A Former Trump Campaign Staffer Was Ordered To Pay $25,000 For Violating Her Nondisclosure Agreement
Jessica Denson is going to court to challenge the award to the campaign, which came out of secret proceedings in arbitration.
WASHINGTON — Jessica Denson, a former staffer for President Donald Trump’s campaign, is fighting an order to pay nearly $25,000 for violating a nondisclosure agreement, according to court papers.
The award to the Trump campaign came out of arbitration — nonpublic proceedings the campaign pursued against Denson after she filed two lawsuits against it. Denson was ordered to pay $25,000 to the campaign in October, but the award wasn’t made public until Denson’s lawyers included it in court filings in New York County Supreme Court in late November. The documents obtained by BuzzFeed News this week were not filed electronically.
The award payment is part of a complicated, ongoing legal battle between the Trump campaign and Denson, who, according to her court filings, worked on the campaign as a national phone bank administrator and as director of Hispanic engagement. Denson sued the campaign in New York County Supreme Court in November 2017, claiming that officials discriminated against her, cyberbullied her, and were otherwise hostile toward her; it did not include any allegations against Donald Trump personally. She sought $25 million in damages.
But the Trump campaign claimed Denson’s lawsuit violated the terms of her nondisclosure agreement, which prohibited her from disclosing confidential information, disparaging the campaign, competing with the campaign, or violating its intellectual property. The NDA gave the campaign the power to take issues that arose under the agreement to arbitration, and so the Trump campaign went to the American Arbitration Association and initiated the arbitration case against Denson, which has taken place behind closed doors; she has declined to participate.
The arbitration documents offer a glimpse into the stakes of NDAs signed by a number of staffers who worked on Trump’s 2016 campaign. The campaign originally sought $1.5 million for the alleged violation of Denson’s NDA, though that figure dropped as the case proceeded. According to the final arbitration award order, the campaign had asked for $84,571, arguing that amount represented the cost of having to litigate Denson’s lawsuits in state and federal court. The arbitrator, Paul Kehoe, ultimately awarded a smaller amount, $24,808, which he concluded was what the campaign “reasonably expended” to defend against one of Denson’s cases.
Denson is not the only former staffer the Trump campaign has gone after for allegedly breaching a nondisclosure agreement. The campaign went to court in the summer of 2016 to try to enforce an NDA signed by former campaign consultant Sam Nunberg, accusing Nunberg of leaking confidential information. The campaign and Nunberg reached a confidential settlement a few months later. This year, the campaign said in August that it had filed an arbitration case against former White House official and former campaign aide Omarosa Manigault Newman, accusing her of violating the NDA she signed during the campaign. A campaign spokesperson and a spokesperson for Manigault Newman did not immediately return requests for comment.
Denson and her lawyers are now going to state court in New York to challenge the arbitrator’s award, arguing in papers filed in late November that it ran afoul of a court order published over the summer that held that Denson’s allegations against the campaign — that she was the victim of discrimination and harassment — weren’t covered under her NDA. The judge last week set a hearing for Jan. 29.
Denson’s fight with the campaign has played out for more than a year in state court, federal court, and in arbitration. After the Trump campaign went to arbitration in response to Denson’s original lawsuit in state court, Denson filed a separate lawsuit in March in the US District Court for the Southern District of New York, arguing that her NDA wasn’t enforceable because the campaign was trying to use it to block her from exercising her legal rights to pursue employment-related claims; she argued that the NDA was not the same as an employment agreement.
The state court judge, Judge Arlene Bluth, ruled on Aug. 7 that Denson’s NDA did not apply to her employment claims against the campaign. The NDA did not address Denson’s job responsibilities, her salary and benefits, or whether she could pursue claims about employment-related issues, the judge found.
The federal court judge, US District Judge Jesse Furman, ruled later that month that Denson’s challenge to whether the campaign could enforce the NDA at all did have to go to arbitration, however. Furman wrote that his decision did not conflict with Bluth’s — his case was about a dispute that came out of the agreement, while Bluth had found that Denson’s employment-related claims were not covered.
As the court cases played out in public, the arbitration proceedings were taking place in secret. Denson did not participate, except to alert the arbitrator in September about the pending state court case and Bluth’s decision in August, according to the arbitrator’s account of the case in his October order. Denson filed an affidavit in the state court case saying she didn’t participate because she believed it would “legitimize an unlawful attempt to keep my matters out of court.”
Kehoe concluded in his Oct. 19 order that the NDA was “valid and enforceable.” He found that Denson violated the terms of her agreement by sharing confidential information in her federal court case, and also by making “disparaging statements” on a GoFundMe fundraising page and on her personal Twitter account.
In addition to nearly $85,000 in damages, the campaign had asked the arbitrator to order Denson to turn over money she’d raised online via a GoFundMe page — according to her website, she’s raised $1,505 since June — but Kehoe wrote that New York law didn’t allow for that and denied the request. Kehoe did agree that Denson should have to pay the campaign’s legal fees in the arbitration in addition to the $25,000 award; the amount hadn’t been finalized when Kehoe signed the order.
Denson was handling her cases on her own without lawyers until late October, when she hired counsel. David Bowles, one of her lawyers, said in a statement to BuzzFeed News that they are “confident that our client will prevail.”
“That arbitration should have stopped in its tracks on August 9, 2018, which is when the Court decided that these sorts of claims cannot be arbitrated. Ms. Denson will have her day in court — that is not in doubt — but the Campaign should not be able to punish her for having it,” Bowles said.
A lawyer for the Trump campaign did not return a request for comment Monday.