Judge Dismisses Charges against Al Hill III after Craig Watkins Refuses to Answer Questions

CraigWatkins.jpg
Watkins, still not talking.
Update, 3:52 p.m.: The Dallas Morning News' Jennifer Emily tweets that the case against Hill has been dismissed. Judge Levario cited Watkins' refusal to testify as part of her basis for dismissal.

Original post: Craig Watkins wasn't sick today, and contrary to the inexplicably wrong tweets from one TV news station, he didn't plead the Fifth Amendment, invoking his right to avoid self-incrimination.

The district attorney came into Judge Lena Levario's courtroom this morning with his attorney by his side, where he spent about five minutes on the stand. He was called to answer questions from the defense attorneys of Al Hill III, the heir to an absurdly large oil fortune, who argues he was charged with mortgage fraud by the DA's office as a favor to a friend and political donor of Watkins' named Lisa Blue. Last time Watkins was called, as you might remember, he was real sick and just couldn't make it down from his office.

The courtroom was packed today in anticipation of Watkins' testimony, with at least half the DA's office in attendance, Watkins' wife Tanya and a couple dozen reporters. Also there, for reasons that were unclear: Terri Hodge, the ex-state representative who was sentenced to a year in prison after getting caught up in that massive City Hall corruption scandal of ours.

Lisa Blue was not in attendance; her attorney told Judge Levario that she would continue to take the Fifth in order not to testify. In response to direct questions from the judge, he wouldn't quite say that she was not testifying to avoid implicating herself in a criminal matter, although that's the subtext here.

If Watkins wanted to avoid testifying without getting in trouble with the judge, he too would have had to take the Fifth. He didn't. Instead, Watkins' attorney told Judge Levario that Watkins doesn't have to testify, asserting attorney-client privilege and "work product privilege." The argument on that second one is that Hill's attorneys are requesting Watkins' "thought process," which he shouldn't have to explain.

The judge didn't buy it. What's more, she said, "Are you aware that your office has sent out emails about this case, that news conferences have been held denying these allegations?" In other words: you want to be silent now, but your assistant DAs will happily discuss the case every chance they get?

"Hasn't he basically waived any privilege?" Levario inquired. Then, to Watkins, she added, "You are ordered to answer questions." He didn't. The judge told him she was holding him in contempt of court, and that she'd take up that matter "later."

With that, Watkins and his attorney swept out of the courtroom, which almost immediately took on the itchy feeling of people stuck in church for way too long. Hill's attorneys entered several binders into evidence, including, they told the judge, stacks of campaign finance reports. They were clearly hoping that with Watkins refusing to testify, Levario would dismiss the case against their client out of hand. She did not, ordering them to try to prove their case using some other witnesses instead.

Next, Hill's attorneys called Terri Moore, the former Executive Assistant District Attorney at the time Hill was indicted. Moore said that Hill's indictment came out of a "pitch session" in the DA's office, where another ADA, Donna Strittmatter, presented a PowerPoint presentation of the evidence against Hill and his wife, Erin. Watkins was present at the session, Moore said, but didn't recall him asking any questions or making any specific statements about the proposed charges. Nor did Lisa Blue come up in that pitch session or any other meeting she attended, she said.

But wait, you must be asking yourself: Does the DA's office have a big powwow every time they want to indict someone? Great question. Moore said pitch sessions are "common," but not universal. Why did it happen here? In a word, because Al Hill III is godawfully rich. The office knew he was likely to have "a crew of lawyers from California and God knows what," Moore explained.

Moore's testimony also dealt with where the fraud allegations against Hill III originally came from: his own father, Al Hill Jr. The father-son duo were locked in a variety of money disputes, and a federal district judge wrote in an opinion that Hill Jr. had "credibility issues," Moore said. Hill III's lawyer gave that opinion to Moore, warning her to be careful about indicting his client based on Dad's word. His attorney at that time was none other than Lisa Blue, who subsequently turned around and sued Number Three for attorney's fees.

Moore denied that she had any personal friendship with Blue, saying, "I think she's a lovely lady. I like her." That said, she admitted, Blue did give her advice when she went into private practice, and the two women worked together on a case, back when Dallas County sued Merscorp and Bank of America for allegedly cheating them out of filing fees.

After Moore, Assistant District Attorney Donna Strittmatter took the stand. She, too, recollected the pitch meeting where Hill's indictment was discussed, but said no one had suggested contacting Blue. "I don't know if she was," she said.

Judge Levario asked Strittmatter to list "any evidence you have" that Watkins was "personally involved" in the decision to indict Hill. Strittmatter replied that he wasn't involved in prepping the case at all, other than attending the pitch session.

Strittmatter was also adamant that the case against Hill is because he demonstrably broke the law, taking out a nearly $500,000 loan against a $2.8 million home. The problem? He only owned 20 percent of the home, a fact which the DA's office says he neglected to disclose in filing for the loan. But the bank he borrowed from didn't make the complaint. His angry, litigious dad did.

