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ibusinesslines.com November 22, 2018


Top Novartis lawyer steps down over Michael Cohen payments

16 May 2018, 09:49 | Jodi Jackson

Top Novartis lawyer steps down over Michael Cohen payments

Top Novartis lawyer steps down over Michael Cohen payments

Novartis AG's top lawyer became the first executive to take the fall for the controversial $1.2 million in payments he helped arrange to Donald Trump's attorney, as the drugmaker tries to contain the furor from last week's revelation.

Ehrat commented: 'Although the contract was legally in order, it was an error. "As a co-signatory with our former CEO, I take personal responsibility to bring the public debate on this matter to an end", Ehrat, 60, said in a statement released Wednesday. And while Novartis contends the deal was a mistaken attempt to gain insight into the policies of a new administration, it presents a reputational challenge for a company previously accused of improper payments elsewhere in its business dealings.

Daniels, whose real name is Stephanie Clifford, said she was paid $130,000 by Cohen to stay quiet about her alleged affair with Trump.

On May 16, Novartis's general counsel Feliz R. Ehrat apologised for making the deal.

Ehrat will be replaced starting from June 1 by Shannon Thyme Klinger, who is now Novartis's ethics, risk and compliance officer.

Novartis' new CEO Vas Narasimhan has since admitted that the payments were a serious error, but has been careful to distance himself from the decision. The president has denied the allegations.


Telecoms giant AT&T, which has acknowledged paying about $600,000 to Cohen and was also named by Daniels' lawyer, has also said it was a "big mistake" to hire Trump's lawyer, even as it maintained its actions were legal. He said the company continued to pay him because it feared litigation over a premature termination of the agreement.

Narasimhan, who's meeting with investors Wednesday in Basel, conducted a conference call Monday for 5,000 managers in which he said the company needs to rebuild trust and rethink its approach to the use of consultants and lobbying firms, according to a person familiar with the situation.
"We should have just definitively parted ways with this guy as soon as we knew he was not going to be a help".

The case is under examination by the Greek and US authorities.

Jimenez said he never met Cohen himself but told Forbes they did have a long phone conversation where he asked about Cohen's background.

Jimenez told Bloomberg that Cohen had "oversold his abilities" in being able to explain the then-new Trump administration's position on healthcare issues. In addition to those who actually lobby the government, a person would have to register under FARA if they do any kind of public relations for a foreign client or act as a consultant on US policy, as Cohen was hired to do.



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