A prominent Republican fundraiser abruptly closed shop last year to start a COVID-relief business that ended up under federal investigation. Now he wants his former clients to settle up, Axios has learned.
What's happening: Mike Gula, a veteran GOP consultant, has demanded that at least three Republican House campaigns fork over fees he says they still owed to his firm, Gula Graham.
- One of those campaigns says Gula and the company breached their contract last year when Gula suddenly cut off communication with his clients to start a new venture dubbed Blueflame Medical.
What they're saying: "These congressional candidates used the company’s services to successfully raise funds for their campaigns in early 2020. They are the ones who will now need to make the right choice and comply with ethics rules and campaign finance laws," Gula told Axios in an emailed statement.
- According to a person familiar with the disputes, Gula maintains three Republican members of Congress — Reps. Rodney Davis of Illinois, Sam Graves of Missouri and Garret Graves of Louisiana — collectively owe him nearly $150,000 in unpaid expenses and fundraising commissions.
- The expenses, Gula said, included "lavish out-of-town events with lobbyists and donors, along with extravagant meals at places like the Capital Grille and Oceanaire."
- None of the three campaigns responded to requests for comment. But Davis' campaign told the FEC it was in discussions with Gula regarding what it considers his "abrupt and material breach of contract," and that it "still contests" Gula's claims.
Background: Gula raised hundreds of millions of dollars for Republican candidates before suddenly quitting the business in March 2020.
- “Over the last 14 days I have built another business outside politics and will be focusing my full attention there,” he told his clients at the time. “After this e-mail, I will be unreachable. I wish you the best of luck in politics and life.”
- The new business was Blueflame Medical, which was in the process of negotiating a $600 million deal to provide Chinese-made masks and other COVID-related equipment to California, and additional deals with other state governments.
The California deal blew up after financial institutions involved blocked a $450 million wire transfer to Blueflame, saying they suspected potential fraud.
- The resulting fallout caused Blueflame's business to crater, and it subsequently sued its bank over the deal-gone-bad in litigation that remains ongoing.
- Blueflame also was reported to be under federal investigation, but it has not been accused of any legal wrongdoing to date.
Between the lines: Gula has quietly reemerged in the political world recently. Last week, he sat for an interview with the Metropolitan Republican Club to discuss political fundraising.
- "I definitely have tried to keep a low profile and kinda move on to the next stage of my life," he said. "But I want to help Republicans, I want to help raise money still. If they have questions — at the end of the day, now, I can just give the blunt truth."
