Recently news broke that adult film star, Stormy Daniels, sued President Trump asking the court to issue a declaratory judgment stating that her non-disclosure agreement is invalid. Daniels makes two arguments in her complaint: (1) The non-disclosure agreement is invalid because it lacks Trump’s signature; and (2) even if the non-disclosure agreement is valid, it is not enforceable because Trump’s attorney, Michael Cohen breached the confidentiality provision under the non-disclosure agreement in January when he spoke about the non-disclosure agreement and his payment to Daniels.
According to the Complaint, Daniels “began an intimate relationship with Mr. Trump in the Summer of 2006 in Lake Tahoe and continued her relationship with Mr. Trump well into the year 2007.”
The Complaint provides a timeline of events leading up to Trump being elected President of the United States, including the Washington Post’s publication of the Access Hollywood Tape, which “depicted Mr. Trump making lewd remarks about women.”
The Complaint states that like other women who have spoken out about their sexual encounters with Trump, Daniels also desires to do so. Her early efforts to speak out alerted Trump, and his campaign, including Cohen, who then obtained a restraining order before Daniels filed her Complaint seeking declaratory judgment. Of course, Daniels filed the Complaint anyway.
According to the Complaint, the non-disclosure agreement, executed less than two weeks before Trump was elected president, prohibits “Peggy Peterson” (allegedly, Daniels) from discussing her relationship with “David Dennison” (allegedly, Trump) in exchange for $130,000 paid by Essential Consultants, a shell company that Trump’s attorney, Michael Cohen, allegedly created to facilitate the payment.
Whether or not a contract is enforceable does not hinge on whether all parties executed the contract. Of course, a contract does not even need to be in writing to be enforceable. In order to be enforceable there must be a meeting of the minds. A signature is evidence of such meeting of the minds but this element can also be proven in other ways.
By filing this lawsuit, Daniels has effectively made the public aware of her side of the story – her alleged affair with Trump and how she was paid off to keep quiet. At the same time, Daniels put the President (and his personal attorney, Michael Cohen) between a rock and a hard place with regard to a variety of legal issues.
If Trump were to respond to Daniels’ suit, depositions and discovery would ensue to find out how the payment was made to Daniels and establish whether the payment was intended to influence the election and avoid negative publicity. As Daniels’ states in her complaint, the payment was to “ensure he [Trump] won the presidential election.”
If evidence came to light that this was essentially “hush money,” that evidence would help bolster the complaint submitted by Common Cause to the Department of Justice and the Federal Election Commission which alleges that Daniels was paid off for silence and the $130,000 was an in-kind contribution to Trump’s campaign that should have been reported.
It’s not only Trump and his campaign that are in hot water with regard to the payoff. If Cohen made the $130,000 payment to Daniels, he could have personally violated federal election law and ABA Model Rule 1.8(e) which states:
“A lawyer shall not provide financial assistance to a client in connection with pending or contemplated litigation, except that: (1) a lawyer may advance court costs and expenses of litigation, the repayment of which may be contingent on the outcome of the matter; and (2) a lawyer representing an indigent client may pay court costs and expenses of litigation on behalf of the client.”
While it may have been unclear at the time whether there was contemplated litigation, if there was, Cohen paying off Daniels, was likely a violation of Rule 1.8(e).
And let’s not forget that Trump has the option to counter-sue Daniels for breach of contract for discussing the affair despite the terms of the non-disclosure agreement, however, to do so Trump would have to admit that he is, in fact, David Dennison.
If Trump decides not to respond to Daniels’ suit, the suit would likely result in a default judgment which would permit Daniels to discuss the alleged affair.
Either way, the secret is out.