Judge dismisses suit accusing S.C. Gov. Nikki Haley of breaking ethics laws while House member

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COLUMBIA — A judge on Wednesday dismissed a complaint accusing South Carolina Gov. Nikki Haley of breaking ethics laws while she was a lawmaker, ruling that such issues should be handled by either state ethics officials or a legislative panel.

“Alleged violations of the Ethics Code ... are exclusively within the subject matter jurisdiction of the State Ethics Commission or the Legislative Ethics Committees, not the circuit court,” Judge Casey Manning wrote Wednesday in his dismissal of John Rainey’s lawsuit against the first-term Republican.

Rainey has been represented by Dick Harpootlian, a Columbia attorney who is chairman of the state Democratic Party. On Wednesday, Haley spokesman Rob Godfrey called the suit a “political stunt” and said Rainey and Harpootlian “need to stop wasting the courts’ time and money on totally frivolous, nonsense lawsuits, and let the courts and the governor focus on the business of running the state.”

Rainey did not immediately comment on the decision, but Harpootlian said he would ask the judge to reconsider.

Manning also wrote that Rainey, as a private citizen, has no standing to prosecute criminal allegations in court. The state Supreme Court warned against such activity in a 2010 ruling.

The lawsuit was the result of months of digging by Rainey, the former chairman of the state Board of Economic Advisors and longtime Republican activist who recruited Gov. Mark Sanford to seek the state’s top job. Rainey first began raising questions about Haley’s work during her own gubernatorial campaign.

The complaint centered on Haley’s jobs as a fundraiser for Lexington Medical Center and with an engineering firm with state contracts while she was a state representative. It also asked whether it was illegal for Haley to seek tens of thousands of dollars from lobbyists for the hospital’s foundation while legislators were in session.

The lawsuit accused the Republican governor of working as a lobbyist for the hospital and soliciting lobbyists to donate to its foundation. It also accused her of failing to disclose information on campaign filings about her work for Wilbur Smith, not recusing herself from a vote benefiting the employer and not explaining on another vote why she did recuse herself.

“Haley exploited her public office for personal financial gain by trading on her influence and office to benefit corporations that were paying her money,” the lawsuit alleged.

The lawsuit accused Haley, first elected in 2004 to represent Lexington, of lobbying the state Department of Health and Environment Control on behalf of Lexington Medical, as it sought permission for a new open-heart surgery center. Haley and hospital officials have previously said her job as a fundraiser – a $110,000-a-year job the hospital’s CEO created for her in August 2008 – had nothing to do with the heart center.

But the lawsuit pointed to an August 2008 e-mail between Haley and her boss. Asked about a meeting on the heart center, she replied, “We have some work to do not only to switch votes but to hold the ones we have. We are as close as we are going to get and can’t afford to leave one stone unturned. ... Fingers crossed!”

The e-mail, not previously part of open records releases, was an exhibit in the lawsuit. Haley’s campaign said in 2010 there was nothing improper about asking lobbyists to donate to a charity.

Haley, who ran on a transparency platform, has previously argued she didn’t report her job with the Wilbur Smith engineering firm on campaign filings because state law didn’t require it. The firm said the consulting gig was for generating business leads.

Many of the allegations surfaced after Haley won the Republican nomination in June 2010. The money she received from Wilbur Smith became public in the days before her primary runoff. Haley let reporters review some of her income tax returns in her campaign office, after her Republican opponent released his.


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