Defense Contractor Builds Lobbying Team With Firms Tied to Mueller Probe

A Kuwaiti defense contractor that pleaded guilty to stealing U.S. government funds is assembling a team of lobbyists and foreign influence operatives from high-profile, and sometimes controversial, firms.

Agility Public Warehousing recently inked contracts with three firms to represent its interests through lobbying and foreign influence campaigns, the first time the Kuwaiti defense contractor has been listed as a foreign principal under the Foreign Agents Registration Act. All of the firms have connections to people indicted or convicted as part of special counsel Robert Mueller’s investigation of Russian influence in the 2016 election of President Donald Trump.

Skadden Arps Slate Meagher & Flom, which made headlines for a fine exceeding $4.6 million for failing to disclose its role in former Trump campaign manager Paul Manafort’s controversial influence campaigns in Ukraine, was the first firm to register as a foreign agent of Agility.

Within days, Agility inked two more contracts: one with law firm Quinn Emanuel Urquhart & Sullivan and another with SGR LLC, a firm subpoenaed by Mueller over its role in covert influence operations orchestrated by former National Security Council advisor Michael Flynn. Flynn later admitted making false statements related to secretly acting as a foreign agent in a Turkish influence campaign.

Despite years of controversy surrounding defense contracts and legal battles, these are Agility’s first appearances as a foreign principal in FARA filings, which are made available through OpenSecretsForeign Lobby Watch tool.

The Kuwaiti contractor agreed to pay a $95 million fine and gave up $249 million in payments for military contracts after pleading guilty in 2017 to defrauding the federal government. It continued to be awarded lucrative government contracts as the case proceeded, however.

More recently, Agility faced defamation allegations over a pair of letters the contractor’s employees sent to U.S. government agencies under the pseudonym “Scott Wilson” accusing a rival contractor of violating U.S. sanctions on Iran.

A Pennsylvania appeals court ruled in July that the letters could not serve as a basis for defamation claims because they were expressions of opinion protected by the First Amendment even though the truthfulness of the accusations has been brought into serious question.

The letters accused a rival government contractor of violating U.S. sanctions over its ties to an Iranian shipping company. After the company filed a lawsuit against Agility and “John Doe,” Agility admitted that its employees wrote the Wilson letters, acting within the scope of their employment.

It appears the controversy over the letters is the motivation behind the foreign influence campaign and lobbying contracts.

SGR will provide government and public relations services to Agility, “including outreach to media and government officials, in connection with potential litigation regarding defamation allegations,” according to its registration materials. Services will also include “advice on lobbying and public relations issues related to the representation, and lobbying,” according to Quinn Emmanuel. Both Skadden and Quinn Emmanuel have preexisting relationships providing legal services to Agility.

SGR inked a $30,000-per-month deal with Agility, but the cost of Skadden and Quinn Emmanuel’s lobbying and foreign influence campaigns for Agility isn’t clear.

In its registration materials, Skadden says the firm has “received legal fees and reimbursement from Agility solely in connection with legal services” and it has “not yet received any compensation in connection with the activities prompting this registration.” Quinn Emmanuel’s services agreement provides some details on the firm’s billing structure, but little information on the financial arrangement or cost of public relations and lobbying services to be provided to Agility.

SGR and Quinn Emmanuel also registered separately as foreign agents of Bader El-Jeaan, a senior partner with Kuwait-based law firm Meysan Partners. He serves as an outside counsel for Agility. Quinn Emmanuel is providing joint legal representation to El-Jeaan and Agility, according to the firm’s FARA records.

Although Skadden and SGR are Agility’s first two foreign agents disclosed to the Justice Department, the defense contractor has previously paid other firms to lobby based on filings under the domestic-focused Lobbying Disclosure Act.

Agility’s influence operations are bolstered by Venable LLP, a firm it paid $70,000 in the first half of this year, according to filings under the Lobbying Disclosure Act. The firm reported lobbying on “government contracting and related issues” as well as the National Defense Authorization Act.

In the past, the Kuwaiti government has also helped facilitate some of the influence operations for Agility, which originated as a Kuwait state-owned entity.

In a 2009 letter, the Kuwaiti Foreign Minister asked then-Secretary of State Hillary Clinton to intervene with the Justice Department and help nix a criminal fraud case against Agility “in consideration of the special relations between our two friendly countries.”

Kuwait’s government has donated between $5 million and $10 million to the Clinton Foundation, some of the foreign donations to the foundation that raised issues for then-candidate Hillary Clinton the 2016 presidential campaign.

Recovering From Mueller Mess

Agility is Skadden’s first new FARA client registration with the Justice Department in over a decade outside of retroactive disclosures revealing its role in a controversial influence operation, and leading to a $4.6 million fine.

