Damage-Control Firm Finds

Need for Its Own Services

Companies usually call on Don Goldberg, managing director of a K Street damage-control firm, Qorvis Communications, when they get hit with bad press.

Last week, however, Goldberg, a crisis management veteran from the Clinton White House, found himself in the strange position of needing his own services.

Goldberg and his colleagues found themselves in the middle of a flap after Mark French, president of the Washington speakers bureau Leading Authorities, sent out e-mails and letters to experts on corporate governance, saying insurance firm American International Group is "potentially interested" in talking to them. French went on to suggest five-figure fees for acting as "sympathetic sources" for reporters, penning op-eds, and making speeches criticizing New York Attorney General Eliot L. Spitzer's latest fraud probe of the insurance industry, which included the recent guilty pleas of two AIG executives.

French later told reporters he acted in response to a call from Qorvis, which AIG had hired three weeks earlier to turn around media coverage. AIG said it was completely unaware of French's e-mail. The firm fired Qorvis Monday for reasons unrelated to the e-mail flap. An AIG representative said the firm was "unhelpful."

"No offers were ever made . . . only inquiries to determine interest," French said in an e-mail. "Secondly, no one was asked to take a position other than their own. As for Leading Authorities, we are a matchmaker and our job is to identify 'leading authorities' that can be helpful to our clients. That is precisely what we did."

Goldberg and his colleagues at Qorvis were left to do their own damage control. "As part of the basic research we do for many clients, we asked Leading Authorities as well as others to compile a list of experts on corporate governance issues. Leading Authorities, on its own and with no knowledge by Qorvis, approached several experts and apparently suggested fees that they could receive in exchange for speaking on AIG's behalf," said Goldberg in an e-mail. "Qorvis never offered to pay anyone any money and we never had any contact with these experts. Nor would we have ever recommended any such payments to our client."

-- Annys Shin

Eliot Spitzer is looking at insurance industry fraud.