Saturday, March 17, 2018
Procedural Moves in Stormy Daniels’ Lawsuit Against Donald Trump
There has been a lot of coverage of Donald Trump’s relationship with Stephanie Clifford (known by her stage name Stormy Daniels), and the $130,000 payment she received in connection with a nondisclosure agreement during the heat of the 2016 presidential campaign.
Earlier this month, Clifford filed a lawsuit against Trump and Essential Consultants, LLC, in California state court (Los Angeles County). Essential Consultants, which was a party to the nondisclosure agreement, is apparently a Delaware LLC, and Trump attorney Michael Cohen is its sole member. Clifford’s complaint seeks a declaration that the “Hush Agreement” is unenforceable.
Download State Court Complaint
Yesterday, Essential Consultants removed the case to federal court. The notice alleges that, for purposes of diversity jurisdiction, Clifford is a Texas citizen and Trump and Essential Consultants are New York citizens. It also alleges that “the value of the object of the litigation” exceeds $75,000. The federal case has been docketed as Clifford v. Trump, No. 2:18-cv-02217 (C.D. Cal.)
Donald Trump filed a separate document joining in Essential Consultants’ notice of removal. This appears to be his effort to comply with 28 U.S.C. § 1446(b)(2)(A), which provides: “When a civil action is removed solely under section 1441(a), all defendants who have been properly joined and served must join in or consent to the removal of the action.”
Download Trump Joinder in Notice of Removal
You can find more coverage of the removal to federal court here:
https://lawprofessors.typepad.com/civpro/2018/03/procedural-moves-in-stormy-daniels-lawsuit-against-donald-trump.html
It would be useful if someone did an in-depth analysis of this agreement between Daniels, EC, LLC and DD (Trump). Can EC, LLC, acting alone, enter into an agreement that not only benefits DD, but also binds him (there are a number of positive covenants made by DD - if he isn’t a party to the agreement, then the agreement is frustrated if those commitments cannot be enforced by Daniels)? Similarly, if DD is not a party to the agreement, how can EC, LLC enforce certain provisions in the agreement. Specifically, DD, not EC, LLC, has the right to seek arbitration, ex parte injunctions and liquidated damages. If DD is Trump and he is a party to the agreement, then the same issues exist about enforcement - EC, LLC has common law rights to enforcement, but is not afforded the right to arbitrate or to seek ex parte injunctive relief or liquidated damages under the agreement. DD, if he is a party, is granted these rights, but if DD is Trump then he also has to admit he knew about the agreement and the payment. Indeed, one of the provisions in the agreement indicates that absent Daniels’ reps, warranties and agreements, DD would not have agreed to pay funds to her under the agreement. But EC, LLC and DD are avoiding this narrative because if true then DD knew about the agreement and the payment, but did not report the same. I’m just a retired lawyer in Canada, but these questions strike me as worth discussing.
Posted by: Ken Mellquist | Mar 18, 2018 9:40:59 AM