T. Boone Pickens Abruptly Settles With His Son

January 27, 2016
By David Lee
DALLAS (CN) – On the eve of trial Monday, billionaire T. Boone Pickens settled an ugly family dispute in which his son claimed he was owed millions of dollars for a share of an energy company.
Michael O. Pickens sued his father in November 2014, claiming his dad failed to pay $15.1 million worth of interests in energy companies for which Michael worked.
Michael claimed he was promised a salary and 7.6 percent interest in Mesa Prime Partners if he took a job at Primess Energy Partners LP in 2010, among other things.
Pickens fired back, accusing Michael of scheming “to extort $20 million” from him and of needing money “due to a lifetime of failed career choices and substance abuse problems.” Pickens accused his son of “using Internet posts falsely accusing his father of inflicting abuse on Mike Pickens as a child and casting his siblings as failures and addicts,” according to his December 2014 answer and counterclaim.
State District Judge Tonya Parker ordered father and son into mediation during jury selection Monday, resulting in the settlement. The trial was expected to last up to seven days.
Pickens’ attorney did not respond to an email message asking for comment late Tuesday evening.
His son’s attorney, Thomas Bowers in Dallas, said the terms of the settlement are confidential and the parties “are moving on with their lives.”
When asked about the possibility of a reconciliation, Bowers said “anything in life is possible.”
“Maybe they can someday get past their differences, it is possible,” Bowers said Wednesday. “I would hope for that.”
Pickens and his family had anonymously filedprivacy claims against Michael in February 2013 over the online posts of alleged abuse.
Pickens said in his later counterclaims that the family voluntarily dismissed that lawsuit to separate him from his son’s “crazy antics and behavior, which seemed to only be encouraged by being in litigation.”

From Courthouse News.

Texas Calls Out Feds for Violating Court Order In Refugee Row

December 27, 2016
By David Lee
DALLAS (CN) – Texas continued its legal war with the federal government Tuesday, claiming Washington violated a court order to give seven days notice before resettling Syrian refugees in the state, by sending seven refugees to Houston on Friday.
Texas sued the United States and the nonprofit International Rescue Commission in December, claiming they violated the Refugee Act of 1980 by failing to “consult regularly” with state and local governments and nonprofit agencies before placing refugees.
On Dec. 7, U.S. District Judge David Godbey ordered federal officials to give the advance notice, but Texas says it got no notice about the seven refugees until the day of their arrival, Jan. 22.
Texas claims the IRC failed to comply with its Dec. 1 demand not to resettle six Syrians in Dallas “until we have receive[d] the requested information and our concerns with screening procedures have been appropriately addressed” by federal officials.
Texas sought an injunction last week, fueled by the arrest of an Iraqi refugee in Houston on terror charges.
Attorney General Ken Paxton moved again for an injunction on Tuesday, accusing President Barack Obama of continuing to send Syrian refugees to Texas “under a cloak of secrecy.”
“The threat to our communities by foreign terrorists is real,” Paxton said in a statement Tuesday. “The greater concern is not what we know about these refugees; it’s what we do not know.”
Texas said in its “Response to Federal Defendants’ Notice of Arrival of Syrian Refugees” that it “appreciates” that Washington quickly informed the court of its violation of Godbey’s order.
“But this circumstance is the merely the latest in a series of events that proves exactly why a preliminary injunction and ultimate relief are needed to ensure that Texas has, at a minimum, the information it needs to protect the safety of its residents while resettling more refugees than any other state,” Texas said in the response. “The harm that results to the state by this late notification is irreparable as a matter of law.”
Justice Department attorneys apologized to the court on Friday, saying the failure to inform was “inadvertent, not intentional, and apparently occurred because of a miscommunication” between personnel at the State Department.
Texas says it takes in about 10 percent of the country’s refugees, partnering with volunteer agencies and paying some of the costs.
Paxton said it was the second time in a year that the Obama Administration has “either defied or misled a federal court” on an immigration issue.
“In March 2015, the administration admitted that tens of thousands of expanded work permits had been issued to unauthorized aliens, in direct contradiction to the facts they presented in U.S. federal court,” Paxton said.
Seventeen interfaith religious leaders filed an amicus brief on Jan. 11 in support of the IRC and the federal government. They said Texas’ demand that religious groups discriminate against the needy based on national origin “is not just wrong, it threatens religious freedom.”

