Lobbyists dump Chinese clients after blacklist threats

From: POLITICO Influence - Wednesday Feb 21,2024 10:31 pm

Feb 21, 2024

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FIRST IN PI — FIRMS SEVER TIES WITH CHINA CLIENTS: Several of K Street’s top firms are no longer working for Chinese companies that are linked to the Chinese military, Daniel reports, after PI reported last week that several members of Congress were considering banning the firms from meetings with their offices.

— Akin Gump Strauss Hauer & Feld, which began lobbying for Chinese lidar maker Hesai Group in August, filed termination paperwork over the weekend. The firm reported earning $300,000 in lobbying fees during the course of its work for Hesai.

— Brownstein Hyatt Farber Schreck also parted ways with Hesai this week, after being hired in September. The firm reported being paid $220,000 over the course of its work for the company. Some Hill staffers had previously informally told Brownstein — K Street’s top lobbying firm by revenue — to not take such clients.

— The Vogel Group has also dropped the Chinese drone company DJI, for which they have lobbied since 2022, and Complete Genomics, which it signed last fall. The firm reported pulling in $865,000 in lobbying revenues from DJI over the course of their relationship, and $450,000 from Complete Genomics.

— The ban lawmakers were considering would have included firms that represent companies on the Pentagon’s so-called 1260H entity list for “Chinese military companies,” even if they were trying to meet to discuss American clients — a potentially massive upheaval, given that several of the firms are among the biggest in town. DJI and Hesai Group are on the 1260H list. Complete Genomics is not on the list, but its former parent company, BGI Genomics, is.

— All of these firms and their Chinese clients were included in a photo that has been circulating on Capitol Hill, which also includes the different federal government entity lists that they are on. One senior Republican congressional staffer told PI last week they had already started to avoid the firms in question.

— Akin Gump parted ways with a second company not on the 1260H list, electronics firm Xiaomi, with a firm spokesperson pointing out that it hadn’t engaged in any reportable activity for the company in months. Akin Gump reported $1.2 million in lobbying revenues from the company since 2021.

— Avoq (formerly Subject Matter) and CLS Strategies, which also lobby for DJI, had no comment on whether they are keeping DJI as a client, nor did Steptoe, which lobbies for BGI. Brownstein declined to comment on the terminations and Vogel Group did not respond to requests for comment on the terminations, along with Hesai, DJI, Xiaomi and Complete Genomics.

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HOW NETCHOICE GOT HERE: “After California passed a law forcing digital platforms to adopt privacy guardrails and safety standards for young users, Carl Szabo had a blunt warning for legislators attending the nation’s biggest conference for state policymakers: ‘The lawsuits are coming.’”

— “Over the past decade, Szabo and his colleagues have transformed NetChoice, their small, right-leaning lobby known for its brash tactics, into Silicon Valley’s litigation powerhouse,” Bloomberg’s Isaiah Poritz, Tonya Riley and Emily Birnbaum report.

— The trade group, whose members include Meta, TikTok and X, “won injunctions against laws regulating social media in five states. The U.S. Supreme Court will hear challenges on Monday to the constitutionality” of laws in Florida and Texas advanced by Republicans in response to allegations of censoring conservative viewpoints.

— “The spotlight reflects NetChoice’s outsized role in a free-speech debate that’s drawn increasingly more political, legal, and governmental scrutiny, from state capitols to Congress. It doesn’t publicly disclose how much money it receives from each member, but NetChoice’s total revenue jumped from just over $3 million in 2020 to $34 million in 2022, according to public tax records. The group also has built a lobbying presence in 26 states, and opened a new litigation center last year.”

ANNALS OF FUNDRAISING: A super PAC supporting former President Donald Trump has ribbed pro-Israel megadonor Haim Saban for planning to host President Joe Biden for a fundraiser this week, pointing to administration officials’ recent meeting with a controversial Muslim activist. (Saban did not ultimately attend yesterday’s planned fundraiser after testing positive for Covid.)

— But the PAC, MAGA Inc., accepted $1 million in recent months from Cantor Fitzgerald CEO Howard Lutnick, whose firm manages money for Tether, a cryptocurrency that has faced scrutiny over its potential use by terrorist groups like Hamas, according to new FEC filings. Lutnick, a major Republican donor, gave Trump’s super PAC $750,000 on Jan. 26, on top of $250,000 on Dec. 29, filings show.

— A Treasury official testified on the Hill last week that Hamas’ use of crypto financing is likely less than was suggested in an October Wall Street Journal article that implicated Tether’s stablecoin and provoked outrage among the industry. After two Republican lawmakers requested an investigation into the use of Tether and Binance by terror groups, Tether staunchly defended its efforts to counter illicit finance activities. Tether and Cantor Fitzgerald did not respond to requests for comment.

