Rutherford scheduled a news conference for late Monday afternoon to address the lawsuit.
The allegations come just weeks before the four-way GOP primary, and political analysts say they could severely damage Rutherford's chances, particularly among the socially conservative voters who typically turn out to choose the Republican nominee. One political analyst called the claims "toxic."
Rutherford has denied any wrongdoing and held an unusual, hastily arranged news conference Jan. 31 to announce that an unnamed employee had raised "allegations of misconduct" against him. Initially, Rutherford said he couldn't detail the allegations because they were a personnel matter, but he later confirmed they involved harassment and political coercion.
"I know the accusations are completely false," Rutherford told The Associated Press last week.
He said an independent investigation would clear his name and accused a Republican gubernatorial rival, businessman Bruce Rauner, of being behind the accusations in an attempt to undermine Rutherford's campaign in advance of the March 18 primary. Rauner has denied the allegation.
Michalowski submitted a letter of resignation to Rutherford's office last week. The lawsuit names both the treasurer and his chief of staff, Kyle Ham, who didn't immediately return a message seeking comment.
In the lawsuit, Michalowski alleges that he attended an April 2011 overnight retreat at Rutherford's Chenoa home. He says Rutherford told him other staff members would be there, but no one else arrived.
The lawsuit alleges that after Michalowski went to the guest bedroom that night, Rutherford entered the bedroom and grabbed his genital area. Michalowski says he pushed Rutherford away and later told Rutherford's chief of staff about the incident. Michalowski alleges the aide told him, "At least we have job security."
Michalowski also alleges Rutherford approached him a few months later while Michalowski was talking to a group of women at a Springfield bar prior to the Illinois State Fair. He claims the treasurer grabbed his arm and said: "If you go home with me, you can have anything you want in the office."
The lawsuit also claims that during the 2012 Republican National Convention in Tampa, Rutherford asked Michalowski to go back to his hotel room. When Michalowski said no, Rutherford got angry and told him: "You just said no to the treasurer," the lawsuit states.
The suit also claims Rutherford made Michalowski do work for his own campaign as well as for 2012 Republican presidential candidate Mitt Romney. Rutherford was the Illinois chairman for the Romney campaign.
Rutherford, a former state lawmaker, was elected to the office in 2010. He's facing Rauner and state Sens. Bill Brady and Kirk Dillard in the GOP primary to take on Democratic Gov. Pat Quinn.
Rutherford said his office conducted an internal investigation into the allegations and they showed no merit. However, because he's treasurer, Rutherford said was launching an outside investigation with independent attorneys and consultants. Rutherford has said he will tell his side once the investigation is complete.
"What I have asked is, please do it as expeditiously as possible," Rutherford told AP last week. "I absolutely want this thing out there as soon as possible and as public as possible."
Meanwhile, Rutherford claimed Michalowski's attorney was linked to Rauner's campaign and had solicited a $300,000 payout from Rutherford to "walk away and keep it under wraps."
Rauner has said the attorney was paid a one-time fee for a lease agreement and has called allegations he was orchestrating the lawsuit "ridiculous."
Michalowski has a history of financial troubles but told the AP his motivation is neither financial nor political. Public records show Michalowski and his wife — who are in the process of divorcing — filed for bankruptcy in November 2011, claiming assets of $295,000 and liabilities of $642,000. A judgment of foreclosure and sale was entered in October against Michalowski's Chicago condo.
Political analysts, meanwhile, said the allegations will distract from Rutherford's campaign message and could hurt his ability to raise money during the critical final weeks before Election Day.
"Any kind of sexual harassment charge against a major political figure is toxic," said David Yepsen, director of Southern Illinois University's Paul Simon Public Policy Institute. "Even if it's just an accusation, it will hurt him irreparably."
Rutherford has said voters instead should look at his 22-year record in public office without a single previous complaint against him.
Associated Press reporters Sara Burnett in Chicago and John O'Connor in Springfield, Ill., contributed. Lester reported from Springfield, Ill.
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