Texas A look at 1976 case that involved John Wiley Price County commissioner now faces public corruption investigation

By Jason Trahan

Dallas Morning News

DALLAS (AP) -- The burgeoning politician, then 25, fully expected probation after pleading guilty to lying to get a bank loan.

When the judge surprisingly issued a six-month prison sentence, he made a decision that would become the trademark of his career: John Wiley Price fought back.

He got a new lawyer, persuaded his former attorneys to admit they gave him bad advice and -- in a rare move -- got his guilty plea withdrawn.

A trial was scheduled and Price trotted out a secret weapon for jurors: the Dallas Cowboy great Harvey Martin. The legendary defensive end's testimony vouching for his buddy's character tipped the scales and scored Price a career-defining acquittal.

Supporters say the little-known fraud case made an indelible impression on Price and taught him things about "the system" that helped make him the hard-charging, take-no-prisoners kind of politician he is now.

Price, 61, declined to comment on the 1976 case. The longtime Dallas County commissioner now faces a public corruption investigation revealed in late June when FBI agents searched his home and office.

"This could be why John's so dedicated to getting minorities into positions of power," said Price's current lawyer Billy Ravkind, who described the former case as trumped up. But he said he believes that first battle with the government continues to influence Price to this day.

"He was getting indicted and expected not to fight it because he was black."

A conviction would have made Price a felon and ineligible to run for office, ending his nascent political career long before he would become arguably one of the most influential politicians in North Texas history.

"It was the first instance of the government ganging up on John Wiley Price," said James Johnston, Price's defense attorney in the 1976 case and who still has vivid memories of the case.

The trouble began in 1974, when Price sought a $1,850 loan from Guaranty Bank. At the time he was 25, and already involved in politics and civil rights advocacy, though it would be 1984 -- 10 years later -- before he would become the county's first black commissioner.

Price had already gotten loans from the bank, and in 1974, he wanted another. To get it, Price presented the bank officer, a friend of his, with a contract he had entered into with Roger S. Mullins, a security guard and handyman. The contract purportedly was for Mullins to do some work on Price's home on Reynolds Avenue south of Interstate 30 near Dolphin Road.

But in court, Price admitted that the money was not for home improvements. According to pretrial transcripts, Price testified that when the contract was signed, work had already been done on the Reynolds Avenue home, one of several rentals Price owned then. The contract with Mullins, he testified, was a ruse to get a new loan to repay some old loans and debts he owed the same bank.

"I did it falsely, knowing that two-thirds of the work had already been done on the property," Price testified during a hearing on his guilty plea.

But Price would not admit what the government wanted him to: that the contract was used to trick the bank. The bank, Price argued, was in on the scheme and knew the money was not for home repairs.

"I had quite a few (overdraft) checks there at the bank that had been authorized by the bank vice president there, and he was to catch the checks up," Price testified.

The bank representative remembered things differently. Leon Gauthier, a senior vice president and commercial loan officer, testified then that about $1,000 went to repay some of Price's old Guaranty loans, with the rest going into Price's checking account.

"I had been told by (Price) that some work had been done on the house and that the reason he needed the funds was to complete the work," testified Gauthier, who had since left the bank and become the executive director of the Interracial Council for Business Opportunity, a Commerce Department program that helped minorities start and expand businesses.

According to court documents, the $1,850 was not repaid. There was also a question about whether Mullins had even signed the phony contract with Price. Price testified that he believed that Mullins had signed it but said that he did not see him do it. The contract was notarized.

Neither Mullins nor Gauthier was accused of wrongdoing in the case.

Price insisted that he was guilty -- but not necessarily of what the government had charged. U.S. District Judge Robert Porter eventually accepted Price's plea and, in a surprise move, sentenced him to six months behind bars.

After receiving a prison sentence instead of probation, Price hired a new attorney.

Price had been represented by his friend Cleo Steele and his law partner James Hopkins, both of whom worked on the case for free. Price had worked as Steele's paralegal, and when Steele was elected Precinct 8 justice of the peace, Price followed him there in 1975, becoming his chief aide.

Steele and Hopkins advised Price to plead guilty to avoid prison, even though Price disagreed with the government's version of the facts of the case. But when he got jail time, Price hired Johnston, who asked Porter to withdraw the guilty plea.

"I was under the illusion that without putting the court through an expensive trial, that the chances for probation were greater," Price testified at a hearing to withdraw his plea.

The federal prosecutor in the case, Al Badger, pressed Price. According to court transcripts, Badger asked Price if he would have hired Johnston if the judge had given him probation.

"I really don't know," Price answered.

Porter was reluctant to let Price change his plea. The case was referred to the 5th U.S. Circuit Court of Appeals, which determined that Porter should not have accepted Price's guilty plea.

"The clear implication is that if the bank was aware of these misrepresentations, it could not have been influenced by them and was acting out of greed to secure the payment of its own debts," the court wrote. "Therefore, there did not exist a factual basis for Price's plea of guilty."

A jury trial was held before U.S. District Judge Patrick Higginbotham, now a 5th Circuit judge.

Johnston said that the prosecutor was pressured by higher-ups to bring the case. Badger denies that, and insists the evidence was solid against Price.

"I had the discretion not to prosecute the case. Nobody told me to prosecute it," Badger said. "I don't recall (Price) having a public persona at the time. He was just another guy. It was just another case, and not a very big one."

He said, though, that he clearly remembers the two-day trial, which ended with jurors taking less than three hours to acquit Price.

"It's because we lost," Badger said. "That didn't happen very often."

Published: Tue, Sep 20, 2011