Texans for Lawsuit Reform: How the Texas Tort Tycoons Spent Millions in the 2000 Elections
III. Who Financed TLR's PAC?
In the 2000 election cycle, the TLR PAC spent $1.4 million, up from the $1.2 million that it spent in the 1998 cycle. This spending makes it Texas' fifth most powerful PAC.9
The latest PAC data reveal that TLR is increasing its dependence on a small pool of wealthy tycoons who have a keen interest in weaker tort laws. TLR's top five donor families (see table) accounted for almost half ($691,000) of the $1.5 million that TLR raised in the 2000 cycle. Moreover, the top 24 donors contributed almost $1.2 million, or 80 percent of TLR's take.
*Includes contributions by named individuals and their immediate family members. Statewide totals include contributions to all Texas statewide and legislative races, as well as to other Texas candidates and PACs that filed electronic disclosure reports (including TLR).
Top TLR Donors in the 2000 Election Cycle Big TLR Donor Donor's Tort Interest City Money To
TLR in 2000
Total TX 2000
Gordon Cain Sterling Group (chemicals) Houston $200,000 $335,500 Harlan Crow Trammell Crow (real estate) Dallas $150,000 $253,826 Dick Weekley Weekley Homes/Properties Houston $126,000 $208,925 Robert C. McNair Cogen Tech. (electric utilities) Houston $125,000 $354,825 Bob J. Perry Perry Homes Houston $90,000 $912,500 James R. Leininger Kinetic Concepts (hospital beds) San Antonio $75,000 $655,212 William A. McMinn Sterling Group (chemicals) Houston $75,000 $459,000 Michael S. Stevens M. Stevens Interests (apartments) Houston $50,000 $139,175 James A. Elkins, Jr. First City Bancorp Houston $30,000 $129,250 Dan L. Duncan Enterprise Products (oil/gas) Houston $25,000 $74,500 Ken L. Lay Enron (gas) Houston $25,000 $247,000 Walter Negley WWN Corp (fastener testing lab) Houston $25,000 $102,450 Robert B. Rowling TRT Holdings (oil/gas/hotels) Dallas $25,000 $66,000 Harold Simmons Valhi/Contran (corporate raids) Dallas $25,000 $126,000 David M. Underwood Everen Securities Houston $25,000 $70,852 Ernst & Young (accounting) Houston $17,097 $17,097 Price Waterhouse (accounting) Houston $16,666 $26,666 James R. Lightner Electrospace Systems (defense) Dallas $11,000 $93,500 Dennis R. Berman Denitech (copier leasing) Irving $10,000 $45,500 Joseph Jan Collmer Collmer Semiconductor Dallas $10,000 $65,850 William R. Cooper Paragon Group (apartments) Dallas $10,000 $10,000 Ray L. Hunt Hunt Oil/Woodbine Development Dallas $10,000 $82,000 Jeff Davis Sandefer Sandefer Capital Partners Austin $10,000 $35,500 Texas Industries (cement/toxic incineration) Dallas $10,000 $26,750 TOTAL: $1,175,763 $4,537,878
The people who provided most of TLR's PAC money made fortunes in industries with heavy legal liabilities. As shown in the accompanying table, these industries include: the chemical and energy industries (toxic pollution, accidents); builders (injured workers and lemon homes); property managers (premises liability); accounting and investment firms (securities lawsuits) and medical manufacturers (patient injuries).
In Texas-where there are no limits on most political contributions-the influence of the TLR tycoons extends far beyond their tort money. TLR's top 24 donors spent a total of at least $4.5 million to influence Texas politics in the 2000 election cycle. Houston homebuilder Bob Perry spent an astounding $912,500 in the 2000 cycle. In fact, all but three of TLR's top 15 donors gave more than $100,000 apiece to Texas PACs and candidates. Such donors go beyond mere political influence: they are king makers whose personal checks can determine who wins or loses a competitive race.
|Dick Weekley||Leo Linbeck, Jr.||Richard Trabulsi, Jr.|
|The family of strip mall developer and TLR President Richard
Weekley owes much of its fortune to homebuilding. With 2000 revenues of
$711 million, Forbes ranked David Weekley Homes as the nation's 384th largest
privately held company.
The Weekleys have been parties to plenty of lawsuits. In 1995, 11 Spring, Texas homeowners filed suit, alleging that their new Weekley homes cracked up because they were built on bad foundations. Plaintiff Carlos Murillo complained that the builder refused to finish his house until he put up a yard sign that said, "Come Talk To Me Before You Buy a David Weekley Home." The owner of a home security business, Murillo figured out that the security system that he installed on his new home kept going off because its motion sensors picked up on his crackling foundation long before he did. He and neighboring plaintiffs sought damages under Texas' Deceptive Trade Practices Act, a consumer-protection law that TLR got lawmakers to gut the year that Murillo sued Weekley Homes.10
After Murillo's neighborhood cracked up, the Texas Natural Resources Conservation Commission (TNRCC) began uncovering Weekley Homes construction waste in fly-by-night illegal dumps outside San Antonio and The Woodlands. A 1996 TNRCC warning letter reminded Weekley Homes that waste generators are legally responsible for the "transportation, processing, storage and disposal of their wastes, even when these activities are performed by another party."
