City requests summary judgment vs. Texas BioDiesel
By BRENDA SOMMER bsommer@leader-news.com

The El Campo City Development Corporation's lawsuit to force payment on its overdue $215,000 loan to Texas Biodiesel Corp. could end in victory in a matter of days, although actually collecting the sum is by no means guaranteed.

The oft-delayed multi-million-dollar project, which first came before the CDC in August 2003, was granted a $165,000 forgivable CDC loan. The El Campo Economic Development Corp. - a privately funded, local business advocacy group - kicked in an additional $50,000.

The terms of the loan were that if ground had not been broken by the Sept. 1, 2006 deadline, the company would have to repay it, but CDC directors granted the company a six-month extension.

Texas Biodiesel President John Autrey asked for a second extension in March, but the board denied it and instead asked for repayment of the loan.

In April, the CDC voted to have City Attorney Ronny Collins sue the company for repayment.

Texas Biodiesel then claimed it couldn't get financing because the CDC's decision to grant incentives to the Farmers Co-op of El Campo's biodiesel project "confused, delayed and took away the opportunity to solidify farmer support."

Collins denied that accusation, stating the CDC wasn't barred from helping other biofuel projects, and didn't offer aid to the FCEC project "until it became painfully clear that Texas Biodiesel was not performing."

About 60 days ago, Collins filed a motion for summary judgment in the 23rd District Court. To file such a motion, a lawyer gathers all the information both sides agree is true, looks at it, and concludes a reasonable jury would only decide the case one way - in his favor.

If the judge agrees with that conclusion, a trial isn't needed and the judge rules in that attorney's favor.

Collins said Texas Biodiesel didn't respond to requests for information (called "discovery") that came after the lawsuit was first filed, and a court would take that to mean the company didn't dispute what Collins was claiming.

"They didn't respond to some of our discovery requests, so we filed for summary judgment to avoid having a trial over undisputed facts," Col- lins said. "It's a quick way to bring case to resolution without trial. We made allegations we asked them to admit or deny, and the court should rule they've basically admitted all our facts were true - that they defaulted (on the loan) and they should repay the funds and attorney's fees."

Judge Ben Hardin was to hear Collins' motion Monday, but was out of town on another case.

"He had a jury trial canceled on him, and didn't have the docket there," Collins said. "We will send him the order (asking for the summary judgment to be granted.) Since the defendants did not file a response to our summary judgment motion, and the time has passed for them to do that, I'm anticipating the judge will sign our proposed order and we will win."

Collins said if the order is granted, there's a 30-day waiting period for it to become final.

"After that, we can take steps to collect," he said.

Collins would then file papers in the counties in which Texas Biodiesel directors reside.

"Then we could begin our collection efforts by having the sheriff there go out and seize any assets the company owns," he said.

However, it's unknown what, if any, assets the company actually has.

But Collins is hopeful the judge will grant the motion for summary judgment, which at least lets him place a lien against Texas Biodiesel.

"I think it's likely, more than likely," he said.

A message left for Autrey at Texas Biodiesel's Houston office requesting comment was not returned as of presstime.