Former Trump personal lawyer and newly convicted felon Michael Cohen has backed away—far away—from taking Stormy Daniels on in federal court in California over the non-disclosure agreement he arranged just before the 2016 election to keep Daniels from talking about her alleged affair with Trump.
Daniels sued Trump, Cohen, and the shell company Cohen created to coordinate a $130,000 payoff with the help of her now infamous attorney, Michael Avenatti, back in March. Fighting the arbitration clause that Trump and Cohen were using in an attempt to keep Daniels quiet—and threaten her with millions in damages—Daniels argued the NDA was invalid because Trump hadn’t signed it, because it’s unconscionable, and because it was illegal.
Trump and his rep Rudy Giuliani have been all over the map as to what Trump knew when and what his role was. But Cohen recently pleaded guilty to having arranged the payment to Daniels in violation of campaign finance law at Trump’s direction.
Last week, Cohen’s attorney moved to rescind the NDA, an act that presumes its validity. His goal? Getting Daniels’ suit declared moot. It’s hard to see how that could fly, given Daniels sued on the grounds that the NDA is invalid.
Essential to the “existence” of a contract is that the contract have a “lawful object” or lawful purpose. No such lawful purpose existed in the Hush Agreement for at least the following reasons. First, the Hush Agreement was entered with the illegal aim, design, and purpose of circumventing federal campaign finance law under the Federal Election Campaign Act (FECA) and Federal Election Commission (FEC) regulations. The purposes and aims of the FECA include the promotion of transparency, the complete and accurate disclosure of the contributors who finance federal elections, and the restriction on the influence of political war chests funneled through the corporate form.
Remember, this is from March.
Here, the Hush Agreement did not have a lawful object or purpose. The Hush Agreement, and the $130,000 payment made pursuant to the agreement, was for the “purpose of influencing” the 2016 presidential election by silencing Plaintiff from speaking openly and publicly about Mr. Trump just weeks before the 2016 election. Defendants plainly intended to prevent American voters from hearing Plaintiff speak about Mr. Trump. This $130,000 payment was a thing “of value” and an “in-kind” contribution exceeding the contribution limits in violation of FECA and FEC regulations. It was also a violation of FECA and FEC regulations because it was not publicly reported as a contribution. Further, it was a violation of FECA and FEC regulations because it was a thing “of value” and an “in-kind” expenditure that was required to be reported as such. Therefore, because the Hush Agreement did not have a lawful object or purpose, the Agreement was void ab initio.
Trump’s team, meanwhile, has said that he won’t fight Daniels’ “assertion that the Settlement Agreement was never formed, or in the alternative, should be rescinded.” Trump’s angling to get Daniels to dismiss him from the lawsuit.
Here’s Avenatti’s initial take. To his mind, this is all about avoiding discovery—and, specifically, depositions.
There’s zero question that Avenatti and Daniels are going to fight to keep the case alive.
Avenatti filed a supplement Monday that semi-exhaustively reviews Cohen’s and Trump’s conflicting positions, accusing them of bad faith and outright lies.
Avenatti claims that Cohen and Trump can’t end the case on their own, much less with what amounts to a settlement offer that doesn’t even offer Daniels the damages she sought. Moreover, he argues, if the agreement was illegal, as Cohen’s plea ought to have established, then Daniels is not on the hook to return the $130,000 at all. He also rejects the possibility of declaring the case moot on the grounds that doing so would not resolve all of Daniels’ claims; it’d leave her paying attorneys’ fees and other expenses that would be covered by the defendants if she were found to be the prevailing party.
Daniels and Avenatti are going to be on The View on ABC on Wednesday, and they’ve teased a big announcement:
No matter what, Daniels’ defamation claims will proceed regardless of the outcome of the current Cohen-Trump-Avenatti struggle. So, more fireworks ahead.