From Courthouse News.

We Carry ‘Big Five’ Trophy Kills for No One, Delta Says

January 27, 2016
By David Lee
DALLAS (CN) – Hunters are “grasping at straws” in their lawsuit challenging Delta Airlines’ ban on transporting big-game trophies, the airline claims in a motion to dismiss.
Dallas resident Corey Knowlton and several hunting and conservation groups sued Delta in Federal Court in October, challenging the ban Delta announced after Cecil the lion was killed in Zimbabwe six months ago.
Knowlton made headlines January 2014 when co-plaintiff Dallas Safari Club accepted his $350,000 bid to kill an endangered black rhino and Namibia’s Ministry of Environment and Tourism issued him a permit. Despite criticism from animal rights groups and several death threats, Knowlton killed the rhino four months later.
Knowlton accused Delta of robbing “wildlife habitat of its economic value, encouraging habitat conversion to agriculture, grazing, and industry, and undercutting range states’ tried-and-true conservation strategy.”
He claims the ban “jeopardizes the benefits of tourist hunting and its centrality to conservation” in Africa.
The airline blasted his claims Monday, saying it is a common carrier that is allowed under law to “carve out specific cargo exclusions that apply equally to all shippers.” Common carriers are required to carry any kind of cargo that it tells the public it is willing to carry.
“The common-law rule about cargo exclusions is simple: if you will carry it for anyone, you must carry it for everyone – but you can always decide that you will carry it for no one,” Delta said in its 17-page reply in support of its motion to dismiss.
“Delta carries Big Five trophy kills for no one. That policy is faithful to Delta’s duties as a common carrier.”
Big Five trophies are the African lion, African elephant, African leopard, Cape buffalo and the white or black rhinoceros.
Delta rejected Knowlton’s claim that it must carry Big Five trophy kills because it carries other trophies, calling that argument an “absurdity.”
“If it were true, an airline that accepted hunting shotguns as checked baggage would also have to accept AK-47s and grenade launchers,” Delta said in its reply. “Not surprisingly, the case law rejects this position.”
The hunters’ tortious interference claim under Texas law is preempted under the Airline Deregulation Act, Delta says.
“Plaintiffs try to recast their claim as a challenge to Delta’s public announcement of the trophy ban, but this recasting is equal parts implausible (the ban is the true object of Plaintiffs’ ire) and ineffectual (the claim is preempted regardless of whether it attacks the trophy ban or Delta’s statement announcing the ban),” the reply states.
Delta called the plaintiffs’ constitutional challenge to the act’s preemption provision “frivolous.”
“On these facts, the case for preemption is open-and-shut, so plaintiffs try to change the facts,” the reply states. “In their brief, plaintiffs contend that their claim challenges not Delta’s trophy embargo itself, but rather Delta’s public statement ‘announcing its refusal to transport Big Five trophies.’ This quasi-defamation claim is completely implausible: would plaintiffs really not have filed suit if Delta had enacted a trophy ban but used different words to announce it? In any event, this new, unpleaded claim fares no better. It, too, is preempted.”
Finally, Delta says its ban has not injured Knowlton. He was able to ship his trophies home with another carrier, the airline said in its motion to dismiss in December.
Delta is represented by Russell Falconer, with Gibson, Dunn & Crutcher in Dallas.

From Courthouse News.

