Civil Trial Nears for GOP Activist

AUSTIN, Texas —  A Republican Party activist is scheduled to go on trial Monday to face civil charges that he was part of an illegal scheme to finance the GOP’s rise to power here.

The trial is the result of a lawsuit brought by five Democratic state House candidates who lost their races to Republicans in 2002. The election that year was a historic one in Texas, as the GOP -- long the minority party here -- seized a majority of state House seats, giving it control of both houses of the Legislature and the governor’s mansion.

Democrats and independent campaign finance watchdogs have alleged ever since that a network of Republican activists illegally used corporate money to help pay for 22 House campaigns. Much of the money was routed through organizations with ties to U.S. House Majority Leader Tom DeLay, a Texan whose prodigious fundraising operation is considered innovative yet controversial.

“This is the first chance for all of this to be debated in a courtroom -- what they did, whether it was illegal, who was responsible,” said Craig McDonald, director of Texans for Public Justice, a group that tracks the influence of money in politics. “I don’t know if we’ll find out all of the answers. But it’s going to be very interesting.”

The defendant scheduled for trial is Bill Ceverha, treasurer of the political action committee Texans for a Republican Majority.

Ceverha is a prominent Republican consultant and one of President Bush’s Pioneers, a group of his top fundraisers. A former Dallas legislator, Ceverha, 68, helped found the Texas Conservative Coalition, a caucus that promotes limited government and conservative values.

“He is about as sophisticated a political player as one can find,” said Cris Feldman, an Austin lawyer representing the Democrats.

Terry Scarborough, an Austin attorney representing Ceverha, said his client did nothing wrong. “We are pretty convinced of our legal position,” he said. “We are not afraid to go to trial.”

Texans for a Republican Majority is an offshoot of DeLay’s Americans for a Republican Majority, which assists the campaigns of conservative political candidates. Americans for a Republican Majority provided the seed money to launch the Texas version in 2001.

DeLay has denied wrongdoing and is not named as a defendant in the lawsuit. His office declined to comment.

U.S. Rep. John R. Carter, a Texas Republican, dismissed the lawsuit -- and a separate but parallel criminal investigation of the 2002 election cycle -- as politically motivated.

“The plaintiffs are people who lost the election,” Carter said. “That’s about as political as you can get. That’s called sour grapes: I lost. I’m going to sue you.”

State law says that if the Democrats prove their case, they can ask for twice the amount of money that the judge determines was raised through illegal contributions. That would probably amount to about $1 million in damages, Feldman said. State law does not allow the Democrats to seek a new election.

The 2002 elections in Texas had national implications, because the following year DeLay asked GOP leaders in Austin to exercise their power by drawing new maps of Texas’ congressional districts. In the elections last fall, the new maps gave the GOP a six-seat swing in the state’s congressional delegation.

Several political committees run by Republican Party activists and business advocates were later shown to have spent more than $3.5 million during the 2002 state elections. Texans for a Republican Majority raised about $1.5 million, including about $600,000 from corporations.

State law bans corporate contributions to legislative candidates. Corporations are allowed to fund some costs associated with a political campaign, such as telephone lines or other administrative expenses.

The lawsuit alleges that the corporate money was intentionally used to directly support Republican candidates’ campaigns. For instance, the lawsuit says, the money was used to create lists of likely voters and to pay for phone banks. Money was also laundered, the suit alleges, when it was routed through an arm of the Republican National Committee, which then donated it directly to Republican candidates.

Ceverha, the lawsuit says, was “responsible for handling the money collected and expended” by Texans for a Republican Majority. He was also responsible for properly documenting contributions for Texas ethics officials, which was not done, according to the lawsuit.

“He took illegal money. He spent illegal money. And on top of that, he hid it,” Feldman said.

The separate criminal investigation has been underway for more than two years. Many of the documents that have been obtained through the civil lawsuit, more than 1,000 pages in all, could be used in the criminal case, officials say.

Late last year, three fundraisers with ties to DeLay were indicted in the criminal case and charged with money laundering and unlawfully soliciting and accepting corporate contributions.

They included two of the men accused in the civil case: John Colyandro, former executive director of Texans for a Republican Majority, and James Ellis, executive director of Americans for a Republican Majority. The civil cases against Colyandro and Ellis are on hold until their criminal cases are resolved.

Ceverha has not been charged in the criminal case.

Oddly, Scarborough said, the two sides do not disagree on many of the details at the heart of the suit. The political organizations do not deny that money was raised from corporations, but they contend the expenditures were proper and legal.

Scarborough said state law requires only that money given directly to a candidate or money used to advocate a particular campaign be reported on disclosure forms. Those rules were followed, he said. All other fundraising, he said, is protected as free speech.

Feldman said Republicans were seeking to throw out “the entire reporting system in Texas,” which would eliminate “a whole body of basic good-government law.”