A state judge has refused to dismiss the theft case against the wife of state Sen. Fred Hemmings, but said it was a close call and encouraged Hemmings' lawyer to appeal the decision.

Lydia Hemmings was indicted in May 2009 on three counts of stealing funds from Blueprint For Change, a charity she headed in 2005.

The theft indictment was obtained by the state attorney general's office a day before the statute of limitations, barring filing of the charges, would have taken effect. Defense lawyer Howard Luke argued in motions that the deadline actually had expired and that the state's long delay in bringing the charges has prejudiced his client's rights to a fair trial.

Circuit Judge Glenn Kim yesterday denied the motions but encouraged Luke to file an interlocutory appeal, which would delay the start of the criminal trial well past its currently scheduled start date later this year.

Kim ruled that the wording of the indictment specifying when the alleged thefts were discovered barely met legal requirements set by the Hawai'i Supreme Court in a 2006 decision on the statute of limitations issue.

But he told Luke that if the defense wants to appeal the ruling, "I'm strongly inclined to let you do it."

"I don't know what an appellate court will do with that," Kim continued.

Luke said he would have to consult with Hemmings before deciding on whether to appeal.

The attorney general's office first received evidence in the case in 2006 but the lead investigator assigned to the matter left the office six months later and his investigative files were in disarray, according to court testimony.

Subsequent investigators had to rebuild the files and also were assigned to other cases and duties in the office, Deputy Attorney General Lance Goto said in explaining why the investigation lasted three years.

Luke argued that the investigation took far too long.

"There are three (criminal) counts and those three counts are not that complicated," Luke said.

"This is not a case that should have taken anywhere near (this) amount of time."

But Kim agreed with Goto's arguments that the length of the investigation was justified.

"This thing wasn't just back-burnered and forgotten about," Kim said. "I'm persuaded that they did the best they could in this case."

Lydia Hemmings was convicted of forgery and theft offenses here in 1991, crimes that Fred Hemmings said she committed when she was battling alcoholism. He and the defendant married six years ago.

Fred Hemmings, R−25th (Kailua, Waimanalo, Hawai'i Kai), is retiring from office this year.