Naked City

Beyond City Limits

UT System Chancellor Mark Yudof got an $18,000 raise from the UT System Board of Regents Monday, raising his yearly salary from $450,000 to $468,000. No doubt expecting a backlash in a time when all university departments are being forced to make budget cutbacks, Yudof will donate the entire raise to a scholarship and research fund. The bulk of Yudof's salary comes from private donations, not state money, and The Daily Texan reports that Yudof's raise was mandatory under state law. -- L.N.

Among the 28 new topics Gov. Rick Perry added for consideration during the special session is a call to study prison privatization. In the regular session this spring, House Corrections Committee Chair Ray Allen, R-Grand Prairie, along with committee member Jack Stick, R-Austin, proposed expanding the state's already controversial forays into private prisons, to the chagrin of many criminal-justice reformers. Allen authored a bill that would've turned over Texas' entire state jail system over to private-prison operators, while Stick proposed removing the cap on the number of prison beds each operator would be allowed to maintain. Still, after well-attended and heated committee hearings, both proposals languished, and so far in the special session no bills proposing a private-prison study had been filed. -- Jordan Smith

Meanwhile, the Texas Dept. of Criminal Justice has laid off 400 additional workers in response to state budget cuts, with a target of 1,500 positions to be eliminated by Sept. 1. The positions targeted include substance-abuse counselors, mailroom clerks, chaplains, and recreation specialists. Laid-off employees who are qualified are being encouraged to apply for the 2,300 positions already open for correctional officers. In order to comply with the new budget, the TDCJ is also cutting back on the amount and quality of food for inmates. In a presumably unrelated story, more than 600 inmates at TDCJ's Darrington unit outside Houston have fallen ill with suspected salmonella poisoning. -- Micheal King

Step back, there's a new Mold Queen in town. On June 30 Isabelle Arnold, the former national mold claims manager for Farmers Insurance, filed suit in a Los Angeles court against her former employer, alleging she was wrongfully terminated after making a concerted effort to change the way Farmers handled mold claims. Among the numerous named defendants are Farmers Insurance Exchange -- Farmers' L.A.-based management company -- and Texas Farmers Insurance Company. Arnold's suit alleges that Farmers' claims-handling practices were deceptive and discriminatory and that she was fired for her attempts to reform Farmers' practices -- reforms she alleges would have helped to lower premiums for all Farmers policyholders. -- J.S.

In other Farmers news, on July 7 the 3rd Court of Appeals in Austin ordered an emergency stay, forbidding Farmers from sending notices to Texas policyholders regarding the company's settlement agreement with the state. On May 22, District Judge Scott Jenkins gave preliminary approval to the negotiated settlement, but three Farmers customers, represented by Austin attorney Joe Longley, have challenged the settlement, claiming it just wasn't fair, and sought the injunctive relief. The July 7 order will stop the notices -- and the disbursement of the settlement money -- while the court weighs in on whether Jenkins' certification of a settlement-only class "will cause immediate, significant and potentially irreparable effects," a three-judge panel of the court wrote. -- J.S.

The Corpus Christi Caller-Times has reported on a deposition filed in a Corpus Christi lawsuit, alleging that Rep. Jaime Capelo, D-Corpus Christi, got a $100,000 "kickback" in return for a settlement of a lawsuit against his client, Citgo Petroleum Corp. According to the sworn statement by Capelo's former law partner Jeffrey Sherwood, Capelo was paid the money by Rene Rodriguez, the attorney representing plaintiffs suing Citgo in connection with a 1997 explosion at the company's Corpus Christi refinery. Both Capelo and Rodriguez deny the charges. In April, Capelo resigned from the firm of Chaves, Gonzales, and Hoblit to open his own practice. Sherwood alleges Capelo was asked to resign in the wake of questions about the payment from Rodriguez, which Capelo says was for a referral in a medical-malpractice case. The matter has been referred to the state bar by the judge in the Citgo case. Capelo released a statement Monday, saying, "I want to assure everyone that the allegation of wrongdoing presently being aired through the media is completely untrue." In denying the charges, Sherwood said, Capelo told him the allegations were in retaliation for his support of tort reform this year in the Legislature. -- M.K.

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