Denson v. Donald J. Trump For President, Inc.
| Decision Date | 26 October 2021 |
| Docket Number | Index 101616/2017 |
| Citation | 2021 NY Slip Op 32095 (U) |
| Parties | JESSICA DENSON Plaintiff, v. DONALD J. TRUMP FOR PRESIDENT, INC., Defendant. Motion Seq. No. 011 |
| Court | New York Supreme Court |
Unpublished Opinion
DECISION + ORDER ON MOTION
The following e-filed documents, listed by NYSCEF document number (Motion 011) 249-273 J were read on this motion to/for SUMMARY JUDGMENT.
Upon the foregoing documents, the motion is determined as follows:
Plaintiff commenced this action claiming inter alia that she endured a hostile work environment, experienced sex discrimination, and faced retaliation related to her employment with Defendant, Donald J. Trump for President Inc., a corporate entity formed to facilitate Donald J Trump's 2016 presidential campaign. Plaintiff is the former Director of Hispanic Engagement for Defendant.
Central to this litigation are the non-disclosure and non-disparagement provisions ("NDAs") contained within the employment agreement that Plaintiff executed as a condition of her employment. Among other things, these provisions prohibited Plaintiff from disclosing disseminating or publishing any confidential information unfavorable to Donald J. Trump, his family or his businesses. Further, the agreement provided Plaintiff could not demean or disparage Trump, his family or his businesses publicly. At the sole election of Defendant, any dispute arising under or relating to the NDAs was to be resolved by binding arbitration.
Defendant filed a demand to arbitrate the issues of whether Plaintiff breached the NDAs and for awards of damages. Defendant filed a motion in this proceeding to compel arbitration which Justice Arlene Bluth denied by order dated August 9, 2018. Justice Bluth found that the arbitration provision could not be interpreted to apply to Plaintiffs affirmative state law claims arising out of her employment. While the motion was subjudice, Plaintiff commenced another action against Defendant in United States District Court for the Southern District of New York wherein she sought a declaration that the NDAs were void and unenforceable as against public policy. Plaintiff claims that after she commenced the New York State action, Defendant retaliated against her by bringing an arbitration proceeding wherein Defendant sought determination of its claims that Plaintiff breached the NDAs through disclosure of confidential information and making disparaging statements in connection with this lawsuit.
Defendant moved again to compel arbitration, this time in the District Court, and to dismiss Plaintiffs complaint. By order dated August 30, 2018, Judge Jesse M. Furman granted Defendant's motion finding that the parties had agreed to proceed with binding arbitration and that the validity of the agreement was an issue to be resolved by the arbitrator (see Demon v Donald J. Trump for President, Inc., ___ F Supp3d ____, 2018 U.S. Dist. LEXIS 148395 [SDNY 2018]). That Court found its determination was not inconsistent with Justice Bluth's ruling since the federal court claims did not arise out of her employment, but out of the agreement.
After arbitration, at which Plaintiff only tacitly participated, the arbitrator concluded, among other things, that the validity of the NDAs was an issue that was properly before him and found those provisions enforceable. Plaintiffs motion in this action to vacate that award that was denied by Justice Bluth (see Demon v Donald J. Trump for President, Inc., ___Misc3d ___, 2019 NY Slip Op 30611 [U] [Sup Ct. NY Cty 2019]). The Appellate Division, First Department reversed Justice Bluth and vacated the arbitration award holding that it was "partly made in violation of public policy, and otherwise in excess of the arbitrator's authority" (see Denson v Donald J. Trump for President, Inc., 180 A.D.3d 446 [1st Dept 2020]). Specifically, the Appellate Division found that while the demand to arbitrate was limited to Plaintiffs statements made in connection with this state action, the arbitration award was made in the context of the federal action in which she sought a declaration that the non-disparagement agreement was unenforceable (id. at 454). The balance of the award i was based upon certain Twitter posts and statements on a GoFundMe page that were irrelevant since they occurred after the date of the demand to arbitrate and clearly fell outside the scope of the arbitration as set forth by Defendant.
