Trial Lawyers Pump Big Bucks
Into Obscurely Named PACS
Legal Watchdog Says Spirit of Election Laws Violated

By Jon Opelt, Houston Director
Citizens Against Lawsuit Abuse
Frustrated by earlier losses at the ballot box and in the Legislature, a handful of Texas trial lawyers are poised to be the biggest political players in the November statewide election. Meanwhile, the legal watchdog Citizens Against Lawsuit Abuse today accused the trial lawyers of “deceit” and “violating the spirit” of Texas election laws by hiding their political giving in obscurely named PACs. The group is calling for an Ethics Commission investigation.

At issue are two political action committees – the Texas 2000 PAC and the Constitutional Defense Fund. Texas 2000 was funded primarily by $200,000 each from four of the private lawyers who sued tobacco companies on behalf of the state. The Constitutional Defense Fund was funded by three of the five state tobacco lawyers.

Together the PACs amassed $1.95 million in soft money contributions during the first six months of this year – more than double what the Democratic and Republican parties raised during the same period combined , according to reports filed with the Texas Ethics Commission.

(Click graph for a better look)

The five tobacco trial lawyers have donated more than half of the funds raised by the stealth PACs.

“The public is left in the dark when PACs are able to craft their name so as to hide the driving force behind the money,” said Jon Opelt, Houston director of Citizens Against Lawsuit Abuse. “It’s a potential Trojan Horse attack on the Texas political process,” he said.

“Personal injury lawyers are camouflaging their political contributions in obscurely named PACs,” said Opelt. “But it’s like Goliath trying to fit into David’s clothes. It’s not a good fit.”

“With their money and their power the trial lawyers could be Texas’ Third Political Party – and their mascot; a Trojan Horse stuffed to the ears with nearly $2 million.”

The section of the Texas Election Code that deals with PAC names was amended in 1991. That section states: The name of a general-purpose committee must include the name of each corporation, labor organization, or other association or legal entity other than an individual that directly establishes, administers, or controls the committee. The name of an entity that is required to be included in the name of the committee may be a commonly recognized acronym by which the entity is known.
(Click here for a list of the biggest givers to the Texas 2000 PAC)

“Texas election laws require truthfulness in PAC names. The intent was to ensure honesty in disclosure,” Opelt said. “In the spirit of the Texas Election Code, the name of a political committee should reflect the actions of that committee. These PACs clearly violate the spirit of the law.”
"This amendment is truth in political action committee names. It merely says that a general/specific purpose political action committee must list in its name the corporation, organization, or association or legal entity that controls that political action committee. This is so you don't have 'good government league.' You would instead have 'good government league of the bank of whatever.' It's just truthfulness in PAC names – it ensures honesty in disclosure."

State Rep. Glen Maxey, D-Austin
Second Reading, Senate Bill 1
Floor of the Texas House
May 16, 1991

From January through June trial lawyers deposited $1.65 million in Texas 2000 and another $300,000 in the Constitutional Defense Fund. By contrast, the Republican Party of Texas raised $341,191 and the Texas Democratic Party raised $561,724 during the same period.

John Eddie Williams, Walter Umphrey, Wayne Reaud and Harold Nix – private lawyers who represented Texas in the state’s tobacco lawsuit – each contributed $200,000 to the Texas 2000 PAC.

Reaud, Williams, and fellow tobacco lawyer John O’Quinn contributed $100,000 apiece to the Constitutional Defense Fund. Since June of 1998, the Constitutional Defense Fund has raised $750,000. All of these donations have come from the Texas tobacco lawyers, Ethics Commission reports show.

This doesn’t include other soft-money contributions the lawyers have made or any of their donations to individual candidates at the state or federal level. For instance, according to a Dallas Morning News story on May 14, the five tobacco lawyers had by then given more than $2.2 million in unrestricted soft money to the Democratic Party this election.

The lawyers were awarded $3.3 billion in legal fees for representing the state in its $17.3 billion tobacco settlement.

Collectively, the five tobacco lawyers have given $3.3 million in soft-money donations-- to state and federal PACs –during the first six months of this year.

“Most of that money is expected to find its way into Texas political races in November,” said Opelt. “It is unhealthy when a handful of folks can dictate the political process.”

“If these trial lawyers are proud of their self-proclaimed role as ‘champions of the little guy,’ why do they funnel donations through obscure political action committees? Are they trying to hide their political might?” Opelt asked.

“There ought to be truth in labeling,” Opelt said. “The public has a right to know who is paying for political campaigns. The Ethics Commission should launch an investigation into the legality of these vaguely named PACs,” said Opelt.

“In the spirit of honesty and openness, we call on them to change the names of their PACs to Texas Trial Lawyer 2000 PAC and Personal Injury Lawyers’ Constitutional Defense Fund,” he said.

As the PACs dole out their contributions, Opelt said his group would continue to track the “political droppings of this Trojan Horse.”

Citizens Against Lawsuit Abuse

2500 City West Boulevard, Suite 300 • Houston, Texas 77042
E-mail: • Administrative: (713) 267-2302 • Fax: (713) 267-2267