Stormy Daniels Hush-Money Lawsuit Kept on Hold

LOS ANGELES (CN) – A federal judge Tuesday shot down a request by Stormy Daniels to lift an ongoing delay in her lawsuit to void a non-disclosure agreement with President Donald Trump and his personal attorney Michael Cohen.

On Monday, the judge cancelled a Thursday hearing on the motion to lift the stay, saying he would base his ruling on the briefs already filed in the case.

In a 5-page order, U.S District Judge S. James Otero said that the ongoing criminal investigation in federal court in New York into Cohen’s business dealings – and the interest in protecting Cohen’s rights against self-incrimination – merit keeping the stay order in place.

“After careful consideration, the Court concluded that the gravity of the criminal investigation and the various competing interests in this action counseled in favor of a temporary stay,” Otero said.

Daniels’ attorney Michael Avenatti argued in a May 24 motion that the request was justified by “new revelations” about Trump’s reimbursement to Cohen and that the criminal probe of Cohen’s business may not be “as compelling as previously argued” by his attorneys.

He said that the scope of the criminal investigation is unrelated to Daniels’ lawsuit and that Cohen has no valid reason to believe his testimony would be self-incriminating.

Stormy Daniels, center, speaks during a ceremony for her receiving a City Proclamation and Key to the City on Wednesday, May 23, 2018 in West Hollywood, Calif. (AP Photo/Ringo H.W. Chiu)

“Less drastic measures than a complete stay of proceedings are available” in order to protect Cohen’s Fifth Amendment rights, the motion said.

Avenatti also argued that Trump and Cohen would have been “fully equipped” to mount a defense against Daniels’ declaratory judgment claim without Cohen since they would have use of Cohen’s previous declarations and documents obtained in discovery.

Otero deemed the argument invalid and overruled previous objections by Cohen that the statements made by Trump and his attorney Rudy Giuliani were “inadmissible hearsay,” even though Otero said the court generally admits relevant statements as comments.

“The Court makes no finding as to whether Mr. Giuliani is an authorized agent of Mr. Trump for the purpose of the hearsay exclusion,” he said. “The Court is not considering the truth of the statements…and makes no finding as to whether Mr. Giuliani is an authorized agent of Mr. Trump.”

Otero said Cohen’s efforts seeking to protect himself from self-incrimination are independent of what Trump or Giuliani have said in media appearances.

“As an initial matter, Mr. Trump or Mr. Giuliani’s belief in Mr. Cohen’s innocence has absolutely no bearing on Mr. Cohen’s Fifth Amendment privilege,” the order said. “Plaintiff has provided no evidence demonstrating that Mr. Cohen’s invocation of the privilege was disingenuous or unreasonable.”

Otero also said Daniels has not provided substantial evidence that the order to delay the case caused her any prejudice, noting that she and other members of both parties have regularly made media appearances – including Daniels’ “now famous appearance” on “Saturday Night Live.”

“Despite the imposition of the stay, the media attention on this action– and the parties’ willingness to publicly discuss its merits– has not waned,” he said.

Daniels had previously tried to assuage Cohen’s fears regarding self-incrimination by saying in her motion that she would only depose Trump in the case, not Cohen.

Otero said that argument was irrelevant since the court has previously found that Cohen is “the alleged mastermind behind the Agreement with the most direct knowledge of the facts and circumstances surrounding its formation.”

Otero closed out the order by reminding both parties he advises against the “unjustified use” of ex parte applications and other “extraordinary procedural mechanisms” to advance the case.

He also said the “amount of media attention in this case” doesn’t justify any request from either party for emergency relief in the case.

“If anything, the heightened scrutiny on this action requires that the Court ensure that the rules are scrupulously followed,” he said.

The court has yet to address the legality of the hush agreement and the payment to Daniels by Cohen.

Cohen’s attorney Brent Blakely did not return a request for comment Tuesday.

Avenatti’s office did not immediately respond to a request for comment.

Daniels, whose birth name is Stephanie Clifford, says Cohen paid her $130,000 to keep quiet during the 2016 presidential election about a one-night stand she claims to have had with Trump in 2006 in Lake Tahoe.

Her California lawsuit against Trump, Cohen and Essential Consultants – a company Cohen set up to facilitate the payment – argues the nondisclosure agreement she signed is invalid since Trump never signed it. She has offered to repay the money to Cohen.

Daniels sued to get out of the agreement and added defamation claims over statements Trump and Cohen have made about her and the agreement in the press and on Twitter.

Trump, through White House officials, has continued to deny the affair with Daniels took place.

Last month, the Office of Government Ethics released Trump’s financial disclosure form, which describes a 2016 expense incurred by Cohen in the amount of $100,001 to $250,000.

“Mr. Cohen sought reimbursement of those expenses and Mr. Trump fully reimbursed Mr. Cohen in 2017,” the report states.

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