Denson v. Donald J. Trump for President, Inc.

530 F.Supp.3d 412

Jessica DENSON, individually and on behalf of all others similarly situated, Plaintiff,

v.DONALD J. TRUMP FOR PRESIDENT, INC., Defendant.

20 Civ. 4737 (PGG)

United States District Court, S.D. New York.

Signed March 30, 2021

David K. Bowles, Bowles & Johnson, David A. Schulz, Joseph Slaughter, Ballard Spahr LLP, New York, NY, John Langford, Protect Democracy, Los Angeles, CA, Anne Harden Tindall, Brittany Marie Williams, Protect Democracy, Washington, DC, for Plaintiff.

Jared Evan Blumetti, Patrick Thomas McPartland, LaRocca Hornik Rosen & Greenberg LLP, New York, NY, for Defendant.

MEMORANDUM OPINION & ORDER

PAUL G. GARDEPHE, U.S.D.J.:

Plaintiff Jessica Denson brings this putative class action against Defendant Donald J. Trump for President, Inc. (the "Campaign"), seeking a declaratory judgment that an agreement she entered into with the Campaign (the "Employment Agreement") – which contains non-disclosure and non-disparagement clauses – is void, as well as an injunction prohibiting enforcement of the non-disclosure and non-disparagement clauses. Pending before the Court are the Campaign's motion to dismiss (Dkt. No. 23) and Denson's motion for summary judgment (Dkt. No. 19).

For the reasons stated below, the Campaign's motion to dismiss will be denied, and Denson's motion for summary judgment will be granted to the extent that the Employment Agreement's non-disclosure and non-disparagement provisions (Employment Agreement (Dkt. No. 22-1) ¶¶ 1-2) will be declared invalid and unenforceable as to Denson.

BACKGROUND

I. FACTS ¹

A. Denson's Employment and the Agreement

In August 2016 – soon after Donald J. Trump was selected as the Republican Party's nominee for the office of President of the United States – Denson applied to work for the Campaign, and was hired as a national phone bank administrator. (Pltf. R. 56.1 Stmt. (Dkt. No. 21) ¶¶ 6-7, 9; Def. R. 56.1 Cntrstmt. (Dkt. No. 35) at 3-4) Prior to beginning work, the Campaign required Denson – along with other Campaign employees – to sign the Employment Agreement, a form contract that contains non-disclosure and non-disparagement clauses. (Pltf. R. 56.1 Stmt. (Dkt. No. 21) ¶¶ 10-11) Denson remained an employee of the Campaign until November 10, 2016. (Id. ¶ 12)

The Employment Agreement provides as follows:

During the term of your service and at all times thereafter you hereby promise and agree:

a. not to disclose, disseminate or publish, or cause to be disclosed, disseminated or published, any Confidential Information;

b. not to assist others in obtaining, disclosing, disseminating, or publishing Confidential Information;

c. not to use any Confidential Information in any way detrimental to the Company, Mr. Trump, any Family Member, any Trump Company or any Family Member Company;

d. not to save, store or memorialize any Confidential Information (including, without limitation, incorporating it into any storage device, server, Internet site or retrieval system, whether electronic, cloud based, mechanical or otherwise) except as may be expressly required in connection with the performance of services to the Company;

e. to (i) provide the Company with written notice of any legal obligation to disclose any Confidential Information as soon as you become aware of such obligation, (ii) not make any disclosure notwithstanding such obligation until the Company (or the appropriate Trump Person) has had a reasonable opportunity to seek an appropriate protective order or similar relief, (iii) fully cooperate and join with the Company (and the appropriate Trump Person) in any request for a protective order or similar relief, (iv) exercise all reasonable efforts to obtain reliable assurance that confidential treatment will be accorded such Confidential Information in the event no such protective order or similar relief is obtained, whether because it has been denied or because the Company (or the appropriate Trump Person) has elected not to seek it, and [(v)] under all circumstances, not furnish any greater portion of the Confidential Information than you are advised by counsel is absolutely legally required to be disclosed by you or furnish any Confidential Information to any individual, company or governmental entity other than the one to whom or to which you are absolutely legally required to disclose it; and

f. promptly upon the request, whenever made, of the Company, (i) return to the Company all Confidential Information furnished to you, together with all copies, abstracts, notes, reports, or other materials furnished to, or otherwise obtained by, you or prepared by you or on your behalf, without retaining copies, extracts or other reproductions, whether physical, electronic, cloud based or otherwise, in whole or in part, (ii) destroy all documents, memoranda, notes or other writings prepared by you or anyone on your behalf that are based upon the Confidential Information, and (iii) acknowledge such destruction in writing to Company.

