Hurricane Mostyn bearing down on the Texas legislature

HOUSTON (Legal Newsline) – In the wake of hurricanes Ike and Rita, no lawyer profited more from the storms, financially and politically, than plaintiffs attorney Steve Mostyn.

In fact, Mostyn, founder of the Mostyn Law Firm in Houston, is so involved in Texas politics that he keeps an office in Austin for the legislative session – his own perch overlooking the state capitol where he can ensure the millions of dollars he invests every election cycle yield interest.

In the five years since Ike pummeled Southeast Texas, Mostyn has engineered settlements with the Texas Windstorm Insurance Agency — the lone provider of windstorm insurance for Gulf Coast residents – arming him with $150 million in attorneys fees.

“Although he does not register as a lobbyist, Steve Mostyn is omnipresent at the state capitol,” said Sherry Sylvester, a spokesperson for TLR PAC, adding that Mostyn has earned a “reputation in the legal profession and in politics as having a bullying manner.”

TLR PAC is the political action committee of Texans for Lawsuit Reform, a group that has targeted Mostyn with criticism in the past.

Texas Sen. Larry Taylor, R-Friendswood, backed TLR’s assessment of Mostyn. He says that as a fixture at the state capitol and as a mega-donor, Mostyn’s influence on the state Legislature “is very powerful – beyond powerful. He’s the No. 1 funder of Democrats statewide.”

Texas, one of the few states with no campaign contribution limits for individuals, allows wealthy Texans like Mostyn to spend modest fortunes year-in and year-out on candidates of their choosing.

For example, on Dec. 31 Mostyn donated $1 million to Texas Sen. Wendy Davis, the Democratic nominee for governor, a Texas Ethics Commission report shows.

But Mostyn spending millions to either elect or stop someone from being elected is nothing new.

Just ask Taylor, who says Mostyn spent close to $1 million funding his opponent, Dave Norman, in the 2012 Republican Primary.

“He (Mostyn) spent about a million dollars against me in the Republican primary,” Taylor said.

In a span of 30 days leading up to the May 29, 2012, primary election, Norman raised $879,048.79 — $872,024.79 of which was donated by Mostyn or political actions committees to which he donates, according to the TEC.

Mostyn himself made a contribution of $275,000 with less than two weeks to go before the primary. Conservative Voters of Texas contributed $228,283.14, and Texans for Insurance Reform donated a total of $368,741.

Campaign finance records available by followthemoney.org show Norman raised a total of $1,025,377 during his campaign, an amount which included $53,967 in loans he self-financed – meaning Mostyn and the PACs funded nearly the entirety of Norman’s campaign.

According to TLR, Mostyn uses the aforementioned groups to fund politicians who oppose lawsuit reform. One of Norman’s own campaign ads said he would “stand up to insurance companies.”

“When looking at the candidates that Steve Mostyn chooses to bankroll, it appears that his self-interest as a personal injury trial lawyer supersedes his liberal Democrat partisanship,” Sylvester said.

“He backs candidates who will push the trial lawyer, anti-tort reform agenda regardless of their party label. Although he has affirmed in the media that he is a committed liberal Democrat, when he is backing Republican candidates he masquerades behind his own political action committee, which is named ‘Conservative Voters of Texas.’”

Despite its name, Conservative Voters of Texas was founded by Mostyn and his associate, Mark McCaig, to attack pro-tort reform legislators and candidates and is exclusively funded by Mostyn, according to TLR’s website www.thetruthaboutstevemostyn.com.

Sylvester says TLR PAC created www.thetruthaboutstevemostyn.com to make sure Texas voters are aware that Mostyn has reaped hundreds of millions of dollars in attorney fees from TWIA, which she says undermines the solvency of the quasi-governmental body.

As far as Texans for Insurance Reform goes, Mostyn did not establish the PAC but is its largest donor, the TLR website states.

Nonetheless, well-funded PACs and the hundreds of thousands of dollars Mostyn spent were not enough to stop Taylor from winning the District 11 Senate seat and continuing his work into investigating and reforming TWIA.

Taylor said while his rival Republican opponent did little-to-nothing to campaign, relying on the bombardment of media ads Mostyn’s money bought him, Taylor pounded the pavement, spending as much face time with the voters as possible, even going door-to-door.

However, despite Mostyn spending so much money to stop him from coming to power, Taylor says he has no problem with Texans spending big bucks on their preferred candidate.

“So long as you have transparency, I don’t have a problem with it,” Taylor said.

“In fact, it can be an advantage if your opponent is receiving all that money from a single person. Someone taking that much money is going to have to defend it. Mostyn is the type of guy that when he gives someone that much money, he’s going to come back expecting something. He certainly likes a friendly venue.”

Taylor gave an example of Mostyn throwing his weight around, saying Mostyn was the source behind killing his Senate Bill 1700 last spring.

SB 1700, a TWIA reform bill introduced in the 83rd Legislature in 2013, was designed to streamline TWIA management and funding. Also, if passed, TWIA would have been renamed Texas Residual Insurance Plan, according to openstates.org.

The bill was co-sponsored by state Sen. Juan Hinojosa, a Democrat.

In attempt to make the bill as non-controversial as possible, Taylor said he worked alongside Democrats and the Texas Trial Lawyers Association, making sure the piece of legislation contained no tort reform.

But Mostyn had other plans.

Taylor said a Democratic senator (who was not named) told him Mostyn called and said he didn’t want the bill passed, denying him a vote he needed.

“They (TTLA) were embarrassed,” Taylor said. “Mostyn made a phone call and stopped the bill.”

Mostyn, a former TTLA president, has since broken away from the organization after the death of the bill and formed the Texas Association of Consumer Lawyers with the help of attorneys Amy Witherite of Dallas and Kurt Arnold of Houston.

Dissatisfied with the amount of money TTLA was spending on political campaigns, Mostyn formed TACL with the goal to get more money into the hands of candidates without the bloated overhead in the TTLA, according to an article in the Texas Tribune.

Mostyn said in the article he was frustrated that too much of the dues being paid to TTLA were going to compensation for employees and leaving too little for campaign spending.

While Sylvester said TLR was not privy to the internal debate that caused the schism between TTLA and Mostyn, she did say whether Mostyn can be more effective funding and electing candidates with his new organization will be determined by results or lack thereof.

Through his media spokesman, Jeff Rotkoff, Mostyn declined to be interviewed.

Rotkoff said Mostyn and his wife Amber, who is also a Mostyn Law Firm shareholder, would not participate in any story written by Legal Newsline because it is owned by the U.S. Chamber Institute for Legal Reform.

From Legal Newsline: Reach David Yates at elections@legalnewsline.com.