UPDATED: AT&T said it was contacted by Special Counsel Robert Mueller’s team about Michael Cohen after the revelation that the company had retained Cohen’s consulting firm to provide insight on the new Trump administration.
“When we were contacted by the Special Counsel’s office regarding Michael Cohen, we cooperated fully, providing all information requested in November and December of 2017,” AT&T said in a statement on Wednesday. “A few weeks later, our consulting contract with Cohen expired at the end of the year. Since then, we have received no additional questions from the Special Counsel’s office and consider the matter closed.”
AT&T said on Tuesday that it had retained Cohen, Trump’s personal lawyer, around the time of the inauguration and through the end of 2017, for consulting on a range of issues. At the time, the company was seeking government approval for its merger with Time Warner. Trump opposed the transaction during the presidential campaign, and the Justice Department ultimately sued to block it.
Still unanswered are questions of who approached whom to do the work, and what Cohen ultimately did for the company.
Sen. Ed Markey (D-Mass.) and Sen. Richard Blumenthal (D-Conn.) called for the Judiciary Committee to investigate the payments. At a press conference on net neutrality, Blumenthal said the issue was “those payments and other payments that might be used to influence the president of the United States.” Markey noted, wryly, that Cohen was “not known as a telecom policy analyst.”
Sen. Amy Klobuchar (D-Minn.) and Sen. Dave Cicilline (D-R.I.), the top Democrats on antitrust subcommittees in the Senate and House, sent a letter to Makan Delrahim, the Justice Department’s antitrust chief, asking him to disclose “any information that you may have concerning payments made by AT&T that may have influenced the Administration, White House, or transition regarding the AT&T/Time Warner transaction.” Delrahim was unaware of Cohen’s work for AT&T and did not know about the payments, Variety has learned.
A spokeswoman for the Justice Department had no immediate comment.
Mueller’s team has been investigating Russian interference in the 2016 presidential election and potential collusion by members of Trump’s campaign. At some point, their investigation took interest in Cohen and his consulting firm, Essential Consultants, and the work he had done for AT&T and other clients. Mueller reportedly referred the Cohen case to New York federal prosecutors, who in April obtained a warrant for a raid on his home and office.
On Wednesday, AT&T sent out an email to its employees explaining the situation, characterizing it as no different from what they have done in response to prior new administrations, but also distancing themselves from Cohen’s more recent troubles.
“In early 2017, as President Trump was taking office, we 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, corporate tax reform, and antitrust enforcement,” the company said in the e-mail. “Companies often hire consultants for these purposes, especially at the beginning of a new Presidential Administration, and we have done so in previous Administrations, as well.”
“Cohen was one of those consultants. Cohen did no legal or lobbying work for us, and our contract with Cohen expired at the end of its term in December 2017,” the e-mail continued. “It was not until the following month in January 2018 that the media first reported, and AT&T first became aware of, the current controversy surrounding Cohen.”
AT&T’s payments were first disclosed by Michael Avenatti the telegenic attorney for Stormy Daniels, the adult film actress who was also paid $130,000 by Cohen’s firm as part of a settlement agreement to keep quiet about her claims of an affair with Trump.
Avenatti posted the results of his investigation into Essential Consultants. The document also included the claim that the Cohen firm was paid $500,000 for work by a Russian oligarch Viktor Vekselberg, through the company Columbus Nova, and that it also received payments from Novartis and Korea Aerospace Industries. Columbus Nova denies that it was a conduit for the payment.
Avenatti’s document reported $200,000 from AT&T, made in four $50,000 payments from Oct. 3, 2017, to Jan. 3, 2018. The company indicated that his work spanned for much of the year, meaning that Cohen’s total payment may be more.
An AT&T spokeswoman declined to say how the company came to retain Cohen, who was relatively well known, having frequently appeared on TV to comment on the Trump campaign.
A spokesman for Novartis, the pharmaceutical company, told ABC News that Cohen approached them, promising “access to the new administration.”
