Moody National Bank this week filed a lawsuit against the Galveston County Republican Party Executive Committee asking a district court judge to decide who is in control of the party’s finances.
The lawsuit was filed Tuesday in Galveston’s 56th District Court. It stems from a monthslong conflict between Galveston County Republican Party Chairman Carl Gustafson and a group of county precinct chairs who, citing dissatisfaction with Gustafson’s leadership, said they have seized control of the party.
The group that claims control calls itself the party’s Steering Committee, and uses a resolution voted on by precinct chairs in November as proof of its power.
But while the committee members argue they should have control of the party’s finance, attorneys for Moody Bank say they’re not so sure.
On Dec. 26, the bank received a letter signed by two precinct chairs, Alicia Youngblood and Kathy Rogers, asking that Youngblood and another precinct chair, Janis Lowe, be added as signatories to one of four party bank accounts, according to the lawsuit.
Two days later, the bank responded, saying that the party’s secretary needed to submit an adopted resolution to the bank, and that existing signatories — including Gustafson — would be needed to sign documents acknowledging the changes, according to the lawsuit.
Lowe subsequently sent more emails to the bank on Jan. 8, Jan. 18, Jan. 19, Jan. 25 and Feb. 7 requesting information and changes to the bank account, according to the lawsuit.
In one letter, Lowe claimed to be the party’s new treasurer.
The bank took no action, and on Feb. 9, received a message from Gustafson saying he was not agreeable to the changes proposed by the steering committee, according to the lawsuit.
The bank’s attorneys are seeking a judgment from the court because the state election code doesn’t address the management of bank accounts held in the name of the county executive committee.
The executive committee is the name for the collective group of elected party precinct chairs, and is separate from the party’s executive board, which consists of Gustafson and people he appoints to lead the party.
The bank also is seeking unspecified attorneys fees, court costs and other relief, according to the lawsuit.
Vic Pierson, the president and CEO of Moody National Bank, said the bank has no opinion on who should be in charge of the party and its finances, but wanted a judge to decide who the company should be listening to.
“We’re really not suing anybody,” Pierson said. “We’re just asking the court to give us direction on what we should do.”
Pierson said he couldn’t think of another time when the bank had gone to court in an attempt to decide who was in charge of an account.
Julia Hatcher, the legal counsel for the Galveston County Republican Party, said she believed the steering committee had no standing to request access to the bank accounts.
“The state law is very clear, and I’ve said many times that state law trumps bylaws,” she said. “They can’t create bylaws, they can’t write a resolution, that trumps a state law.”
Hatcher had previously said the steering committee had no standing to challenge Gustafson’s control of the party.
Lowe declined to comment about the lawsuit Thursday, but said a group of members of the steering committee was set to meet and talk about the lawsuit.
Gustafson declined to comment on the lawsuit.
No hearing date on the lawsuit had been set as of Thursday, according to court records.