Attorney General Henry McMaster Defends Donations from Lawyers He Hired

Columbia, SC—South Carolina’s attorney general received campaign donations from private lawyers he hired to help with a case against drugmaker Eli Lilly & Co., which is a potential violation of state law.

Campaign disclosure forms show that two attorneys Henry McMaster hired in 2006 to help sue the company donated a total of $7,000 to his campaign between June 2007 and March 2009. Attorney John B. White donated $2,000 to McMaster’s campaign in November 2007 and another $1,500 in March 2009. Attorney John S. Simmons donated $3,500 in September 2008.

State Ethics Commission assistant director and general counsel Cathy Hazelwood says the state ethics law prohibits contractors who get no-bid or non-competitive contracts from contributing to officials who hired them.

“It’s the ‘pay-to-play’ statute, that you shouldn’t be winning contracts and then turning around and making campaign contributions. And states across the nation have these statutes on their books,“ she says.

She says the law is aimed at the people who make the contributions, not the official who receives them, but says if McMaster simply returned the money it would erase any hint of impropriety.

But McMaster says neither he nor the two attorneys have done anything wrong so he sees no reason to return the money. He says the ethics law is aimed at commercial vendor-type contracts, to prevent a city, county or state official from awarding a contract to a company that then gives money to the official.

In this case, it’s a litigation retention agreement. “There’s no state money involved,“ McMaster says. “These lawyers will never get a penny of state money whether we win or lose the case. They will get paid, if they do, from the winnings that they create from the defendant. There’s no obligation from the state to pay them a cent.”

McMaster sued Eli Lilly to recover state funds used to treat illnesses allegedly caused by an anti-psychotic drug. He says the suit is too large and complex for him to have handled it with his staff attorneys, given the cases they’re already handling.

One of the lawyers for Eli Lilly also contributed to McMaster’s campaign. During the trial, the company made a motion to have the two defense attorneys that McMaster hired removed from the case because of their contributions.

Circuit Judge Roger Couch refused to remove the attorneys. He wrote in his opinion, “It is simply bizarre to say that the lawyers an official is working with cannot show their support for the official (and exercise their First Amendment rights) by making a contribution to him or her, but the lawyers on the other side (who may be seeking from the official a favorable deal for their client) can make contributions to further their client’s agenda.“

McMaster says Hazelwood’s interpretation of the statute is simply wrong. “We checked the rules. We researched it to be sure that it was perfectly proper to do this. And a state judge has now ruled on the very question and said that there’s nothing in the world wrong with those contributions,” he says.

Hazelwood says someone would have to make a complaint in order for the Ethics Commission to take any action.