Charge: In 1987, a 15-year-old black girl named Tawana Brawley went missing and was found four days later covered in dog feces and with racial slurs written on her body. She claimed that at least two and possibly six white men, one of them carrying a badge, had repeatedly raped her in the woods in upstate New York. Sharpton took up Brawley's cause and defended her refusal to cooperate with prosecutors, saying that asking her to meet with New York's attorney general (who had been asked by Gov. Mario Cuomo to supervise the investigation) would be like "asking someone who watched someone killed in the gas chamber to sit down with Mr. Hitler." According to the Associated Press, Sharpton and Brawley's lawyers asserted "on 33 separate occasions" that a local prosecutor named Steven Pagones "had kidnapped, abused and raped" Brawley. There was no evidence, and Pagones was soon cleared. Sharpton then accused a local police cult with ties to the Irish Republican Army of perpetrating the alleged assault. The case fizzled when a security guard for Brawley's lawyers testified that the lawyers and Sharpton knew Brawley was lying. A grand jury investigation concluded in late 1988 that Brawley "was not the victim of forcible sexual assault" and that the whole thing was a hoax. The report specifically exonerated Pagones, and in 1998 Pagones won a defamation lawsuit against Sharpton, Brawley, and Brawley's lawyers. Sharpton was ordered to pay Pagones $65,000. Johnnie Cochran and other Sharpton benefactors subsidized the payment.
Defense: Sharpton stands by Brawley's story. In May 2002, when the Associated Press asked whether he would apologize to Pagones, Sharpton replied: "Apologize for what? For believing a young lady?" Referring to his incipient presidential campaign, Sharpton continued, "When people around the country know that I stood up for a young lady ... I think it will help me." In March 2003, when the Washington Post asked whether Sharpton could have expressed sympathy for Pagones after the prosecutor was cleared, Sharpton replied that Brawley "identified Pagones. I was her spokesperson. I cannot turn around in what I said I believed." As to the jury verdict against him, Sharpton told the New York Daily News in July 2003 that "a jury said in the Central Park jogging case … that I was wrong, and it was just overturned 13 years later. Juries can be wrong.
http://www.slate.com/articles/news_and_politics/ballot_box/2003/09/the_worst_of_al_sharpton.html