A three-judge panel of the 8th Circuit U.S. Court of Appeals agreed with a lower-court judge that Minnesota went too far when it passed its law two years ago because the state couldn't prove that such games hurt children.

The law would have hit kids under 17 with a $25 fine if they rented or bought a video game rated "M" for mature or "AO" for adults only. It also would have required stores to put up signs warning of the fines.

Game makers and retailers swiftly challenged the law, arguing it was an unconstitutional restriction of free speech. U.S. District Judge James Rosenbaum ruled in their favor in July 2006.

But the appellate opinion, written by Judge Roger l. Wollman, showed the judges weren't entirely happy about it.

"Whatever our intuitive (dare we say commonsense) feelings regarding the effect" of violent video games, precedent requires undeniable proof that such violence causes psychological dysfunction, Wollman wrote.

"The requirement of such a high level of proof may reflect a refined estrangement from reality, but apply it we must," he wrote.

In two unrelated cases, the Kentucky Bar Association is investigating alleged ethics violations by its own future president as well as another lawyer who was slated to become president of the Louisville Bar Association next year.

The two accused attorneys have responded quite differently.

Maria Fernandez, who was president-elect of the Louisville Bar Association, said in an interview that she resigned last week to avoid embarrassing the bar over a court's ruling that she charged an excessive fee in settling the estate of Claudia Sanders, the widow of the Kentucky Fried Chicken founder.

But Barbara Bonar, the KBA's president-elect, said she plans to assume the presidency of the 15,544-lawyer state organization in June, despite a judge's findings last year that she acted unethically in the priest-abuse litigation against the Roman Catholic Diocese of Covington. A judge referred those allegations to the KBA last May.

The Kentucky Court of Appeals ruled in January that Fernandez, 49, breached her duty to the estate of Sanders, who died in 1996, and may have tried to conceal her $175,000 fee, which it said could warrant her suspension from practice.

Fernandez has denied wrongdoing and asked the court to reconsider its ruling. But in an interview, she said that while she regretted having to give up the bar post, she "didn't want to embarrass the LBA."

In Bonar's case, Special Judge Robert McGinnis found last year that she committed "numerous ethical violations" by settling cases for individual sex-abuse clients while she was serving as co-counsel for a group of plaintiffs in a class-action suit against the diocese.

Lawyers in class actions are generally prohibited from settling cases for individual clients because it could reduce the pool of money available to class members.

Bonar, 54, said in an interview that she disagrees with McGinnis' findings and has appealed his ruling in a related civil case. "I haven't done anything wrong," she said.

The KBA's chief counsel, Linda Gosnell, confirmed on Tuesday that its inquiry tribunal has open investigations pending of Fernandez and Bonar.

The disclosure of those investigations is allowed under a new Supreme Court rule that permits the release of information about the status of disciplinary probes if they are prompted by a court's findings in a civil matter. Investigations previously were confidential until a lawyer was found guilty.

Lawyers who are found to violate ethics rules may be privately admonished, publicly reprimanded, suspended or disbarred.

Louisville lawyer Sheryl Snyder, a former KBA president, said that by declining the top job with the Louisville bar, "Ms. Fernandez has done a commendable thing. It will be interesting to see what happens with Ms. Bonar."

Bonar's lawyer, Bill Rambicure, did not return calls this week. But in an interview last year, he said of Bonar's future role as bar leader: "You don't want to reflect poorly on the profession. But when you believe you didn't do anything wrong, you don't want to have a knee-jerk reaction and leave."

The KBA's current president, Jane Winkler Dyche, declined to comment on whether she believes it is appropriate for a president to serve while facing pending bar charges.

The KBA's duties include hearing disciplinary charges against lawyers. Its board, including its president, hears appeals of sanctions recommended by hearing officers.

Membership in the KBA, an agency of the Kentucky Supreme Court, is mandatory. The LBA, Kentucky's oldest bar association, is a voluntary group to which about 80 percent of Louisville's lawyers belong.

A law enforcement official said Spitzer's high-powered defense team was believed to be negotiating a plea deal with prosecutors over his connection to a high-end prostitution ring, but attorneys would not comment Thursday about the discussions.

"Corruption cases often pose a dilemma for the prosecutor," said Evan Barr, a private practice lawyer who once handled such cases for the same Manhattan U.S. Attorney's Office that is now weighing how to proceed with Spitzer.

"If you charge a public figure under an obscure or rarely used legal theory, the critics will say the prosecution is politically motivated; if you decline to charge under the same circumstances, the critics will say the prosecutor is going easy on the would-be defendant because he or she is a prominent person," Barr said.

The city of Palo Alto on Wednesday lost an 11-year legal battle over whether police officers violated a man's civil rights and now faces the prospect of paying hundreds of thousands of dollars to finally settle the case.

