Texas
How Texas’s bankruptcy courts are used to shield a prison healthcare provider
When late last year the largest provider of healthcare to inmates in jails and prisons in the US found itself facing an avalanche of medical malpractice lawsuits, its path forward was seemingly obvious.
By filing for Chapter 11 bankruptcy in Texas’s increasingly popular bankruptcy courts, Wellpath Holdings could restructure itself, in the process staying the 1,500 lawsuits it had been facing and limiting its exposure to more than $100m in potential liabilities.
Last month, a bankruptcy judge for the southern district of Texas in Houston extended those stays to give Wellpath additional time to propose how it might exit bankruptcy and continue operating.
But critics say that the move is a cynical attempt to avoid paying out to the families of people devastated by the company’s actions in a state increasingly seen as a safe haven for big corporations looking to avoid paying out to people and families their actions have harmed.
Among the cases stayed for Wellpath was one brought by Teesha Graham of Albuquerque. Her father Frankie died in 2022 after spending almost a week slumped in his San Juan county jail cell, covered in vomit and excrement as medical staff and prison guards refused his requests for help, an inmate in the jail told the Guardian.
Also stayed was a claim brought by Nicole Poppell of Colorado Springs. Her daughter Savannah died aged 24 just three days after she was booked into El Paso county jail in Colorado. Incessant vomiting caused by opiate withdrawal tore her esophagus and she bled to death in her cell.
“Now they’re filing bankruptcy the chances are I could get next to nothing but really I don’t even give a shit about the money,” said Nicole. “I just want to be heard.”
Poppell and Graham are just two grieving family members wanting the bankruptcy court to consider their claims against Wellpath because as “unsecured creditors”, but they’re at the bottom of the hierarchy when it comes to who gets paid from the limited funds that remain.
Last week they enjoyed a small victory as Wellpath dropped its request that the court approve some $5m in bonuses for 12 of its executives. “I’ll never understand it,” said Graham.
Attorneys representing claimants against Wellpath say its bankruptcy was a long time coming, and part of a cynical strategy that would see it minimize costs low with reduced staff and improper insurance coverage. Malpractice lawsuits would inevitably accumulate but using the Texas courts it could largely shed itself of those liabilities and exit from it all relatively unscathed.
“These companies keep their costs as low as possible and then rely on the bankruptcy courts in Houston to bail them out once they hit a critical mass of lawsuits,” said Adam Flores, a New Mexico attorney representing Graham.
Wellpath is a for-profit business headquartered in Nashville, Tennessee, and owned by private equity firm HIG Capital. It operates in jails and prisons across almost 40 states and is responsible for the care of hundreds of thousands of inmates.
Although bankruptcy is governed by federal code, jurisdictions will enforce it with varying lenience, and typically if a company has enough assets in a given state they can make use its courts.
In recent years, the southern district of Texas has become a go-to bankruptcy venue, displacing the southern district of New York as the second most popular in the country behind Delaware.
“The Southern District of Texas really blew up four or five years ago,” said RJ Shannon, a bankruptcy attorney in Houston who is representing almost 100 claimants in the Wellpath case. “It’s a debtor-friendly court, so it’s where all the big cases will be filed.”
Last year, the southern district of Texas saw some 31 filings for bankruptcy by companies with assets greater than $100m, whereas the southern district of New York saw just 11, according to figures from Bankruptcy Data.
Wellpath’s filing in November made it the second prison contractor to have used the court’s Houston division in just two years after prison healthcare firm Corizon filed for Chapter 11 in early 2023. The maneuver it attempted has been referred to as “the Texas Two-Step” and sees a company split itself into two, placing valuable assets in one and its liabilities in the other.
Although Wellpath is pursuing a simpler and more traditional Chapter 11 restructuring, its critics say the move is intended to have precisely the same effect.
“I think the reason Wellpath filed here [in Texas] is that they saw Corizon do it and they saw good things came of it,” said Shannon. He said that not only is the Houston court friendly to debtors, it’s also “user-friendly”, meaning proceedings can take place fast.
Anna Holland Edwards, a civil rights attorney in Denver who has brought a handful of cases against Wellpath over her career, said she saw its bankruptcy coming from a mile away. In early November her office asked a state court to issue sanctions on the company ahead of its expected bankruptcy.
