management) by sending two letters to Guariglia falsely describing what he, Wallach, had done to earn payments of $ 125,000 and $300,000 from Wedtech, enabling the company to inflate its profits for the year and conceal his (concededly legal) lobbying of Meese; and (2) conspired with Guariglia and others to violate a federal conflict-of-interest law by taking the $300,000 as a prepayment to lobby for Wedtech from inside the government as soon as he could get a high-level job (which he never got nor had much chance of getting).

Guariglia’s testimony against Wallach was critical to the government’s case. His testimony about gambling was relevant in one critical particular: Guariglia’s credibility, already suspect given his history as a colossal crook who had looted Wedtech and then fingered Wallach to get himself a sweetheart deal, could have been obliterated had the prosecution been forced to tell the jurors that he had lied (even about a collateral matter) right there at Wallach’s trial.

Prosecutor Weiss first raised Guariglia’s history of compulsive gambling (with other people’s money) in an effort to pre-empt defense attacks. To show that the one-time crook had lately become the prosecution’s truthful servant, Weiss got Guariglia to testify that he had stopped gambling, on the prosecution’s orders, by the summer of 1988.

The defense knocked a big hole in this assertion by introducing records from Atlantic City’s Tropicana Casino. They showed that Guariglia had bought $15,000 in chips on Sept. 18, 1988, and $50,000 worth on Oct. 26, 1988, borrowing the $65,000 from the casino by signing IOUs called "markers." Guariglia’s explanation on cross-examination was that "I did not gamble," but rather used most of these IOUs to pay off old IOUs to the casino.

This was absurd on its face; as Weiss soon confirmed by checking with the casino, it did not take IOUs as payment for IOUs. When Weiss privately told his witness about this little problem, Guariglia admitted the falsity and completely changed his story.

He told Weiss (and testified on redirect) that rather than paying off old markers with new ones, on the first occasion, Sept. 18, he had exchanged the chips for $15,000 in cash, which he pocketed and took home, and on the second, Oct. 26, he had given the $50,000 in chips to a friend, Marshall Koplitz, in payment of old debts.

Guariglia also made a devastating admission to Weiss: that in October, "I may have played Koplitz’s hand, but it was Koplitz’s money after I gave it to him. He was the one who gambled.”

Weiss says he credited this preposterous yarn, for which he claims Koplitz and another Guariglia gambling buddy vouched. But would the jury believe a compulsive gambler who admits buying $50,000 in chips, and sitting at gaming tables, and playing cards, and losing chips, but says he wasn’t gambling because the chips weren’t his?

Fat chance. So Weiss made sure that neither jurors, nor judge, nor defense counsel would hear the part about Guariglia playing Koplitz’s hand.

Rather, on redirect, Weiss elicited the Koplitz story and another flat denial that he, Guariglia, had gambled. And on recross, Weiss let Guariglia deny-contrary to what he had told Weiss-that he had ever laid a chip on the table that night.

It gets worse.

Wallach’s lawyers had obtained-and shared with the prosecution before the redirect-more casino records that recorded Guariglia as having gambled at several different tables on both occasions in September and October 1988, after buying the chips. These records showed when he sat down at tables and when he left, the sizes of his average bets, and his Josses, adding up to $13,000 in September and more than $40,000 in October.

If a smoking gun was needed, this was certainly it. Even in the unlikely event that the chips Guariglia bought and lost in October belonged to Koplitz, the gambling records belied the story that in September Guariglia had cashed in his chips without gambling.

Instead of disclosing their witness’s perjury, the prosecutors got the ever accommodating Judge Owen to bar the defense from telling the jury about the gambling records that proved the lie, by excluding them as "collateral" evidence.

And in their closing arguments, Weiss and Jacobson both touted Guariglia’s truthfulness, stressing that if he lied, "the deal is off" and they could throw the book at him for his many crimes.

But the prosecutors never did revoke Guariglia’s plea bargain. And it was not until they were confronted months later with still more proof of Guariglia’s gambling-this time in Puerto Rico-that they charged him with perjury.

Weiss has said in court papers that Louis Freeh, then deputy U.S. attorney, and Mark Hellerer, then chief of the major crimes unit-who have strong reputations for integrity-helped question Guariglia about the gambling issue and "personally approved" Weiss’ handling of it. Weiss filings imply without explicitly stating, that Freeh and Hellerer were fully informed of all relevant facts.

If so, as Bork has written, then "the act which corrupted Wallach’s -trial was…a well-considered stratagem" approved at high levels of the office-and raising grave questions about everyone involved. (Freeh, now a U.S. district judge, declined a request for comment. Hellerer, who recently left the office, could not be reached.)

This sorry tale of federal prosecutors pulling the rug over proof of perjury by their stool pigeon, with the help of a judge, cries out for further exploration. The Wallach prosecution, on the other hand, cries out for dismissal.