A lawsuit accusing a Bay Area flight-planning company of aiding an alleged CIA program of kidnapping and torturing terror suspects threatens national security and is too sensitive to discuss fully in a public courtroom, an Obama administration attorney argued Tuesday.

"The case cannot proceed without getting into state secrets," Justice Department lawyer Douglas Letter told an 11-judge panel of the Ninth U.S. Circuit Court of Appeals in San Francisco.

Several judges noted that most of the essential facts of the case have been widely aired - the existence of the "extraordinary rendition" program under President George W. Bush, the five plaintiffs' accounts of their abduction and torture, and the alleged participation by Jeppesen Dataplan of San Jose - and asked why the case is too sensitive for the courts to hear.

Letter said he could reply only in a closed session. For the record, he said, "the U.S. government will not confirm or deny any relationship with Jeppesen."

The court met privately with Letter after the one-hour public hearing, a practice that the plaintiffs' lawyer, Ben Wizner of the American Civil Liberties Union, described as common in cases involving government claims of secrecy.

During the public session, Wizner accused the administration of trying to cover up wrongdoing.

"The CIA has engaged in kidnapping and torture and declared its crimes state secrets," he said. Dismissing the suit without deciding whether the plaintiffs' rights were violated, he said, would be "dangerous to democracy."

Extraordinary rendition is the practice of abducting suspected terrorists and taking them to foreign countries or CIA prisons for interrogation.

The Bush administration used rendition extensively but said it always insisted on a guarantee from the foreign country that it would not torture the prisoner. President Obama has issued orders closing secret CIA prisons and barring torture, but has also endorsed Bush's arguments for dismissal of the Jeppesen case and other suits by alleged victims of torture.

CIA's air provider

Jeppesen, a Boeing Co. subsidiary, was described in a 2007 Council of Europe report as the CIA's aviation services provider. In a court declaration in the current suit, a company employee quotes a director as telling staff members in 2006 that Jeppesen handled the CIA's "torture flights."

The five plaintiffs accuse Jeppesen of arranging their flights to foreign or CIA prisons, where they say they were interrogated brutally. Two of the men are still being held in Egypt and Morocco, and the others have been released without U.S. charges.

The Bush administration won a ruling by U.S. District Judge James Ware of San Jose dismissing the suit in February 2008. A three-judge appeals court panel reinstated the suit this past April, saying that neither the CIA nor its contractors were above the law. But the full court then granted the Obama administration's request to refer the case to an 11-judge panel.

Mixed reaction

The government's argument Tuesday - that allowing the case to proceed would risk disclosure of secrets about interrogation methods and CIA operations - drew a mixed reaction from the court.

Judge Michael Hawkins, author of the April decision, noted that the Obama administration plans to try the alleged mastermind of the Sept. 11 attacks in open court and has spoken publicly about interrogation abuses.

But Chief Judge Alex Kozinski said the administration, not the courts, must decide crucial questions of secrecy.

"I understand you think it's not fair, but so what?" he told Wizner.

The plaintiffs could ask Congress to pass a special compensation bill for them without involving the courts, Kozinski said.

Congress already allows victims of torture, including foreigners, to sue for damages, the ACLU lawyer replied. "It's not a waste of judicial resources to give torture victims their day in court," he said.

The court gave no indication of when it would rule. The losing side could appeal to the Supreme Court.