By Corte                                             H.C.R. No. 153
         76R9480 MDR-F                           
                             HOUSE CONCURRENT RESOLUTION
 1-1           WHEREAS, Lawrence Littwin alleges that:
 1-2                 (1)  the Texas Lottery Commission hired Lawrence
 1-3     Littwin in June 1997 to fill the position of executive director,
 1-4     with an annual salary of $100,000;
 1-5                 (2)  Mr. Littwin served as executive director until
 1-6     October 1997 when he was wrongfully terminated;
 1-7                 (3)  the Texas Legislature enacted the state lottery
 1-8     act in 1992, which established the state lottery system in Texas;
 1-9                 (4)  the operation of the lottery was privatized and
1-10     the Texas Lottery Commission was created to oversee the private
1-11     vendors that operate the state's lottery, and various safeguards
1-12     were  provided  to ensure that privatization would not lead to
1-13     corruption;
1-14                 (5)  the Texas Lottery Commission contracted with GTech
1-15     Corporation and GTech Corporation has operated the state's lottery
1-16     since 1992;
1-17                 (6)  Lora Linares, the first executive director of the
1-18     Texas Lottery Commission, was responsible for the oversight of the
1-19     operation of the lottery;
1-20                 (7)  under Ms. Linares's administration, GTech
1-21     Corporation engaged in questionable business practices that
1-22     included putting Ms. Linares's boyfriend on GTech Corporation's
1-23     payroll, making gifts and other contributions to Ms. Linares,
1-24     hiring former state officials as lobbyists with excessive control,
 2-1     repeatedly violating the contract with the state, and failing to
 2-2     provide the state with sufficient data to oversee GTech
 2-3     Corporation's operations;
 2-4                 (8)  the Texas Lottery Commission fired Ms. Linares and
 2-5     voted to put the lottery operator contract up for rebid in March
 2-6     1997;
 2-7                 (9)  GTech Corporation's contract allowed the Texas
 2-8     Lottery Commission to terminate the contract with 30 days' notice
 2-9     for any reason and if GTech Corporation was not awarded the
2-10     contract under the new request for proposal, GTech Corporation's
2-11     contract could be terminated;
2-12                 (10)  the request for proposal was designed so that it
2-13     would be considered "above reproach" and the bid would be given
2-14     objectively to the lowest qualified bidder;
2-15                 (11)  GTech Corporation was not the successful bidder
2-16     under the request for proposal;
2-17                 (12)  in June 1997, Mr. Littwin was hired from
2-18     approximately 700 applicants to  replace Ms. Linares as executive
2-19     director;
2-20                 (13)  Harriet Miers, chair of the Texas Lottery
2-21     Commission,  said of Mr. Littwin, "his extensive business,
2-22     technical and lottery experience, his knowledge of lottery products
2-23     offered by vendors, and his knowledge of the procurement process
2-24     will be of great benefit . . . .  He is a man of integrity who will
2-25     further develop and maintain strict controls at the commission and
2-26     insure operations that are above reproach";
2-27                 (14)  Mr. Littwin's duties included oversight of the
 3-1     rebidding of the multimillion dollar lottery operator contract,
 3-2     oversight of the issuance of the request for proposal in an effort
 3-3     to solicit bids for the lottery operator contract, and the exercise
 3-4     of strict control  and close supervision over GTech Corporation to
 3-5     ensure integrity, security, honesty, and fairness in the operation
 3-6     and administration of the lottery;
 3-7                 (15)  when Mr. Littwin first began his new position,
 3-8     the state auditor provided Mr.  Littwin with a highly critical
 3-9     review of the Texas Lottery Commission, GTech Corporation, and the
3-10     relationship between the two;
3-11                 (16)  the state auditor warned Mr. Littwin that GTech
3-12     Corporation had not provided complete and timely responses to the
3-13     state auditor's request for information and denied the state
3-14     auditor access to information concerning its contracting practices;
3-15                 (17)  based upon the state auditor's report and
3-16     Mr. Littwin's review of the current state of affairs, Mr. Littwin
3-17     realized that the Texas Lottery Commission had not conducted
3-18     necessary audits of GTech Corporation as required by law and Mr.
3-19     Littwin entered into a contract with Deloitte and Touche to perform
3-20     the necessary audits;
3-21                 (18)  Mr. Littwin also instructed staff members to
3-22     review the GTech Corporation contract to determine whether GTech
3-23     Corporation had complied with all of the contract obligations;
3-24                 (19)  from the staff members' preliminary
3-25     investigation, it appeared that GTech Corporation had seriously
3-26     violated the contract and that the violations gave rise to millions
3-27     of dollars in liquidated damages;
 4-1                 (20)  Mr. Littwin made the Texas Lottery Commission
 4-2     aware of these issues;
 4-3                 (21)  Mr. Littwin continued a previously initiated
 4-4     investigation into, among other things, alleged unlawful campaign
 4-5     contributions made by GTech Corporation, through various
 4-6     subterfuges, in violation of the contract;
 4-7                 (22)  ultimately, Mr. Littwin was instructed by Harriet
 4-8     Miers, John Hill, and Anthony Sadberry, members of the Texas
 4-9     Lottery Commission, to stop the investigation;
4-10                 (23)  the investigation was never completed;
4-11                 (24)  the Texas Lottery Commission did not take any
4-12     action and to the best of Mr. Littwin's information and belief,
4-13     GTech Corporation has never been forced to cure these breaches or
4-14     pay these penalties;
4-15                 (25)  Mr. Littwin was terminated on October 29, 1997,
4-16     only five months after Mr.  Littwin had been hired;
4-17                 (26)  the commission members did not provide a reason
4-18     for his dismissal other than to say they had "lost confidence" in
4-19     him;
4-20                 (27)  Mr. Littwin's personnel files list the reason for
4-21     his termination as "reasons unknown" and none of the commission
4-22     members would explain what that actually meant;
4-23                 (28)  following Mr. Littwin's dismissal, Linda Cloud
4-24     was named executive director of the commission;
4-25                 (29)  Ms. Cloud quietly canceled the request for
4-26     proposal, leaving the contract with GTech Corporation despite the
4-27     fact that GTech Corporation was not the successful bidder;
 5-1                 (30)  the audit of GTech Corporation that Mr. Littwin
 5-2     contracted for was never  performed;
 5-3                 (31)  the Texas Lottery Commission never forced GTech
 5-4     Corporation to pay the liquidated damages under the contract;
 5-5                 (32)  the investigation of illegal contributions to
 5-6     state officials has never been completed;
 5-7                 (33)  a report prepared and completed by Mr. Littwin
 5-8     discussing material problems with the Texas Lottery Commission was
 5-9     never disclosed to the public; and
5-10                 (34)  Mr. Littwin's termination did not come as a
5-11     result of poor job performance, but rather, his attempts to uphold
5-12     the laws of the state and eradicate inappropriate activities by the
5-13     Texas Lottery Commission and GTech Corporation; now, therefore, be
5-14     it
5-15           RESOLVED by the Legislature of the State of Texas, That
5-16     Lawrence Littwin is granted permission to sue the State of Texas
5-17     and Texas Lottery Commission subject to Chapter 107, Civil Practice
5-18     and Remedies Code; and, be it further
5-19           RESOLVED, That the executive director of the Texas Lottery
5-20     Commission be served process as provided by Section 107.002(a)(3),
5-21     Civil Practice and Remedies Code.