The influence operations quietly orchestrated by Skadden, former Trump campaign chair Paul Manafort and former Trump campaign deputy chair Richard Gates attempted to legitimize Ukrainian politician Yulia Tymoshenko’s imprisonment after it led to international condemnation of her political rival, former Ukrainian President Victor Yanukovych.

Skadden’s FARA filings identify Ukrainian oligarch Victor Pinchuk as the third-party it understood was funding the controversial report on Tymoshenko.

As part of the February settlement, Skadden agreed to cooperate with an ongoing probe into one of the foreign agents implicated in the scheme, former Obama White House counsel Greg Craig. Craig is scheduled for trial next week on a criminal charge related to withholding material facts from the Justice Department in a case accusing him of failing to register as a foreign agent of the Ukrainian government for his role in the 2012 influence operation.

Former Skadden associate and Dutch national Alex van der Zwaan was the first person sentenced in Mueller’s investigation back in 2017. He plead guilty to lying to federal agents about his September 2016 interactions with Gates, who was indicted by a D.C. federal grand jury along with Manafort.

The third firm that signed on to Agility’s foreign influence operation, SGR LLC, was also caught up in Mueller’s investigation. Mueller subpoenaed SGR after the Flynn Intel Group’s retroactive FARA registration revealed that the now-defunct Flynn firm paid $40,000 to SGR for foreign influence operations.

SGR’s work for Flynn Intel Group included outreach to government officials and other public relations work. Flynn commissioned a Monopoly-style graphic called “Gulenopoly” from SGR that appeared in a 2017 op-ed. That piece initially ran without any disclaimers about the author, a foreign agent working for lobbying powerhouse Mercury Public Affairs. Mercury is one of the three firms enlisted by Manafort for his controversial Ukraine work, along with Skadden and the Podesta Group.

Following Flynn Intel Group’s retroactive FARA registration with the Justice Department, SGR registered as a foreign agent of Inovo BV, a Dutch company with links to Turkish President Recep Tayyip Erdogan. Inovo is owned by Ekim Alptekin, a Turkish businessman accused of conspiracy with Flynn’s partner, who was indicted for secretly acting as foreign agent for a Turkish influence campaign.

Alptekin sits on the board of the Turkish government-linked Turkey-US Business Council. In 2018, both the Turkish government and business council signed a contract with Mercury Public Affairs. In 2018, Mercury inked new contracts with both the Turkey-US Business Council and the Turkish government.

Quinn Emmanuel was not as embroiled in the Mueller investigation, but did represent Trump’s former White House Chief of Staff Reince Priebus and White House Counsel Don McGahn in the Mueller investigation. The firm also represented former White House strategist Steve Bannon as he prepared for testimony in the House Intelligence Committee’s investigation into Russian interference in the 2016 presidential election.

Contracting Controversy Follows Agility

Agility is not without its own controversies. Following a multi-year Justice Department criminal investigation, the company was indicted in 2009 for defrauding the government by inflating the cost of providing food to American troops throughout the Middle East during the height of the Iraq War.

Federal prosecutors accused Agility of double-charging for some logistics costs, submitting false invoices and knowingly inflating the actual cost of food it bought for the Pentagon.

In 2017, Agility plead guilty to a criminal misdemeanor offense of defrauding the U.S. military in relation to a single $551 invoice. As part of a global settlement, Agility agreed to pay $95 million in cash to settle all civil fraud claims, forgo $249 million in additional payments under its military food contracts and plead guilty to a criminal misdemeanor for theft of government funds.

Agility was barred from bidding on new contracts during the course of the case against it. But the suspension was lifted in return for its 2017 guilty plea.

Despite the suspension as the case proceeded, Agility continued to do business with the U.S. federal government following the allegations and has even been awarded new contracts thanks to a little-known waiver system that extended its government contracts.

Agility, which touts an array of former senior Pentagon officials on its board, accounted for 15 of the 21 waivers listed on the U.S. General Services Administration’s website over the past decade, 71 percent of the total waivers issued by the U.S. Army and the Department of Defense’s combat logistics support agency. The determination of what constitutes a compelling reason for a waiver is largely subjective, with Congress traditionally deferring to military procurement officials’ judgment on the necessity of a contract extension.

One of Agility’s contracts with the Department of Defense’s combat logistics support agency was extended four times in 2010 for a total award of at least $63 million. Another was extended twice, but the U.S. government doesn’t disclose how much Agility was awarded in that case. None of the Army’s waivers for Agility reveal how much the defense contractor cost U.S. taxpayers.

After Agility settled its fraud case in May 2017, it sought new logistics contracts with the U.S. military. In July 2018, the Pentagon awarded the company a $62.4 million contract to provide aviation fuel to support military operations in Guam. Agility, the lone bidder on the project, began shipping the gas in late August.Agility has had at least four instances of misconduct since 1995, racking up more than $101.6 million in penalties, according to the Project of Government Oversight’s Federal Contractor Misconduct Database.