Hilton Head mayor was paid to testify for Coral Resorts

dburley@islandpacket.comJuly 11, 2014 

Hilton Head Island mayor Drew Laughlin.

THEOPHIL SYSLO — Staff photo

Coral Resorts paid Hilton Head Island Mayor Drew Laughlin to appear at a hearing where he testified that punishing the timeshare company would hurt the island economy, the mayor said Friday.

Laughlin also told the S.C. Real Estate Commission last year that the company's four resorts bring jobs, tourists and millions of dollars to the island. The loss of the economic benefits could be devastating, he said.

But Laughlin, an attorney who has represented Coral Resorts in other matters, didn't mention that he worked for the company at the same time he was touting it.

"In retrospect I wish I had," he said Friday. "I probably intended to. I certainly had no thought process that I'm not going to tell them. And I don't think it made any difference."

Laughlin's sworn testimony came during a Jan. 23, 2013 Real Estate Commission hearing to determine whether Coral Resorts' registration to sell timeshares was in good standing.

The transcript of the hearing has been sealed from the public by two different courts and a state regulatory official.

Laughlin said he had nothing to do with the sealings.

He said he testified before the commission as a private citizen -- not as an attorney for Coral Resorts and not as mayor. He was paid for his hours and the mileage to drive to Columbia. He charged his normal rate as an attorney, which he did not disclose.

"I was reimbursed for my time and my expenses, nothing else."

Laughlin was asked to testify because of his deep knowledge of timeshare resorts and Hilton Head's economy, he said. He also has a friendship with Dwight Trew -- founder of Coral Resorts -- and could vouch for the company's ethics.

At the hearing, however, Coral Resorts attorneys indicated Laughlin spoke for the town. They introduced him as the mayor and referred to him as a "public official," according to the hearing transcript.

"With me is Mayor Drew Laughlin of Hilton Head, here to testify on behalf of these resorts," Coral Resorts attorney Nekki Shutt told the commission.

AT THE HEARING

When Laughlin testified, he highlighted the merits of Coral Resorts, mentioning the money the company pumps into the local economy and how well it maintains its four properties.

"I can tell you without hesitation that I believe that these (timeshare) plans are ethically and well run, and that they are consistently trying to improve," he said.

"It's terribly important what happens to these folks," he added.

He did not mention he is an attorney for the company.

Commission members misunderstood if they thought he was speaking as mayor, Laughlin said Friday.

"It was not my intention to mislead them," he said. "I never said I was speaking for the town, I never said the town sent me, I never said it was part of my official duties."

A Coral Resorts spokesman declined on Friday to comment on Laughlin's appearance at the hearing.

RELATIONSHIP WITH CORAL RESORTS

People connected with Coral Resorts heavily funded Laughlin's 2010 mayoral campaign, records show.

Eight of the 12 people who donated the maximum $1,000 to him had ties with Coral Resorts, according to S.C. Ethics Commission records. Two of the eight -- Dwight and Judy Trew -- also donated $1,000 to Laughlin's opponent, Tom Crews, records show.

The mayor acknowledged the donations, but said they had nothing to do with his decision to testify at the hearing.

Laughlin also has done legal work for Coral Resorts for two years. His friendship with the company's founder dates back more than 25 years, he said.

In 2012, Laughlin represented Coral Resorts in a business dispute with a marketing firm. That case is pending, according to court records.

In September 2013 -- nine months after Laughlin testified at the Real Estate Commission hearing -- he took on representation of the company's homeowners associations. Coral Resorts runs Port O'Call at Shipyard Plantation, Island Links, Coral Sands and Coral Reef resorts. Each has its own homeowners association. The associations are among many defendants listed in lawsuits filed by dissatisfied owners, according to court records.

Zach Naert and Joseph DuBois, attorneys for more than 25 unhappy timeshare owners, have argued there is little difference between the resorts and the associations. They say B. Dean Pierce, CEO of the resorts, is also president of the associations.

The mayor declined to discuss who runs the associations because "that goes into the merits of litigation, and I don't want to go there."

"Just because somebody is mayor doesn't mean in my view they aren't entitled to what they want to say as citizens," Laughlin said Friday. "Nor can they not make a living representing clients ... even if they aren't the most popular clients in the world."

Follow reporter Dan Burley on Twitter at twitter.com/IPBG_Dan

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