Some Pro-Stormy Advocacy (or Trump Put a Gag on Stormy in Arbitration)

A sign at Little Darlings Las Vegas advertises an upcoming performance at the strip club by adult film actress/director Stormy Daniels on January 25, 2018 in Las Vegas, Nevada. Daniels, whose real name is Stephanie Clifford, was allegedly paid USD 130,000 by an attorney for Donald Trump one month before the 2016 presidential election to keep her from talking about an alleged sexual encounter with Trump in 2006.
Ethan Miller/Getty Images North America

News comes this morning that President Trump is angry with Sarah Sanders for how she handled the Stormy Daniels questions in yesterday’s White House press briefing. Much as I find Sanders a disreputable wretch, it is quite rich to hear he’s unhappy with how she handled the story of his seeking and receiving a restraining order against his porn star girlfriend. Some stories are easier to spin than others! Jay Carney and Josh Earnest had it easy.

Still, it was a fatal error to say repeatedly that President Trump had “won” the case in secret arbitration. Let’s look at specifically what she said.

After repeatedly speaking of arbitration and referring reporters to the President’s private lawyers who of course will not talk, she said this: “I can share that the arbitration was won in the President’s favor.”

Here’s why this is an even greater lapse than it may seem at first glance (it also goes to the President’s failure to sign the Stormy settlement). I’ve read all the legal documents. And though I’m not a lawyer, it is clear the agreement was structured in such a way as to ensure that in a situation precisely like this one Sanders could truthfully say that President Trump wasn’t a party to the arbitration at all. Indeed, he wasn’t.

Technically, the claim that generated the restraining was brought by Essential Consultants LLC, the LLC controlled by the President’s “personal lawyer” Michael Cohen.

President Trump may be the beneficiary of the decision. But he’s not a party to the decision. And there’s no need to say the arbitration was decided in his favor since again, he’s not a party to the dispute which was raised last month in arbitration. Of course, this is all a ridiculous legal fiction since Essential Consultants is controlled by Michael Cohen who is not only Trump’s personal lawyer in general but his lawyer in this case! Still, they’re legally distinct.

Now here’s an additional point. As we noted night before last (“Summa Stormietica“), one of Daniels’ claims is that the agreement is void because Donald Trump never signed it. As noted, that seems questionable as a legal argument because Daniels signed the document and (as far as we know) accepted the cash consideration of $130,000. That may make the deal binding regardless of whether Trump signed it. But let’s look beyond the legal question. Was Trump just busy with the final week of the presidential campaign and didn’t get around to signing it?

It’s pretty clear Trump intentionally failed to sign the document and that this was the plan from the start. Again, look at how the agreement is structured. There are three parties to it: Daniels, Trump and Essential Consultants (Cohen). But there are only two parties with actual interests at stake: Daniels and Trump. Cohen is there to create a nominally independent actor and source of money. The substance of the agreement only involves Daniels and Trump. But two parties did sign it: Daniels and Essential Consultants (Cohen). So there’s your apparently binding agreement. And Cohen is there as a party to the agreement to act against Daniels if she gets out of line.

It’s somewhat ingenious. When you appreciate this structure it seems obvious that Trump purposely failed to sign it so that he can plausibly or perhaps with technical accuracy say that he never agreed to anything and knows nothing about it.

As a separate matter I’m curious to hear from lawyers whether, if my theory is accurate and Trump acted in bad faith, that that may render the agreement void (as opposed to the simple failure to sign.)

In any case, it makes Sanders’ boasting gaffe all the more comical. She didn’t have to say it and in some sense it’s not even entirely accurate. But now we know, based on the President’s spokesperson’s own words, that President Trump got his lawyer to get a restraining order to compel the silence of his former porn star girlfriend. She not only can’t discuss their sexual relationship, which she now has attested to in a court filing, but also can’t discuss or reveal the text message logs and “still images” which Donald Trump was so keen to retrieve from her.

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