Judge finds no evidence of racketeering in Criswell College lawsuit_101804

Posted: 10/15/04

Judge finds no evidence of
racketeering in Criswell College lawsuit

By Ken Camp

Managing Editor

DALLAS–A district judge found no evidence of racketeering by either the W.A. Criswell Foundation or Criswell College in a dispute with a computer contractor.

International Data Systems sued the foundation and the college for allegedly breaching a contract with IDS and then giving the business to a corporation in which IDS claimed a foundation board director held significant financial interests.

IDS accused the Criswell entities of engaging in a pattern of racketeering activity that included mail fraud, extortion and copyright infringement.

By granting the partial summary judgment and dismissing complaints filed under the Racketeering Influenced Corrupt Organizations Act, the judge reduced the claim for damages from $46.6 million to about $15.5 million–which IDS claims are actual damages. The anti-racketeering statute allows recovery of three-fold damages.

Attorney Scott Hershman, representing IDS, noted a jury still could award punitive damages equal to or greater than those allowed under the anti-racketeering statute.

The judge found the case lacked evidence to qualify as racketeering under several elements of the RICO Act–particularly no evidence of a continued threat of criminal activity or the presence of a racketeering enterprise.

While the cause of action by IDS and its attorneys listed First Baptist Church of Dallas as part of the criminal enterprise, the judge found no evidence linking the church to racketeering.

The judge's ruling “removed all doubt of wrongdoing and vindicated the W.A. Criswell Foundation and the Criswell Center for Biblical Studies,” said Blake Beckham, lead attorney for the foundation.

Beckham characterized the anti-racketeering claims as “a cheap publicity stunt in an otherwise simple contractual dispute over $40,000 of contested invoices.”

The suit arose from an agreement John Thomas, a Baptist layman and founder of IDS, reached in 1995 to digitize tapes, transcripts and outlines of sermons by W.A. Criswell, longtime pastor of First Baptist Church in Dallas.

Thomas claimed he understood he was working on a charitable venture for Criswell College. Consequently, he agreed to donate his own time and charge the school only what it would cost him to complete the project.

Thomas hired two students to digitize the sermons, and he purchased hardware and software for the job. Criswell College paid on invoices received for services and equipment through October 1999.

Originally, the Criswell Legacy Project–as the sermon preservation effort became known–called for the sermons to be available on compact disk. Later, the medium shifted to the Internet, and IDS developed a prototype website for the project, which was demonstrated at the 1998 Southern Baptist Convention in Salt Lake City, Utah.

Operating under the understanding IDS would host the website, Thomas secured a five-year lease on a building with the necessary fiber-optic capacity and entered other contracts for Internet-related lines, connections and equipment.

But sometime between October 1999 and January 2000, the business relationship soured, and the Criswell entities stopped paying on invoices IDS presented. Each party since has accused the other of trying to change the terms of earlier agreements.

In March 2000, the Criswell entities terminated their relationship with IDS and entered into a contract with Chris Mor-eau, president of DIAWS Systems, to complete the project. Thomas maintains the project essentially was completed, a matter the foundation disputes.

Thomas also alleged a foundation board director had financial interests in DIAWS.

The court set another summary judgment hearing for Nov. 19. The trial on any remaining charges begins Dec. 6.