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his cousins.” Pusey, consulting his notes, most of which he did not use in his 1986 story, said that when he called Mattox, the attorney general said, “I don’t recall the checks, how they were made out, or about the nature of those transactions. They should have been closed out in the name of Mattox” \(Pusey was not aware in any way that the land was being divided up and sold to the investors,” he also told Pusey. “Let’s take this in context,” Mattox continued. “This was in 1982 before I entered the AG’s office.” Pusey asked him why he had not looked into the 1-30 scandal as the state’s chief legal officer. \(Pusey and Christi Harlan had broken this scandal in notes, Mattox replied: “You had the local DA, the FDIC [Federal Deposit Insurance Corp.], and the Justice Department looking at the matter. There were an ample number of authorities looking into it.” On the question of what he had done for the $200,000, Mattox said, as Pusey recalled, that he had not had a formal option to buy the 21.5 acres, but had had “sorta an option.” In his story, Pusey said Mattox explained that he had an informal option. “In effect,” Pusey’s notes show Mattox saying, “we did not execute our right to buy the property and allowed the property to go and be sold to Sinclair. Sinclair then paid us what would have been our profit had we bought and sold the property to someone else.” While Pusey was writing his story, Mattox phoned him back twice. The first time, Pusey’s notes reflect, Mattox said: “I remembered Ken [Cansler] giving me something. It must have been an envelope.” Opening up their third discussion on that evening, Mattox said, as Pusey’s notes report it: “I hope I’m not botherin’ you, but when guys like you start callin’ guys like me, guys like me get worried.” Pusey said he asked Mattox if it bothered him that Cansler, the man who handed him the $200,000, himself made more than $700,000 in the same deal. “I’ll never forget what he said,” Pusey, seated at his desk in the Dallas News, recalled. “He laughed and said, ‘I’m not greedy.’ ” II. A CONTROVERSY ABOUT $125,000 A/ SWORN ALLEGATION that $125,000 was set aside in a bankruptcy case so that the money could be conveyed to Jim Mattox might never have found its way into an open court record but for a Dallas lawyer named Mike Cooper. Joseph F. Landis, a Duncanville, Texas, insurance operator who owns and works 8 JUNE 16, 1989 through several companies that can be characterized as Intercon Reinsurers involuntary bankruptcy. He and Intercon are being pursued for their assets by Lloyd’s, U.S. \(hereafter usually called simply alleges that Landis and others committed “a massive insurance fraud” by selling bogus Lloyd’s insurance policies without consummated authority from the company and keeping for themselves most of the $2 million in premiums they received from the 4,000 Texans to whom they had sold the policies. One Monday last January, on the 23rd, in Dallas in the U.S. bankruptcy court of Judge Robert C. McGuire, perhaps 40 lawyers, but no reporters, were participating in or attending a hearing on a Lloyd’s motion to remove Don Navarro as the U.S. trustee in the case. Lloyd’s charged that Navarro had “thrown his lot in with” Landis, Intercon, and those associated with them. A lawyer for Lloyd’s, Samuel D. Rosen of New York City, was asking Navarro if he knew that for at least five months, Lloyd’s had been asking Navarro to recover $125,000 from Gail E. Cooper, a Dallas business consultant. Navarro agreed that Lloyd’s had been trying to get him to act on the matter for that long. Turning then to Judge McGuire, Rosen said: “Your Honor, at this point we need to clear the courtroom, because we are addressing the very issue that Judge Sanders put under seal.” Mike Cooper, the lawyer for Navarro, immediately said: “Your Honor, I will object to clearing the courtroom. . . . Their allegations are that some of this money allegedly went to the attorney general of the state of Texas. If that’s a fact, let them prove it, and let’s get it on the record. There is no reason for that to be under seal.” “Your Honor, I am appalled,” Rosen exclaimed. “Judge Sanders filed an order placing this information under seal.” But a moment or two later Rosen accepted the fact that the cat was out of Judge Sanders’s bag. “Now that Michael Cooper has made the statement for the record,” Rosen asked Navarro, “you are aware that Mr. Landis and Mr. [Lawrence Dale] St. John have testified under oath that this $125,000 payment of Mr. Landis’s money was for the purpose of conveying it to the attorney general of the state of Texas?” Yes, Navarro said, he had heard that the day before. “And you are aware,” Rosen continued, “that Mr. [Robert K.] Dowd, the attorney for Mr. Landis who actually made the payment, asserts that the reason for the payment was not for the attorney general, but rather in payment to Gail Cooper for services in making one telephone call to obtain a new insurance carrier for Mr. Landis?” Navarro said he knew that, too, and explained that he had not moved to get Cooper to turn over the money because he was still investigating the matter. Rosen, in a hypothetical question, asked Navarro “if the testimony of Mr. Landis and Mr. St. John [is correct] that this $125,000 was for a bribe to the attorney general, would you agree with me that that money is recoverable by you” as the trustee for the Landis and Intercon estates? Yes, Navarro said. Later in the hearing Mike Cooper testified, as a witness, that in December 1987 Joseph Landis deposited $590,000 in a trust account with his’attorney then, Robert Dowd; that most of it was transferred back to Landis later that month; but that $125,000 was paid out of the Dowd account to Cooper. “Mr. [Gail] Cooper has denied that he paid any money to the attorney general of the state of Texas,” Mike Cooper said, adding: “I have seen no evidence that anybody paid any money” to Mattox. This unsettling day in Judge McGuire’s court could not remain secret forever; Judge Sanders’s seals could not close the record of a hearing in Judge McGuire’s open court. John Kirkpatrick, an investigative reporter for the Dallas Morning News, was working on the story for about three months, and on March 8 he signed a form he had to sign in order to unbind for copying certain papers in the clerk’s office of 298th District Judge Adolph Canales in Dallas concerning the Landis/Intercon matter. Kirkpatrick has told parties he is doing an investigative story about it, but as of this writing it had not been published. However, on page 21 of the Dallas Business Journal for the week of June 6, in a copyrighted sidebar run with a pageone feature concerning Gail Cooper, the events in McGuire’s court last January 23 are reported. Pertinent excerpts follow: .. Allegations have been made that a $125,000 consulting fee paid to [Gail] Cooper was funnelled through [the law firm of Simpson, Dowd, Kaplan, Lewis & Moon Dowd being Robert K. Dowd] to be used as a bribe of Texas Attorney General Jim Mattox. . . . “An official in the attorney general’s office said no attempt was made to bribe Mattox, and [Skip] Simpson, [Gail] Cooper’s lawyer, said there is no basis for the allegations. . . . ‘That stuff about Mattox is absolute crap,’ Simpson said. ‘It makes a good story when there’s an election coming up. In Gail Cooper’s case they’re going to have a hard time showing there was a payoff because it just didn’t happen.” The morning of June 9 as this Observer story was being written, Kirkpatrick telephoned the author, saying: “I’m calling to check out a rumor that y’all have a fantastic story on ‘Mattox that’s comin’ out in a few days.” “Well, John, I don’t know how to respond,” this reporter replied. “I have asked Attorney General Mattox to see him, and I’m waiting to hear back from him.” Kirkpatrick asked: “When will youall’s next issue be out on the streets?”