The foregoing provisions each apply to Confidential Information and disclosure, dissemination, publication, use and effort to help others obtain, saving, storing and memorializing of Confidential Information, as applicable, (i) by any means of expression, including but not limited to verbal, written, or visual, (ii) whether or not preserved in any medium now known or hereafter discovered or invented, including but not limited to audio recording of any type, written text, drawing, photograph, film, video, or electronic device, (iii) in any manner or form, including but not limited to any book, article, memoir, diary, letter, essay, speech, interview, panel or roundtable discussion, image, drawing, cartoon, radio broadcast, television broadcast, video, movie, theatrical production, Internet website, e-mail, Twitter tweet, Facebook page, or otherwise, even if fictionalized, (iv) in any language, or (v) in any country or other jurisdiction (collectively, the "Restricted Means and Contexts ").

(Employment Agreement (Dkt. No. 22-1) ¶ 1) (emphasis in original).²

The Employment Agreement defines "Confidential Information" as

all information (whether or not embodied in any media) of a private, proprietary or confidential nature or that Mr. Trump insists remain private or confidential, including, but not limited to, any information with respect to the personal life, political affairs, and/or business affairs of Mr. Trump or of any Family Member, including but not limited to, the assets, investments, revenue, expenses, taxes, financial statements, actual or prospective business ventures, contracts, alliances, affiliations, relationships, affiliated entities, bids, letters of intent, term sheets, decisions, strategies, techniques, methods, projections, forecasts, customers, clients, contacts, customer lists, contact lists, schedules, appointments, meetings, conversations, notes, and other communications of Mr. Trump, any Family Member, any Trump Company or any Family Member Company.

(Id. ¶ 6(a))

The Employment Agreement defines "Family Member" as

any member of Mr. Trump's family, including, but not limited to, Mr. Trump's spouse, each of Mr. Trump's children and grandchildren and their respective spouses, including but not limited to Donald J. Trump Jr., Eric F. Trump and Ivanka M. Trump, Tiffany Trump, and Barron Trump, and their respective spouses, children and grandchildren, if any, and Mr. Trump's siblings and their respective spouses and children, if any.

(Id. ¶ 6(b))

The Employment Agreement defines "Family Member Company" as "any entity, partnership, trust or organization that, in whole or in part, was created by or for the benefit of any Family Member or is controlled or owned by any Family Member." (Id. ¶ 6(c)) The Agreement defines "Trump Company" as "any entity, partnership, trust or organization that, in whole or in part, was created by or for the benefit of Mr. Trump or is controlled or owned by Mr. Trump." (Id. ¶ 6(f)) And the Agreement defines "Trump Person" as "each of Mr. Trump, each Family Member, each Trump Company (including but not limited to the Company) and each Family Member Company." (Id. ¶ 6(g))

As to non-disparagement, the Employment Agreement provides as follows:

During the term of your service and at all times thereafter you hereby promise and agree not to demean or disparage publicly the Company, Mr. Trump, any Trump Company, any Family Member, or any Family Member Company or any asset any of the foregoing own, or product or service any of the foregoing offer, in each case by or in any of the Restricted Means and Contexts and to prevent your employees from doing so.

(Id. ¶ 2)

As to remedies for breach of the Employment Agreement, the Agreement provides as follows:

a. Consent to Injunction. A breach of any of your promises or agreements under this agreement will cause the Company, Mr. Trump and each other Trump Person irreparable harm.

Accordingly, to the extent permitted by law, and without waiving any other rights or remedies against you at law or in equity, you hereby consent to the entry of any order, without prior notice to you, temporarily or permanently enjoining you form violating any of the terms, covenants, agreements or provisions of this agreement on your part to be performed or observed. Such consent is intended to apply to an injunction of any breach or threatened breach.

b. Agreement to Indemnify. You hereby agree to indemnify, defend (with counsel acceptable to the Trump Person you are defending) and hold harmless each Trump Person from and against any claim, demand, suit, proceeding, damages, cost, loss or expense of any kind or nature, including but not limited to reasonable attorneys’ fees and disbursements, incurred by any Trump Person as a consequence of your breach of any of your promises or agreements in this agreement.

c. Damages and Other Remedies. Notwithstanding anything to the contrary, each Trump Person will be entitled to all remedies available at law and equity, including but not limited to monetary

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