Paxton trial, Sept. 12: Whistleblower says he feared Paxton had “turned over” his office to donor

Tony Buzbee, Ken Paxton’s defense lawyer, pushed whistleblower Darren McCarty on his claims that there was no justification for the attorney general’s office to get involved in the lawsuit between Nate Paul and the Mitte Foundation, which he noted had been previously sued by then-Attorney General Greg Abbott.

Buzbee also asked McCarty to detail how he believed the Mitte Foundation was harmed by the agency’s intervention in their lawsuit. McCarty responded that the nonprofit was threatened with an investigation, that the intervention had delayed its litigation and cost them money in additional attorneys fees.

“Most importantly … we had used the criminal justice system to prejudice the Mitte Foundation’s interests,” McCarty continued.

McCarty also said that he agreed to involve the AG’s office in the lawsuit because of Paxton’s claims, which he said he had “no reason to question at the time.”

Knowing what he knows now, he said, “I would never have signed off on the intervention.”

– Robert Downen

A Ken Paxton whistleblower testified Tuesday that Paxton took an unusually intense interest in Nate Paul’s litigation against a charity in 2020, leading the whistleblower to believe Paxton had “turned over” his office to Paul.

The whistleblower, Darren McCarty, said he ultimately found the office’s involvement in the lawsuit to be “unethical, against our statutes, and, I highly suspected, corrupt.”

McCarty was the deputy attorney general for civil litigation at the time.

Paul, an Austin real estate investor and Paxton campaign donor, was locked in a contentious dispute with the Mitte Foundation, an Austin-based nonprofit that had sued Paul for fraud. McCarty testified that Paxton asked him to intervene in the lawsuit, saying the litigation had gone on for too long.

McCarty said he was struck by how interested Paxton became in the case, describing an “urgency and anxiety” from the attorney general. Paxton wanted updates on any new developments, McCarty said, and even pulled McCarty out of an “important teleconference” to talk about it one day.

Paul was “vigorously complaining” to the office throughout, demanding to know why it was not making more progress in the lawsuit intervention, according to McCarty’s testimony. The whistleblower said he found Paul’s tone “wholly inappropriate” because the office is supposed to be working in the public interest of the charity, not in the interest of a litigant against the charity.

McCarty said Paxton had asked him to appear in Travis County District Court in a hearing on the lawsuit, but he resisted. Paxton said he himself would go, but McCarty said he talked Paxton out of it, calling it a “terrible thing for him to do” and that it would have sent a “very odd message.”

“He was the attorney general of Texas,” McCarty said. “He never appeared in court. Not once. Not a single time.”

McCarty testified that he later connected the dots when he saw Brandon Cammack, an outside lawyer that Paxton hired, issued a grand-jury subpoena “clearly seeking information” that would help Paul against the foundation. McCarty called his reaction “stunned.”

“I believed that the attorney general’s office had been … turned over by [Paxton] to a private citizen to do his bidding, and it was acting against the interests of the state of Texas,” McCarty said.

— Patrick Svitek

House managers called their 11th witness in the impeachment trial: Kendall Garrison, chief executive officer of Amplify Credit Union. His testimony focused on three properties owned by Nate Paul that faced foreclosure because Paul had stopped repaying his loans. Garrison testified the outstanding loans totaled around $11.5 million.

Amplify had posted to sell the properties at auction on Aug. 4.

On Aug. 3, Paul sent Amplify employees an email with a link to an attorney general opinion prohibiting foreclosure during the pandemic, which Garrison said his office dubbed the “midnight” opinion. The opinion, which was published in record time, stated that foreclosure sales could not continue due to COVID-19 restrictions.

“It was surprising to see a ruling issued on a Sunday morning that essentially prohibited foreclosures in the state of Texas,” Garrison said. The bank withdrew the foreclosure sales, but eventually sold them in September.

“Who benefitted from the foreclosure letter?” asked Erin Epley, a lawyer for the House.

“Nate Paul and the World Class Entities,” Garrison said.

During cross examination, Paxton’s lawyers pushed back against that claim and tried to cast doubt on Garrison’s testimony by pointing out Amplify did not lose any money in the eventual foreclosure sales.

– Kate McGee

House impeachment managers called as their next witness Joe Brown, the former U.S. attorney for the Eastern District of Texas.

Brown interviewed for the job to investigate Nate Paul’s claims in 2020. He said he quickly became concerned about potential conflicts of interest, given that Paxton had previously been fined by the Texas State Securities Board, which was listed in Paul’s complaint.

“Red flags are going off,” he said. “So, eventually I say my preference is I would write a report and evaluate these conflicts before I would commit to any level of prosecution.”

Brown said he voiced some of those concerns to Paxton’s deputies, but said he was still “willing to do the job.” After that, he said, there was a standstill in talks with the attorney general’s office, which opted to hire the younger, less experienced Cammack at the same rate.

Brown also said that during the interview process, he spoke to Paxton who complained that he "could not get the people in his office to do anything about" Nate Paul's claims.

Brown asked why Paxton didn’t fire them.

Brown said that Paxton responded: "It's complicated."