Holland Edwards and other critics of Wellpath paint its use of Chapter 11 as a “business model” – both inevitable and symptomatic of the increasing extent to which America’s corporate assets have come under the ownership of private equity funds.
They argue that Wellpath, under private equity ownership, borrowed money to buy up regional facilities across the country and then underbid rivals and county services in order to win taxpayer-funded government contracts. Underbidding meant cost-cutting.
“If they don’t have enough money, maybe instead of having 10 nurses working in jail they’d only get five,” said Shannon.
According to Graham, it was a lack of staff in San Juan county jail that led to her father’s death: “They feel like they can send two people in there to care for over 500 humans?”
Another cost-cutting measure that may have brought Wellpath to its knees was its purchase of liability insurance policies that appeared to meet state and local government requirements but failed to establish any “true risk transfer”. As revealed in the ongoing bankruptcy proceedings, these policies only pay out if Wellpath covers a share of the damages, otherwise, no insurance kicks in.
And so tight were Wellpath’s purse strings that at the time of its bankruptcy it had left around 15 EMS providers in Michigan with more than $6m worth of unpaid bills, according to the Michigan Association of Ambulance Services.
Where the chips will now land remains uncertain, according to Shannon. As it stands, the ball is in Wellpath’s court, as prepares to issue a revised plan for how it will restructure and emerge out of Chapter 11 operational.
A recent ruling by bankruptcy Judge Alfredo R Perez of the southern district of Texas extended the stay on the pending lawsuits until at least 30 April.
In the meantime, unsecured creditors will fight to have as much money as possible set aside for their settlements. In many cases, especially those involving personal injury, once the stays are lifted plaintiffs’ right to seek damages will be restored, but the pool of funds from which to collect will be limited.
For Wellpath, the plan after Chapter 11 is to continue business as usual, and with Trump in office, there has never been a better climate in which for it to emerge from bankruptcy, according to Andy McNulty, another civil rights attorney based in Colorado.
“We saw when Donald Trump was elected that private prison company stocks soared to all-time highs so there’s no reason to believe that if Wellpath is allowed to continue operating it will not continue to profit off the suffering of inmates across the country,” he said.
A spokesperson for Wellpath said in a statement to the Guardian that it had filed for Chapter 11 in order to “strengthen our financial foundation without compromising our ability to deliver high-quality patient care”.
“We remain committed to providing vital healthcare services to underserved populations and are confident this process will allow us to continue to do so for years to come,” they added.
The company declined to say why it chose to file in the southern district of Texas or to answer questions about its liability insurance.
Savannah’s mother Nicole said she wants to see Wellpath dissolved for good. “For three days she was in there and she was begging for help, she was crying for help, and she was alone,” she said. “I want these people shut down.”
Texas
Texas school board to vote on required Bible readings in public education
AUSTIN, Texas (AP) — The Texas education board will vote Friday on a required reading list for more than 5 million public school students that includes Bible passages, widening conservative efforts to push Christian teachings in U.S. classrooms.
The proposal in Texas — which would mandate literary works such as Charles Dickens’ “Great Expectations” alongside parables from the New Testament — has been closely followed by education observers who say it appears to be the first of its kind in the nation.
If approved by the Texas State Board of Education, which is controlled by Republicans, the reading list would take effect in 2030.
Texas, which educates roughly 1 in 10 of the nation’s public school students, has been at the forefront of a charge by conservatives to incorporate more religion into classrooms. The state already allows public schools to hire chaplains to counsel students, mandates the display of the Ten Commandments in classrooms and has approved an optional Bible-infused curriculum.
For months, critics have blasted both the push to require Bible readings and the state mandating what books are read by students, which are decisions typically left up to teachers. Teachers could still assign students other books to read on top of the required titles.
A focus on Christianity
Critics say the reading list lacks diversity, blurs the separation of church and state that is enshrined in the Constitution and leaves teachers and students with little room to decide what to read.
“Kids of all faith backgrounds and no faith are served by Texas schools and they should all feel welcome in Texas schools,” said Elva Mendoza, legislative communications associate for the progressive Texas Freedom Network. “But this is sending the message to children that one and only one religious text — a Christian one — is worthy of making this required reading list.”
