Hand exposed by accident. What's the correct ruling?

[Kevin J]

Most couldn't remember this ever happening exactly like this and it was the subject of conversation for hours afterward .

I raised, the button cold-called, and the sb started contemplating. As he did, he exposed one of his cards to the button. Being very honest, the button mentions that he clearly saw a card.

Even though I appreciated his honesty, I didn't think it was fair that he knew an exposed card that I did not. The sb wasn't in the hand yet, but the button definitely was.

The floor was called and asked the button what card he saw. He correctly identified it and the floor ruled that the card must be exposed. I thought it was the right ruling, since the sb has a responsibility to protect his cards. But one player in particular (not in the hand), had a real problem with it...

What if someone now wanted to take a shot and just declare out of the blue that he saw someone's hand whether he really did or didn't? Suppose he said, "I saw a black ace"? The floor is called and it's determined there was no black ace. That would be an advantage as well.

I admit, it's hard to refute that logic, although I think it would be a simple matter to implement a severe penalty upon a player for doing this.

Anyway, what was the correct ruling for this hand? Should the card have been exposed? Or should the hand have proceeded with the button knowing this card, but not me? Thanks.

Btw- The reason few have ever seen this situation is because few players (who were the button), would be honest enough admit to seeing the card. So I really felt bad. It was as if he (and the sb) were being punished for his honesty.