The New Republic

February 15, 1999

Delayed Justice

The House whip pulls a Clinton under oath.

For more than a year, Republicans have lectured the country that the core issue of their crusade to remove the president is not sex, but lying under oath. And few have made this argument more vocally than the mastermind of Clinton's impeachment in the House, Majority Whip Tom DeLay. While legal experts note that such cases are rarely prosecuted, DeLay has never accepted that excuse. A born-again Christian who says he cherishes the Bible and the Constitution, DeLay has cast his campaign against the president as a battle of "relativism versus absolute values" and has excoriated the president for "trying to use legalese and lawyerese to do two-steps around the questions." When there have been plausible explanations for Clinton's misstatements, DeLay has dismissed them.

DeLay's absolutism may or may not be right for America; until recently it was not the standard that prevailed in most courtrooms. But it does raise an intriguing question: If DeLay's standards for truth were really in force, would his own testimony in a 1994 Texas lawsuit pass muster? Three people directly involved in the case say the answer is "no." And the evidence suggests they may be right.

It all began in 1986, when DeLay and an associate named Darrell Hutto approached Robert Blankenship, owner of a pest control company, to merge their firms. In the restructured company, Albo Pest Control, DeLay became the chairman, Hutto the president, and Blankenship the vice president. But, as Blankenship would later testify, over the years he would become convinced that DeLay and Hutto were not living up to their business commitments.

For one thing, Blankenship was irritated to learn that Albo was paying off a past judgment of $32,000 against DeLay won by a previous business associate. What's more, Blankenship says, he believed that DeLay was using money from their business to pay off his campaign loans--which, if true, would violate federal election laws. "When I first saw the [profit and loss] statement," Blankenship would later testify, "I looked at the money owed to these different banks ... and I said, `Darrell, what is all this money owed for, what is this?' And he said, `This is money, quote, that Tom DeLay borrowed to run his campaign, and now we're stuck paying it back.'" (Contacted in Houston this week, Hutto declined to comment on this matter, saying, "I think the record speaks for itself.")

Finally, Blankenship says that DeLay and Hutto routinely excluded him from important company decisions and meetings. In late 1993, he got wind of the fact that DeLay and Hutto were trying to sell the business. Blankenship says that, when he confronted his partners, they agreed to allow him to find a buyer, which would allow him to remain a partner in the business. By then, Blankenship says, he was so certain that Albo was carrying DeLay's campaign loans that he told one interested buyer of his concern. The buyer, in turn, wanted a clause in the contract to indemnify him in case Albo had made "any illegal political campaign contributions with corporate funds."

Soon after those negotiations broke off, Blankenship arrived at work to find the locks changed. A note taped to the door informed him that he had been fired. Blankenship promptly filed a lawsuit, which was initially reported by MichaelBerryhill in the Houston Press, charging DeLay and Hutto with breach of fiduciary duty, fraud, wrongful termination, loss of corporate expectancy, and injunctive relief. "They were trying to sell the business out from under me," says Blankenship. DeLay and Hutto responded by filing a counter suit, alleging that Blankenship improperly took home a customer list and shared it with a potential Albo buyer.

On February 5, 1994, Blankenship's lawyer, Gerald DeNisco--who, like Blankenship and his wife, was a lifelong Republican--began his deposition of DeLay in the usual way: "Would you state your name for the record, please? . . . Mr. DeLay, where do you reside? . . . And is that a home, sir?" Then he moved on to the subject of DeLay's relationship with the company. While it was routine questioning, having DeLay confirm his designation as Albo's chairman was important to the case since it tied DeLay to the company's business. But DeLay surprised everyone with his answer.

Question: And are you presently still an officer or director of [Albo]?
DeLay: I don't think so. No.
Q: All right. You're still an officer, are you not?
DeLay: I don't think I am.
Q: Okay. Did you resign as an officer?
DeLay: Not written. It was sort of an agreement.
Q: Okay. So you had an agreement with whom to resign verbally as an officer?
DeLay: With Darrell Hutto, president of the company.
Q: And when was that?
DeLay: I don't know. Two, three years ago,ù it wasn't anything formal. I haven't had much to do with the company since I got elected to Congress.[...]
Q: Suffice [it] to say, sir, it's your testimony today that you from about two, three years ago had a verbal agreement with Mr. Hutto to resign as an officer or director of Albo Pest Control. Is that correct?
DeLay: As far as I remember, yes.
Q: All right, sir. And that was never reduced to writing that you know of?
DeLay: That I know of, no.