EEI CHIEF VOWS IRA DEFENSE: Our Catherine Morehouse reports that “the Edison Electric Institute would defend parts of the Inflation Reduction Act from rollbacks under a potential second Trump administration, said CEO Dan Brouillette, who once served as the former president's Energy secretary.”

— “The trade association also estimated the law could help boost spending on transmission by nearly $10 billion compared to last year. Republican lawmakers have been hostile toward the legislation and last year the GOP-led House voted to repeal its billions of dollars in clean energy tax benefits.”

— “Brouillette said the trade group, which represents some of the largest power utilities in the country, will be ‘very aggressive’ in defending ‘certain elements’ of the Biden administration’s landmark climate law during a Nasdaq power industry outlook in New York on Tuesday. Brouillette did not specify what elements EEI would defend.”

— “Brouillette also reiterated his belief that a second Trump term will not doom some of the largest provisions of the IRA because of how much money has flowed to Republican districts and states. … A good chunk of the IRA money is expected to flow to electric utility companies as demand for more electricity spikes and utilities need to build out more grid infrastructure to handle rising load.”

CRITICS TARGET CONSERVATIVE INCUBATOR: The New York Times’ Robert Draper has a look at the Conservative Partnership Institute, “a sprawling new force in Washington’s right-wing ecosystem” that “has become a well-paying sinecure for Trump allies and an incubator for the policies the former president could pursue if elected.”

— “The message at the conference was ‘taking on the Swamp’ from a nonprofit with a $36 million annual budget from private donors that now operates as a full-service nerve center for right-wing activity and a breeding ground for the next generation of Trump loyalists.”

— “Legislators can hold fund-raisers in its event rooms; send their staff members to training sessions at the group’s getaway lodge in Maryland; do their TV news hits in its studio; or be fed, by text message, follow-up questions for lawmakers to ask witnesses during congressional hearings. Donors can funnel their money through the institute into a host of conservative causes, from promoting Christian values in education to helping pay legal fees incurred by what the group calls ‘America First public servants.’”

— “‘We’re just doing what the other guys have been doing for decades,’ Robert Bruce, a retired Texas aviation entrepreneur and C.P.I. donor, said in an interview two days after the conference. ‘There’s been a void in Washington, D.C., and C.P.I. has filled it by giving conservatives a refuge.’”

— But critics accuse the group of “running afoul of laws that prohibit tax-exempt nonprofit organizations from engaging in partisan activity,” and on Tuesday the watchdog groups Campaign for Accountability and Accountable.US “filed a formal complaint about the group to the Internal Revenue Service, arguing that the group’s offerings of funds and services are reserved for a single political party.”

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Jobs Report

— Peter Comstock is now senior director of government affairs at Autos Drive America. He previously was senior director of legislative affairs at the Associated Builders and Contractors.

— Ainslie Lane is joining USTelecom as a manager of government affairs. Lane was previously a policy adviser at the International Organization for Migration.

— Alex Edwards has joined Invariant as a senior associate working with tech and defense clients. Edwards previously was an associate with Glen Echo Group.

— Joseph Papa will become president and CEO of Emergent BioSolutions. He was previously CEO and chair at Bausch and Lomb Corporation.

— Rebecca Gansca is now a director at SMI. She most recently was national security adviser to Sen. Mazie Hirono (D-Hawaii), chair of the Senate seapower subcommittee, and is a retired Marine Corps officer.

— Jim Schultz has been named chair of the Delaware River Port Authority. He continues as the executive vice president of global public policy and government affairs at Scientific Games.

— David Hyde has returned to the Aerospace Industries Association as senior director of sustainability. He previously was autonomous systems lead for aviation and robotics at the World Economic Forum.

— Rebecca Vallas is now a distinguished fellow and senior adviser at the National Academy of Social Insurance. She most recently was a senior fellow at the Century Foundation.

— Smriti Kirubanandan is joining Accenture as managing director of the firm's health care practice. She was previously at Tata Consultancy Services.

— Jerry Leverich has been promoted to partner at Salt Point Strategies. He was previously vice president.

— Jinhee Kim will be executive vice president for public events and engagement at The Aspen Institute. She currently is chief creative officer for Events DC.

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New Lobbying REGISTRATIONS

Arch Street: Griffiss Institute Inc

Axadvocacy Government Relations: Uni Ag Group

Brian Glackin & Associates LLC (Formerly Listed As Brian J. Glackin & Associates LLC): Aerovironment, Inc.

Brian Glackin & Associates LLC (Formerly Listed As Brian J. Glackin & Associates LLC): Covisus Corporation

Broydrick & Associates: Beth Rivkah Associated Schools

Dutko Worldwide, LLC: Carbon Sic Technologies, Inc

Dutko Worldwide, LLC: Centegix Holdings, LLC

Dutko Worldwide, LLC: Saginaw Valley State University

Dutko Worldwide, LLC: Vericarbon

Grant Consulting Group: Kingsberry Fuel Cell Power Corporation

Holland & Knight LLP: National Cannabis Roundtable