Update: 8 a.m. Aug. 2

The Oregon Department of Justice is looking into a complaint that an agreement struck by Gov. Kate Brown, Nike and public employee unions in late June to keep an initiative off the ballot violated state elections law.

The union-backed proposal, Initiative Petition 25, would have required Nike and other large companies to disclose tax payments and other closely held business details. The unions said they collected more than enough signatures to get it on the ballot but decided not to proceed.

Around the same time, Nike donated $100,000 to the Common Good Fund, a political action committee which is expected to campaign against two tax initiatives on the November ballot opposed by Brown and the public employee unions. The committee was formed by Nike's senior director of government and public affairs Julia Brim-Edwards, who is also on the Portland Public Schools board.

In a letter dated July 24, Portland resident Richard Leonetti says the arrangement violated the prohibition in state law against paying to "sell, hinder or delay any part of an initiative, referendum or recall petition."

Leonetti's letter, which he said was prepared by an unidentified lawyer, states that the Legislature passed the election law in question "to prohibit the payment of money in exchange for withdrawing initiatives, and if this practice is allowed then surely there will be a flood of initiatives filed with the sole motivation of securing payments to certain PACs or organizations in exchange for withdrawing initiatives."

Leonetti named the governor, Brim-Edwards, AFSCME executive director Stacy Chamberlain and SEIU Local 503 president Steven Demarest in the complaint filed with the Secretary of State's office. Staffers there referred it to the Oregon Department of Justice to investigate, which is standard protocol for such complaints.

Last month, Brown's re-election campaign revealed to OPB that she had brokered a deal with Nike and the public employee unions to keep the corporate transparency initiative off the ballot. The news organization also reported Leonetti's complaint on Tuesday. It's a characterization the unions, which support Brown's campaign, disagreed with on Wednesday.

"It was an internal decision," said Joe Baessler, political director for AFSCME. "We didn't withdraw the measure because of Nike." Baessler said the union did not anticipate how many initiatives it opposed would wind up on the November ballot, raising the prospective of an expensive campaign to defeat them. "It's just a question of resources," Baessler said.

Demarest, with SEIU Local 503, said in an emailed statement that the complaint "has no merit." He agreed with Baessler that unions dropped their initiative in order to focus on defeating the two anti-tax initiatives.

Greg Rossiter, a spokesman for Nike, declined to comment on the complaint.

Brown's communications director Chris Pair declined to comment on the elections complaint, saying that it was a question for the governor's re-election campaign.

Brown's campaign spokesman, Christian Gaston, wrote in an email that the complaint was "baseless."

This story has been updated to reflect the following corrections: an earlier version of this story incorrectly stated Brim-Edwards was chair of the Portland Public Schools board and that the Oregon Department of Justice was investigating the complaint. DOJ is reviewing the complaint before deciding whether to open an investigation.

-- Hillary Borrud

503-294-4034; @hborrud