– Robert Downen

Brandon Cammack, the Houston attorney that Ken Paxton hired to investigate Nate Paul’s adversaries, testified that Paul’s lawyer provided him with a list of people to subpoena and that, after he received two cease and desist letters, he was told by the Attorney General’s Office that he’d have to “eat” a $14,000 invoice for his work.

Cammack’s testimony outlined the direct role that Paul’s lawyer, Michael Wynne, played in the attempts to investigate Paul’s adversaries in September 2020. Wynne, Cammack said, insisted that he be with Cammack as he issued subpoenas for phone and other records to some of Paul’s adversaries.

At one point, Cammack said he spoke with the spouse of a deceased clerk for the court that issued the search warrants for Paul’s businesses. He said Wynne and Paul suggested that the clerk had potentially died from “foul play” — insinuating that she was the victim of the same cabal that they claimed was targeting Paul.

Cammack said he became increasingly concerned that he was being misled about why he had been hired after he was visited by U.S. marshals, and felt like he’d “gotten the rug pulled out from me.”

He was asked to drive at the last minute from Houston to Austin for a meeting at Paul’s home. Paxton was there wearing running shorts, but spent most of the time talking on the phone outside. Cammack said he received little new information about what was expected of him, why U.S. marshals had contacted him or why he hadn’t been paid yet.

Later, Cammack said he was again called from Houston to Austin for a meeting with Paxton and Brent Webster, who played a direct role in firing whistleblowers who reported Paxton to the FBI. The two took him to a Starbucks for a 15-minute meeting during which Cammack said Paxton barely spoke. He said Webster told him that his contract was “not any good,” that he would need to “eat” the $14,000 in work he’d done and that the two almost left him without giving him a ride back to his car.

“It was offensive,” he said.

Cammack also lamented Paxton’s decision to involve him in the Paul matter, saying his name was dragged through the mud, that it hurt him professionally and that the only thing he received in return were two cease and desist letters.

“I had a whole entire life before all of this,” he said.

– Robert Downen

Brandon Cammack, the Houston attorney hired to investigate Nate Paul’s claims after they were debunked by top deputies in the attorney general’s office, testified Tuesday that he reported directly to Ken Paxton and communicated with him by encrypted messaging services.

“The only person I reported to was Mr. Paxton, at his direction,” Cammack said.

Cammack’s testimony sheds new light on the direct involvement that Paxton played in the September 2020 investigation into Paul’s claims that he was the victim of two separate conspiracies. By the time he was hired, top deputies had already met repeatedly with Paul, debunked his claims and repeatedly urged Paxton to “back away” from Paul.

"I did everything at his supervision and kept him informed of everything," Cammack said, referring to Paxton.

Cammack said that Paxton personally reached out to have him investigate Paul’s claims, and said the case lacked support from his top deputies.

“His own staff would not work on what he wanted them to work on,” Cammack recalled Paxton saying. “He just wanted to find out the truth of what happened."

Cammack said he expected to have meetings with top agency deputies such as Mark Penley, the former deputy attorney general for criminal justice who testified Monday that he thought Paul was dishonest. Cammack said he asked Paxton when he could meet with Penley, but was always told that Penley was on vacation and the case file was on his desk.

Cammack also said that Paxton asked him to communicate with him through encrypted communications services such as Signal and ProtonMail, and that the first time he saw Paxton’s official email address, it was when he received a cease-and-desist letter from top agency deputies.

Paxton — who House impeachment managers have accused of using burner phones — also called from two cell phone numbers, Cammack said.

– Robert Downen

The clock is quite literally running down on the impeachment trial of suspended Attorney General Ken Paxton. Lt. Gov. Dan Patrick told the Texas Senate on Monday morning that the historic trial could wrap up by the end of this week, despite earlier predictions that the proceedings could last several weeks.

The prosecution and the defense were each given 24 hours to present their case and cross examine witnesses. As of Monday night — the end of the fifth day of the trial — lawyers for the House impeachment managers who are prosecuting the case against Paxton had about nine hours and 19 minutes left. Paxton’s defense lawyers had around 12 hours and 14 minutes left.

Throughout Monday, the prosecution picked up the pace — calling four more witnesses. Paxton’s lawyers have yet to call their own witness, and have used their time on cross examination. But it’s appearing unlikely either side will make a significant dent in their list of nearly 150 witnesses subpoenaed, according to a witness list.

— Kate McGee

Margaret Moore, who served as Travis County district attorney from 2017 to 2020, testified Monday that she had her office look into real estate investor Nate Paul’s claims that he was the victim of a wide-ranging conspiracy among several law enforcement agencies. Staffers in her office found his claims “ridiculous,” she said.

“I expected it to be a dead issue,” she said.

Moore later found out that the attorney general’s office had hired Brandon Cammack, an outside attorney from Houston, to investigate the claims made by Paul, a friend and political donor to suspended Attorney General Ken Paxton.

On cross-examination, Paxton’s attorney Tony Buzbee suggested Moore was too dismissive of Paul's allegations against the FBI in particular. Buzbee is defending Paxton against 16 articles of impeachment that accuse him of misusing the powers of the attorney general’s office to help Paul, who was under federal investigation.

— Robert Downen