Others have applauded the possibility of mandated Christian religious reading in public schools. Brooke Mazel, a retiree from Lubbock, encouraged the board to adopt biblical materials, saying her children and grandchildren grew up with “strong faith and family values.”
“America should celebrate our 250 years that started as a nation of unwavering Christian values,” Mazel said.
The board is also set to vote Friday on a social studies curriculum that links Bible stories with American history.
Texas may be a trailblazer
A state law passed in 2023 required a mandatory list of at least one literary work be taught in each grade level. The proposed new list contains around 200 texts, including Bible passages, essays and books, far in excess of that requirement.
Antero Garcia, president of the National Council of Teachers of English and a Stanford University professor, said he doesn’t know of any other state with a mandatory reading list that includes religious texts. Educators at the district and school level usually choose the texts their students will read, Garcia said.
Kasey Meehan, director of PEN America’s Freedom to Read program, agrees the move is “unique” to Texas.
Picture-book stories for elementary students including “David and Goliath” and “Daniel and the Lion’s Den” are on the required reading list. By fourth grade, students would encounter passages about Jesus in the New Testament.
By middle school, students would be expected to read several passages about Jesus, including passages from his most famous sermon, and another where he instructs people to cast aside earthly anxiety and seek the kingdom of God.
For high schoolers, the list requires the reading of specific Bible passages as supportive materials for literary works including works by Dickens and Jane Austen’s “Pride and Prejudice.”
Holding diversity in check
Such strict requirements amount to “almost de facto censorship,” Meehan said, comparing the list to book bans.
“It certainly leans ideologically more conservative,” she said. “It excludes a lot of diverse voices from the reading list.”
The list mandates that students reading Shakespeare’s “The Tragedy of Julius Caesar” also read a eulogy for President Ronald Reagan written by former British Prime Minister Margaret Thatcher, a staunch conservative.
Frank Strong, an English and journalism teacher and co-founder of the student advocacy group Texas Freedom to Read, said diversity is not only important for students needing to see themselves in what they read but also as a way to learn about different cultures.
Many of the books on the reading list are not controversial, but Mendoza asks why books like “Chicka Chicka Boom Boom” need to be required for kindergartners.
“Can’t our kindergarten teachers be trusted to choose board books?” Mendoza asks.
___
Stengle reported from Dallas.
Texas
A Judge Issued a Rebuke to the Texas GOP’s Claims About the East Plano Islamic Center
For more than a year, high-profile Texas Republicans have argued that Muslims are secretly plotting to take over Texas, centering their outrage on the East Plano Islamic Center, a mosque and Muslim community in North Texas known as EPIC. That hysteria resulted in a range of government enforcement actions last year, including a probe by the Texas Funeral Service Commission that barred EPIC from performing funeral rites. Last July EPIC sued the state, alleging Texas had violated its religious freedom. Late Wednesday, a federal judge in the Western District of Texas ruled that the mosque’s lawsuit can proceed despite the state’s attempt to dismiss it. In his ruling, the judge also issued a strong rebuke to claims made by Governor Greg Abbott and other state officials, writing that “no evidence has been presented” that EPIC intends to impose “Sharia law,” Islamic teachings based on the Quran and words of the Prophet Muhammad, on Texans.
The case stems from last March, when the funeral commission issued a cease and desist order that barred the mosque from performing traditional cleansing, shrouding, and prayer over bodies, on the grounds that EPIC may have been unlawfully conducting such rites without a license. (EPIC denies this allegation.) As Texas Monthly has reported, the agency was pushed to issue the order by some of Abbott’s closest advisers, who had made unsupported claims that EPIC and a proposed housing development it was affiliated with, EPIC City, was building a “no go zone” exclusive to Muslims (it was not).
EPIC sued the funeral commission in July 2025, arguing that the cease and desist order was an unconstitutional prohibition on religious practices. In Islam, preparing bodies for funerals stands as one of the most sacred rites; by the time of EPIC’s lawsuit, according to the petition, at least eleven congregants had been forced to receive rites elsewhere—away from their home mosque.
