By People Staff
Updated September 10, 1979 12:00 PM

About the only thing that everyone in the Hamilton Jordan-Studio 54 Cocaine Furor agreed upon was that the second most powerful man in the Carter administration did indeed visit the New York disco. Accounts of what happened next depend on who is telling the story and what ax needs grinding. But as the story unfolded last week, it seemed as bizarre as anything in the lurid two-year history of the club.

At the base of it is an accusation by the club’s co-owners—both under indictment for income tax evasion—that Jordan snorted cocaine while at 54 last summer. As one of the proprietors, Steve Rubell, recalls the event, Jordan and a group of friends—Rubell isn’t sure how many—came to the club and to asked for directions to the basement, a sanctum where VIPs could allegedly find drugs. Once downstairs, Rubell claims Jordan made contact with a supplier called “Johnny C,” who provided the coke. “I saw him take a hit in each nostril,” Rubell says of the President’s new chief of staff. “He knew what he was doing. It wasn’t like a strange substance to him. Johnny C says Jordan was in the club for two and a half hours. He tried to pick up some girls and he succeeded.”

Jordan denied the cocaine transaction, although conceding he was at the club with Carter administration officials Tim Kraft and Evan Dobelle. He contends that he didn’t stay “for more than an hour.” As for what he did there, Jordan says, “We walked around. I remember going there, sort of as a spectator sport. I did not request the use of any drugs.” Kraft and Dobelle support Jordan’s version.

All the charges and denials are being investigated by the FBI—a mandatory procedure under the new Ethics in Government Act. Specific accusations against top government figures must now be thoroughly pursued, no matter where they come from.

There was one other reason not to discount the charges as totally malicious or desperate. Schrager was represented in the case by Mitchell Rogovin, a former U.S. Assistant Attorney General and respected counsel for clients ranging from Common Cause to the CIA. “From the time of the incident,” Rogovin points out, “the U.S. Attorney’s office has sought the cooperation of the defendants with respect to possible drug use. They are basically interested in trading—in effect, to take it easy on our clients if we cooperate. But I don’t think even in their wildest dreams they thought Jordan’s name would come up.”

The Justice Department was really after dealers, of course, and it gave Rogovin pause, he says, “because the President relies very heavily on Mr. Jordan and I would regret the political impact.” On the other hand, he points out that “it would be an extraordinary security risk if the allegations were true” against Jordan. Rogovin also noted that “unproved sensational charges” would in the long run damage his case, and admitted, “If I’d had 16 bishops as witnesses I’d have preferred it. But even a disco owner can tell the truth.” Yet Rubell’s savvy attorney, Roy Conn, who was traveling overseas when Rogovin made his charges, returned to the U.S. and disassociated himself from the attack on Jordan.

As the case hit the headlines, not even Jordan’s defenders denied his reputation as a partygoer and womanizer—he was divorced last year—and last week rumors predictably began involving him with bashes as far away as California at which drugs were available. But Jordan’s closest friends insist he isn’t the drug type. “Everybody knows Hamilton has a weakness for women and booze,” says White House pollster Patrick Caddell bluntly, “but he doesn’t do drugs.”

That is a particularly touchy subject in the Carter White House. Last summer longtime aide Dr. Peter Bourne was forced to resign after illegally prescribing Quaaludes for a staffer. The President sent each of his senior aides a terse memo. “I expect every member of the White House staff to obey the law,” he wrote. “You will obey it, or you will seek employment elsewhere.” That made Bourne’s observation on the Jordan crisis more worrisome. “The charges may not be very significant,” he said. “But it’s like the Chinese water torture—gradually eroding everything away each morning on page one.”