In response to an attempt to force her to arbitrate, on March 6, Stephanie Clifford (a.k.a. Stormy Daniels) filed a lawsuit against Donald Trump and Essential Consultants, LLC seeking to set aside a 2016 Settlement Agreement (“SA”) under which she was to receive $130,000 for keeping quiet about her affair with Trump. Clifford alleges the Agreement is void because Trump failed to sign it. A copy of the SA (which uses pseudonyms of “Peggy Peterson” for Clifford and “David Dennison” for Trump) and a Side Letter (“SL”) (which identifies the real parties, but must be retained solely by the attorneys) are attached to the complaint. Without bothering to wait for Trump’s Answer to the complaint, I’m ruling in favor of Clifford.
Neither the SA nor the SL is signed by Trump. SA Section 8.6 provides, “this Agreement, when signed by all Parties, is a valid and binding agreement, enforceable in accordance with its terms”. Clearly, in order to create an enforceable agreement, the parties required the document to be physically signed. Under Section 8.9, the SA could be signed in “separate counterparts”.
Curiously, there is no requirement for delivery of a signed counterpart to the other parties. However, the Side Letter which is supposed to be incorporated into and as a part of the SA specifically requires both signature and delivery of the signed counterpart to the other parties. So even if Trump actually signed a copy of the SA, he still failed to sign and deliver a copy of the SL. (The SL is supposed to amend SA Section 8.1 “Entire Agreement”, but instead refers to SA Section 7.1 “Confidentiality of this Agreement”.)
It is difficult to imagine that any story Stormy Daniels has to tell could sully Trump’s reputation in any manner. Unless Trump can prove delivery of a signed SA and SL, then he shouldn’t bother defending the suit. A counter-claim for $130,000 for unjust enrichment, however, may be warranted.
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