Attorneys revealed at a Tuesday morning Harris County state District Court hearing that Texas Attorney General Ken Paxton and state prosecutors had struck an agreement to resolve his nine-year-old securities fraud allegations.
If Paxton fulfills the conditions of the 18-month pretrial intervention agreement, which were made public Tuesday morning, he will be able to leave the years-long case without facing any charges.
These conditions include doing 100 hours of community service in Collin County, enrolling in 15 hours of legal ethics training, and paying $271,000 in total restitution to investors who invested in a Dallas-area tech startup after seeing Paxton’s solicitations.
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“I am grateful to reach this agreement, to get this matter behind me, so I can get back to the work representing the State of Texas,” Paxton stated in a press release. Dan Cogdell, Paxton’s attorney, stated, “The State approached us, and General Paxton is happy to agree to the terms of the dismissal.”
“He can now resume representing the people of the State of Texas thanks to the deal. To be clear, though, he was never going to sign into a plea deal or acknowledge doing anything that just did not happen. Since Ken did not commit any violation, there is no admission of wrongdoing in the agreement.
The accusations that Paxton sought the investments without disclosing that the company, Servergy, was giving him $100,000 in company stock for each referral led to the charges, which were brought up by a Collin County grand jury in 2015.
The state was “confident a Harris County jury would have found our proof beyond a reasonable doubt,” according to special prosecutor Brian Wice, but he issued a warning that three possible results might have been reached, “and two are bad — a hung jury or not guilty.”
“This case was a perfect storm of everything that could have derailed and delayed a prosecution,” Wice said in a news conference on Tuesday morning, citing the 2020 COVID-19 pandemic and Hurricane Harvey’s destruction of Houston, which forced the courthouse to close in 2017. This is why the case took nine years to resolve.
In addition, Wice said that Paxton had filed pretrial proceedings for a full year and that earlier judges in the case “didn’t do what we pay Harris County district judges to do: rule on motions timely.” Her forebears declined to take that action.”
A Deal Was Negotiated Before the Trial Date of April 15th
A spokesman for Paxton’s alleged victims stated Tuesday that they are satisfied with the decision.
“The criminal justice system makes any promise to any defendant — including Mr. Paxton — of a fair proceeding that produces a reliable result, and we believe we did just that,” Wice said, adding that this resolution compensates the victims and their estates. “Victims are seldom made whole,” he remarked.
The American-Statesman, a member of the USA TODAY Network, revealed on Friday that Wice and Paxton’s legal teams were in talks about how to resolve the matter before an April 15 trial date in District Court.
In explaining why Paxton consented to a pretrial diversion agreement, Cogdell stated at a press conference after the settlement was announced that “you don’t go to trial to prove your innocence” and “you never know what 12 strangers are going to do if you try a case anywhere.” In his 42 years as an attorney, Cogdell said he has never refused a pretrial diversion arrangement, “and I am damn sure not going to do it representing the Attorney General of Texas.”
Over the years, the case has witnessed conflicts over jurisdiction, a move from Collin County to Harris County, and salary disputes between Wice and another prosecutor working on the case. Paxton also filed a series of proceedings that delayed the litigation.
Paxton Still Faces a Federal Probe
This case’s resolution, however, comes as Paxton remains under federal investigation in a separate matter stemming from allegations made by top aides in his office that the attorney general abused his position to assist Austin real estate developer Nate Paul, who was the subject of an FBI investigation at the time.
Those claims prompted the Texas House to conduct its inquiry into the whistleblowers’ complaints, eventually voting decisively to impeach Paxton on 20 charges, including bribery and abuse of power. The impeachment probe was subsequently sent to the state Senate for trial. In September, senators acquitted Paxton on all charges, primarily along party lines.
Those allegations also prompted a lawsuit filed by the whistleblowers, who claimed Paxton fired them after they complained to the FBI about his actions. The lawsuit was tentatively settled for $3.3 million but remains unresolved after the House declined to pay for it last year. The lawsuit is currently being considered by the Louisiana Supreme Court.
Lt. Gov. Dan Patrick, a Paxton supporter who presided over the attorney general’s impeachment trial as the Senate’s chief, wrote on X, “The actions from the Court in Houston highlighted the lack of any real evidence — the prosecution was wise to save themselves the embarrassment of a courtroom defeat.”
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