Study Shows 15 Insurers Contributed to Controversial 2002 Texas Election

July 25, 2005

Insurance companies that were fighting tighter state regulations were major corporate donors to a business lobby group’s mail campaign that helped Republicans take control of the Legislature in the 2002 elections, the Austin American-Statesman reported.

The newspaper examined records released by the Texas Association of Business that indicated the identity of 18 corporations – 15 of them insurance companies – that helped finance the mailings.

The Texas Supreme Court last month ordered the association to release the records to 2002 Democratic legislative candidates who sued the association after losing their races. Those Democrats contend the TAB worked with Texans for a Republican Majority, a political action committee formed by U.S. House Majority Leader Tom DeLay, to funnel corporate money into the Texas House races.

The business association has argued that the mailers, which criticized Democrats, were meant to educate voters about issues, not to urge votes for any particular candidate.

State law generally prohibits use of corporate or union money in political campaigns.

The court ordered the TAB to provide a list of how many businesses donated and how much each donated. It did not require the association to release specific names of the corporations that contributed the $1.7 million to the 4 million-piece mailing.

The association had argued that releasing the names would violate the donor’s First Amendment rights.

But the release of documents by the association disclosed almost two-thirds of its 30 or so corporate donors, the American-Statesman reported.

The TAB blacked out some names and many other identifying marks but left other documents untouched. Other documents showed bank account numbers that could be compared to other checks or invoices. On some documents, signatures were visible.

The association’s lawyer, Andy Taylor, invited news reporters to examine the pages, assuring them “nothing’s there.” He denied that the association may have made a mistake in editing the documents, except in two or three instances when original checks or invoices were released without the corporate names adequately blacked out.

He said the group had no choice but to follow the court order in releasing the information.

“We had to give everything but the names. We didn’t have the right to redact anything else,” Taylor said.

The association would continue to fight to protect the names of the donors that have not been revealed, Taylor said.

Austin lawyer Buck Wood, who represents Democrats suing the TAB, said he will add those companies as defendants in the lawsuits.

“I was surprised there was information given to me to allow us to identify the donors,” Wood said. “I think we’ll get them all now.”

Of the 18 corporations the newspaper identified, three are not involved directly in insurance but have an interest in insurance costs and lawsuits. They are AT&T Corp., the National Federation of Independent Business and a small data company in the Rio Grande Valley.

The insurance firms include United HealthCare, Cigna, Aetna, Humana, PacifiCare, Blue Cross of California, State Farm and Allstate.

The insurance industry was successful in fighting the harshest regulatory proposals in the 2003 legislative session.

Most companies donated $40,000 each, while other donations ranged from $100 to $300,000, the American-Statesman reported.

Officials with most of the corporations declined to comment because of the threat of litigation and a grand jury criminal investigation or did not respond to inquiries from the American-Statesman.

Representatives of Liberty Mutual Insurance Co., Allstate Insurance Co. and the business federation confirmed the donations. They said the money was used to educate voters, not to campaign for candidates.

Copyright 2005 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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