As DoJ blocks proposed AT&T deal with Time Warner, carrier’s SVP of External and Legislative Affairs resigns
Looking for inroads at the White House amid a contentious merger proposal with Time Warner, AT&T paid $600,000 to President Trump attorney Michael Cohen for lobbying services. Since that revelation was made public last week in ongoing coverage of Trump’s legal entanglements, AT&T CEO Randall Stephenson has called the move a “big mistake,” the company’s SVP of External and Legislative Affairs is leaving his position and some unionized workers considering a strike have used the Cohen payment as a talking point.
In a May 11 New York Times piece citing an internal memo, Stephenson is quoted as saying, “Our company has been in the headlines for all the wrong reasons these last few days and our reputation has been damaged. There is no other way to say it — AT&T hiring Michael Cohen as a political consultant was a big mistake.”
Stephenson also confirmed Quinn’s departure. A Bell alum, Quinn served in his most recent position since October 2016. Prior to that he was SVP of Federal Regulatory, responsible for “leading the AT&T Federal Regulatory group responsible for all regulatory matters affecting AT&T and its affiliates before the Federal Communications Commission,” according to a company bio.
AT&T is pursuing an $85 billion acquisition of Time Warner, which owns brands including HBO, Turner Broadcasting System, The CW, DC Comics and Warner Bros. On the campaign trail, Trump railed against the merger, despite established antitrust rules having set a precedent to the contrary as it relates to vertical acquisitions–like Comcast buying NBC Universal. The U.S. Department of Justice last year moved to block the deal and opening arguments began last month; the DoJ’s primary argument is that the combined company would create an anti-competitive environment and raise consumer prices. No word yet on where DoJ stands on the proposed combination of Sprint and T-Mobile US, which would is decidedly not a vertical acquisition, and would reduce the Tier 1 U.S. carrier market from four to three major players.
In a Feb. 9 pre-trial filing, attorneys for AT&T conclude: “This merger will provide substantial benefits to consumers and, contrary to the government’s contentions, will strengthen rather than harm competition in these markets. For those reasons, and based on the evidence to be adduced at trial, this Court should grant judgment for defendants and permit this merger to proceed.”
Another of Trump’s attorneys, former New York City Mayor Rudy Giuliani, recently resigned his position with a private firm to fully focus on marshaling Trump and his associates through an ongoing probe by Special Counsel Robert Mueller, which is looking into ties between the Trump campaign and Russia, as well as more broad financial dealings related to Trump, the Trump Organization and other entities.
Last week Giuliani hit the news circuit–hard. In a May 11 interview with the Huffington Post, he’s quoted as saying Trump “did drain the swamp … The president denied the merger. They didn’t get the result they wanted.” Giuliani reversed that the next day in an interview with CNN’s Dana Bash. This time around he said, Trump “told me directly he didn’t interfere” with the proposed AT&T-Time Warner combination. White House Press Secretary Sarah Sanders got into the mix Saturday too telling CNN, “The Department of Justice denied the deal.”
Cohen, widely described as Trump’s fixer, had his New York City office and hotel room raided by the FBI in April. Cohen, an avid New York City cab medallion holder among many other things, is alleged to have set up a slush fund to channel a $130,000 payment to adult film actress Stephanie Clifford, who says she was paid in the run up to the November 2016 election to keep quiet about a relationship with Trump.
In addition to Quinn’s ouster and Stephenson’s comments, another wrinkle is an ongoing dispute between AT&T and about 14,000 unionized workers. The Executive Board of the Communications Workers of America approved a strike “if negotiators cannot reach an agreement” regarding employment contracts that expired in April.
“AT&T paid six-figure sums to a shady consultant who provided nothing of value to the company but is unwilling to commit to family-supporting jobs in the communities that it serves,” CWA District 4 VP Linda Hinton said in a statement.
