The work atmosphere at Sinclair following the CEO's arrest also deteriorated. "Let's just say the arrest of the CEO was part of a sexual atmosphere that trickled down to different levels in the company. There was an improper work environment. I think that because of what he did there was a feeling that everything was fair game," says Canipe, who says she chose to leave Sinclair in 1998. She says that she once complained to management about another Sinclair employee, who had engaged in audible phone sex inside a station conference room, but that no action was taken against the employee. A Sinclair spokesman did not return calls seeking comment.

Most upsetting to Canipe was the deal Smith struck with the Maryland state's attorney, which allowed him to perform his community service by having his station air reports on the Baltimore drug court. "A Baltimore judge called me up," she recalls. "He wasn't handling the case, but he called to tell me about the arrangement and asked me if I knew about it. The judge was outraged. He said, 'How can employees do community service for their boss?'"

Smith, she says, "had a script written up [acknowledging his arrest] and made the anchor read it for him on the air. I asked the anchor why she was reading it, and she said she didn't feel like she had any choice."

Questions about Sinclair executives' public behavior extend beyond Smith's prostitution arrest and the "Stolen Honor" controversy. Last week, WBAL-TV in Baltimore reported that Frederick Smith, David's brother and a Sinclair vice president, owns a Maryland trailer park that's being sued for discriminating against African-Americans. Over the past year Baltimore Neighborhoods Inc., a housing advocacy group, sent test applicants to Smith's property to inquire about possible rentals. A BNI representative told WBAL, "When the black person went in, they were told every time that nothing was available, regarding either a trailer or a slab to put the trailer on. On every occasion that a white person went in and [tried] to ask for the same availability of properties, they were given some listing of properties and more or less encouraged to apply."

Citing "blatant discrimination," BNI filed a lawsuit against Smith, alleging violations of the 1968 Fair Housing Act. Smith's attorney declined to comment to WBAL for its report about the lawsuit.

Sherwood's career is also checkered by questionable professional behavior and squandered reputation. A former Marine and Vietnam vet, Sherwood won a Pulitzer Prize in 1980 for his work at Gannett investigating financial donations to an order of Catholic priests. He was then hired by WDVM in Washington (now WUSA), and on Nov. 7, 1983, one year after the Vietnam Memorial was dedicated, he began a four-part series called "Vietnam Memorial: A Broken Promise?" -- in which he "raised serious questions regarding the financial propriety" of the Vietnam Veterans Memorial Fund, a private organization that raised $9 million to build the wall. Sherwood reported that only $2.6 million had been spent and wanted to know where the rest of the money was.

Those connected with the fund saw a clear agenda behind Sherwood's reporting. "During the development of the memorial there were a group of veterans who didn't like it, and they raised a lot of objections," recalls Doubek. "They wanted something that would say the war was right. They wanted a memorial that was tall and white. They said the design looked like a wailing wall. Eventually we were able to outflank them."

Resentment lingered, however, and that anger came through in Sherwood's reports about the Memorial Fund's finances, says Doubek. "There was a clear agenda because the people Sherwood interviewed were the same people who tried to stop us from building the memorial." (In a sworn statement sent to WDVM on the eve of the series, one Vietnam vet claimed he had conversations with Sherwood in which the reporter referred to the memorial as the "liberal memorial" and a "black gash." Sherwood denied ever saying that.) Sherwood could not be reached for comment.

At the time, several Republican members of Congress, expressing their "great concern" over impropriety at the Memorial Fund, asked the General Accounting Office to examine its records. One of the key critics was Rep. Tom Ridge, R-Pa., who later became governor of Pennsylvania and is currently director of homeland security. "Ridge just hated the wall," recalls Doubek. During the Memorial Fund controversy, Sherwood and Ridge became friends. According to a former staffer to a Republican senator, Sherwood prompted Ridge and the other Republican congressmen to attack the Memorial Fund.

In the 1990s, Sherwood was hired to head up Pennsylvania's video production agency. Ridge introduced Sherwood to President Bush in the summer of 2001. Sherwood now says he has no ties to the Republican Party.

In its 1984 audit the GAO dismissed every charge raised by Sherwood. WDVM's subsequent retraction was dramatic and unequivocal. "To officially set the record straight," station news director Dave Pearce told viewers on the night of Nov. 7, 1984, "we would like to correct any impression left from our broadcasts last November that the Memorial Fund or its officers have done anything improper. We regret any harm that may have been caused to the Memorial Fund and its officers. The evidence indicates they performed a great public service."

He continued: "The GAO investigation turned up no evidence which supported the statement made in our series. In addition, our own internal investigation into the story has turned up no evidence to support the charges made during last year's reports."

Despite the station's public rejection of Sherwood's work, he stood by his reporting, telling a reporter at the time, "I do not apologize. I do not retract anything that was aired." A New York Times article in 1984 about Sherwood's newsroom fiasco was headlined "Reporter's Project Ruins His Career."

Now, with "Stolen Honor," he's been given another chance, thanks to David Smith and Sinclair.

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