Blankenship says he and his wife, Jacqueline, who was also present, were "stunned and speechless." So was DeNisco, who says he immediately suspected that DeLay was "seeking to distance himself from the responsibilities of his position and liability in the lawsuit." DeNisco may be right. According to Tom Read, dean of the South Texas College of Law, whom I asked to speculate on the testimony without telling him the names of the parties, "It appears to be an attempt to shield himself from liability for corporate acts."

Through further questioning, DeNisco did get DeLay to acknowledge that he had never told Robert Blankenship about his resignation--and that there was no company meeting or vote to ratify the change. In fact, DeLay even began to backtrack, saying he couldn't "remember" when he had resigned and adding that "I'm not even sure I am resigned. . . . I have nothing to do with the company. And in the day-to-day operation of the company." (He also punctuated his statements with frequent variations on "I cannot recall" or "I don't remember.") Yet DeLay also conceded that he had remained involved with Albo in myriad ways. DeLay testified that he had been immediately informed by Hutto of Blankenship's termination, had kept up with the monthly reports of the company's books, had signed a bank loan to consolidate the company's debt, had made calls to solicit customers, and had received "consultation fees"--and these activities took place during the period when he was allegedly no longer serving as chairman, or at least having "nothing to do" with the company.

Furthermore, while Hutto's testimony backed up some of DeLay's responses, he said "I don't know" when asked whether DeLay was chairman. And, when I recently asked him to recall or confirm the purported resignation conversation with DeLay, Hutto amiably declined, adding, "I don't want to use up my fifteen minutes of fame on this thing."

Finally, there was one other crucial piece of evidence of DeLay's continued status as chairman--only Blankenship and his lawyer didn't know about it. House members must file financial disclosure forms. In the filings for 1991, 1992, and 1993--the very years between DeLay's purported resignation and the deposition--DeLay listed himself as Albo's "Chairman of the Board." The House documents carry warnings: "Any individual who knowingly and willfully falsifies ... this report may be subject to civil penalties and criminal sanctions"--up to a $10,000 fine per count and/or up to five years in prison. (In 1984, Congressman George Hansen was sentenced to five to 15 months in prison and paid a $40,000 fine for failing to disclose relevant information.) Just below the warning on each form lies Tom DeLay's signature. The form for 1993 is dated May 10, 1994--a mere three months after the deposition.

DeNisco now says that had he known about DeLay's answers on his financial disclosure form he would have "asked the court to consider referring the matter to the district attorney for perjury charges." But, even without that information, according to DeNisco, the judge eventually made it clear to DeLay's brother Randy, who served as his lawyer, that "if the case went forward it was not going to have a very happy ending for them." Tom DeLay ended up settling, paying Blankenship a sum both parties agreed to keep confidential.

The settlement did not end Blankenship's saga. Soon afterward, DeLay reportedly pressured Milton Wright, a candidate for sheriff of Fort Bend County, to dismiss Jacqueline Blankenship, who was a well-known local Republican activist and Wright's campaign manager. When Wright refused, DeLay (ultimately unsuccessfully) campaigned against him and gave $70,000 in contributions from his reelection committee to Wright's opponent. DeLay has denied that his involvement in the race had anything to do with Jacqueline.

But the settlement did avert a trial that might have ended in bad publicity for DeLay and--if Blankenship was right about the campaign loans--more serious problems. Reached this week, DeLay's spokesman, Mike Scanlon, would not comment on any aspect of the lawsuit. "We are not going to participate," he said. "We are not going to confirm or deny anything. It's pretty clear what's going on here, and we will not be a party."

Of course, in the legal environment that prevailed before the right's crusade against Bill Clinton, it would have been easy to give DeLay the benefit of the doubt on these matters. For example, it is possible that, in his carefully worded statements about whether he was Albo's chairman, DeLay meant to suggest that he was no longer serving as the company's chairman in practice--even though, technically and legally, he was still holding that position.

But it is precisely such Clintonian arguments that DeLay has categorically rejected in recent months. Don't forget: DeLay voted to remove President Clinton from office because of his alleged perjury in the Paula Jones lawsuit--an apparent falsehood also told under murky circumstances to hide what was arguably less harmful conduct. That particular impeachment article failed, but DeLay insists it shouldn't have. So, if he's not willing to listen to lawyerly explanations about why an apparent untruth under oath isn't a lie, why should anybody else?