Tuesday, January 31, 2017

Paxton's Buddies Are Trying to Hamstring His Prosecution For Felony Fraud

Posted By on Tue, Jan 31, 2017 at 10:50 AM

click to enlarge Texas Attorney General Ken Paxton was booked on felony fraud charges in 2015.
  • Texas Attorney General Ken Paxton was booked on felony fraud charges in 2015.
Texas Attorney General Ken Paxton sure has some loyal friends. Not only have the scandal-prone AG's supporters helped bankroll his defense against felony securities fraud charges, they've even sued to strip funding away from the prosecutors handling his case.

And on Monday, they scored a significant victory when the state's 5th Court of Appeals stepped in to block officials from paying the three prosecutors on the case, a move that could hamstring the prosecution and potentially even delay Paxton's May 1 trial, as the Austin-American Statesman reports.

Monday's court order, in response to yet another lawsuit filed by Paxton donor Jeffory Blackard, came just before Collin County commissioners were set to discuss a $200,000 invoice submitted by the three Houston lawyers appointed to handle the case. (The county picked three private defense attorneys from Houston to be so-called "special prosecutors" after the local DA, a longtime friend and sometimes business associate of Paxton's, had to recuse himself.)

When the county hired the special prosecutors, it promised a rate of $300 an hour, and as of this month they've billed roughly half a millions dollars for about a year's worth of work. Blackard's crusade, by comparison, has so far cost Collin County taxpayers more than $106,000 in attorney fees and court costs, according to the American-Statesman.

Blackard first tried to block payment to the prosecutors on the case in December 2015, arguing that local rules cap prosecutors' pretrial fees at just a few thousand dollars. While his first case was thrown out of court earlier this month, he quickly filed a new lawsuit against the prosecutors and six county officials. As the Dallas Morning News reports, Blackard's attorney has vowed to "continue to pursue his claim until some Texas court agrees to take it up."

The charges against Paxton allege that he duped a state lawmaker (Corsicana Republican State Rep. Byron Cook) and another investor into dumping money into a North Texas tech company called Servergy Inc. Prosecutors claim Paxton convinced Cook and the other businessman to invest hundreds of thousands of dollars in Servergy without disclosing that he himself was being paid by the company to do so, in violation of state securities laws. The U.S. Securities and Exchange Commission meanwhile has also filed a civil case against Paxton. (The SEC has also accused Servergy of lying to its investors; falsely claiming its data servers had already been sold to huge companies like Amazon and Freescale, when that wasn't true; and of lying about the very servers it was hawking, falsely claiming they required 80 percent less cooling, energy and space than others on the market.)

Throughout his defense, Paxton's team has worked to steer the narrative away from the actual charges against him, not just by challenging the fees paid to lawyers brought in to prosecute the case (his defense attorneys made a similar plea to strip funding from prosecutors before Blackard's lawsuit was filed). The defense team has also claimed politics to be the driving force behind Paxton's legal woes — a curious theory, especially when you consider that Paxton’s criminal case ended up in his home turf, the GOP enclave of Collin County, or that it was a Republican judge who appointed the special prosecutors on the case (one of whom helped overturn former House Majority Leader Tom DeLay’s conspiracy and money-laundering convictions). Paxton's defense team has even gone so far as to call the Republican judge who oversaw the the grand jury that indicted Paxton “vindictive,” practically accusing him of criminal misconduct in his handling of the case. Almost every judge on each appeals court that refused to toss the charges against Paxton is a Republican.

Still, in other court filings, Paxton's team has blamed his legal troubles on GOP infighting. Indeed, Rep. Cook, one of Paxton's alleged victims, has been an irritant to the Paxton-loving hard-right wing of the Texas Republican party since at least the 2009 legislative session (Cook not only helped defeat Paxton's bid for House Speaker when he was still a state representative, but he also backed Paxton's more moderate opponent in the GOP primary for Attorney General).

Dave Feldman, the attorney representing the three special prosecutors assigned to Paxton's case, told the American-Statesman that Blackard is "a rich stalking horse" for the AG, whose supporters are "trying to starve the beast." He told the paper that the appeals court should make a final ruling on the payment issue before the end of February.


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