Ethics Charges Hurled in Paxton Case Sidebar

January 22, 2016
By David Lee
DALLAS (CN) – A Texas judge faces an ethics complaint for appearing on TV and criticizing Attorney General Ken Paxton’s attorneys’ behavior in defending Paxton from criminal securities fraud charges.
The ethics complaint accuses State District Judge Chris Oldner of violating several sections of the Texas Code of Judicial Conduct. Aaron Harris, of North Richland Hills, filed the complaint on Jan. 11 with the State Commission on Judicial Conduct.
Oldner recused himself in July last year after overseeing a Collin County grand jury that 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, Paxton could face up to life in state prison.
In asking for the charges to be dismissed last month, Paxton’s attorneys blasted Oldner, saying he did not have the discretion to recuse jurors. They said that Oldner entered the grand jury room and “robbed this grand jury of randomness” by asking prospective jurors if they wanted to serve, and sending home those who declined.
They also accused Oldner’s wife of disclosing the indictment to a county commissioner before it had been made public.
Oldner defended days later on “Inside Texas Politics,” a talk show on ABC-affiliate WFAA-TV.
His appearance was unusual in that judges rarely comment publicly on cases over which they presided.
Harris said the judge’s comments about Paxton’s defense being “desperate” and making a “tapestry of false allegations” were unethical: that he “knew or should have known that the statement would have a substantial likelihood of materially prejudicing” Paxton’s case. Harris also questioned why Oldner waited so long to recuse himself, and that his contradictory statements on the recusal “convey at the least the appearance of impropriety.”
Harris said Oldner stated in the interview that the Collin County district judges had agreed to recuse themselves from the case to have a judge from another county appointed, but that Oldner also said he recused himself to avoid the appearance of bias in Paxton’s favor because he had socialized with Paxton and contributed to his political campaign.
“If this is true, then Judge Oldner’s belated and public claim regarding an alternative basis for recusal – the appearance of bias in favor of Paxton due to an alleged contribution and social contact – makes no sense, even if that basis were a legal grounds for recusal,” Harris said in his complaint.
Oldner’s political campaign on Wednesday called the ethics complaint “completely without merit.”
Oldner is a Republican candidate for the Texas Court of Criminal Appeals.
“It’s just another just another example of how dark-money special interest groups seek to bully and intimidate ethical, conservative judges who strictly follow the law,” Oldner’s campaign told The Dallas Morning News. “It has to be humiliating that they had to resort to a young, low-level political operative to do their bidding.”
Harris responded that it is “very telling” that Oldner did not address the merits of his complaint.
“I have no idea where he gets ‘dark money’ or anything like that,” Harris told the Morning News. “I’m not sure how a concerned citizen is a special interest group.”
The Morning News described Harris as “a North Richland Hills politico who’s worked on anti-[school] bond efforts and other Tarrant County campaigns.”
Harris, 35, a real estate investor, also managed the campaign of state Rep. Jonathan Stickland, R-Bedford. Stickland, like Harris, believes the conservative Texas Legislature is not conservative enough, according to the Morning News.

From Courthouse News.

