Former Obama White House counsel Greg Craig found not guilty in Mueller spinoff case

Greg Craig, who served as White House counsel early in President Barack Obama’s administration, was found not guilty by a Washington, DC, jury Wednesday after a trial stemming from the Mueller investigation.

Craig had been charged with making false statements in a Justice Department inquiry into whether his law firm Skadden Arps should have registered under the Foreign Agents Registration Act (FARA) because of its work for the Ukrainian government.

His prosecution was spun off from former special counsel Robert Mueller’s extensive investigation of Paul Manafort, Trump’s former campaign chair who came under scrutiny in the Russia investigation.

Craig’s trial, which lasted about three weeks, boiled down to the question of whether, back in 2013 and 2014, he tried to mislead the Justice Department about what, exactly, he did for Ukraine, in hopes that DOJ would conclude he didn’t have to register as a foreign agent.

Prosecutors argued that Craig tried to mislead the government about his contacts with journalists regarding a report that his firm had put together for the Ukrainian government. Their theory was that, because admitting to doing “public relations work” — rather than just legal work — could have led to a finding that he had to register under FARA, Craig misled DOJ about his contacts with the press.

The defense argued that, while Craig indeed didn’t want to register as a foreign agent, he genuinely didn’t think he needed to. Craig himself took the stand to testify that any inaccurate statements to DOJ were accidental, and that he was talking to the media for his and his firm’s interests (rather than to help Ukraine).

Craig’s prosecution has been viewed as a test for newly aggressive efforts from DOJ to scrutinize foreign work by Washington’s lobbying and influence industry, so the outcome may be a setback for that initiative.

Craig was also, notably, the only Democrat to face charges stemming from the Mueller investigation. And now, he’s the first person to be acquitted in a Mueller-related trial as well.

Who is Greg Craig?

For decades, Craig has been a mainstay in Washington’s Democratic legal establishment. He worked on Ted Kennedy’s Senate staff, at the State Department during Bill Clinton’s administration, and then as a White House lawyer for Clinton during the impeachment battle.

But when Barack Obama challenged Hillary Clinton for the Democratic presidential nomination in 2007 and 2008, Craig surprised (and angered) many of his former associates by backing Obama early and becoming an adviser to his campaign.

When Obama won the presidency, Craig became his first White House counsel. But he didn’t last long in the administration — he clashed bitterly with Chief of Staff Rahm Emanuel over Guantanamo Bay policy and other national security-related legal matters.

Craig left the administration in early 2010, reportedly turning down a judicial nomination Obama offered him. Instead, he quickly joined the law firm Skadden, Arps, Slate, Meagher & Flom, saying he was interested in the firm’s global reach.

Craig took on work for the Ukrainian government at Manafort’s behest

In the spring of 2012, Paul Manafort — then working for Ukrainian President Viktor Yanukovych — helped arrange a deal in which Ukraine would retain Skadden to write a report.

The report was meant to evaluate the trial of Yulia Tymoshenko, who had run against Yanukovych and lost in the country’s 2010 presidential election, and was later prosecuted and jailed. Tymoshenko’s treatment was harshly criticized in the West, and Manafort’s aim was to get some better PR for Yanukovych’s government.

In theory, Skadden would be free to reach its own conclusions on Tymoshenko’s treatment. But the team knew the Ukrainian government was their client, and they were being paid $4 million for the work by a Ukrainian oligarch through an offshore account.

Craig was Skadden’s lead partner on the Tymoshenko report. And early on, he made clear that he wanted to make sure the firm wouldn’t have to register under FARA for this work. “The powers that be in NYC,” he wrote in an email, “insist” on that.

After some consultation, one Skadden partner advised the team that a key to avoiding registration would be to avoid doing any “public relations work” related to the report. Another partner told Craig that they were in this “as lawyers, not spin doctors,” per a settlement agreement between Skadden and the DOJ.

Yet when it came time for the report’s release, Craig had contacts with several journalists about it, most notably the New York Times’s David Sanger. He tried to get Sanger to cover the topic, “attempted to email him an electronic copy” of the report, “and personally hand-delivered a hard copy” to Sanger’s home, per the indictment.

The actual charge against Craig was for making false statements to DOJ’s FARA unit

Just about a week after the report’s release, the Justice Department’s FARA Unit sent a letter to Skadden saying the firm might have to register as a foreign agent for its Ukraine work, and asking for information on several topics.

So over the next 14 months, Craig sent a series of letters to the FARA Unit and had an in-person meeting with the FARA Unit’s staff. Prosecutors alleged that Craig made a series of false and misleading statements and omissions during this period that were aimed at avoiding a government determination that Skadden should register as a foreign agent.

In particular, the indictment alleged, Craig told the government that he had only spoken with the media to correct misinformation, and in response to journalists’ requests. But emails appear to show him playing a more proactive role in trying to get coverage for the report’s rollout.

So in January 2014, the FARA Unit told Skadden and Craig that they did not need to register as agents of Ukraine — because, prosecutors later claimed, the unit was “misled by Craig.”

There the matter sat for several years, until Manafort’s Ukraine work came under scrutiny in the Mueller investigation. In October 2017, the indictment says, Mueller’s team interviewed Craig on the topic, and he “repeated” some “false and misleading statements” about media contacts he had made previously.

Mueller referred the Craig investigation elsewhere in the Justice Department. Last year, Craig left Skadden under a cloud. And this January, Skadden made a settlement agreement with the Justice Department, in which the firm agreed to return the Ukraine money, register under FARA, and admit a series of facts that seemed to heap blame on Craig.

So Craig was indicted, on two counts (one of which was thrown out before the trial). The trial began in August and took three weeks, and included several witnesses vouching for Craig’s good character, as well as Craig himself taking the stand in his own defense.

The defense argued that there was no intentional effort to mislead — that whatever errors took place were accidental, and that the media contacts in question were not to advance Ukraine’s interest but rather the interests of Craig and his firm.

Apparently, the jury was persuaded. After deliberating for just a few hours, they returned their not guilty verdict Wednesday afternoon.