The California Supreme Court turned down the city's request to review and overturn lower court rulings in Schmidlin vs. City of Palo Alto, the civil case in which Michael Schmidlin successfully contended police used excessive force when they arrested him March 29, 1997, on suspicion of public drunkenness.

Unless the city appeals to the U.S. Supreme Court, it could pay $24,000 plus interest to Schmidlin and at least $300,000 in legal fees to his lawyer, Mark Martel. That figure might swell to more than $500,000, said Martel, who will spend the next month or so calculating the exact cost.

City Attorney Gary Baum expressed disappointment when reached for comment Wednesday evening. "We did not feel the elements of excessive force had been met," he said. "Obviously, the (6th District) Court of Appeal and the Supreme Court disagreed with us."

The appeals court in December upheld a 2003 jury verdict against the three police officers Tim Martin, David Trujillo and Burt Milliken accused of excessive force. The officers said they believed Schmidlin was drunk and alleged he "displayed an uncooperative and resistive attitude toward complying" with their demands, according to court

MasterCard International said on Thursday it welcomed a U.S. appeals court's dismissal of an antitrust lawsuit by a group of merchants claiming that the company, Visa USA and three banks had conspired to set fees charged to businesses for credit card sales.

The ruling by the 9th U.S. Circuit Court of Appeals upholds a San Francisco federal judge's 2005 dismissal of the case led by hair salon operator Sheri Kendall and James Maser, who operated a restaurant in Alameda County.

MasterCard General Counsel Noah Hanft said in a statement that the company "welcomed" the appellate ruling on March 7.

"No U.S. court has found interchange to be illegal," he said, referring to the fees charged among card association member banks.

The plaintiffs' attorney, Richard Archer, had no comment on the ruling.

The 9th U.S. Circuit Court of Appeals ruled that the merchants had failed to present facts to support claims of a conspiracy among the credit card companies and Bank of America Corp, Wells Fargo & Co and U.S. Bancorp.

The merchants had accused the card associations of fixing prices on "merchant discount fees," which are transaction fees between merchants and banks, and interchange fees.

The court dismissed the case without leave to amend, which means the merchants cannot refile the case.

In a setback for terror victims, a French court lifted a freeze on Iranian state funds.

Victims of Iranian-sponsored attacks in Israel in 1995 and 1997 are suing Iran for compensation.

While the Paris Court of Appeal this week released the $117 million held in the Natexis Banques Populaire, it did not seek interest and court fees from the plaintiffs, their Paris-based attorney Christoph Martin Radtke told the JTA in a telephone interview.

The court told the attorneys to reapply for the Iranian funds once a decision is made on whether funds in the Iranian Central Bank may be confiscated to pay the damages in a U.S. court decision.

Federal judges in Washington ordered Iran to pay damages and interest of $87.5 million to 12 U.S. citizens injured in the two terrorist attacks in Israel. The U.S. courts determined that Iran was liable for the damages due to its sponsorship of Hamas, which orchestrated the attacks.

Radtke said the French court decided to release the Iranian funds because "the law that protects state accounts does not allow an exception for provisional seizure measures."

In January, Radtke in another Paris court sought the enforcement of the U.S. court judgments. He told JTA he hoped for a decision within a few months.

In an e-mail to the JTA, the plaintfffs' U.S.-based attorney, David Strachman of Rhode Island, said they "are really disappointed with the outcome" in the French court.

A Miami real estate appraiser has pleaded guilty to wire fraud for her involvement in the Southwest Ranches-area fraud scheme in Broward County, the office of the U.S. Attorney for the Southern District of Florida said.

Martine Yanisse Castrillon is one of 15 defendants charged with buying homes through straw buyers at an inflated price, and then getting cash back at the closings. So far, nine defendants have pleaded guilty to various federal charges in the indictment.

Castrillon admitted that she did fraudulent appraisals -- valuing the properties at the amount requested by another defendant, not the true market price -- and forged the name of the certified appraiser who was to review her work.

According to the indictment, co-defendants Lazara Villalba and Henry Quintero-Lopez would offer the owner's full asking price and then inflate the contract purchase price to allow their companies, New World International and D&H Investments of South Florida, to receive a finder's fee, assignment fee or additional funds to allegedly construct improvements to the properties. They would then recruit individuals, who, for a fee, acted as straw buyers of the properties. Villalba and a co-defendant would obtain fraudulent pay stubs, IRS documents, verification of employment and verification of deposit forms; documents would be submitted to cooperating mortgage brokers and the loans were approved to purchase the properties.

Castrillon faces a maximum of 20 years in prison on each of the wire fraud counts and a fine of up to $250,000 on each count. Sentencing is scheduled for May 22.