"I think the speed which the Texas Attorney General went after them is interesting."
September 14, 2006
By Robert Nathan
Killeen Daily Herald
A Killeen-based company that promised to protect landowners – for a fee – from potential eminent domain proceedings in connection with the proposed Trans-Texas Corridor project has suspended operations in the wake of a lawsuit filed Tuesday by the Texas Attorney General's office.
Attorney General Greg Abbott filed the suit against three individuals and their Killeen-based company, "You Can't Take It," which claimed it had found a loophole in eminent domain procedures.
The company and Killeen residents Douglas Lee Thayer, Lou Ann Reed and her daughter Nykee Jolene Murray of Austin are defendants in the lawsuit.
"They are calling it fraud and fraud would be a conclusion," Lou Ann Reed said Wednesday afternoon. "All they have is speculative. It's not fraud; there was nothing fraudulent about it. We haven't even done any business."
Hale Stewart, a Houston attorney representing the company, said they would love to fight the suit, but cited insufficient funds to contest it.
"It is a temporary injunction and we have basically folded the company as a result of this, because we don't have the funds to fight the AG (attorney general)," Stewart said.
"The company does not have the funds to fight the litigation is what it comes down to," he said, "and there is no point in funding litigation if you can't pay for it and if it is going to prevent you from doing any business."
Stewart said the company is "voluntarily shutting down."
Abbott is seeking a temporary injunction that will go before the 345th District Court in Austin today.
"Residential property owners are being taken for a ride by these so-called transportation experts," Abbott said in a news release. "They have no standing whatsoever to insert themselves into such legal proceedings, and homeowners, who are already protected by the constitution, will find they have paid a lot of money for a service that is null and void."
The company was using the 2005 U.S. Supreme Court decision, Kelo vs. city of New London, to justify its business plan, claiming a company can block the state from taking any land through eminent domain. The decision says that if an economic development project would provide an economic benefit in the form of higher tax revenues to a city, then eminent domain could not override that project, Stewart said.
The company's chief executive officer, Douglas Lee Thayer, said Wednesday, "It (the Kelo decision) allowed us to file a development project ahead of theirs (the Trans-Texas Corridor.
Thayer has been doing business under the name of Douglas Lee.
"What we had planned to do was go in there and plan development projects ahead of the Trans-Texas Corridor," Thayer said.
The Trans-Texas Corridor is intended to relieve congestion on Interstate 35. It will parallel I-35 and extend from Oklahoma to Mexico, with possible connections to the Gulf Coast. It would not only separate car and truck lanes, but it would also include railroads and underground utilities, such as telephone, water and gas pipelines.
Thayer said he thinks the state's actions are the result of his negative comments about TxDOT's reputation.
"We have been addressing the fact that they're taking these homeowners' properties," Thayer said.
He said a major construction company had been lined up to where "we could have gone in and scheduled all of these development projects."
"When these projects were completed," he added, "it would have increased the local tax revenues to satisfy the Kelo decision requirement to stop them from using eminent domain to take the properties."
During a series of TxDOT public hearings this summer, TxDOT officials said all land for the multi-use highway project would be purchased and property owners would be paid full market value and their property would not be taken through eminent domain.
"As we indicated previously, we don't know where the corridor is going to go," TxDOT spokesman Ken Roberts said in a July interview. "That is going to determine what exits are going to be constructed for what towns and cities along the way."
Stewart said the company has only been in business for a month and hasn't purchased any properties or done any other business.
"I think the speed which the Texas Attorney General went after them is interesting, shall we say," Stewart said. "I'd love to fight this thing, but what the attorney general will do is just put up as many roadblocks as possible."
The Attorney General's Office released its statement early Wednesday afternoon.
"We have been internally debating here about this matter," said Tom Kelly, spokesman for the Texas Attorney General, before the statement was released.
The statement said the lawsuit had been filed to stop the company from falsely claiming it can protect property owners from potential eminent domain proceedings linked to the Trans-Texas Corridor project.
The company was planning a business meeting on Sept. 16 at Temple High School. However, Thayer was notified Tuesday the city of Temple would not allow such a meeting at the high school.
"They gave us the runaround to keep the meeting from taking place," Thayer said.
He said it is not fair that the city can hold TxDOT meetings to bring in the highway, but "someone in opposition, who offers a remedy to the matter, can't get the same courtesy or treatment."
The attorney general seeks both temporary and permanent injunctions halting any deceptive claims or advertising, requiring the defendants to fully disclose all of the facts associated with eminent domain proceedings.
The suit also requests penalties of $20,000 per violation of the Texas Deceptive Trade Practices Act, a penalty of $250,000 if a harmed consumer is 65 years of age or older, and payment of attorney's fees.
Contact Robert Nathan at firstname.lastname@example.org
© 2006 Killeen Daily Herald: