Oyster Companies Demand Millions From State Board

GALVESTON, Texas (CN) – Two oyster fishing companies have taken a Texas navigation board to federal court for granting of an exclusive oyster fishing lease to a competitor, which a Galveston County judge nullified in September.

Hannah Reef and Shrimps R Us claim the Chambers-Liberty Counties Navigation District knew it did not have authority to grant the lease to Sustainable Texas Oyster Resource Management (STORM), an organization headed by Tracy Woody, who is president of Jerri’s Seafood in Smith Point.

The now-void lease covered 23,000 acres of submerged land in Trinity and Galveston Bay, home to an oyster fishing industry that generates more than $20 million a year.

The plaintiff companies did not say in their Monday lawsuit how much money they want, but a spokesman for their law firm said it could be in the millions.

“They want to hold the members of the board personally responsible for the back-room sweetheart deals they gave to their buddies,” said Wayne Dolcefino, a consultant and media contact for Feldman & Feldman, a Houston law firm.

The companies say that before the lease was voided, STORM prevented them from getting top their oyster leases.

“Imagine that you had a garden in your back yard, and then someone comes along and tells you that you can’t plant any flowers because your garden is now theirs,” Dolcefino said.

Hannah Reef and Shrimps R Us first sued in April 2015, saying the navigation district had violated open meetings laws before granting the lease, which it did not have the authority to grant.

At least one state official agreed.

“State law is very clear,” Lance Robinson, deputy director of the state parks and wildlife’s costal fisheries division told Courthouse News in a 2015 interview. “This was not a normal lease for the navigation district to give.”

The fishing companies called the lease a land grab at state-controlled resources. In the new lawsuit, they say the board chose not to adequately publicize discussions about the lease, and gave preferential treatment to STORM by not submitting the lease to a public bid.

“Not surprisingly, the audiotape of this meeting [at which the lease was approved] shows that there was no actual deliberation as to the approval of the lease,” the complaint states.

“Altogether, the lease was approved in less than three minutes, amidst laughter from the commissioners.”

Galveston County Judge Lonnie Cox sided with Hannah Reef and Shrimps R Us in September, granting them summary judgment and voiding the lease, as only the state can issue leases for oyster fishing. Cox also dismissed with prejudice STORM’s counterclaims for trespass and conversion.

The oyster companies seek damages for deprivation of the property interests they held on their pre-existing leases from the board itself and from its members: Terry Haltom, Ken Coleman, Ken Mitchell, Dave Wilcox and Allen Herrington, a former member.

The navigation board is represented by the Lloyd Gosselink in Austin. The board declined to comment for this article, and their attorney did not return calls for comment.

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