RWY INCURSION SMA X CROSSED HOLD LINE WITH ATX Y LNDG. MULTIPLE RWY OP INTERSECTING RWYS. SYS ERROR.

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I WAS THE GND CTLR AT MGW TWR. SMA X FROM THE FBO CALLED FOR TAXI. I ASSIGNED RWY 23 FOR TKOF (AS THE WINDS WERE 240 AT 8) WITH A 'TAXI TO' CLRNC. THIS RTE CROSSES RWY 18 AT APPROX MIDFIELD (COORD WAS COMPLETED WITH LCL CTL FOR THE RWY XING). APCH CTL CALLED AND REQUESTED TO VECTOR AN ATX Y 'IN-CLOSE' TO THE ARPT IN HOPES OF A VISUAL APCH (VISIBILITY APPROX 6 MI IN HAZE) (FLT DATA WAS COMBINED WITH MY POS). APPROX 2 MINS LATER; THE ATX Y CALLS TWR ON THE RADIO AND REQUESTS A 360 DEG TURN IN ORDER TO LOSE ALT; AS HE WAS APPROX 2000 AGL 1 MI N OF THE ARPT. I THEN CALLED APCH CTL TO ADVISE THEM OF THE 360 DEG TURN. UPON COMPLETION OF THE CALL; I THEN WATCHED ATX Y LAND AND START ROLLING OUT. MY FIRST INDICATION SOMETHING WAS WRONG WAS WHEN THE DEVELOPMENTAL ON LCL CTL STARTED YELLING 'STOP! STOP!' I THEN LOOKED IN THE DIRECTION HE WAS LOOKING AND SAW SMA X XING THE YELLOW HOLD SHORT LINES. I IMMEDIATELY ORDERED SMA X TO JUST PLAIN 'STOP!' THE PLT OF SMA X EXECUTED A PERFECT 180 DEG TURN ON A DIME; NEVER XING THE RWY EDGE LINES. ATX Y ROLLED TO A STOP PRIOR TO THE INTXN. THE PLTS OF ATX Y LATER TOLD US THAT THEY SAW SMA X AND JUDGED THAT HE WAS NOT GOING TO HOLD SHORT OF THEIR RWY AND THAT THEY USED A LITTLE EXTRA BRAKING TO STOP THEIR ROLLOUT. CAUSES? ATTN DIVERSION -- SMA X WAS MY ONLY PLANE AND ATX Y WAS LCL'S ONLY PLANE. THE 360 DEG TURN REQUIRED A COORD CALL THAT MADE ME COMPLETELY FORGET ABOUT SMA X. PERSONALLY; I WILL NEVER ISSUE A 'TAXI TO' RWY 23 FROM THIS POINT ON. SMA X TOOK A LONG TIME TO START HIS TAXI FROM THE TIME HE REQUESTED TAXI; AND I BELIEVE THAT 'HELPED' ME TO FORGET ABOUT HIM. FROM NOW ON; MY WORDS WILL BE 'RWY 23; TAXI; HOLD SHORT OF RWY 18.'