Skadden Arps Settles With DOJ Over Manafort Ukraine Dealings

The prominent law firm Skadden Arps reached a civil settlement with federal law enforcement today over work it performed in Ukraine on Paul Manafort’s request, the Justice Department announced in a statement.

The firm agreed to pay $4.6 million that it secretly received for the work that it performed on behalf of the Ukrainian Ministry of Justice, and agreed to retroactively register as a foreign agent of the Ukrainian government.

Skadden wrote a report in 2012 whitewashing the Ukrainian government’s prosecution of a main political opponent, Yulia Tymoshenko.

The press release says that the lead partner in the matter made “false and misleading statements” to the DOJ after its foreign agents registration unit contacted the firm in 2013 in connection with the case. The lead partner was former Obama White House Counsel Gregory Craig, who left the firm in April 2018. The lead partner told the FARA unit that he had only replied to media requests regarding the report, and did not actively attempt to disseminate it in the American press, according to the press release.

An attorney for Craig did not immediately reply to an emailed request for comment.

Craig flew to Ukraine in 2012 with a team of attorneys that included Alex Van Der Zwaan, a London-based associate who pleaded guilty to lying to federal agents in the Mueller investigation last year.

An appendix attached to the settlement agreement gives a detailed history of Craig’s and Skadden’s involvement with Manafort in Ukraine.

In a 2012 email from an unnamed partner that appears to match Craig’s description to Manafort that the DOJ cites in the release, an engagement letter appears to show Skadden agreeing to be paid by an unnamed “third party” for the work it was to perform on behalf of the Ukrainian government. That “third party” has been referred to as an unnamed “oligarch” in other filings.

The release says that Skadden agreed to take an initial $4 million advance from the unnamed “business person” before starting work on the report. Officially, the documents say, the Manhattan-based law firm was to charge the Ukrainian government 100 Ukrainian hryvnia per hour – amounting to an official charge of only $12,000 for its labors.

By the end of the engagement, Skadden had taken in $5.2 million from the oligarch, the appendix states, largely through Cyprus-based offshore firms controlled by Manafort.

The now-imprisoned political consultant had hired Skadden to legitimize the prosecution of Tymoshenko in the eyes of human rights observers and European politicians, who viewed her imprisonment as an act of political retribution. To that end, the filing states, Skadden partners and Manafort attempted to organize a PR campaign around the distribution of the report that involved leaking it to an unnamed American journalist in advance of its official publication.

Manafort and Skadden worked with a U.S.-based public relations firm to roll out the report, the document states. That included a plan to distribute it to “approximately 20 members of the U.S. Congress” and for the partner whose description matches that of Craig to give on-record briefings to journalists about the Tymoshenko case.

However, even as the release proceeded, questions about how Skadden got paid began to arise. One unnamed journalist emailed the lead partner regarding a “rumor/dispute…about how and how much Skadden got paid.” Within a week of the report’s release in December 2012, the DOJ’s FARA unit requested meetings with the Skadden attorneys about the issue.

Skadden spent more than a year negotiating with FARA over whether it had to register as an agent of Ukraine in the case. In one email, attributed to the partner matching Craig’s description, the attorney told another lawyer “we need an answer from someone who we can rely on with a straight face” regarding a FARA issue.

By September 2013, the Justice Department had made an initial decision to order Skadden to register. However, the law firm was able to dissuade the department by telling members of the FARA unit at a meeting that the firm didn’t disseminate the report to journalists, contact the media, or issue statements to the press “about Ukraine.”

Skadden admitted that these were false statements as part of the settlement.

The settlement agreement itself states that it only resolves the case against the law firm. Craig reportedly remains under investigation for his involvement.