A state district judge has ordered Mayor Paulette Guajardo and hotel developer Phillip Ramirez to complete depositions before she will rule on a jurisdictional challenge in the civil lawsuit tied to a $2 million public incentive awarded to a downtown hotel project.
Judge Sandra Watts issued the order this week in the case brought by competing developer Ajit David. The ruling means the plea to jurisdiction — a legal challenge that could determine whether the case proceeds — is on hold until Guajardo and Ramirez have completed depositions.
Guajardo and Ramirez have both been partially deposed, but did not complete the depositions pending a ruling from the Texas 13th Court of Appeals.
On May 19, the Texas 13th Court of Appeals denied a petition for writ of mandamus filed by the city, Guajardo and Ramirez that sought to block discovery in the case.
How the dispute started
Developers Deven Bhakta and Phillip Ramirez of Elevate QOF LLC sought a Type B sales tax incentive in 2023 for their five-story, 126-room Homewood Suites — the first time such public funds had been used to subsidize a hotel in Corpus Christi.
During presentations to the Type B Corporation board in December 2023 and the City Council in February 2024, developers said that newly finalized FEMA floodplain maps caught them off guard and resulted in unexpected additional costs. They said the maps, which became effective October 13, 2023, threw "a wrinkle" into the project from both constructability and cost perspectives.
Competing hotelier Ajit David alleged those claims were false. Documents show a screenshot of a FEMA press release had dates and a document number covered up in a presentation presented to the board and City Council
During the Type B meeting, then-board president Leah Olivarri noted support for the project based on the catalytic nature of the project, rather than FEMA flood plain requirements.
6 Investigates obtained a recording of a phone call between City Manager Peter Zanoni and David in which Zanoni said the document had been deliberately altered to support a false narrative about recent FEMA changes. Despite those concerns, Zanoni verbally endorsed the project at the April 2024 council meeting, saying city staff supported the $2 million award.
The first reading of the ordinance passed 7-1-1 in February 2024. On second reading in April 2024, the ordinance passed 5-3-1, with council members Michael Hunter, Jim Klein and Sylvia Campos voting no and Gil Hernandez abstaining. The language was amended to remove all references to FEMA requirements.
The civil lawsuit
David filed suit in late September 2024 seeking to invalidate the city council's vote. The lawsuit seeks a declaratory judgment based on allegations that the city failed to follow its two-reading rule, used an altered federal document and violated the Texas Open Meetings Act. The developers have denied wrongdoing and called the lawsuit an attempt by a rival to disrupt the project.
The push to remove Guajardo
The City Council voted in March 2026 to begin formal removal proceedings against Guajardo, following a citizen petition filed by Rachel Caballero in August 2025 accusing Guajardo of misconduct, malfeasance, incompetence and willful neglect.
Guajardo filed suit in federal court in April 2026 seeking to block the proceedings. Her attorneys argued that council members present at the February 20 and April 23, 2024, meetings cannot serve as both witnesses and judges in the same proceeding. Because the charter requires five votes to remove the mayor, disqualifying those four members would make the required vote mathematically impossible.
A federal judge issued a temporary restraining order in April 2026 barring any suspension of Guajardo without due process. That broader injunction request was later denied. The judge found Guajardo had not clearly shown a substantial likelihood of success and had not established a property interest in her position as mayor entitled to federal due process protection.
In December 2025, an attorney for Ramirez announced that the Corpus Christi Police Department, FBI and Texas Rangers had closed investigations into potential criminal conduct related to the project, with no charges filed.
New federal motion
On June 10, Guajardo's attorneys filed a motion for summary judgment and injunction in federal court, again arguing that council members Carolyn Vaughn, Gil Hernandez, Sylvia Campos, Kaylynn Paxson and Eric Cantu cannot constitutionally serve as judge and jury because they are witnesses to the events underlying the impeachment. That motion is set for the federal docket July 1.
The full removal trial is expected to span four days, with proceedings scheduled to begin July 22 and 23.
Guajardo has denied wrongdoing.