Weekley Homes barred Occupational Safety and Health Administration (OSHA) inspectors from a Colorado construction site for two years-until a federal judge ordered the company to grant access to inspectors. In 1996, OSHA levied the largest worker safety fine in Colorado history on Weekley Homes for six "willful" violations of safety laws. The Occupational Safety and Health Review Commission threw out these fines in 2000, ruling that OSHA failed to prove that Weekley Homes was aware of the violations, which involved contract workers.11
Given this history, it is not surprising that Dick Weekley's TLR has lobbied Texas legislators to slash the liability that businesses face for subcontract workers and for incidents in which they are only partly responsible for harming customers, workers or communities.12
|TLR Chair Leo Linbeck, Jr., heads a construction firm that
had 2000 revenues of $239 million. He also co-founded Americans for Fair
Taxation, which seeks to replace federal income taxes with a national sales
tax that would shift more of the tax burden from the rich to the poor.
Linbeck is best known for heading Texas A&M's probe into the 1999 bonfire tragedy that killed 12 people. Stacked with three TLR PAC contributors, Linbeck's five-member panel never pursued a basic question. Namely, Did Texas' $500,000 cap on the liability of state entities encourage A&M to ignore the foreseeable risks of letting thousands of poorly supervised students work around the clock stacking telephone-pole-sized logs on top of one another?
Certainly Linbeck knows the liabilities posed by dangerous work sites. Linbeck Construction was a party to more than 125 Houston lawsuits between 1978 and 1995.13 Some of these lawsuits reflect the fact that construction is Texas' deadliest industry, accounting for 6 percent of the state's workforce and 26 percent of its on-the-job fatalities.14 A 43-year-old employee, Jerry Jordan, was electrocuted to death at a Linbeck Construction site in Beaumont in 1985, for example, when the crane he was operating hit a dangling power line carrying 7,600 volts. A crane collapsed at a Linbeck site in Dallas two years later, killing three contract workers and hospitalizing a Linbeck worker.
Government inspectors have recommended a paltry $12,565 in fines against Linbeck Construction for 31 "serious" health and safety violations since 1985. The company so far has negotiated these fines down to just $8,790.
Juries often are tougher than regulators. Working for $7 an hour for a Linbeck Construction subcontractor in 1995, Mexican national Rodrigo Martinez was paralyzed after falling into an open basement. In a resulting lawsuit, the trial judge instructed the jury that Linbeck Construction "failed to comply with their duty to preserve evidence." Finding that the company acted with malice, a jury ordered Linbeck Construction to pay Martinez $6 million in actual damages and $1 million in the punitive damages that juries use to punish particularly irresponsible behavior. The parties confidentially settled before the judge entered a final judgment in the case.16 In another case, contract worker Edilberto Martinez sued Linbeck Construction for rollover injuries that he sustained after being ordered to drive a truck up a steep dirt embankment in 1994. The parties settled that suit for $100,000 in 1996.16
TLR has pushed bills to further diminish construction firms' responsibility for contract workers who get injured on their work sites. Defending such legislation in 1997, Linbeck said that workers turn their injuries into "a lottery ticket" by collecting workers compensation insurance and then collecting damages all over again from contractors.17 In fact, state workers compensation laws only compensate workers for a fraction of their true injury costs.
|TLR co-founder Richard Trabulsi, Jr. owns Richard's Liquors
and Fine Wines, a Houston liquor store chain founded by his father. Alcohol-related
diseases and accidents are the nation's third leading cause of preventable
deaths.18 In recent
years, families that have been devastated by alcohol-related accidents
have demanded greater accountability from venders for the foreseeable consequences
of selling alcohol to drunks or to kids. Trabulsi, who owned a liquor store
facing Lamar High School, fought a 1996 Houston City Council proposal to
establish "alcohol-free zones" around schools.19
The booze industry's biggest TLR coup came with the 1995 enactment of severe limits on so-called joint and several liability laws. Under the revised law, individuals who knowingly sell alcohol to someone who is visibly drunk cannot be held responsible for the resulting damages unless a jury finds that they were at least 51 percent responsible. According to the Texas chapter of Mothers Against Drunk Driving, this virtually eliminated the alcohol industry's liability for drunk drivers, since drivers almost always will be found to be more than 50 percent responsible for their destructive behavior. State bills backed by Mothers Against Drunk Driving to increase this industry's liability for selling alcohol to people who are visibly intoxicated never made it out of committee in 1997 and 1999. Trabulsi contributes money to the political action committee of the Texas Package Stores Association, an industry group that opposed one of these bills in 1997.20
Richard's Liquors also faces generic premises liabilities that require retailers to provide a safe environment for their employees and customers. Trabulsi himself led TLR's doomed 1997 push to radically rollback Texas' premises liability laws. Lawmakers balked when they learned that TLR's broad bill would protect everyone from slum lords who fail to invest in the security of their tenants to negligent nursing-home owners. "Don't let our lousy draftsmanship wreck the public policy interest here," Trabulsi begged fed-up members of the House Civil Practices Committee.21
Despite TLR's purported aversion to lawsuits, Richard's Liquors sued Walgreens in 1986 to enforce residency requirements that prevented that discount store from competing with Texas-based liquor stores-like the ones that Trabulsi owns.