Trump’s toothless NDA

Harry Litman, a former federal prosecutor, says Stormy Daniels shouldn’t worry about having to pay millions of dollars to the President even if the now-infamous non-disclosure agreement isn’t set aside:

Take the case of Stormy Daniels, the porn actress who says she had an affair with Trump in 2006. Trump lawyer Michael Cohen said he negotiated an agreement with Daniels in October 2016 in which he paid her $130,000 and required she not disclose any details of the alleged affair or otherwise disparage Trump. The “hush agreement,” as Daniels aptly calls it, is backed by a so-called “liquidated damages” provision, which purports to require she pay $1 million for any and all breaches.

[…]

Trump and Cohen’s Bronx bluster notwithstanding, the “liquidated damages” clause in Daniels’s hush agreement is a far less potent tool then they want her to believe. Indeed, it is not enforceable.
Contract law is pragmatic: It permits actual damages for breach, but not punishment. The breaching party is responsible for making the non-breaching party whole — nothing more.
There is a legitimate place in a contract for the “liquidated damages” clause. For some contracts, it is very hard for the parties to determine in advance the fair measure of damages in the event of a breach. In such a setting, the parties can include a clause that sets out what the damages will be.
However, and crucially, the set amount must be a reasonable forecast of the anticipated or actual harm from a breach. A party cannot simply name an arbitrary, exorbitant figure as the presumed “damages” from a breach, even if the other party agrees. If the law were otherwise, the breaching party would be locked in even when performance was inefficient or unfair, and the non-breaching party would reap a windfall.
When courts see a party using a liquidated damages clause to punish or deter a breach, they will condemn it as a “penalty” and strike it out of the contract.
Meanwhile, sit back and enjoy Daniels’ lawyer and a lawyer for Trump’s lawyer screaming at each other about this on CNN.  For twenty-six minutes.  As Allahpndit put it, “We were offered a ticket to the circus and accepted. We might as well get our money’s worth.”

Dowd is Done

There’s nothing I hate more than having to withdraw as legal counsel for a client, after putting in months of hard work. But when your client is determined not to listen to you, and in fact has repeatedly gone out of his way to flout your legal advice, there comes a point where you have to admit that the lawyer-client relationship has collapsed and you cannot represent this person any more.

Counsel for the President of the United States apparently felt the same way.

Good luck to Trump finding a replacement.  Maybe Joseph Rakofsky is still available, unless he’s in a conflict of interest because he sued Trump along with everyone else on the internet.

Protecting Donald Trump fans from themselves

The Attorney General of New York is suing Donald Trump for running an allegedly fraudulent “Trump University.”

Yes, “Trump University.”  My favorite allegation: “Trump University speakers repeatedly insinuated that Donald Trump would appear at the three-day seminar, claiming that ‘he is going to be in town’ or ‘often drops by’ and ‘might show up’ or had just left, or baited students with the promise of a ‘surprise’ or a ‘special guest speaker.’ As students later discovered, these claims were untrue. Rather than being photographed with Donald Trump, they were offered the chance to have photos taken with a life-size photo of Donald Trump.”

The Donald™ hit back by saying the prosecution is politically motivated.  (To be fair, there’s no reason they can’t both be true.)  Meanwhile, the Washington Post‘s Alexandra Petri concedes that TU is almost certainly a scam, but how can you help anyone gullible enough to sign up for it?

There is another word for “consumers who believed in the Trump brand” enough to pay $35,000 to go to Donald Trump University, and it rhymes with “Borons.”

New York is suing Trump for fraud. Maybe the word “University” shouldn’t have been in the name, but does the state of New York always swoop in on such cases? If so, I know some people who paid $12.50 each to attend “Monsters University” at their local cinemas who learned very little about being monsters and became, if anything, less attractive as hiring prospects.

Also, doesn’t the proximity of the name “Donald Trump” in the phrase “Donald Trump University” cancel out “university,” like “Facebook” in “Facebook privacy”?

Donald Trump University didn’t make you rich? Donald Trump can barely make Donald Trump rich!

What did people think they were going to get out of this? Even if the program did what it promised — offered you an instructor hand-picked by Donald Trump who showed you the way to replicate The Donald’s success — you wouldn’t actually be much better off. “Okay,” the instructor would say. “First, be born the son of real estate developer Fred Trump. Then lose a lot of money. Call me back when you’ve completed that step, and we’ll discuss hair options.”

Fraud is wrong. But if you looked at this offering and your thought was, “Great! I will just give Donald Trump $35,000, and then I’ll be a millionaire like him!” maybe you needed this wake-up call before you embarked on any other business ventures, like, say, mailing Elon Musk your life savings “as an investment.” What was your backup plan, to buy 2000 As Seen On TV Earwax Vacuums, and use the $50,000 you “saved” to start a business?

Whoever wins, we lose

The good news is, Donald Trump or Bill Maher will lose this case. The bad news is, Donald Trump or Bill Maher will win this case:

Donald Trump is filing a lawsuit against Bill Maher for failing to live up to an “unconditional offer” made on NBC’s Tonight Show to donate $5 million to charity if Trump provided a copy of his birth certificate proving that he’s not “spawn of his mother having sex with orangutan.”

We’ll chip in $500 to the charity of Trump’s choice if he actually prevails in court over Maher and collects $5 million.

“Trump would have to prove that Maher’s words and conduct demonstrated, objectively, that he intended to be bound by his statement, and that he was not merely making a joke,” says Dori Ann Hanswirth. “Given the outrageousness of Maher’s statement, the amount of money involved and the fact that his statement was made on a comedy TV show, it seems that Trump has an uphill battle here.”

[…]

perhaps the case that might most demonstrate why Trump is likely to lose is the case ofthe Pepsi Points.

In 1999, John Leonard sued PepsiCo., attempting to get the company to hand over an AV-8 Harrier II jump jet. The advertised “offer” came in the form of a television commercial that showed the big prize for 7 million Pepsi points. Leonard had 15 points and attempted to send Pepsi a certified check for $700,000 — 10 cents a point, per contest rules — to cover the rest.

Pepsi successfully argued that its advertisement was intended to be humorous.

“Plaintiff’s insistence that the commercial appears to be a serious offer requires the Court to explain why the commercial is funny,” wrote a judge. “Explaining why a joke is funny is a daunting task; as the essayist E.B. White has remarked, ‘Humor can be dissected, as a frog can, but the thing dies in the process.’ ”

Ultimately, Leonard was deemed to be a loser.

As the judge wrote: “A reasonable viewer would understand such advertisements as mere puffery, not as statements of fact. … The Court rejects plaintiff’s argument that the commercial was not clearly in jest.”