Novartis Spoke to Mueller’s Office About Its $1.2 Million Contract With Michael Cohen
The Swiss pharmaceutical giant Novartis said Wednesday that it had spoken to lawyers for the special counsel, Robert S. Mueller III, about its payments to a shell company controlled by Michael D. Cohen, President Trump’s personal lawyer and longtime fixer.
Novartis said it paid $1.2 million to Mr. Cohen’s company, Essential Consultants L.L.C., for a one-year consulting contract on “health care policy matters.” The contract began shortly after Mr. Trump’s inauguration and expired in February of this year.
The company said it was contacted by Mr. Mueller’s office in November of last year and that it had fully cooperated and now considers its role in the investigation as closed. Mr. Mueller is examining Russian interference in the 2016 presidential election.
The payments came to light Tuesday after Michael Avenatti, the lawyer for Stephanie Clifford, an adult film actress who said she had an affair with Mr. Trump, released a document that contained details of the financial transactions. Similar payments were made by AT&T and the aircraft manufacturer Korea Aerospace Industries. The New York Times reviewed financial records that confirmed some of what was in Mr. Avenatti’s report.
Ms. Clifford was paid $130,000 by Essential Consultants to keep quiet about the alleged affair with Mr. Trump.
The companies’ arrangements with Mr. Cohen show how eager corporate executives were to establish ties to a new administration that did not seem to play by the typical Washington rule book or work in the traditional circles of power.
Mr. Trump’s arrival came at a particularly perilous time for both Novartis and AT&T. Mr. Trump had threatened to eliminate President Obama’s health care program, which could disrupt the pharmaceutical industry, and had also frequently raised the issue of high drug prices during his campaign.
AT&T had announced an $85.4 billion bid for Time Warner in 2016, and needed the approval of the Justice Department. The agency sued to block the deal last year.
Mr. Cohen came to the attention of Novartis executives in early 2017, presenting himself as knowledgeable about the president’s thinking on health care and other areas of concern to the company, according to two people briefed on the talks. The people would speak only under the condition of anonymity because they were not authorized to discuss the contract publicly.
Novartis said after it determined that Mr. Cohen could not provide the services he offered, the company wanted to terminate the contract but learned it could do so only for cause, so it allowed the contract to expire.
AT&T officials also scrambled to adjust to the new White House. Inside the company’s Washington office, which had close ties to people in traditional Republican circles, staff members were concerned that they didn’t have connections to the Trump administration. In addition, one of its top executives in Washington had been a vocal opponent of Mr. Trump during the campaign.
On Tuesday, AT&T acknowledged making payments to Mr. Cohen’s company. According to a person familiar with the agreement, the company paid a total of about $600,000 to Mr. Cohen’s firm for a yearlong contract. Mr. Cohen provided advice on how AT&T should approach the administration about its $85.4 billion merger and regulatory issues before the Federal Communications Commission, the person said.
AT&T would not comment on whether it has been approached by investigators for Mr. Mueller or by other federal government officials.
The company said Mr. Cohen was one of several consultants it retained at the start of Mr. Trump’s term to help it better understand the president’s thinking. “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,” the company said Wednesday in a note to employees.
In June 2016, AT&T’s former head of lobbying and government affairs, James Cicconi, publicly endorsed Hillary Clinton. A longtime Republican insider, Mr. Cicconi had led AT&T’s Washington office for many years and retired a few months after his endorsement of Mrs. Clinton and just before the announcement of AT&T’s bid for Time Warner.
Mr. Trump had criticized the proposed merger during the campaign. But inside AT&T, few expected him to win the election, and there was little planning in place for his potential victory, according to three people familiar with discussions at the company.
AT&T poured money into efforts related to the new administration. It donated $2 million to the inauguration festivities and an additional $80,000 for telecom equipment used during the inauguration.
It first engaged with Mr. Cohen around the time Mr. Trump took office, looking for people who could provide some sense of the president’s thinking, the company said in its letter to employees.
The circumstances around Mr. Cohen’s dealings with Korea Aerospace are less clear. Representatives for the company could not be reached for comment Wednesday.
Reuters cited an unnamed spokesman for Korea Aerospace saying it retained Mr. Cohen for “legal consulting concerning accounting standards on production costs,” and that the contract ended with the payment of $150,000 to Essential Consultants last November. Korea Aerospace said it had not been contacted by Mr. Mueller’s office.
Korea Aerospace, which has been a partner with the American defense contractor Lockheed Martin in bidding for a United States Air Force contract, was mired in scandal last year. According to South Korean press reports, the company’s former chief executive was charged with accounting fraud last September and a senior officer in charge of its overseas operations committed suicide.
Jim Rutenberg, Mike McIntire, Peter S. Goodman and Susan Beachy contributed reporting.