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Jacobson and Cowan (D) were indicted by a federal grand jury for fraudulent misapplication of funds of a federally insured savings and loan. The case was set for trial and Jacobson made a sweetheart deal to testify for the Special Prosecution Force under the Watergate scandal. Part of the deal was that Jacobson would not be prosecuted in Texas for his misapplication of funds charges. In accordance with Jacobson's plea agreement with the Watergate Special Prosecution Force, the indictment in Texas was motioned to be dismissed under Rule 48(a). D also made a plea agreement, and all charges against both Ds were motioned for dismissal. The trial court denied the motion and appointed a special prosecutor, and the government appealed.

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