LOS ANGELES – A lawyer for Senator Clinton urged a California state appeals court Friday to give the senator a second chance to end her involvement in a politically nettlesome lawsuit stemming from a star-studded and star-crossed fund-raising gala for her 2000 Senate bid.

During the hour-long hearing, Mrs. Clinton’s attorney, David Kendall, asked a three-judge panel to order a lower court to reconsider its denial of the senator’s motion to dismiss the case under a California law that allows certain suits involving political campaigns or matters of public controversy to be terminated at an early stage.

“We respectfully submit that the court was in error here,” Mr. Kendall said.

The lawsuit was originally filed in 2001 by an Internet entrepreneur, Peter Paul, who alleged that President Clinton reneged on a deal to work for Paul’s companies, Stan Lee Media and Mondo English, after leaving office. Paul claimed that as part of the deal, he agreed to provide Mr. Clinton with $10 million in stock, $5 million in cash, and a $1 million donation to the president’s foundation, and to pay more than $500,000 to underwrite the costs of a fund-raising concert for Mrs. Clinton that was held in August 2000.

Due to an apparent breakdown in vetting procedures, the Clintons and their aides were unaware that, in the 1970s and 1980s, Paul was convicted of three federal felonies, including drug and fraud charges. Those facts emerged in the press a few days after the gala, causing embarrassment to Mrs. Clinton’s campaign.

The disclosure apparently led to a federal investigation. In 2003, Mrs. Clinton’s national finance director, David Rosen, was indicted on charges that he understated the costs of the August 2000 gala, which took place on a 112-acre estate in the Brentwood hills. In May, Mr. Rosen was acquitted of all charges following a three-week trial in federal court in Los Angeles.

Mrs. Clinton was not called to testify at Mr. Rosen’s trial and has never publicly offered a detailed account of her involvement with the gala or Paul. The lawyer who represented Paul at Friday’s hearing, Gary Kreep, said Mrs. Clinton’s lawyers want to stymie the lawsuit in order to spare her the awkwardness of having to give a deposition in the case as her re-election campaign gears up.

Mrs. Clinton’s appeal relates to a failed attempt her lawyers made last year to have Paul’s lawsuit against the senator and her campaign committee thrown out under California’s so-called anti-Slapp law, which takes its name from the phrase “strategic lawsuits against public participation.” In September 2004, Judge Aurelio Munoz denied Mrs. Clinton’s request, ruling that her attorneys did not comply with certain deadlines in the law.

“What we’re dealing with is hyper-technicalities on both sides,” the presiding appeals court judge, Dennis Perluss, said at Friday’s hearing.

Judge Perluss said it was clear that the lower court misread one aspect of the law. “Judge Munoz got the statute wrong,” Judge Perluss said. He added that it was less clear whether the error was significant because Mrs. Clinton’s motion may have come too late even if the trial judge had read the law properly.

Mr. Kendall said the delay in seeking a hearing was an attempt to allow Judge Munoz, who was scheduled for back surgery, to decide the matter. “You don’t just want to schlep in and get the first judge you can,” Mrs. Clinton’s lawyer said.

Judge Perluss did not seem impressed with that argument. “The work in that department didn’t stop,” the judge said.

In addition, the motion was not received at first by other lawyers in the case, a scenario Mr. Kendall described as “the post office ate our homework.”

It is unclear why the senator’s attorneys waited so long to make their request of the judge, though they had another routine motion pending to dismiss the lawsuit on other grounds. Mr. Kendall declined to be interviewed for this story.

Mr. Kreep told the court that the delay was a deliberate effort by Mrs. Clinton’s lawyers to get the issue decided by Judge Munoz, who earlier dismissed Mr. Rosen from the case in response to a similar motion. “They probably wanted Munoz to hear it,” said Mr. Kreep, the executive director of a conservative legal group, the United States Justice Foundation.

The majority of yesterday’s hearing was devoted to arguments between Mr. Kreep and an attorney for Mr. Rosen about Judge Munoz’s decision to let the political fund-raiser out of the case.

Paul has asserted that the main go-between for his deal with Mr. Clinton was a Chicago businessman, James Levin, who is also named as a defendant in the lawsuit. Earlier this year, Mr. Levin agreed to plead guilty to charges stemming from an investigation into bribery and minority contracting fraud at the Chicago Public Schools.

In March, Paul agreed to plead guilty to a federal stock fraud charge connected to the demise of Stan Lee Media. Yesterday, one of the appeals court judges, Earl Johnson, made mention of the fact that Paul left for Brazil as the company ran aground. Paul, who is awaiting sentencing on the securities charge, has denied that he fled to avoid prosecution.

The New York Sun was the only news organization that attended the arguments Friday, but about a dozen law students from an appellate advocacy class at the University of California at Los Angeles made a special visit to see the Clinton case. Some said they enjoyed the spectacle of Mr. Kendall, a prominent Washington attorney who has handled such weighty matters as Mr. Clinton’s impeachment, arguing over filing deadlines and mailing mishaps.

Mrs. Clinton was on a three-day fund raising swing through Los Angeles on Friday, but was not present at the hearing.