DeWine’s campaign contributions illegal, lawyer contends

Ohio Attorney General Mike DeWine might have received more than $12,000 in illegal campaign contributions during his successful run for office last year.

Why might they be improper?

The money purportedly came from Medicaid providers, and Ohio law prohibits candidates for attorney general or county prosecutor from accepting campaign cash from them, or from anyone with an “ownership interest” in one.

Who were the Medicaid providers?

Mike DeWine himself.

How is a Cedarville attorney and former U.S. senator a Medicaid provider?

Because DeWine held or traded stocks in CVS/Caremark Corp., Kroger Co., Walgreen Co. and Walmart Stores Inc., which are Medicaid providers. That arguably gives him an “ownership interest,” however tiny, in Medicaid providers.

So when DeWine gave his own campaign 25 donations totaling more than $12,000, under one interpretation of the law that money came from a Medicaid provider, and thus the contributions were first-degree misdemeanors.

Isn’t that a little absurd?

That’s what DeWine says. “If you followed that line of reasoning, you would have to exclude any contributions from anyone who owned one share of stock in a Medicaid provider.”

Exactly the point, says the lawyer who brought the questionable contributions to light, Subodh Chandra of Cleveland.

“As a minority shareholder, Mike DeWine hasn’t committed Medicaid fraud and had no control over CVS, Walgreens or Walmart — much less any of their Medicaid pharmacy services,” Chandra said. “Yet Ohio law and Secretary (of State Jon) Husted would brand DeWine a pariah and criminal for owning some shares in those companies and contributing to his own campaign.”

DeWine, noting he did return “several” contributions from Medicaid providers during last year’s campaign, insists he’s done nothing wrong.

So what’s really going on here?

Chandra filed a pair of lawsuits in federal court last year claiming that Ohio’s 1978 ban on political contributions from Medicaid providers is unconstitutional. He has won support for his fight from three former attorneys general, Republican Jim Petro and Democrats Marc Dann and Lee Fisher.

In one action, Chandra represents nine Cleveland-area doctors who claim their rights were violated because they could not give money to Attorney General Richard Cordray’s campaign against DeWine last year as a reward for the Democrat’s support of the federal health-care overhaul.

In the other suit, John P. Kilroy, a Lorain lawyer who does no Medicaid work, claims his rights are being violated because he can’t contribute to prosecutor or attorney general candidates because he owns 10 shares of stock in Target, some of which run pharmacies that provide Medicaid services.

“I was shocked to learn that candidates to whom I would like to contribute would be subject to criminal prosecution were they to accept my contribution,” Kilroy said in a statement with the suit. “I do not wish to put my chosen candidates at risk and do not wish to incur the stigma that would result were I to attempt to inspire such illegal conduct.”

Chandra said he suspects that county prosecutors around the state — and perhaps previous attorneys general — have unknowingly accepted improper contributions as well. Chandra was a candidate for attorney general in 2006, losing in the Democratic primary to Dann.

A special counsel representing Husted said in a court brief that the contribution ban is needed because it “advances the sufficiently important purpose of preventing corruption, or its appearance.” The attorney general and county prosecutors investigate reports of Medicaid fraud.

“In his capacity as secretary of state, he will continue to defend state law, but we don’t have any comment as to the specifics of the case as it is an ongoing legal matter,” said Husted communications director Maggie Ostrowski.

Chandra obtained a statement from former Senate President Harry Meshel saying the bill he sponsored didn’t stem from any instance of corruption but rather was enacted “in an era of one-upmanship in which Democrats and Republicans were trying to outdo one another regarding ethics.”

This week, Chandra issued a subpoena for DeWine and campaign leaders. On Friday, DeWine’s attorneys asked the court to quash it, contending that “DeWine’s actions and policies have no bearing on the constitutionality of Ohio’s campaign-finance statutes.”

DeWine said he does not agree with Chandra’s interpretation that the law bars contributions from those holding small amounts of stock with companies that provide Medicaid services.

“I don’t think the legislature ever intended that,” the attorney general said.

But Chandra said, “Instead of trying to avoid testifying, he ought to just admit, ‘Look, this statute is pretty much impossible for prosecutor candidates to comply with if they or their friends own any mutual funds or stocks — and that pretty much leaves out most people with money to contribute. Declare it unconstitutional and start over.’  ”