Stormy Daniel’s $1 Million Liquidated Damages Clause is Excessive
Typically, a financial penalty for disclosing information deemed private is characterized as “liquidated damages.” This means both parties have agreed to a predetermined amount of the penalty. While the general concept of liquidated damages has been held enforceable, the amount awarded by Courts has not always aligned with the amount set forth in the agreement. I don’t believe a Court will uphold the $1million penalty for each time Stormy Daniels talks about having sex with Trump.
Courts consider various factors on the amount of liquidated damages, in particular, whether the agreed amount is “ascertainable based on evidence, the amount of the underlying settlement and the ability of the party to “pay” the liquidated damages amount. Here, there is likely NO evidence to support how Trump reaches an amount of $1 million per violation. There is no rhyme or reason to coming up with this number. It is hard to believe that Trump would be harmed in this amount per violation. Next, since Stormy Daniels only received $130,000 and she does not likely make millions of dollars (via the porn industry) it is very likely that a Court will find the amount of the liquidated damages clause “unconscionable.” This means the Court believes the penalty amount is excessive and being used more as a “weapon” or penalty and not to compensate Trump for actual harm. Daniel’s lawyer will likely argue that Trump did not suffer any harm when the tape of him admitting groping women with Billy Bush went viral. Trump still won the election!