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Brian Bakst, Associated Press
St. Paul, Minn. (AP)

Texas judge dismisses lawsuit against Coleman donor

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A remnant from former Minnesota Sen. Norm Coleman's wrenching re-election loss disappeared Friday when a Texas judge dismissed a lawsuit filed late in the campaign, tainting Coleman and a major donor.

Houston Judge Michael Gomez found Deep Marine Technology's former chief executive lacked standing to pursue a lawsuit against business associate and majority shareholder Nasser Kazeminy. The lawsuit contained allegations that Kazeminy tried to use the company to enrich Coleman's family.

The claims surfaced in the final week of Coleman's bid for another term, which he lost to Democrat Al Franken by 312 votes. Coleman wasn't a defendant in the lawsuit, but his name appeared in it.

Gomez said in his two-page order that ex-CEO Paul McKim couldn't pursue his business litigation because he is no longer a shareholder in the company. The judge declined to bar McKim from moving ahead with a wrongful termination case if he chooses.

Among other things, the civil lawsuit accused Kazeminy of trying to improperly funnel $75,000 to the Coleman family through a Minneapolis insurer that employs the former senator's wife. McKim said he was ordered to pay the money. Kazeminy and Coleman denied any such arrangement.

Kazeminy's attorney, Robert Weinstine, said his client and his associates feel vindicated.

"This is a victory. It's been eight or nine months of hell. This is a day they've been waiting for," Weinstine said. He said he and his client haven't ruled out lawsuits of their own to recover costs or allege defamation.

"I don't think we're going to be in any position to give Paul McKim a free pass here," he said.

McKim's lawyers seized on the fact the judge didn't stop him from pursuing other claims.

"This is not the final chapter of this controversy," said Arthur Howard, an attorney with the Houston firm representing McKim. "His rights to pursue actions against the wrongdoers are still alive and well."

Gomez rejected a request to order McKim to pay legal fees for the company's lawyers and the named defendants.

K.B. Battaglini, an attorney for a special committee appointed by the company's board, said Deep Marine will ask for a new hearing on their attempt to recoup expenses.

Coleman, who hasn't ruled out another run for political office, often said the lawsuit was politically motivated. On Friday, he said, "I'm not surprised - the election is over and the lawsuit goes away. There was never anything to this."

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Associated Press writer Arelis Hernandez contributed to this report from Houston.

(Copyright 2009 by The Associated Press. All Rights Reserved.)