Funeral Case Targets WH Counsel
Gandalf Grey
Funeral Case Targets
White House Counsel Gonzales
A long simmering lawsuit is threatening to ensnare a White House lawyer Bush
may want to name to the U.S. Supreme Court
By Michael Isikoff
NEWSWEEK WEB EXCLUSIVE
April 21 - A nasty, long simmering lawsuit involving allegations of
political favors and big money campaign contributions in Texas is
threatening to ensnare one of the rising stars of the Bush administration:
White House counsel Alberto Gonzales.
GONZALES, A LONGTIME BUSH AIDE, is widely thought to be at the top of
the president's "short list" to fill the first available vacancy on the U.S.
Supreme Court-a spot that some believe could open up as early as this
summer. So the last thing that Bush aides want at this point is to have
Gonzales questioned under oath in a politically charged lawsuit by hostile
lawyers out to embarrass the administration.
But that possibility, NEWSWEEK has learned, has moved one step
closer as a result of court papers filed in Austin late last week. In a
document entitled "Motion to Compel Deposition of Alberto Gonzales," lawyers
for Eliza May, a former whistleblower who served as executive director of
the Texas Funeral Services Commission, the state agency that regulates the
funeral business, seek a court order to require the White House counsel to
answer questions in the case.
Specifically, the lawyers want to grill Gonzales about a recently
uncovered April 22, 1996 memo sent to his office when he was Bush's
gubernatorial counsel. The memo, written by the chief lawyer for the funeral
agency, suggested possible improprieties by two funeral commissioners with
ties to Service Corporation International, a huge Houston-based funeral
conglomerate headed by Robert Waltrip-a longtime friend and generous
financial patron of the Bush family.
May's lawsuit has been a thorn in the side of Bush and his aides
ever since it was first filed more than two years ago. Although many of the
issues seem obscure and even macabre, the case at its heart revolves around
allegations that Bush's office interfered with an aggressive state
investigation into SCI's embalming practices that was then being spearheaded
by May after receiving complaints from Waltrip, who had contributed $45,000
to Bush's gubernatorial campaigns and more than $100,000 to the elder George
Bush's presidential library. (Funeral industry sources have also confirmed
that the same year the dispute with May took place, SCI paid the elder Bush
a $70,000 honorarium to speak at a national convention of morticians.)
May, a one time official in the Texas state Democratic Party, was
later fired from her job-an action that has formed the basis for her
whistleblower lawsuit alleging she was the victim of "political" retaliation
because she was threatening the interests of a well-connected political
patron of the governor.
Bush and his top aides have heatedly denied the charges and
suggested the entire matter was drummed up by Democratic lawyers with
political motives. And until now, they have remained insulated from the
proceedings that have moved along at a snail's pace in Austin. But the
recent discovery of the 1996 memo-followed by last week's court
papers-represent the first time Gonzales's name has been dragged into the
dispute.
Gonzales, the motion states, is a "critically important witness in
this case." But, through lawyers representing him at the Texas attorney
general's office, Gonzales has so far refused to "voluntarily" agree to a
deposition on the grounds that "he claims not to 'remember' the matter," the
lawyers for May write. Given the "extraordinarily analysis" in the 1996 memo
and the "players involved,"-namely Waltrip and two funeral service
commissioners with financial ties to SCI (including one appointed by George
W. Bush)-Gonzales's claim not to remember "is, on its face, incredible" and
"strains credulity far beyond the breaking point," they add.
They conclude by asking Texas state judge John Dietz to order
Gonzales to submit to a deposition in Washington on June 9. That's just one
day after May's lawyers- with Dietz's blessing-are slated to take another
political sensitive deposition in the case: that of Joe Allbaugh, Bush's
former chief of staff in Austin and later presidential campaign manager, who
now serves as director of the Federal Emergency Management Agency (FEMA.)
Reached at his White House office on Saturday, Gonzales dismissed
the latest legal development-"it doesn't concern me"-and indicated he will
continue to resist being deposed. "I really don't remember anything about
this," he told NEWSWEEK. "So I think it would be a waste of time to take my
deposition."
Whether May's lawyers will succeed in compelling Gonzales's
deposition-thereby allowing them to confront him with documents and hammer
him with hostile questions about his work for Bush-is not clear. In August,
1999, after Bush had already begun his campaign for the presidency, they
sought to compel Bush's deposition. They cited comments by SCI lobbyist
Johnnie B. Rogers to NEWSWEEK that he had briefly spoken to the then
governor in April, 1998 when he and Waltrip arrived at Bush's office to
hand-deliver a letter to chief of staff Allbaugh. The letter alleged May was
using "storm-trooper tactics" by raiding the offices of SCI funeral homes
and demanded that May's investigation be halted.
"Hey Bobby (Waltrip), are those people still messing with you?" Bush
said to Waltrip when he saw him in Allbaugh's office, according to Rogers's
account at the time. Rogers later disputed the quote and Bush insisted in a
sworn affidavit that he never had "any conversations" about the SCI case. In
any case, the judge then denied May's efforts to question Bush, saying that
they should first question others with more extensive knowledge of the facts
in the case.
Judge Dietz' recent order requiring Allbaugh to submit to a
deposition is one indication that the May legal team may be making some
progress. And May's lawyers believe they have at least some limited
ammunition at their disposal this time: a paper trail in the form of the
April 22, 1996 memo written by Marc Allen Connelly, then general counsel to
the funeral services commission.
In his memo, Connelly wrote he had "recently received information"
from Texas state officials that two of the funeral commissioners charged
with regulating the state funeral business actually worked for SCI-the
largest funeral firm in the state. Although one of the commissioners was
openly an SCI officer (the one appointed by Bush), Connelly stated that
state banking records he inspected showed that another of the commissioners
worked for a firm in which SCI had become the largest stockholder.
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This represented "a possible statutory conflict" because state law
prohibited any two commissioners from having ties "directly or indirectly"
to the same funeral company.
Connelly concluded his memo to Dick McNeil, the Bush-appointed
chairman of the agency, by stating: "I recommend that you immediately inform
the Governor of this apparent conflict and also recommend that the Governor
take action to remove both (the two SCI-related commissioners) from the
commission because both individuals knew or should have known of this
conflict yet failed to notify the governor's office."
May's lawyers have seized on Connelly's memo as important evidence
showing SCI's power within the state agency charged with regulating it. But
their efforts to find out what became of it has been repeatedly frustrated.
McNeil in a recent deposition stated that after he received the
Connelly memo, he faxed it to Polly Sowell, who then served as Bush's
appointments secretary. When she was questioned, Sowell was asked what she
did with the memo. "I sent it to the General Counsel's Office," she said.
But Sowell said she did not remember what happened after that and, in his
interview with NEWSWEEK, Gonzales said such a memo was merely one of many
that might have crossed his desk and was otherwise not memorable. In any
case, Bush never acted on the memo's recommendations that the SCI affiliated
commissioners be removed.
--
"If this were a dictatorship, it would be a heck of a lot easier, just so
long as I'm the dictator." George W. Bush, Televised Newsconference
December 18, 2000