What’s the Deal With Star Scientific, McDonnell and Cuccinelli?

By Peter Galuszka

What, exactly, is the relationship between Governor Robert F. McDonnell, his family, and Attorney Gen. Kenneth Cuccinelli with the head of a money-losing, tobacco-related dietary supplement maker that is the target of federal prosecutors?

All involve Jonnie R. Williams Sr., chief executive of Star Scientific, a Henrico County-based firm that has sold discount cigarettes, smokeless tobacco products and dietary supplements, including one called Anatabloc, that might someday have medical applications, according to The Washington Post in a front-page story today. A key ingredient for Anatabloc is found in tobacco and other plants, the newspaper says.

Star was sued last week by a former shareholder, Francis J. Reuter, who claims that Star misled investors about research involving the dietary supplements and the fact that the firm has been subpoenaed by the U.S. Attorney’s Office for Eastern Virginia.

The Post details links between Star and Williams and McDonnell and his family. Not only was Star a major campaign contributor to McDonnell, it allowed the governor to ride on its corporate jet and provided $15,000 worth of catered food, including shrimp cocktails, for the Executive Mansion wedding of his daughter Cailin in 2011.

McDonnell’s wife, Maureen, a former Washington Redskins cheerleader and skilled marketer, attended a Florida conference to tout Star’s products three days before her daughter’s wedding, the Post reports.

From 2009 to 2012, Star gave $130,000 to Virginia officials and a political action committee that supports McDonnell, the Post says.

The Star case becomes even more intriguing with Cuccinelli’s involvement. The attorney general and Williams are personal friends. Cuccinelli has stayed at Williams house and used his boat. In 2010, Cuccinelli bought 5,060 shares of Star stock at $1.98 and later increased his holdings by more than 3,500 shares at $2.79 a share. He sold 1,500 shares at $4.70 a share last year, the Post says, making a $7,000 profit.

Cuccinelli, however, failed to disclose his financial interests in Star for more than a year. An aide told the Post that the attorney general did not realize that his financial interest in the firm had passed the $10,000 threshold needed for reporting, but has since updated his disclosure. Records also show that Cuccinelli stayed at Williams’ house, used a lake home and a boat owned by Williams, was given a trip to Kentucky valued at $3,200 and a box of “food supplement” valued at $6,700.

A spokesman for McDonnell says the governor did not disclose Williams’ wedding gift of the catered meal because the gift was not intended for him. McDonnell and Williams declined to be interviewed directly by the Post.

Star Scientific had been seen by some of the state’s business elite as a way the Old Dominion can wean itself from its historic dependence upon tobacco by deriving healthy products form it. Star has attempted to do that over the years and dropped selling tobacco products last year in favor of dietary supplements and skin cream products. Last year, the firm lost $22.9 million and laid off some of its employees. It needs Anatabloc to be successful, the Post reports.

Star Scientific says that the lawsuit against it by Reuter has no merit.

This intriguing story is bound to become more interesting.

10 Responses to What’s the Deal With Star Scientific, McDonnell and Cuccinelli?

  1. How much does an investigator cost these days?

    Bet it’s more than 7 grand…

    Maybe he could also look into why Cooch helped the Wall Street crooks get off scott free.

  2. I read the Post’s articles. I have also followed the tax suit “stall” with Star.

    I don’t want to “jump to conclusions”, but this does not smell good. Things seem to be a little too cozy for my tastes.

  3. Maybe I’m missing something… Have either McDonnell or Cuccinelli intervened on Star’s behalf? If so, we may have a real story. If not, then what’s all the fuss about?

    This looks like simple guilt by association. (1) Star gets sued for allegedly misleading its investors about research results. (2) Star is tight politically with McDonnell and Cuccinelli. (3) Ergo….. er, what?

    On the basis of the information presented, what are we supposed to conclude?

  4. Did you go back and read the entire Post asrticvles? Apparently not, because you wouldn’t be so off handedly dismissive. What is a firm doing paying $15K for the Governor’s daughter’s wedding diner? Why is the governor’s wife going to Florida to conferences to push dietary supplements associated with Star. Why is Cuccinelli staying at the CEO’s house and using his boat? Why is Star being sued? Why is the U.S. Atty’s office subpoenaing records? Did the Atty. Gen’s office know of the probe? But maybe it had nothing to do with global warming?

    Gee, Jim, this raises more questions than have been seen around these parts since the Tobacco Fund director (surprise, surprise) got convicted for misusing funds.

    I do guess your attitude is predictable If it were the MWAA, you’d be jumping up and down!

    • OK, I recant….partially. The Maureen McDonnell trip to Florida does look like a mutual back-scratching exercise. Although the trip does not involve any abuse of public power, it does look bad. Should the First Lady of Virginia be trading on her position to benefit a company like that? I don’t think so. It looks unseemly.

      I’m still missing the Cuccinelli connection. What has the AG done, either by omission or commission, that hints at an abuse of public power?

      Powerful politicians have rich friends. It only becomes a problem when they intervene to help their friends.

  5. Brother Bacon,

    I know Robert Haskell trained you better than that comment would imply.

    There’s the $15K for the wedding feast coupled with a quote that I recollect from a McMinion that His Eminence and Lady McD were “footing the bill” for the nuptials. The only reason I took notice of the quote, at time, is because folks like you reported many years ago about a controversy surrounding the Commonwealth picking up the tab for a tent to be used at the Mansion for a Dalton wedding. The McD’s seemed determined to avoid any similar “damned spot” on their daughter’s wedding.

    I didn’t think, and still don’t, that the Dalton tent was a big deal because it would’ve been an asset that could’ve been used over and over again for events at the Mansion. Regardless, as I recall, Governor and Mrs. Dalton decided not to taint their daughter’s wedding with controversy, paid for the tent and then donated it.

    The play here seems to have taken a quite different line: one that gives rise to suspicion, at least, that something might be rotten.

    By the way, when was the last time that a “nutritional supplement”, or any other product, got its roll-out at the Executive Mansion?

    And, when was the last time a product roll-out was paid for by a governor’s political action committee?

    • Brother Severt… formerly of Martinsville, but now of Washington, D.C.? Holy moly, a blast from the past. I agree that the “optics” of Ms. McDonnell pitching nutrition products in Florida look bad. Very undignified. A definite P.R. mistake. But in the grand scheme of things, it looks like very small potatoes.

      If it turns out that Ms. McDonnell’s husband has given legislative or regulatory favors to Star Scientific, then we’re talking about something serious. But I have seen evidence of no such thing.

      Is the story worth digging into? Sure, that’s the proper role of the Fourth Estate. That’s how we keep the big boys honest. On the other hand, I’m not getting exercised until I see a lot more than what I’ve seen so far.

  6. Breaking News: Star Scientific announces new product sure to be an even bigger success than Anatabloc:

  7. Ethics is what this is about. How can anyone look at this issue and say it looks like small potatoes ? When it was MWAA it was they all need to go. But when it’s the present Virginia Governor and Attorney General well it’s all ok. Give me a break. This thing smells. These are two elected officials that are corrupt. If anyone of us received a gift of $15,000 plus all the other gifts we would be hung. But you say this is acceptable? Talk about double standards.

  8. yeah… funny how things change .. when McDonnell first got elected – Conservative types – even Jim Bacon types were shaking their fingers saying “Now you’re gonna see what a Conscientious Fiscal Conservative CAN DO!

    even when he blundered to and fro with Confederate holidays and trans vaginal probes – the Conservatives defended him as a committed public servant – and heckfire…. he was even Presidential TIMBER!

    HEY – look at it this way- he’s making Terry McAUliffe look respectable!

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