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Friday, May 17, 2024 | Back issues
Courthouse News Service Courthouse News Service

Felony Case Against Texas Attorney General Grinds On

McKINNEY, Texas (CN) - By 3-2 vote Monday a Texas county commission approved paying special prosecutors $254,000 in legal fees for the felony securities fraud case against Texas Attorney General Ken Paxton.

The Collin County Commissioners Court approved the payments one week after presiding Tarrant County District Judge George Gallagher approved the $300 per hour rate the prosecutors negotiated last year and ordered the county to pay.

Collin County Judge Keith Self questioned the need for the expensive "gold-plated justice," the Dallas Morning News reported. Self said the county has "little discretion" over the judge's order and urged the special prosecutors - private attorneys Kent Schaffer, Brian Wice and Nicole DeBorde - to resign, so a nearby district attorney's office can be appointed to take over. The replacement prosecutors would then draw their normal salaries. Dallas County District Attorney Susan Hawk had declined to investigate Paxton before he was indicted in Collin County.

Collin County's rules limit first-degree felony attorneys' fees to a $1,000 flat fee and an additional $1,000 per day during trial, with payment withheld until the case is over.

The vote came two weeks after a proposed class action was filed against Gallagher, the commissioners court and county Auditor Jeff May. That lawsuit, in Collin County Court, claims the special prosecutors seek " expenditure of public funds that would unlawfully serve to enrich private attorneys at the expense of taxpayers in Collin County. It claims the special prosecutors are limited to what court-appointed attorneys for the indigent are paid under the Texas Fair Defense Act.

"Defendant Judge Gallagher has discretion to adjust the payment in an amount not to exceed $1,000.00, but that payment is a '[per] case adjustment' and cannot occur until disposition of the case," plaintiff Jeffory Blackard said in the complaint. "For these reasons, the payment sought by the Attorneys Pro Tem violates Local Rule 4.01 and Tex. Code Crim. Proc. §§ 2.07 and 26.05. It seeks an illegal expenditure of taxpayer funds."

A Collin County grand jury in August 2015 charged Paxton with two first-degree felony counts of securities fraud and a third-degree felony count of failing to register with the Texas State Securities Board. If convicted of all charges, he could be sentenced to up to life in prison.'

Paxton is accused of fraudulently selling more than $100,000 in Servergy stock to two investors in July 2011 without disclosing that he would be paid commissions on it. He also failed to disclose that he had been given 100,000 shares in the company but had not invested in the company himself, according to the indictment.

Judge Gallagher denied 10 dismissal motions from Paxton's defense attorneys in December, paving the way for trial. He was not persuaded by arguments that the charges are unconstitutionally vague or that state District Judge Chris Oldner improperly impaneled the grand jury before recusing himself. Paxton has appealed.

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