The Charleston Place is suing the Southern Republican Leadership Conference (SRLC), claiming the group booked nearly the entire venue for the weekend of the Republican primary and has since refused to pay its $227,872 bill. Under the terms of the contract, the hotel was to provide rooms, food and beverages, and other services for the group's stay, and payment of all outstanding charges was to be made at the conclusion of the conference.
In its federal complaint, the hotel says in March it originally entered into an agreement for the booking which ran from Thurs. Jan. 19 through Sun. Jan. 22. South Carolina political operative Robert C. Cahaly, who is named as co-defendant in the lawsuit, served as the group's signatory. The contract was amended on Dec. 20, 2011.
In the complaint filed in the Charleston County Court of Common Pleas, the hotel says it has come to believe that the SRLC "was grossly undercapitalized, failed to observe corporate formalities, was insolvent, and was mere[ly] used as a façade for the operations of the defendant Cahaly." In addition it says, "Cahaly, an individual businessman, has sought to hide from the normal consequences of carefree entrepenuring by doing so through a corporate shell.
"Due to their incompetence, the defendants failed to properly plan or manage the Southern Republican Leadership Conference, and it was poorly attended," the hotel says. "The conference was so poorly attended as to cause one Republican candidate, Newt Gingrich, to cancel his appearance.
"Poor attendance caused many of the conference sponsors to leave the conference," it continues. "Poor attendance left the defendants responsible for a significant payment to the plaintiff under the terms of the contract."
But at 3:01 p.m. on the day they were due to check out of the hotel, the defendants e-mailed its management and canceled the meeting at which they were supposed to settle their bill. In the e-mail, the hotel says, the defendants "made the following false, fraudulent, and unsubstantiated claims in an effort to evade their responsibility for payment... that there had been 'inappropriate sharing of privileged SRLC/Charleston Place information;' that there were 'various difficulties with refunds or adjustments;' and that 'the overall treatment of [the SRCL's] staff by some of the hotel staff [had to] be addressed, especially [the hotel manager's] instructing of an SRLC staffer to engage in illegal activity.'"
"Defendants contended that these fabricated claims required resolution 'before committing to and executing final payment,' and their attorney would 'be in touch to schedule a meeting early this week,'" the hotel says.
Despite repeated requests the hotel, which is represented by Allan R. Holmes of Gibbs & Holmes in Charleston, says no meeting has ever been scheduled.
Meanwhile, a blog post added to the SRLC's website at 6:02 p.m. on Mon. Jan. 23 talks about how the event established "a new standard of significance." Attributed to "SRLC Staff," the paragraph-long post offers an effusive "Thanks to all the attendees, sponsors, and staff of SRLC 2012!"
"Our speakers, presidential candidates, panels, and globally-televised presidential debate made SRLC 2012 the most notable and covered SRLC in history," it continues. "The goal of any SRLC is to have an impact on party and presidential politics. SRLC 2012's impact on the race for president especially South Carolina's 'First in the South' presidential primary secures its place among the most successful Republican conferences ever."
The Southern Republican Leadership Conference also booked blocks of rooms at two other hotels in town, the Renaissance hotel on Wentworth Street, and the Courtyard by Marriott on Calhoun Street. The City Paper was unable to determine whether those hotels are also owed any money, but to date neither has filed suit against the organization.
Alan Coker, marketing manager for the North Charleston Coliseum and Performing Arts Center, venue for the Charleston Republican Presidential candidates' debate broadcast by CNN, said his facility is not owed any money by the SRLC.
The Charleston Place Hotel is asking to "pierce the corporate veil" so that it can obtain a judgment against Cahaly and "such other individuals who may come to be identified and determined responsible."
According to a bio published on the Conservative Leadership Institute.org website, Cahaly has been involved in politics for most of his life and worked over the years with GOP legends like Lee Atwater, Carroll Campbell and Strom Thurmond.
Often described today as an advisor to Gov. Nikki Haley, Lt. Gov. Kenneth Ard, and House Speaker Bobby Harrell, Cahaly was charged in Nov. 2010 with making illegal political phone calls involving six House District race across the state. At the time, the South Carolina Law Enforcement Division (SLED) accused Cahaly of paying for and disseminating automated robo-calls from an automatically dialed answering device (ADAD) on Sept. 23, 2010. These calls were political in nature and were allegedly made to potential South Carolina voters without properly disclosing the identity of the originating party to the call recipients, which is in violation of SC Code 16-17-446.
Kathryn Richardson, spokeswoman for SLED said late Friday afternoon that she had no information on the status of the case, but said she would get the information by Monday.
Cahaly could not be reached for comment.
Previously, Corey Hutchins of the Free Times in Columbia reported on the possible reasons for the conference's poor attendance. Go here to read the report.