“Our company has been in the headlines for all the wrong reasons these last few days and our reputation has been damaged,” Stephenson wrote in a letter to employees on Friday. “There is no other way to say it — AT&T hiring Michael Cohen as a political consultant was a big mistake.”
He added, “To be clear, everything we did was done according to the law and entirely legitimate. But the fact is, our past association with Cohen was a serious misjudgment. In this instance, our Washington D.C. team’s vetting process clearly failed, and I take responsibility for that.”
He said for “the foreseeable future,” its external and legislative affairs group, based in Washington, will report to General Counsel David McAtee.
Quinn, who has been in charge of the D.C. office as senior executive vice president, will retire.
“David’s number one priority is to ensure every one of the individuals and firms we use in the political arena are people who share our high standards and who we would be proud to have associated with AT&T,” Stephenson wrote.
The hiring of Cohen was revealed in a documented posted online by Michael Avenatti, the attorney for adult film actress Stormy Daniels, who claims that she had an affair with Trump in 2006 and later was paid $130,000 through Cohen’s firm, Essential Consultants, to keep silent about it. Avenatti’s document detailed other clients and their payments for Cohen’s consulting business, which he ramped up as Trump was about to enter the White House.
The revelation has proved to be an embarrassment for AT&T, in the midst of a protracted legal battle over its proposed merger with Time Warner, which the Justice Department sued to block. A federal judge is set to announce his ruling on the deal on June, after a six week trial.
According to AT&T, it was Cohen who “approached our External Affairs organization during the post-election transition period and said he was going to leave the Trump Organization and do consulting for a select few companies that wanted his opinion on the new President and his administration – the key players, their priorities, and how they think.”
AT&T said that in early 2017, it hired several consultants to “help us understand how the president and his administration might approach a wide range of policy issues important to the company, including regulatory reform at the FCC, tax reform, and antitrust enforcement, specifically our Time Warner deal.”
Trump announced his opposition to the merger shortly after it was announced in October, 2016, but even after his election, there was some feeling on Wall Street that the transaction would still go through as it was reviewed by antitrust officials. Stephenson has called Trump’s opposition — and his dislike of Time Warner unit CNN — the “elephant in the room.”
Cohen had a one-year contract, to be paid at $50,000 per month, but his duties did not include lobbying, and the contract expressly prohibited it.
“We didn’t ask him to set up any meetings for us with anyone in the Administration and he didn’t offer to do so,” AT&T said. Stephenson did meet with Trump at Trump Tower during the presidential transaction period in January, 2017, but the company said that the merger was not discussed.
Cohen is under investigation by special prosecutors in New York. His home and office were raided by the FBI in April, as authorities sought business and other records.
AT&T earlier this week said that it was contacted by Special Counsel Robert Mueller about Cohen. Mueller is investigating Russian interference in the 2016 election and whether there was any collusion by members of the Trump team.
AT&T said that they “cooperated fully, providing all information requested in November and December of 2017. Since then, we have received no additional questions from the Special Counsel’s office and have considered the matter closed.”
Quinn had succeeded Jim Ciccone in the post in the fall of 2016, after Ciccone retired.