Trawling in Deep Water

Peary Perry's lawsuit against the city may indeed have implications for the November mayoral election -- but perhaps not the ones Perry and his lawyer have in mind

It's mid-afternoon in Kemah, and the winds from an approaching thunderstorm rock the pleasure crafts docked across the street from the law offices of Richard Morrison. Inside, framed by color sketches of hunters aiming shotguns at waterfowl on the wing, the 60-ish attorney is seated before a mounted 75-pound tarpon.

Clad in boots, jeans and a sport shirt printed with trout flies, Morrison is a study in earthy manliness, someone whose amiable nature could warm up a duck blind on a cool morning. But right now, Morrison is losing it. He can't get a bead on his prey, and the frustration is making the great white-haired hunter trigger-happy.

"I'm going to stick it about nine yards up that son of a bitch's ass," Morrison declares, in a tone that could blow the gills off of the petrified game fish on his wall.

The target of Morrison's tirade is George Greanias, the former city controller, who plans to formally declare his candidacy next week for the November 4 election to replace the term-limited Mayor Bob Lanier. Morrison has been stalking Greanias since before the 1995 election, when the attorney's client, Municipal Collections Incorporated, sued the city of Houston.

The trial of the lawsuit -- which essentially pits Greanias against Peary Perry, a friend of Lanier's and the president of Municipal Collections -- was scheduled to begin June 2 but was reset for July 7. The city has since replaced its lead counsel, Randy Pourteau, with Nelly Santos, a young assistant city attorney.

As it happens, Santos is more than seven months pregnant and due to deliver on August 2, raising the possibility that she might give birth before the estimated three-week trial ends. Last Monday, she asked state District Judge Scott Link to delay the start of the trial until November 10 -- about the time Santos would return from maternity leave, and six days after the first-round mayoral election. Link put off a decision on the city's request until June 26.

Morrison, though, has already brought to life a new theory, delivered in a May 29 press release issued by Kirk Public Relations, a firm based in the Dallas suburb of Richardson that Municipal Collections has retained to put its spin on the case.

"I think the city is playing musical chairs with its lead attorneys," Morrison was quoted as saying. "Justice delayed is justice denied."

In the comfort of his Kemah habitat, Morrison is more to the point: "This is nothing but subterfuge to put this thing off until after the election. Does the city owe us money or do we owe the city money? Why not air it out?"

But as Morrison is well aware, Municipal Collections versus the City of Houston has never been solely about money, at least not to Peary Perry. Perry, an ex-cop, was a private investigator when Municipal Collections was incorporated on March 10, 1993, just two weeks before the firm won the lucrative contract to collect delinquent municipal court citations.

In November 1994, Greanias initiated an audit that found Perry's firm had been paid between $500,000 and $1 million too much. That same audit -- prompted by a Houston Press report that raised questions about the awarding of the contract -- also found that a minority subcontractor, Bayou City Enterprises, was in all probability a sham operation that had collected $400,000 in fees for work done by someone else.

In late July 1995, several months after Lanier fired Bayou City, the mayor also cut loose Municipal Collections, which, up to that point, had been paid about $3 million in fees. A week later, it was learned that the FBI and the U.S. Attorney's Office were poking into the affair, and Morrison called an outdoor press conference on a blistering hot afternoon. With Perry sweating profusely beside him, Morrison announced they were suing the city for breach of contract to recoup $737,913 in back pay withheld by Greanias, as well as $1.15 million Perry says the city underpaid him.

The city has filed a counterclaim against Municipal Collections seeking $315,000 in errant fees. Perry is also seeking punitive damages in an amended case, and has another lawsuit pending that alleges copyright violations by Greanias and the city. A second collection agency, West Capital Financial Corporation, has also sued the city for breach of contract. In yet another case, which was tossed out by Link earlier this year, Perry claimed he had been defamed by Greanias.

As might be expected, Morrison and Perry aren't lingering over the political overtones that shadow all this litigation: They're not interested, for example, in explaining how Municipal Collections -- and for that matter, Bayou City Enterprises -- managed to win the contract over established collection agencies. Greanias found that Perry and partner William E. Wells apparently did it with the help of Larry Miller, the Lanier-appointed director of the city's Municipal Courts Administration Department, who recently retired.

Miller, whose sister-in-law worked for Perry, is a longtime friend of Wells, an ex-municipal court judge and attorney who was indicted and subsequently disbarred for swindling an elderly woman out of her Social Security checks.

Morrison believes Lanier and the city want to avoid any embarrassing revelations in court -- at least until after the election. But he says he doesn't know who stands to benefit by a delay. It's wholly implausible to believe that it could be Greanias: After years of feuding between the mayor and the ex-controller, no one in the Lanier administration cares about how a trial might damage Greanias's mayoral bid.

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