In a statement, Novartis said that they hired Cohen in February of 2017, to advise the company on how Trump’s administration might approach healthcare policy matters, including the Affordable Care Act, under a one-year agreement that paid $100,000 per month. But after one meeting with Cohen, they determined that he would be “unable to provide the services that Novartis anticipated” and “the decision was taken not to engage further.”
“As the contract unfortunately could only be terminated for cause, payments continued to be made until the contract expired by its own terms in February, 2018,” the company said.
Novartis said the company was also contacted in November of 2017 by Mueller’s office.
AT&T is considered one of the most influential of all corporations in Washington, as it is heavily involved in telecommunications issues like net neutrality.
It was among the top 10 spenders on lobbying in 2017, a total of $16.8 million, according to the Center for Responsive Politics, and it has a highly visible presence in D.C., not only for its large public affairs shop, but for its sponsorship of major events and the AT&T Forum, a venue for policy discussions located near the Capitol.
AT&T’s decision to hire Cohen’s firm isn’t, on the face of it, even all that unusual in Washington, where big conglomerates and trade associations try to soak up information and access about any administration. As one veteran in the field noted, at the start of 2017, “there weren’t a lot of Washington lobbyists who could give you insight into Donald Trump.”
Cohen, though, didn’t lobby, AT&T says.
But when it comes to seeking influence, the lines have blurred. In D.C., there is a growing category of strategic consultants, often with close connections to the administration, who do not face the same disclosure rules as lobbyists, but they have become relatively common in Washington. They offer expertise, advice, and entree.
Gene Kimmelman, the president of public interest group Public Knowledge, said he was sure that “AT&T was trying every angle imaginable to try to convince the Trump administration not to oppose the merger.”
In retaining Cohen, “on the face of it, there are no obvious legal or ethical issues that arise, unless other facts raising such concerns are uncovered.”
The public interest group Public Citizen is calling for congressional committees to investigate the payments, and for the companies to disclose their agreements with Cohen’s firm and what services he performed. They say that if the purpose was to exert influence over the administration, Cohen needed to have filed lobbying disclosures.
“What we know is mind-blowing, but the public needs to know much more before we can understand what the heck was going on,” said its president, Robert Weissman, in a statement. Among his questions: What special insights did Cohen have that were worth these considerable sums, but which did not involve him lobbying?
If the intent was to change Trump’s mind on the merger, it didn’t work.
Trump declared his opposition to the AT&T-Time Warner deal shortly after it was announced in October of 2016, but after the election, the feeling on Wall Street was that a Republican administration would view the transaction more favorably.
That didn’t happen.
AT&T CEO Randall Stephenson said at a conference in December, 2016, just weeks after the merger was announced, that “anytime the president of the United States comes out and says they’re not in favor of what you’re trying to do, you have to pay attention. But I don’t know what part of the deal he’s referring to. I’ve heard rumors he’s not happy with CNN, so that might have come into it.”
Trump continued to rail against the network, a unit of Time Warner.
The Justice Department filed its lawsuit to block the merger on Nov. 20, and a six-week trial ended last week. U.S. District Judge Richard Leon said he plans to announce his ruling on June 12.
Last week, in its post-trial brief, AT&T-Time Warner’s attorneys said they have not abandoned their selective enforcement defense, or the idea that they were singled out for antitrust enforcement because of Trump’s opposition to the deal and dislike of CNN.
Leon declined to let AT&T-Time Warner pursue that argument in the trial, while the Justice Department denies that there was any improper influence.
Attorney Henry Su, partner at Constantine Cannon in Washington, said AT&T-Time Warner could be waiting to use the selective enforcement defense should it lose the case and appeal. With the disclosure of the Cohen payments, pursuing that line of argument may just raise further questions of why the company hired him and what he did.
“It would seem to me that if you are AT&T, you would be really thinking of whether you would want to pursue that,” he said.
Kimmelman said he does not think that the latest revelation will affect such a legal defense, nor will it “play a meaningful role in Judge Leon’s deliberations.”
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