In reaching its conclusion, the Appellate Division, First Department reasoned as follows:
By concluding that the allegations in the federal action are tantamount to disclosure of i confidential information violative of the NDA, the arbitrator improperly punished plaintiff for availing herself of a judicial forum. Defendant is hard-pressed to explain how plaintiff could have pursued her rights without setting forth necessary factual statements for the federal court to consider (id.).
Thereafter, Plaintiff commenced a class action suit against Defendant in New York State Supreme Coun which sought a declaratory judgment on behalf of all class members that the employment agreement containing the NDA was void. It further sought an injunction prohibiting enforcement of the NDA. That action was removed to federal court (see Denson v Donald J. Trump for President, Inc., 20-CV-4737 (PGG) [SDNY 2020]). In that action, Judge Paul G. Gardephe denied Defendant's motion to dismiss and granted Plaintiffs :motion for summary judgment to the extent that the NDAs within the employment agreement were declared invalid and unenforceable as to Plaintiff. Judge Gardephe held that neither the non-disclosure nor the non-disparagement clauses were sufficiently definite to be enforceable (see Denson v Donald J. Trump for President, Inc., ___ F Supp3d ___, 2021 U.S. Dist. LEXIS 61270 [SDNY 2021]). In declining to "Blue-Pencil" or pare down the scope of the NDAs, Judge Gardephe noted:
Moreover, the Campaign's past efforts to enforce the non-disclosure and non-disparagement provisions demonstrate that it is not operating in good faith to protect what it has identified as legitimate interests. The evidence before the Court instead demonstrates that the Campaign has repeatedly sought to enforce the non-disclosure and non-disparagement provisions to suppress speech that it finds detrimental to its interests (id. at *48).
While the above motion was sub judice this Court granted Plaintiffs motion to amend her complaint to include a cause of action for retaliation pursuant to Section 8-107[7] of New York City Human Rights Law based upon Defendant's action in bringing the arbitration and attempting to enforce the award therein.
Now, Plaintiff moves for summary judgment on her retaliation cause of action on the basis that this claim has been determined as a matter of law in Plaintiffs favor by the Appellate Division, First Department and in the federal court relying on the doctrines of res judicata [claim preclusion] and collateral estoppel [issue preclusion].
"The preclusive effect of a judgment is determined by two related but distinct concepts-issue preclusion and claim preclusion-which collectively comprise the doctrine of 'res judicata'" {Paramount Pictures Corp., v Allianz Risk Transfer AG, 31 N.Y.3d 64, 72 [2018]). Under the principle of res judicata, a final judgment on the merits of a claim precludes re-litigation by a party, and those in privity with that party, of that claim and all claims arising out of the same transaction, or series of transactions, even if based upon different theories or if seeking different remedies (see O'Brien v City of Syracuse, 54 N.Y.2d 353, 357 [1981]; Schwartzreich v E.P.C. Carting Co., 246 A.D.2d 439 [1st Dept 1998]; see also Sclafani v Story Book Homes, Inc., 294 A.D.2d 559 [2d Dept 2002]; Winkler v Weiss, 294 A.D.2d 428 [2d Dept 2002]).' In other words, the "transactional analysis" of res judicata adhered to in this state "preclude[s] the litigation of matters that could have or should have been raised in a prior proceeding arising from the same, "factual grouping'" (Board of Managers of Windridge Condos. One v Horn, 234 A.D.2d 249 [2d Dept 1996]). Ultimately, application of res judicata requires the claim sought to be resolved thereby to have been "reasonably and plainly comprehended to be within the scope" of the prior dispute (see Kim v NRT New York LLC., ___A.D.3d ___, 2021 NY Slip Op 05291 [1st Dept 2021]).
The doctrine of collateral estoppel prevents a party from relitigating an issue that was "raised, necessarily decided and material in the first action", provided the party had a full and fair...
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