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Proposed $3.3 million settlement in whistleblower lawsuit against Texas AG Ken Paxton in jeopardy

The lawsuit against Paxton accused him of firing the former employees after they alleged he committed criminal acts, according to past court filings.

AUSTIN, Texas — A proposed multi-million-dollar settlement between Texas Attorney General Ken Paxton and four former employees who filed a whistleblower lawsuit is in danger of unraveling.

The whistleblowers filed a motion Wednesday asking the Texas Supreme Court agree to allow the lawsuit to proceed because, they say, the Office of the Attorney General will not agree that the legislature would have to approve the settlement during this current session. 

“That was the fundamental premise upon which they asked us to negotiate in the first place,” attorneys representing the whistleblowers said in a statement Wednesday. “We would still settle the case if the legislature approved the payment this session, but we cannot and did not agree to give OAG the benefit of a settlement while the whistleblowers wait in perpetuity for legislative approval.”

As part of the mediated settlement agreement, Paxton agreed to apologize and for the state to pay $3.3 million. The settlement is contingent upon legislative approval.

The court granted a joint motion on Feb. 16 agreeing to abate the lawsuit while the parties proceeded with settlement negotiations.

The new motion states that the Office of the Attorney General has said in oral communications that “it has maneuvered” the whistleblowers into a “GOTCHA position.”

“If funding approval is not achieved this session, OAG says this case should be abated until the 89th Legislature considers it in 2025,” the motion said. “And if that Legislature reuses to approve it, OAG says the abatement should remain in place until the following session. And so on in perpetuity.”

The motion states that in written communications the OAG said that it is researching what happens if the Legislature decides not to fund the settlement during this session.

The lawsuit against Paxton accused him of firing the former employees after they alleged Paxton committed criminal acts, according to past court filings.

In a statement provided to WFAA from General Litigation Division Chief Chris Hilton said they plan to "seek a cost-efficient resolution." 

“The Office of the Attorney General and opposing plaintiffs signed a binding Mediated Settlement Agreement weeks ago that maximizes savings to the taxpayer. OAG immediately began to fulfill its obligations under the agreement," said Hilton. "Now the plaintiffs have decided to try to undo the agreement by filing a misleading brief with the Texas Supreme Court, all the while coordinating with the media to create drama. We’ll continue to seek a cost-efficient resolution, even while the plaintiffs needlessly drag this process out.”

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