Thomas Dale DeLay v. State
2013 Tex. App. LEXIS 11776
| Tex. App. | 2013Background
- In 2002 TRMPAC (a Texas general-purpose political committee) received substantial corporate donations and issued a $190,000 check to the Republican National State Elections Committee (RNSEC); RNSEC then issued $190,000 in checks to seven Texas candidates from a separate "hard-money" account. TRMPAC deposited corporate funds in a separate "soft-money" account.
- DeLay was indicted and convicted of (1) conspiracy to commit money laundering and (2) money laundering (funds $100,000+), with the predicate felony alleged as violations of Texas Election Code subchapter D (unauthorized corporate contributions).
- The State's theory: corporations’ donations to TRMPAC (and an agreement to a soft-for-hard money “swap”) produced "proceeds of criminal activity," so the transfers to candidates were money laundering.
- DeLay argued transfers were lawful, customary structuring (soft/hard segregation), and the funds used to pay candidates came from RNSEC’s hard-money account (not corporate funds), so there were no "proceeds" to launder.
- The jury convicted; during deliberations they asked whether money must be illegal at the start of the transaction — the court declined to clarify beyond the charge. The majority appellate opinion held the evidence legally insufficient and rendered acquittals.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Legal sufficiency to prove money laundering (funds were "proceeds of criminal activity") | Corporate donations and the agreement to swap soft money for hard money made the TRMPAC funds "proceeds" because they were intended for Texas campaigns in violation of Election Code subchapter D. | Transfers were lawful or structured to comply: corporate funds went to TRMPAC’s soft account and RNSEC paid candidates from a separate hard account; corporations intended lawful uses. No tainted funds were transferred to candidates. | Reversed convictions: evidence legally insufficient — State failed to prove the funds delivered to candidates were proceeds of criminal activity. |
| Whether an "agreement" to swap money can itself be the predicate unlawful act (i.e., create proceeds) | The agreement to exchange corporate soft money for hard-money contributions to Texas candidates completed the unlawful act (an agreement to make unauthorized contributions) and thus produced proceeds. | Even if an agreement existed, money laundering targets funds derived from a completed unlawful act; here the alleged predicate act and the laundering transaction were part of the same series, and the hard-money payments came from untainted sources. | The court rejected the State’s "agreement" theory as insufficient to show proceeds existed at the time of the laundering transactions. |
| Whether lack of express designation on corporate donations made them unlawful contributions under Election Code | State: undesignated corporate contributions to a general-purpose committee can be illegal if intended for candidate use; many TRMPAC solicitations suggested candidate support. | Defense: contributors testified they intended lawful uses; corporations can lawfully donate to general-purpose committees for administration and out-of-state activity; mere undesignation does not prove criminal intent. | Court held State failed to prove requisite criminal intent of corporations for Election Code violation, so donations were not proven criminal proceeds. |
| Effect of separate accounts / commingling on taint of funds | State: a negotiated one-for-one swap made separateness irrelevant; intent transformed TRMPAC funds into proceeds. | Defense: RNSEC maintained separate soft and hard accounts; RNSEC paid Texas candidates from hard account funds not containing corporate money, so funds were not "tainted." | Court emphasized separate accounts and lack of commingling; funds to candidates were not shown to be tainted. |
Key Cases Cited
- Jackson v. Virginia, 443 U.S. 307 (establishes federal due process legal-sufficiency standard)
- Brooks v. State, 323 S.W.3d 893 (Tex. Crim. App.) (legal-sufficiency review and deference to jury verdict when supported)
- Ex parte Ellis, 309 S.W.3d 71 (Tex. Crim. App.) (interpretation of corporate contributions and subchapter D limitations)
- Williams v. State, 235 S.W.3d 742 (Tex. Crim. App.) (court must ensure evidence actually supports crime charged)
- Emily’s List v. Federal Election Comm’n, 581 F.3d 1 (D.C. Cir.) (discussion of soft/hard money accounts and permissible separateness)
- United States v. Christo, 129 F.3d 578 (11th Cir.) (money-laundering conviction reversed where laundering transaction was same as underlying criminal act)
- United States v. Butler, 211 F.3d 826 (4th Cir.) (funds must be derived from an already completed offense to support laundering)