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

Background

Jessica Denson brought a proposed class action against Donald J. Trump For President, Inc. (the Campaign). She challenged an employment agreement she signed before working as a national phone bank administrator in 2016. The agreement contained two provisions at issue:

- A non-disclosure provision that applied during employment and at all times afterward. It broadly covered private or confidential information, including information about President Trump’s personal, political, and business affairs, his family, and entities connected to them. It also covered information that President Trump insisted remain private or confidential. - A non-disparagement provision that barred public statements that demeaned or disparaged the Campaign, President Trump, family members, related companies, their assets, or their products and services.

The Campaign had previously pursued arbitration against Denson, alleging that she violated these provisions through statements and a federal lawsuit. An arbitrator awarded the Campaign money, but the New York Appellate Division later vacated the award in its entirety. The Campaign also pursued or threatened similar enforcement efforts against other former Campaign workers.

Denson sought a declaration that both provisions were invalid and unenforceable and sought an injunction preventing their enforcement. The pending motions were the Campaign’s motion to dismiss and Denson’s motion for summary judgment, which asks for judgment without a trial when the material facts are not genuinely disputed.

Motion to Dismiss

The Campaign argued that Denson lacked standing, meaning a sufficient personal injury or credible threat of harm to invoke federal-court jurisdiction. The court held that Denson had shown a substantial risk that the agreement would be enforced against her. The court relied on the Campaign’s enforcement efforts against Denson and other former employees, as well as statements by President Trump about enforcing confidentiality agreements. The Campaign’s statement in its briefing that it did not currently intend to enforce the agreement against Denson did not eliminate that risk because it had not definitively agreed not to enforce the provisions in the future.

The Campaign also argued that issue preclusion, sometimes called collateral estoppel, barred Denson’s claims because of the earlier arbitration and state-court proceedings. The court rejected that argument. It explained that the First Department had ruled that non-disclosure and non-disparagement agreements do not automatically violate public policy and that the arbitrator had authority to consider their validity. But that court had not decided Denson’s specific arguments about the provisions’ scope, including their lack of a time limit and their vagueness and breadth. The Campaign’s motion to dismiss was therefore denied.

Summary Judgment on the Non-Disclosure Provision

Applying New York law, the court held that the non-disclosure provision was unenforceable. Restrictive covenants such as confidentiality agreements must be reasonable in time and area, necessary to protect legitimate interests, not harmful to the public, and not unreasonably burdensome to the employee. The provision had no time limit, applying during employment and forever afterward.

The court also found the provision practically unlimited in scope. Its categories included vague terms such as personal life, relationships, political affairs, and business affairs, and it covered any information President Trump insisted remain private or confidential. The provision extended to President Trump, family members, and entities created for, controlled by, or owned by them. The court concluded that employees could not determine what speech was prohibited, and that the provision chilled speech about matters of public interest. The provision was also too indefinite to show a sufficiently definite agreement about the material terms. Denson’s motion for summary judgment was granted as to the non-disclosure provision.

Summary Judgment on the Non-Disparagement Provision

The court did not accept Denson’s argument that the non-disparagement provision was necessarily subject to the same restrictive-covenant test. It also noted that the word “disparage” itself had been treated as clear in other cases. But the court found the provision’s overall scope too indefinite because it covered an unascertainable group of people and entities, including family members, companies, assets, products, and services connected to them.

The court concluded that the agreement did not show sufficiently definite mutual assent about the scope of the non-disparagement provision. Denson’s motion for summary judgment was granted as to that provision as well.

No Judicial Rewriting of the Clauses

The Campaign asked the court to “blue-pencil” the provisions—that is, narrow or revise an overbroad restriction rather than invalidate it entirely. The court declined. It found that making these provisions enforceable would require wholesale redrafting, not merely trimming their duration or geographic scope. The court also found that the Campaign’s past enforcement efforts showed it was not acting in good faith merely to protect legitimate interests, but had repeatedly sought to suppress speech it considered detrimental.

Disposition

Judge Paul G. Gardephe denied the Campaign’s motion to dismiss. He granted Denson’s motion for summary judgment to the extent that the employment agreement’s non-disclosure and non-disparagement provisions were declared invalid and unenforceable as to Denson. The court denied Denson’s request for injunctive relief because the complaint did not seek an injunction. It granted, on consent, an amicus-brief motion filed by several press and journalism organizations, and denied as moot the amicus-brief motion filed by Neil Klausner and Marissa Comart. The opinion does not state that the provisions were invalidated on a class-wide basis or that a class was certified.