The real monkey business; it was Gary and Billy, not Gary and Donna - Gary Hart, Billy Broadhurst, Donna Rice

Washington Monthly, Feb, 1988 by Liz Galtney

The Texaco treatment

Broadhurst also made deals with Texaco, the largest lessee of state lands in Louisiana. Shortly before his second term as governor ended in 1980, Edwards appointed Broadhurst to lead the state's legal claim that Teaco cheated Louisiana out of $500 million in royalties due from gas drawn on public lands. The suit even sought cancellation of Texaco's lease agreements with the state.

At first, Broadhurst beat the drums, charging in a report that Texaco was "profiting at the state's expense" and accusing it of depriving Louisianians of "enormous sums of royalties." But Broadhurst eventually settled for much less, accepting a $28 million payment to the Louisiana treasury and taking much more for himself than had originally been expected. Broadhurst, along with one other attorney who helped on the case, had originally charged the state $600,000 for their services. When Broadhurst settled with Texaco he got the oil giant to pay not only his $600,000 legal fees but also an additional $900,000 to himself and the other attorney. "Texaco had a very good defense," explained Broadhurst.

The small settlement -- and big Broadhurst payment -- prompted a special state legislative committee investigation in which former state Mineral Board chairman, Bill Moran, charged, "We may not have had disinterested legal counsel on this issue." Broadhurst called the accusation from Moran and others a "cheap shot...a lie." But according to a former government attorney involved with the case, Broadhurst agreed to settle for a fraction of the state's claim on the condition that Texaco pay him and other attorneys more. "If they didn't settle the suit (for $28 million), they wouldn't have gotten that money out of Texaco," the attorney says. "They could only get the big bucks ($1.5 million) if they agreed to that settlement. Otherwise, they would have only gotten $600,000 from the state."

Broadhurst argued that Texaco's payment of his fees saved the state money. "It was a historic example of protecting the state's interest," Broadhurst maintained. But critics charged that Texaco's payment of $1.5 million to Broadhurst and the other counsel motivated the attorneys to serve Texaco's interests rather than those of the state of Louisiana.

Edward's successor, Governmor David Treen, fought the payment of the $900,000 bonus in court, but ongoing appeals kept the issue tied up until Edwards returned to office in 1984. Shortly after is return to the governor's mansion, Edwards ordered a halt to the state's action, allowing Gary Hart's good friend to keep the Texaco dollars. During the four years he ws out of office, between 1980 and 1984, Edwards was on retainer from Texaco.

And not everyone is convinced that only $28 million could have been wrung out of Texaco's coffers. Indeed, the attorney general's office is still pursuing damages against Texaco for hundreds of millions of dollars in unpaid land royalties -- a case based on virtually the same issues Broadhurst settled in 1982.