The Fortune piece includes the tale of how ChaCha came to be:

The trigger to launch ChaCha came when Jones was preparing a speech for the National Academy of Sciences at Stanford in 2005. To fill in some technical gaps in his talk, he phoned several venture capitalists and technology experts for help in tracking down information. Each pointed him to a specific website. "I thought, 'Holy s—-! I can actually do it now! If I recruit an army of experts, I could actually do what I was considering doing 20 years ago.'"

Wheeler said the potential for the partnership struck him when, writing a speech, he struggled to track down a vaguely remembered quote. He was impressed when IU's Ask a Librarian service found the quote, from former Harvard President James Bryant Conant, within hours. But a ChaCha guide got it in two minutes.

"That's where my head about exploded," he said. "I realized this is our core problem for the 21st century."

Jones is a millionaire inventor. And I suspect he's equally good at inventing the story behind his company. He almost has me believing that if there were more public speakers in the world, maybe ChaCha would actually have some users. That is, besides those students forced to use ChaCha because their university's president is buddies with Jones.

The Herald-Times wrote:

The lesson here is not that there was anything legally or ethically wrong, at least until such evidence surfaces, which it has not. Rather, it is one of recognition of situations and of McRobbie's changed role... Aggressive disclosure that spelled out any and all connections — even ones that seemed coincidental or even accidental — could have gone a long way to blunt the thrusts of critics.

To the editor:

Your Aug. 12 editorial, "Aggressive disclosure would clear air about IU dealings," left me wondering, what's your point?

It was unfortunate that Indiana media gave credence to the innuendo and inaccurate statements about the IU-ChaCha alliance that were anonymously posted in a self-described Silicon Valley "tech-gossip rag." The fact that no one by name stood behind these statements should have been a tip-off as to their veracity.

In response, McRobbie immediately disclosed all details of his involvement with ChaCha, and they were publicly reported. He resigned from the ChaCha board before taking over as IU president. He gained nothing from ChaCha. The only potential beneficiaries in this deal are IU and the people of Indiana if ChaCha catches on and becomes another successful Indiana business.

It sure looks as if someone in California is not happy that IU is getting together with Scott A. Jones, one of the tech industry's most successful innovators, to develop what could well be a much better Internet search engine than anything up to now. It should be welcomed by all who want Indiana to prosper. If someone in California doesn't like it, and whines about it anonymously on the Internet, we should ignore it.

-LEE MARCHANT, Bloomington

• My Valleywag posts were not anonymous, and I stand behind them.
• I am not in California — if I'm in California, then Bloomington, Indiana is downtown Palo Alto. Moreover, half of my family lives in Indiana!
• The only "inaccurate statements" reported here were made by Indiana University vice president Brad Wheeler, to the press, and by ChaCha in its SEC filings.
• McRobbie did not immediately disclose his involvement with ChaCha. He allowed Wheeler to speak, incorrectly, on his behalf. A ChaCha PR flack further muddled matters in a statement left in a comment on Valleywag. Valleywag and others questioned those statements, and finally McRobbie chose a consistent story (subscription required), though one that differed from previous tales told. Plenty of questions about this deal remain.
• The information ChaCha publicly disclosed in an SEC filing was false, a fact conceded by the company when it stated its intention to refile the document.
• It's absurd to suggest McRobbie gained nothing from ChaCha.
• And even more absurd to claim the primary beneficiary of this deal is not ChaCha and its shareholders.

Unsurprisingly, like ChaCha, Lee Marchant has benefited from close ties to Indiana University. Marchant received an oversized check for $25,000 in March from Indiana University for his "community lobbying effort" to keep a local military base, also tied to the university, open.

No wonder Mr. Marchant would prefer to ignore our coverage of goings-on in Bloomington. It doesn't fit with a booster's fantasy world view, where every deal is above board, and the ethics of every local notable are above average.

When critics observed that McRobbie was a board member of ChaCha, Brad Wheeler, IU's vice president of information technology, claimed McRobbie had resigned his board position on March 1 when he became president-elect to avoid any impropriety.

But three months after McRobbie supposedly resigned, ChaCha filed a Regulation D statement with the Securities & Exchange Commission — a requirement imposed on private companies when they register shares — that stated (PDF) McRobbie was a member of the board as of May 31.

Is Wheeler lying? If so, it's a stupid lie, one easily discovered, and a lie that will only increase scrutiny of the university deal. And it's a lie that does little to change the appearance of conflict, since McRobbie had been working as an executive overseeing IT and research at the university for years — roles which would have been central to any search-engine deal the university struck.

There's another possibility, one far worse for the company than a mere conflict of interest. Wheeler's statement could be accurate, and ChaCha's filing with the SEC could be false. In which case, Dean Burger, ChaCha's CFO and general counsel, would have lied to the SEC when he signed the filing and certified it as factual and true. And that scandal would spread as far as Seattle, since Jeff Bezos is also an investor in the company, and as the CEO of the publicly traded Amazon.com, hardly needs an SEC investigation coming anywhere near him.

And this all reminds us why "human-powered" search engines will never take off. As annoying as Google's robotic algorithms are, they never pull this kind of nonsense on us.