UPDATED: 13 MAR 2023 06:11 PM EST
When California Gov. Gavin Newsom threatened to cut off Walgreens over its plan to scale back access to abortion pills, panicked representatives for the company raced to call his aides for clarity about the state’s retaliatory policy.
As the standoff unfolded, the governor’s senior staff heard a familiar voice come over the phone as a lead representative for Walgreens: Ann O’Leary.
An attorney and crisis manager who served as senior policy adviser to Hillary Clinton’s presidential campaign, O’Leary is viewed in Washington’s Democratic circles as a policy powerhouse with a golden Rolodex to match.
But in Sacramento, she’s still best known for another resume line: Newsom’s first chief of staff.
Some top advisers to the governor were alarmed to learn that O’Leary, a national authority on expanding abortion access, was trying to convince them to soften their approach on behalf of Walgreens, according to three people briefed on the exchanges.
POLITICO granted them anonymity because they weren’t authorized to speak publicly on the matter. One of the people said Newsom — who eventually spoke with Walgreens chief executive Rosalind Brewer — was disappointed not only in the pharmacy company’s vague response to his concerns but also the fact they came mostly from O’Leary.
“It didn’t sit particularly well with the governor that he had a former top aide of his administration now trying to push back on the policy he’s making,” said one of the people briefed on the calls.
Anthony York, the governor’s spokesman, said Newsom’s office would not elaborate on private conversations with Walgreens, but confirmed O’Leary’s participation in the calls when contacted by POLITICO.
O’Leary did not return messages seeking comment.
The pharmacy company’s outreach began shortly after Newsom responded to Walgreens’ announcement that it would scale back access to abortion pills in states where Republican attorneys general were objecting to them. The governor, in a tweet, said the state would be severing ties with the company. In an interview with POLITICO on Wednesday, he elaborated as to why California wouldn’t renew a $54 million contract with Walgreens.
That contract with California was set to be renewed beginning May 1. Newsom’s decision means Walgreens won’t provide medications to inmates in the state’s correctional system. The state now is reviewing other financial ties to the pharmacy chain, as well.
Walgreens quickly reached out to the governor's office to discuss the matter. On the calls for Newsom were his senior-most officials. Walgreens representatives, led by O’Leary, made similar arguments to those they have offered in public, one of the people briefed on them said. Walgreens reps have said they felt like they were being picked on for acting decisively in response to the GOP officials, whereas other pharmacies were keeping mum about their plans.
The Walgreens reps also stressed that once certified by the FDA, the company will dispense Mifepristone everywhere it’s legal to do so. And company reps repeatedly made the point, according to the same person briefed on their exchanges, that California was one such state.
“They made the point that they were good actors and [were] trying to continue to make [the drug] available in California,” the person said. “That did not move the governor. That was not the reaction he was looking for.”
To some advisers and other people in Newsom’s immediate orbit, there was an unmistakable irony to O’Leary’s involvement. It was she, while serving as the governor’s chief of staff, who authored tough revolving-door and conflict-of-interest rules for Newsom’s advisers. The ethics rules came amid criticism of him for attending a powerful lobbyist friend’s birthday at the French Laundry.
The rules, which initially prohibited registered lobbyists from serving as paid consultants and barred paid consultants from directly communicating on behalf of a client with the governor and his team to influence action at the Capitol, received widespread coverage and some praise when they were unveiled a few years ago. O’Leary also asked the state’s ethics watchdog about how to further strengthen those rules, and after she left, Newsom’s team expanded the ban on consultants trying to influence him to include unpaid advisers.
Some Newsom advisers and allies saw it as not merely a good government effort but a powerplay by O’Leary to curtail access to Newsom and his administration for those who consulted outside clients.
A partner at the law firm Jenner & Block, O’Leary is not registered to lobby. The firm describes her as involved in sensitive investigations, government controversies and public policy litigation. She also is listed as a co-chair for Jenner & Block’s “Post-Dobbs Task Force,” a group that stood up to help the firm guide clients through complex issues around law and policy after the Supreme Court overturned the constitutional right to abortion last year. In that capacity, she has co-written articles about the legal landscape surrounding medicated abortion. Jenner has represented Walgreens in court.
O’Leary departed the Newsom administration after two years, leaving at the end of 2020. Before landing at Jenner, she was eyed for various jobs in the Biden administration. She was a contender to lead the Office of Management and Budget, and in early 2021, she privately touted support for her potential confirmation in the U.S. Senate, just as her friend Neera Tanden’s own nomination to head OMB was on life-support, POLITICO reported at the time.
Newsom’s aides say he views the standoff with Walgreens as part of a larger battle. His decision on Wednesday was meant to demonstrate that Democrats have a role in countering what he views as GOP leaders successfully bullying corporations into doing their bidding.
Among many examples cited by people around the governor was Florida Republican Gov. Ron DeSantis beating Disney into submission when the company ultimately declined to fight state legislation that gave the governor far-reaching power over its theme parks in Orlando; credit card giants Mastercard and Visa pausing a decision to categorize gun store purchases in the face of threats from Republicans and Second Amendment groups; and the College Board stripping advanced placement Black studies curriculum of many subjects that came under withering GOP-led attacks.
But, ultimately, Newsom’s Walgreens gambit goes to his efforts to create a safe harbor for abortion in California. Last fall, he spent millions of his own campaign dollars on a successful measure that enshrined the right to abortion and contraceptives in the state constitution. He and the Democratic-dominated legislature also allocated hundreds of millions of dollars and passed laws to protect and expand abortion access.