"You've got rich people where the defendant appears to have borrowed half a million dollars, paid it right back, and nobody complained until a couple years later?" Levario asked skeptically. The subtext to that question being: Why did this end up as an indictment, if the bank, Omni American, wasn't complaining? In a moment, she made that subtext explicit, asking: "How often does the state prosecute cases where everyone's been made whole? No harm, no foul, so to speak?"

Strittmatter replied that Hill's lies "violated numerous laws. The loan was not paid off until the defendant was sued." She added that the state prosecutes these types of cases quite often, and that even though the loan had been repaid, Hill III's conduct was still criminal.

Then things got weird. The DA's office quickly displayed the actual PowerPoint presentation that had been shown in that "pitch session" about Hill III's indictment. It was all done in yellow lettering, with a bright blue background and lots of crappy-looking clip art. The presentation, which Strittmatter said she didn't prepare, laid out that that Hill III and Erin were broke (Hill didn't have any apparent income at that point), and suggested they filed for the loan against the house to remedy that.

The strange part came a moment later. One of the slides displayed a picture of Erin from 1993, back when she was Erin Nance and a contestant in the Miss Usa pageant. Nance Hill came in as the first runner-up. Underneath her photo, the courtroom quickly caught sight of what looked like a snarky joke. It read something like, "Guess who was the runner-up?"

"Why is that necessary?" inquired Judge Levario. She'd been noticeably unhappy throughout the hearing, and things kicked up a few notches. "Were you making light of her being a runner-up? Do y'all do that kind of tacky stuff all the time?"

Strittmatter responded meekly that she hadn't made the PowerPoint. Levario let it go.

A moment later, just before the court recessed for lunch, Levario had another question, this one weirder even than a random photo of a beauty pageant in the midst of a mortgage fraud case. Lisa Blue, the judge said, apparently had copies of subpoenas that were filed with the grand jury. Those subpoenas, like everything else that happens in a grand jury, were under seal. No one should have seen them. So how exactly did that happen?

Other assistant district attorneys will continue their testimony this afternoon. It's not yet clear whether Judge Levario will issue a ruling today on Hill III's motion to dismiss the case. Stay tuned.

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16 comments
mewkins
mewkins

Okay. It was a $2.8 MM house. I'm guessing there was no mortgage/debt, hence the 80% - 20% split between the Trust and III. He bought it through the Trust. So they had 100% equity. 20% of that equals $560K. The bank gives III $500K. Why couldn't he have access to his equity?

Why didn't they just explain what laws III broke, or what exactly his alleged "fraudulent misrepresentations" were? Did the bank ever say he duped them into giving him the $? Probably not as they knew he didn't own the house outright so they only gave him $500k.

smichaelclark59
smichaelclark59

Another embarrassment to the city of Dallas.  We are  already the laughing stock over our long list of corrupt politicians.  I'm sure no one is surprised by this given Watkins history

halldecker
halldecker

I talked with another Courthouse Judge yesterday,  "Craig is doing no more than Henry Wade, Bill Hill and John Vance also did regularly."

Rumpunch1
Rumpunch1

Question.  Now that the case is dismissed, are the misconduct charges also dead?  Is the DA only having to face the music regarding the contempt issue?  Will this be rolled up into the AG investigation regarding the DA campaign finance issues?

Rumpunch1
Rumpunch1

DMN is reporting that case against Hill has been dismissed.  Judge noted that part of the reason for dismissal was Watkins refusal to testify. 

Regardless of what you think about either Watkins or Hill, since the DA actions today partially led to the dismissal of the case, is this who we want as our face of law and order in the County?

casiepierce
casiepierce

".. where Hunt's indictment was discussed..."

So.... can you or someone else diagram the Hunt-Hill relationship here? This part of the family gets confusing. 

Lakewooder
Lakewooder

If the DA split, you must acquit.

WylieH
WylieH

@Rumpunch1 Watkins has been a problem for a long time.  It would be great if we could get Judge Creuzot to take up the cause.

Anna_Merlan
Anna_Merlan

@casiepierce Argh, that's a typo. Sorry, let me fix that immediately before I get sued to the ends of the earth. Thanks, Casie.

mewkins
mewkins

You better hurry up and trademark that quote.

animas
animas

Hilarious.  Also: If the DA's a twit, you must acquit.

Rumpunch1
Rumpunch1

@WylieH @Rumpunch1 The problem is the DA still thinks like a defense attorney.  It was Hill's attorney job to prove reasonable doubt of the whether the prosecution's case was motivated by outside forces.  By the DA's refusal to testify, it played right into the defense team's plan to create that doubt. 

The DA lost this case. More specifically, the DA gave this case away - possibly to hide something. 

WylieH
WylieH

@Rumpunch1  I suspect the DA was caught in a bind here; if nothing untoward happened, all he had to do was say so from the stand.  Matter closed.

What makes things "interesting" however, is that his hands may not be so clean-- and the Feds may already be investigating him.  If he were to perjure himself on the stand, this could make things even more sticky for him if the Feds end up filing charges against him.  He may be worried that Blue would turn state's evidence to avoid prosecution, herself.

More to come, no doubt.

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