AUSTIN (KXAN) —The Third Court of Appeals heard arguments Wednesday about the denial of the OAG’s motion to dismiss the lawsuit brought against Ken Paxton by James Blake Brickman and three other former aides — David Maxwell, J. Mark Penley and Ryan Vassar.

The court recessed after hearing oral arguments. It will evaluate them and write an opinion later.

One of the attorneys who represented a whistleblower in the hearing Wednesday released a statement, saying, “This appeal is nothing but a delay tactic so Ken Paxton can avoid the scrutiny of the trial court just like he has in his criminal case, except this time he is using taxpayer dollars to do it. The Attorney General’s position has no merit whatsoever. We look forward to a prompt decision from the Court of Appeals.”

The aides sued Paxton for wrongful firing and retaliation after they accused the state’s top law enforcement officer in September of using his office to help Nate Paul, a wealthy Austin-area real estate developer who donated $25,000 to Paxton’s campaign in 2018.

It is unclear how Paul and Paxton became friends, but the lawsuit, which KXAN received a copy of, presents four instances in which Paxton directed the whistleblowers to take actions that could benefit Paul and his companies. 

Last year, the Federal Bureau of Investigation raided Paul’s home and offices as part of an investigation. The whistleblowers allege Paxton leaned on his deputies to release state and federal records related to the searches. The whistleblowers, however, felt this would scuttle long-standing policies that exempt records tied to ongoing investigations from state public records law, “and likely spark innumerable lawsuits.”

Around July 31, 2020, the whistleblowers allege Paxton directed employees to research restrictions on foreclosure sales and then made it clear he wanted an opinion issued that would stop foreclosure sales, the lawsuit states. The employees later learned that opinion, which was issued August 2, was cited the following day by Paul’s attorney to prevent the impending foreclosure sale of his properties.

The whistleblowers also allege Paxton “plotted OAG investigations into Nate Paul’s adversaries.” Paxton’s former first assistant attorney, Jeff Mateer, and Brickman had to talk Paxton out of personally appearing in a hearing for a legal case between some of Paul’s companies and an Austin charity, “…as Paxton has not appeared in any court on behalf of the OAG in years,” according to the suit.

But the act that prompted Paxton’s staff to report him to the FBI was his hiring of an outside lawyer to investigate Paul’s claims that the FBI broke the law by searching his home and offices. Paxton’s staff concluded the allegations were outside their jurisdiction and unsupported by evidence, according to the complaint. Penley, one of the whistleblowers, refused to sign a memo that would approve the outside attorneys hiring and said the claim that search warrants used in the raids on Paul’s properties were altered was “unsupported by credible evidence.”

Paxton claims the allegations brought forth by his former employees are false, and the employees left or were terminated for reasons unrelated to him. 

“They decided on their own to leave,” said Paxton. “Others left, because they were terminated, and there were issues related to their employment that were legitimate. Facts matter. As time goes on people will see the truth of what we’re saying…”

At the initial hearing in March, Paxton’s lawyers argued that whistleblower protections don’t apply to claims about an elected official, that Paxton is not considered a “public employee” and that the AG’s office has immunity.

Wednesday’s hearing will be streamed on the court’s YouTube page and audio will be posted on the court’s website.