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Trump Directed Action to Enforce Stormy Daniels's Hush Agreement

The Wall Street Journal. logo The Wall Street Journal. 10/2/2018
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President Trump personally directed an effort in February to stop Stormy Daniels from publicly describing an alleged sexual encounter with Mr. Trump, people familiar with the events say.

In a phone call, Mr. Trump instructed his then-lawyer Michael Cohen to seek a restraining order against the former adult-film actress, whose real name is Stephanie Clifford, through a confidential arbitration proceeding, one of the people said. Messrs. Trump and Cohen had learned shortly before that Ms. Clifford was considering giving a media interview about her alleged relationship with Mr. Trump, despite having signed an October 2016 nondisclosure agreement.

Mr. Trump told Mr. Cohen to coordinate the legal response with Eric Trump, one of the president’s sons, and another outside lawyer who had represented Mr. Trump and the Trump Organization in other matters, the people said. Eric Trump, who is running the company with his brother in Mr. Trump’s absence, then tasked a Trump Organization staff attorney in California with signing off on the arbitration paperwork, these people said.

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Direct involvement of the president and his son in the effort to silence Ms. Clifford hasn’t previously been reported. The accounts of that effort recently provided to The Wall Street Journal suggest that the president’s ties to his company continued into this year and contradict public statements made at the time by the Trump Organization, the White House and Mr. Cohen.

The White House referred a request for comment to the president’s outside counsel. Jay Sekulow, a lawyer for Mr. Trump, declined to comment. A person close to the situation said Eric Trump had acted as the president’s son and not in his role as a company executive. The Trump Organization declined to comment. Lanny Davis, a lawyer for Mr. Cohen, declined to comment.

In March, the Trump Organization denied any role in the arbitration, saying its lawyer assisted in her “individual capacity.” At the same time, the White House issued blanket denials when asked about a hush payment to Ms. Clifford and directed questions to Mr. Cohen, who had called the deal a private transaction between himself and the former adult-film star. Mr. Trump has denied any sexual encounter with Ms. Clifford.

The Journal revealed on Jan. 12 that Mr. Cohen paid Ms. Clifford $130,000 before the 2016 presidential election to keep silent about the alleged sexual encounter. In a phone call about a month later—as Ms. Clifford made plans to tell her story despite the nondisclosure agreement—Mr. Trump told Mr. Cohen to enforce the contract in arbitration and indicated he would pay legal costs. “I’ll take care of everything,” the president said, one of the people familiar with the conversation said.

Mr. Cohen had a second phone conversation with Mr. Trump about the arbitration days later in the Manhattan office of Lawrence Rosen, the outside lawyer, that person said.

At the time of the conversations, the White House and Mr. Trump were dealing with the mass shooting in Parkland, Fla., and a new round of criminal charges filed by special counsel Robert Muelleragainst 13 Russians accused of meddling in the 2016 election.

Jill Martin, a Trump Organization lawyer, was listed as counsel on the arbitration paperwork filed in Orange County, Calif., on Feb. 22. Five days later, an arbitrator privately issued a restraining order against Ms. Clifford, who ignored it and proceeded with her plans to publicly discuss the alleged affair.

Ms. Martin was asked to sign off on the arbitration documents by Mr. Rosen, who told her the request came from Eric Trump, according to the people familiar with the matter.

Mr. Rosen’s firm had prepared the documents for the arbitration proceeding, but an attorney licensed in California—one of the venues stipulated for resolution of any dispute under the contract—had to sign off on them while Mr. Rosen’s application to participate in the matter as an out-of-state lawyer was pending, Mr. Rosen said in an interview this week.

When the Journal contacted Ms. Martin and the Trump Organization in March about her involvement in the arbitration, she sought out Eric Trump for advice on how to respond, according to the people.

Eric Trump then approved a statement to the Journal drafted by Ms. Martin with input from Mr. Rosen and Alan Garten, the Trump Organization’s chief legal officer, these people said. The statement said Ms. Martin had facilitated the filing of the arbitration “in her individual capacity” and that “the company has had no involvement in the matter.”

Ms. Martin didn’t respond to a request for comment.

On March 6, Ms. Clifford sued Mr. Trump and Essential Consultants LLC, the company Mr. Cohen used to pay her, in Los Angeles County Superior Court. She asked a judge to invalidate the nondisclosure agreement, saying it was contrary to public policy and unenforceable because Mr. Trump hadn’t signed the document.

The complaint alleged that it “strains credulity to conclude that Mr. Cohen is acting on his own” to enforce the nondisclosure agreement in arbitration “without the express approval and knowledge of his client Mr. Trump.”

At a briefing at the White House the next day, press secretary Sarah Sanders was asked whether Mr. Trump approved the payment to Ms. Clifford. Mr. Trump has “made very well clear that none of these allegations are true,” Ms. Sanders said, adding that the “case has already been won in arbitration and anything beyond that I would refer you to the president’s outside counsel.”

An interview with Ms. Clifford aired on CBS’s “60 Minutes” on March 25, drawing more than 21 million viewers. She described some details of her alleged encounter with Mr. Trump in 2006 and said she signed the nondisclosure agreement with Mr. Cohen in October 2016 out of fear for the safety of her family.

In a May 3 tweet, Mr. Trump said the nondisclosure agreement with Ms. Clifford was “used to stop the false and extortionist accusations made by her about an affair.”

In August, Mr. Cohen pleaded guilty to felony violations of election laws in connection with the payments to Ms. Clifford and a former Playboy model, Karen McDougal, who also says she had an affair with Mr. Trump that he denies.

Mr. Cohen, whose sentencing is scheduled for December, said during his plea hearing in Manhattan federal court that Mr. Trump directed him to silence Ms. Clifford and coordinate a hush payment to Ms. McDougal “for the principal purpose of influencing the election” in 2016.

Rudy Giuliani, a lawyer for Mr. Trump, said after the plea that Mr. Cohen lacked credibility and that the government’s charges against Mr. Cohen contained no allegations of wrongdoing by the president.

Write to Joe Palazzolo at joe.palazzolo@wsj.com and Michael Rothfeld at michael.rothfeld@wsj.com

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