State high court upholds jail time order for investor at center of Paxton impeachment
A real estate investor accused of bribing the Texas attorney general is facing jail time after the Texas Supreme Court denied his appeal of an order holding him in contempt for lying in court.
The state’s highest civil court narrowly denied Nate Paul’s petition in a 5-4 decision. Paul had been sentenced to 10 days in jail by a Travis County judge.
The Austin-based investor was central to the Texas House’s impeachment case against Attorney General Ken Paxton and was accused of offering him home renovations and other favors in exchange for legal help. Paxton was impeached last fall by the majorityrepublican House but acquitted by the Senate.
Paul and Paxton are the targets of an FBI investigation launched in 2020 when Paxton’s aides went to local and federal authorities, claiming the third-term Republican abused his office and took bribes from Paul. A grand jury has reportedly been convened in San Antonio and called witnesses close to Paxton. Paxton has denied all wrongdoing.
Paul is also facing federal criminal prosecution for allegedly giving false statements to lenders and committing wire fraud and will face trial in November. He has pleaded not guilty.
Paul’s lawyers did not immediately respond to a request for comment. Paul could request a rehearing by the state Supreme Court.
“We are ecstatic,” said Ray Chester, a lawyer for the Roy F. & Joann Cole Mitte Foundation, an Austin-based nonprofit suing Paul for fraud in the underlying case. “We feel like justice prevailed.”
Travis County Judge Jan Soifer found that Paul had made unauthorized financial transfers despite a court order barring him from doing so; the order was meant to prevent him from moving or getting rid of assets to hide them from the court. Paul did not report the transfers and later lied about them, even when confronted with evidence of the accounts, according to a letter from the judge’s office.
The case is one of many that Paul, a Paxton friend and campaign donor, faces as he fights bankruptcies and legal battles with creditors.
Four justices, led by Justice Jane Bland, dissented from the majority, noting that the nonprofit has a conflict as “a financially interested private party.” They argued prosecuting a person for criminal contempt should be handled by a prosecutor instead.
“While a court may initiate criminal contempt charges based on a failure to comply with its orders or abuse of process, a court should refer such charges to the local prosecuting authority,” Bland said. “In the rare circumstance that such a referral is unworkable, the court should appoint an independent prosecutor—one financially disinterested in the outcome of the contempt proceeding. The trial court did neither in this case.”