EPIC later amended its lawsuit to include former funeral commission chair Kristin Tips after text messages were released showing she had shared anti-Muslim messages and videos as the agency’s investigation unfolded. Among the examples was a graphic Tips had sent to the commission’s then–executive director, Scott Bingaman, that accused Islam of allowing child marriage and pedophilia. After sending it, Tips texted Bingaman a YouTube video with the title: “EPIC CITY TEXAS! Are Muslims planning a TAKEOVER?”
For nearly a year, the case has been locked in a procedural back-and-forth as Tips and the agency—represented by Attorney General Ken Paxton’s office—have pushed for the court to dismiss the case. Late Wednesday evening, Judge David Alan Ezra, a Ronald Reagan appointee, issued an order denying Tips’s attempt to dismiss the lawsuit. He also rejected Tips’s claim of qualified immunity, which can shield government officials from personal liability in civil cases. That rejection is rare in courts, such as this one, that appeal to the Fifth Circuit, which is one of the most conservative federal appellate courts in the country and is typically welcoming to government defendants.
In his ruling, Ezra cited the funeral commission’s deviation from historical norm in the EPIC case, as the agency has repeatedly asserted—first in 1987 and again in 2014—that Islamic religious organizations could conduct funeral and burial services without government oversight. The judge also affirmed that the alleged conduct—including the cease and desist order and Tips’s anti-Muslim messages—was seemingly “the result of religious discrimination” that violated EPIC’s clearly established religious rights under the Constitution’s Equal Protection Clause and other laws protecting religious liberty. In a rather remarkable footnote, the judge added that, based on the evidence offered, the court firmly rejected claims “suggesting that EPIC has applied, or intends to apply, ‘Sharia law’ in its practices.”
Though the case will now continue to wind through the courts, the judge’s ruling is a firm rebuke of the anti-Muslim political hysteria fueled by Abbott and his team of advisers. As Texas Monthly reported this month, the governor’s inner circle took an unusually active role in the funeral commission’s regulatory case against EPIC. After being looped into the agency’s pending investigation, which stemmed from an April 2024 complaint levied by a private individual, the governor’s attorneys, including Abbott’s general counsel, Trevor Ezell, edited the boilerplate cease and desist order the commission was ready to issue to make it more severe and punitive.
The original document, drafted by a funeral commission staffer, included a line warning that noncompliance would result in the agency taking “legal action.” Abbott’s team struck that line and suggested replacing it with a “criminal referral” to the Collin County district attorney—in what amounted to a hijacking of the agency’s usual independent regulatory process. At one point, a close adviser of Abbott even reported to a commission staffer that Abbott had texted him that after the cease and desist order was sent out, the funeral commission was his new favorite agency.
Over the following months, the governor’s advisers, including Ezell and a budget and policy adviser, Alex Aragon, weighed in often on the EPIC probe, requesting regular updates, coordinating public statements, and, at times, directing regulatory action. When the agency investigated other cases—such as a high-profile incident in which a Dallas funeral home allegedly accidentally shipped a stillborn baby to a Louisiana laundry facility—the governor’s team exhibited no similar interest. More than a year after the funeral commission’s cease and desist order, its investigation remains ongoing. No violations have been found.
Tips, the agency’s former chair, led the funeral commission until March 12, when, according to an email obtained by Texas Monthly, she “prayerfully” resigned, effective immediately, late in the night. While the circumstances around her departure remain unknown, she had spent months under fire for allegations that she had illegally lobbied for tort reform in her position as chair, which she denies. But in her absence, the governor’s pursuit of EPIC has continued. In March, the funeral commission issued a broad new subpoena to EPIC, seeking every record of funeral services that the mosque has on file.
After EPIC’s attorneys pushed back, arguing the order was too large in scope, Paxton’s office got involved—issuing a letter that demanded EPIC comply. Meanwhile, Abbott has continued his crusade against the mosque, going on Fox News earlier this week to deride EPIC and what he alleged were “multiple violations” of the law. The governor has touted that a dozen state agencies have investigated EPIC. To date, no criminal charges have been filed against the mosque, and a federal probe into EPIC by the the Department of Justice was dropped with no findings of malfeasance.
Texas
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