Mark Cuban Defends Fantasy Sports as Skill

January 22, 2016
By David Lee
DALLAS (CN) – Billionaire Mark Cuban came to the defense of paid daily fantasy sports websites one day after Texas Attorney General Ken Paxton concluded they are illegal, by comparing them to investing in the stock market.
The Dallas Mavericks owner and daily fantasy sports investor gave the keynote address to several hundred attendees at the Fantasy Sports Trade Association conference in downtown Dallas on Wednesday. Cuban said he was “disappointed” at Paxton’s nonbinding advisory opinion that was released on Tuesday.
Paxton said the bets made on daily fantasy sports website are illegal under state law because of the cut the house receives. His nine-page opinion stated fantasy sports website operators are incorrectly claiming the actual-contestant exception, which he said only applies to contestants in an actual skill or sporting event.
Cuban disagreed, saying daily fantasy sports “is a game of skill” and not gambling.
“I can walk into any poker room in the world against the best poker players and if I pull a straight flush, as long as I know what a straight flush is, I am going to win,” he said. “That does not happen in daily fantasy sports. You have to be smart, you have to put in the time.”
Cuban compared daily fantasy sports to stock investing, saying “there is a lot more luck involved” in stocks.
“Why is the stock market acting like it is? Nobody knows,” he said. “Where should you invest your money in the stock market? I have talked to some of the smartest people and nobody knows. That sounds like a game of chance to me.”
Cuban took solace that Paxton’s ruling “was only an opinion” and said he was told “there are no plans initially to file any lawsuits” over the dispute.
“It is just a way of coming out and kind of hedging,” Cuban said. “So I’ll give our guy Ken Paxton some credit. He is playing politics without playing politics.”
Cuban noted Paxton’s ongoing legal troubles – he was indicted last year on two first-degree felony counts of securities fraud and a third-degree felony count of failing to register with the Texas State Securities Board.
“This is a guy who personally [is going] through some security regulations himself, so he knows what it’s like to be a target,” Cuban said.
Paxton’s opinion came one month after Illinois Attorney General Lisa Madigan concluded paid daily fantasy sports betting is illegal in her state as well. Operator DraftKings sued her office within days in Cook County Chancery Court, seeking declaratory judgment for violation of its due process rights.
FanDuel and Head2Head filed a similar lawsuit in Sangamon County Chancery Court shortly thereafter.
Paxton’s and Madigan’s decisions follow New York Attorney General Eric Schneiderman’s cease-and-desist letter to FanDuel and DraftKings, warning them to stop operating in his state. Schneiderman persuaded a Manhattan Supreme Court judge to bar both websites from taking bets in the state last month, but allowed them to appeal his injunction before it takes effect.
Cuban brushed aside the attacks on the industry, saying he invested in daily fantasy sports because it is “in a great position” and that he thinks “gambling as a whole will be made legal.”
“Hypocrisy tends to figure itself out,” he said. “I think there is a whole lot of upside to this industry. While this is a stepping stone that we have to step over and on and across, I think it’s going to happen and it will create a foundation that makes fantasy sports – in particular daily fantasy sports – much stronger.”

From Courthouse News.

Texas Renews Fight Against Syrian Refugees

January 19, 2016
By David Lee
DALLAS (CN) – Emboldened by the arrest of an Iraqi refugee in Houston on terror charges, Texas renewed its demand for an injunction blocking Syrian refugees from the state without more information about them.
Attorney General Ken Paxton on Friday filed a reply in support of an amended application for preliminary injunction in Federal Court.
Texas sued the United States and the nonprofit International Rescue Commission in December, claiming they violated the Refugee Act of 1980 by failing to “consult regularly” with state and local governments and nonprofit agencies before placing refugees.
Texas claims the IRC failed to comply with its Dec. 1 demand not to resettle six Syrians in Dallas “until we have receive[d] the requested information and our concerns with screening procedures have been appropriately addressed” by federal officials.
Paxton’s new filing came days after the arrest of Omar Farej Saeed al Hardan, 24, a permanent resident and Iraq-born Palestinian. He was denied bond on Jan. 13 after federal agents testified that al Hardan told an informant he wanted to plant bombs at two Houston-area shopping malls. The agents testified that al Hardan also told the informant he wanted to go to a military base in Grand Prairie – a suburb of Dallas – and “use gasoline to set fire and blow up Humvees .”
Texas claims the United States’ opposition to its concerns indicate the federal government believes “Texas has neither the right nor role” to protect its residents.
“Texas has a right to protect its residents and obtain full advanced consultation regarding proposed refugee placements – which is far more than after-the-fact notices of mass placements – including person-specific information before defendants place refugees in Texas,” the 16-page reply states. “Their refusal to provide the requested information before resettlement is a harm that cannot be remedied at law.”
Paxton said al Hardan’s arrest “is exactly the type of security risk” to schools and communities that must be stopped.
“Texas resettles, and welcomes with open arms, more refugees than any other state,” he said in a statement Friday. “But there is a significant difference between refugees and terrorists posing as refugees to infiltrate America and cause mass devastation. The safety and security of Texans must always come first.”
Texas takes in about 10 percent of the country’s refugees by partnering with volunteer agencies and paying some of the costs, Paxton said.
Seventeen interfaith religious leaders filed an amicus brief in the lawsuit on Jan. 11 in support of the defendants. They said Texas’ demand that religious groups discriminate against the needy based on national origin “is not just wrong, it threatens religious freedom.”
Immigration attorneys say Texas has no legal basis to keep legal U.S. residents out of the state, and people granted refugee status in the United States are legal residents.
The governor or Legislature may cut off funding to refugee groups, with or without a lawsuit.

