Governor, son discuss legal work done for Chinese firms in Arkansas

by Talk Business & Politics staff (staff2@talkbusiness.net) 1,069 views 

Gov. Asa Hutchinson (left) and Arkansas Secretary of Commerce Mike Preston speak with reporters from their Tokyo hotel via a video conference call in November.

A November trade mission trip raised questions about business being conducted by Gov. Asa Hutchinson’s son, Asa Hutchinson III, with Chinese companies recruited by the state. Both men said their father-son relationship had no bearing on legal matters, the acquisition of clients, or presented a conflict of interest.

A report in early November from the Arkansas Times led to other news reports regarding whether the governor’s son was benefitting from his father’s elected position in the context of national and international stories focused on Democratic Presidential hopeful Joe Biden and his son, Hunter, in Ukraine, as well as President Donald Trump and his children and son-in-law.

Hutchinson III, managing partner with the Asa Hutchinson Law Group based in Northwest Arkansas and with offices in Washington, D.C. and Madrid, Spain, touts the practice’s international business and immigration legal work. The law firm’s web site highlights the governor as the founder of the firm and lists several of the firm’s higher profile clients, including Risever, TY Garments USA and Dragon Woodland – three companies Gov. Hutchinson helped recruit to the state with financial incentives. Other law firm clients listed include Walmart, Arvest, Hunt Ventures, and Asbury Automotive Group.

In early November, Hutchinson III posted a photo to his Twitter account from the trade trip in Asia that included the governor, representatives of TY Garments, Arkansas economic development officials and himself.

“Despite the tariff wars, state and local governments in China and the U.S. can still collaborate to strengthen our economic ties. Thank you Tianyuan Garments for bringing us together! #trade,” Hutchinson III wrote in the post.

The photo led to questions as to why the governor and his son were together during the trade mission. During a conference call from Tokyo on the November trade trip, Gov. Hutchinson said his son paid for his own trip as did other business people that were part of the state’s official entourage. A request for travel reimbursement reports from the Arkansas Economic Development Commission and ultimately from the Arkansas Economic Development Foundation, which paid for the China trip, confirms that the state did not pay for Hutchinson III’s travel expenses.

HUTCHINSON III RESPONDS TO QUESTIONS
In separate interviews, Gov. Hutchinson and his son said there was no assistance or recommendations provided in landing the legal business that Hutchinson III provided for the newly recruited firms.

Asa Hutchinson, III.

Hutchinson III said his work for TY Garments began in October 2017 and his Risever work began in August 2018 and consists in “obtaining employment-based, non-immigrant visas for some of their employees.” Hutchinson III said his work with Dragon Woodland involves a number of legal matters, but does not include any work related to AEDC or state tax incentives. “My work with Dragon Woodland has been primarily on private contract issues and employment matters,” he said.

Hutchinson III said another Arkansas law firm was first selected by TY Garments over his firm in 2016. Subsequently, the lawyer handling the business left the firm, another firm picked up the business, but TY Garments was dissatisfied with the services and approached him in 2017, he said.

A previous Chinese client of more than a decade referred Risever to Hutchinson’s law firm, he said. Risever referred Dragon Woodland to his firm based on their “positive experience,” he added.

Risever and TY Garments are Chinese-based companies, while Dragon Woodland is owned by a Tennessee family with Chinese roots. Hutchinson III said he has worked with a number of foreign clients since his law firm opened in 2008, including clients in Cambodia, Mexico, Guatemala, Canada, Great Britain, Ireland, Spain, and the Philippines.

When asked if he believed that a possible conflict of interest exists due to his father recruiting these companies to Arkansas, Hutchinson III responded by email: “Absolutely not. None of these clients have ever hired or paid me or my firm to perform any work, or to gain any advantage, related to applying for or securing any tax incentives or benefits from the State or any of its agencies whatsoever. My father does not have any ownership or financial interest in my law firm. No tax dollars, incentives, or rebates, nor public monies of any kind, have ever been awarded to any client of my firm due to anything I have done nor due to my representation of the client, which representation has been strictly limited to federal or other unrelated matters. I have never represented any client whatsoever in connection with AEDC or any of its tax incentives. It is well-documented from publicly available information that these three clients qualified to earn the available tax incentives from AEDC based upon the amount of financial investments they are making in Arkansas and the number of new jobs they are creating here.

“These clients did not hire me because my father is Governor. They engaged my legal services because of my reputation in the profession and in their communities, and in the cases of Risever and TY Garments, also because there are very few Arkansas attorneys with my level of experience working on employment-based visas. Since I began practicing law 18 ½ years ago, I have met hundreds of clients and potential clients in other countries around the globe, and I have dedicated a large part of my professional time to maintaining those relationships by traveling to those countries and spending time with people at my own expense. I had a strong and vibrant immigration and international practice well before my father was elected Governor, and have numerous foreign clients outside of China. I have been successful in obtaining a number of visas for key employees of Risever and TY Garments, and I continue to work for these companies on additional visa applications in support of their expansions in Arkansas.”

THE GOVERNOR DISCUSSES ARRANGEMENTS
In a one-on-one interview in his office before Thanksgiving, Gov. Hutchinson confirmed he has no financial interest in the law firm he helped found before he became governor. He also said that he did not anticipate returning to the firm after leaving office when he’s term-limited. He insists he played no role in the three companies hiring his son to do immigration work for them.

“I did not assist. I did not recommend. That’s a connection that he does on his own, makes his own marketing. I did not have anything to do with that hiring decision,” Gov. Hutchinson said. “I don’t have that ability to prohibit that contractual relationship between a company in Arkansas and somebody who practices law here. The key thing is that there’s not favoritism, that I’m not pushing some company in that direction. I haven’t done that and that’s something that you should avoid.”

The governor emphasized that Hutchinson III handled federal issues for these companies, not state business. He also said that TY Garments requested Hutchinson III to attend the trade meeting that launched the controversy.

“I did not recommend Attorney Hutchinson to any of these [clients]. To my knowledge, nobody on my team did. And they made a separate employment decision in terms of his visa experience, which they needed it. Also in terms of the appearance of a conflict, he’s not representing these companies on any state matter. He’s representing these companies on a federal issue,” the governor said. “Immigration is all federal. So there’s not any state decision-making process on that. And then in terms of the appearance as to him coming to China, he went two days ahead. He was not part of the traveling delegation. He traveled there on his own expense, ahead of the time, had his own client meetings. He joined [us] for a couple of our meetings because he had business there and the client, TY Garment Company, requested his presence there.”

The governor said it would be impossible to prevent the appearance of potential conflicts of interest due to the fact that as governor, he deals with domestic and international businesses on retention and expansion issues of companies ranging from Walmart to local real estate groups.

“He could be criticized for representing anybody in Arkansas and yet he has a practice that is uniquely federal, much of it. He does some things here, but I’m very proud of the practice that he’s built up and the fact that he’s able to help some Arkansas businesses that actually need some help on a very complicated, difficult issue,” Gov. Hutchinson said.

Editor’s note: KATV’s senior political reporter Marine Glisovic and Talk Business & Politics Editor-in-Chief Roby Brock collaborated for this report.

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