Federal judge dismisses civil fraud charges against Attorney General Ken Paxton

AUSTIN — A federal court dismissed civil charges of securities fraud against Texas Attorney General Ken Paxton on Friday, a major victory for the Republican state official.

U.S. District Judge Amos Mazzant III wrote that the U.S. Securities and Exchange Commission had failed to show Paxton broke disclosure laws when he encouraged investors to back a McKinney technology company, Servergy Inc.

"This case is not about whether Paxton had a moral obligation to disclose his financial arrangement with Servergy to potential investors," Mazzant wrote in a 29-page ruling. "This case is also not about whether Paxton had some general obligation to disclose his financial arrangement to his investor group. The only issue before the Court is to determine whether the facts as pleaded give rise to a plausible claim under federal securities laws."

Paxton said he is pleased with the outcome.

"I appreciate the judge's thorough review, and I am gratified by his dismissal of the entire case," he said in a written statement.

Read more: http://www.dallasnews.com/news/texas-politics/2016/10/07/federal-judge-dismissed-fraud-charges-attorney-general-ken-paxton