From Courthouse News.

Texas AG Says Fantasy Sites Are Illegal Gambling

January 19, 2016
By David Lee
AUSTIN (CN) – Texas Attorney General Ken Paxton has concluded that participation in paid daily fantasy sports websites is illegal gambling under state law, mirroring similar conclusions in New York and Illinois.
In a non-binding advisory opinion issued Tuesday, Paxton said such betting is illegal due to a cut the house receives.
“Because the outcome of games in daily fantasy sports leagues depends partially on chance, an individual’s payment of a fee to participate in such activities is a bet,” Paxton’s 9-page opinion states. “Accordingly, a court would likely determine that participation in daily fantasy sports leagues is illegal gambling under section 47.02 of the Penal Code.”
Paxton says paid daily fantasy sports operators incorrectly claim the actual-contestant exception under state law, which applies only to contestants in an actual skill or sporting event.
“Paid daily ‘fantasy sports’ operators claim they can legally operate as an unregulated house, but none of their arguments square with existing Texas law,” Paxton said in a statement. “Simply put, it is prohibited gambling in Texas if you bet on the performance of a participant in a sporting event and the house takes a cut.”
Texas law only requires “partial chance” for something to be gambling – it does not require that chance predominate unlike in other states, Paxton added.
Paid daily fantasy sports website operator DraftKings quickly disagreed with Paxton’s opinion, arguing the Texas Legislature has “expressly authorized games of skill” and that daily fantasy sports are a game of skill.
“We strongly disagree with the Attorney General’s prediction about what the courts may or may not do if ever presented with the issue of whether daily fantasy sports are legal under Texas law,” DraftKings attorney Randy Mastro, with Gibson Dunn in New York, said. “The Attorney General’s prediction is predicated on a fundamental misunderstanding of DFS. We intend to continue to operate openly and transparently in Texas, so that the millions of Texans who are fantasy sports fans can continue to enjoy the contests they love.”
Paxton acknowledged that Texas courts have yet to address the actual-contestant exclusion from the definition of “bet,” but he relied on an earlier advisory opinion from his office in 1994.
“We noted that the Practice Commentary to the statute indicated the actual-contestant exclusion ‘is intended to exclude only awards and compensation earned by direct participation in the contest – the pole-vaulter’s cup, the pro football player’s salary – not the receipt of a wager made on its outcome,'” the opinion states. “We concluded that, although the ‘exclusion may embrace and athletes actually competing in the sporting events you refer to, it does not embrace those who pay entry fees for a change to win a prize from forecasting the outcomes of the events.'”
Paxton drew a distinction with traditional fantasy sports leagues, concluding they are legal under Texas law because participants split the pot amongst themselves rather than giving the house a cut.
Paxton’s opinion comes one month after Illinois Attorney General Lisa Madigan concluded paid daily fantasy sports betting is illegal in her state, as well. DraftKings sued her office within days in Cook County Chancery Court, seeking declaratory judgment for violation of its due process rights.
FanDuel and Head2Head filed a similar lawsuit in Sangamon County Chancery Court.
Paxton’s opinion comes two months after New York Attorney General Eric Schneiderman sent a cease-and-desist letter to FanDuel and DraftKings, warning them to stop operating in his state. Schneiderman persuaded a Manhattan Supreme Court judge to bar both websites from taking bets in the state last month, but allowed them to appeal his injunction before it takes effect.

From Courthouse News.