Attorney General John Kroger's spokesman Tony Green said in an interview that his office took up the case against Flaherty after getting a complaint from the Deschutes County sheriff.
The complaint turned into a multi-month investigation involving the Oregon State Police, the governor's office and the Washington County District Attorney's office, which reviewed the case against Flaherty and formally cleared him of any wrongdoing last week over allegations that he had misused his authority in a grand jury proceeding.
In a news conference last week, Flaherty blasted the entire episode as a waste of taxpayers' money and public officials' time. However, Flaherty said he doesn't bear any ill will toward Blanton for relaying information to the Attorney General's (AG) office that investigators later determined to be false.
"I think he had enough of an understanding of the history from being an elected county official that he didn't want to put his foot in that water. The easiest thing for him to do was to stay out of it," Flaherty said.
For his part, Blanton said it was necessary for him to get a third party due to the nature of the allegations, the specifics of which are contained in the investigative files and have not yet been disclosed. Moreover, Blanton said it is not unusual for his office to call on an outside agency whenever a conflict of interest arises, such as a deputy-involved shooting, or an accident involving an officer.
"You can't balance your own checkbook, as it were," Blanton said.
Both Flaherty and Blanton said their working relationship hasn't been damaged by the episode. In fact, Blanton said that he informed Flaherty of his decision to contact Kroger's office almost immediately after making the call.
Speaking Tuesday afternoon by phone, Flaherty reserved his criticism for Kroger's office, which he said bears responsibility for the time and resources devoted to an allegation that he called, "frivolous."
"It's a tar baby of their creation," Flaherty said.
At this point it's not clear just how much taxpayers will pay directly or indirectly for the affair. The Oregon State Police, which spearheaded the investigation, have not provided a cost estimate for the officers' time, but one source said that at least three detectives were working on the case for more than a week in Bend during the investigation.
The investigation was overseen by Attorney General Kroger and grew out of a public records dispute involving Deschutes County Counsel Mark Pilliod, whom Flaherty suspected of intentionally releasing confidential personnel information. Pilliod released the records which pertained to several recently hired employees in the DA's office in response to a public records request from a news reporter. Pilliod later publicly apologized for providing the records, but not before Flaherty called a grand jury to investigate the breach of protocol.
Flaherty dismissed the grand jury before an indictment was handed down, but the dispute simmered. Pilliod has explored the option of suing Flaherty over the episode, and the Oregon State Bar has an ongoing ethics investigation into Flaherty's handling of the issue. In November, Kroger's office opened its criminal investigation.
Washington County D.A. Bob Hermann, who reviewed the OSP investigation on behalf of Kroger's office, found no evidence that Flaherty overstepped his bounds when he convened the grand jury last year.
"Mr. Pillliod's release of the exempt information was an unauthorized exercise of his official duties as Deschutes County Counsel...The fact that the released records contain the applications of employees who were appointed to replace dismissed employees over Mr. Pilliod's objection could lead a reasonable person to conclude that Mr. Pilliod had the intent to harm either the new employees or Mr. Flaherty," wrote Robert Bletko, Hermann's chief deputy district attorney.
Flaherty made clear that the letter served to exonerate him of the charges that have dogged him since last year.
"The grand jury investigation of county counsel was reasonable, lawful and justified by the evidence," Flaherty said in a press conference last week.
While the decision is a milestone in the embattled Deschutes D.A.'s tenure, other issues remain including several workplace complaints filed by his staff with the Bureau of Labor and Industries and the Oregon State Bar investigation. Still, Flaherty said he is relieved to have closed this particular chapter.
"The silver lining I guess is it appears OSP did an extensive and thourough investigation and concluded what I concluded about a year ago, that it was an appropriate lawful (grand jury) investigation into criminal conduct - period. Hopefully, that's the end of it because we have better things to spend our time on," Flaherty said.