LEAD: DPJ kingpin Ozawa snubs calls to testify over money scandal+

TOKYO, Dec. 17 Kyodo -
(EDS: ADDING DETAILS)
Ichiro Ozawa, one of the most powerful lawmakers in Japan, rejected Friday a
request to testify before a parliamentary ethics panel over his alleged role in
falsifying a political funds report, leading to a possible showdown with Prime
Minister Naoto Kan next week, ruling party lawmakers said.
Ozawa, a kingpin in the Democratic Party of Japan, told the ruling party's
secretary general, Katsuya Okada, that he finds ''no rational reason'' to
appear before the House of Representatives political ethics panel, considering
that his case will be addressed in court.
Ozawa's steadfast refusal is widely viewed as typifying the power struggle
within the DPJ at a time when Kan, who heads the party, is faced with low
approval ratings for his six-month-old government.
''I'm disappointed,'' Kan told reporters in Uruma, Okinawa Prefecture, about
Ozawa's refusal. ''Having heard about the situation from the secretary general
it would be better if I meet with Mr. Ozawa.''
Okada told reporters after holding talks with Ozawa in the afternoon that he
will arrange a meeting between Kan and the former DPJ leader next week.
DPJ sources said their meeting may be held as early as Monday.
The DPJ leadership has been hoping that Ozawa will voluntarily testify before
the ethics panel concerning allegations involving his political funds
management body over which he will face indictment in the near future.
Okada told Ozawa on Friday that the DPJ leadership will not hesitate to begin
procedures to enable the ethics panel to adopt a resolution to summon him for
testimony if he does not appear before it voluntarily.
But their 20-minute talks ended without any progress.
Even if the panel votes to hold a hearing for Ozawa, the decision will be
nonbinding and it will still be up to him whether to attend.
Kan will try to break the deadlock, but many DPJ lawmakers believe that Ozawa
is unlikely to change his position.
Amid growing conflicts within the DPJ and with lawmakers close to Ozawa
strongly backing him, Kan could see his leadership weakened further depending
on the outcome of their talks.
Ozawa, who is credited with the DPJ's rise to power in 2009, has claimed he has
done nothing wrong and will say what he needs to say in court.
Even though he heads the biggest intraparty group, Ozawa lost to Kan in the
DPJ's presidential election in September.
==Kyodo