It is entirely possible that federal prosecutors in Manhattan believe President Donald Trump is nothing more than a sleazy huckster. It is equally possible that they have the exact same opinion of Michael Cohen and American Media Inc., the publisher of the National Enquirer.
Assuming these opinions, it is not surprising that New York prosecutors seem to be paying a lot of attention to AMI’s apparent efforts to help Trump’s presidential bid.
While connections between Trump, his former attorney and the publishing company are numerous, prosecutors have reportedly focused in recent weeks on whether Cohen improperly coordinated with AMI to buy the rights to the story of an alleged affair (which the president has denied) between Trump and Karen McDougal. Earlier this year, McDougal told journalist Ronan Farrow that AMI purchased “exclusive ownership of her account of any romantic, personal, or physical relationship she has ever had with any ‘then-married man,’” for $150,000. The National Enquirer never ran her story, and it returned the rights to McDougal in April as part of a legal settlement.
The magazine said that it never ran McDougal’s story because it did not find her account credible. But to many, the incident looked like a case of “catch and kill,” in which a publication purchases exclusive rights to a story in order to ensure it is never published or discussed elsewhere. Farrow reported at The New Yorker that the Enquirer has used this practice in the past to bury major celebrity scandals.
As reported by The Wall Street Journal, among other outlets, New York prosecutors now seem to be trying to build a case that AMI’s helpful spending amounted to an unreported, illegal corporate contribution to Trump’s 2016 campaign. Alleged ties between Cohen, Trump and AMI have come into sharper focus during investigations into Cohen’s personal business dealings, including his emails and a recently released recording of a conversation between Cohen and Trump. The Journal reported that the Manhattan U.S. attorney’s office also subpoenaed AMI and the Trump Organization in April, on the same day it raided Cohen’s home. Investigations into Cohen’s conduct are ongoing; he has not been charged.
Prosecutors like to prosecute. It’s in their DNA. But in AMI’s case, I am reasonably certain that however much they dislike the appearance of collusion between a publisher and a political candidate, they will choose to do nothing about it. There is nothing they can do without courting worse consequences than leaving the issue alone.
AMI bought the rights to McDougal’s story and, under the First Amendment, the publisher was perfectly free to publish it – or not. The only plausible way prosecutors could make a successful case for campaign finance violations is if they could show that the publisher bought McDougal’s story at the direct request of Trump or representatives of his campaign. So far, there is no hint that anyone made such a request.
In fact, there is at least indirect evidence to the contrary. First, when Trump wanted to buy someone’s silence, he clearly had no problem doing it himself. Contrast McDougal’s situation with the case of Stephanie Clifford, who performs in adult films under the name Stormy Daniels. Clifford reportedly attempted to sell her story to AMI too, but the publisher declined to purchase the rights. Cohen, however, was willing to pay up, purchasing Clifford’s silence for $130,000 through a shell corporation less than a month before the 2016 election. While Trump initially denied any knowledge of the payment, he reversed that position in May. Regardless of the particular details of Clifford’s case, which are still a matter of dispute, the incident makes clear that if Trump wanted to buy McDougal’s silence outright, he could have.
Second, in the now-famous secret recording that Cohen made of fragments of a conversation with Trump, Cohen told the candidate that the McDougal transaction was already a done deal. They even considered, according to some accounts, having Trump repurchase the rights to her story from AMI. The publisher said Cohen knew about the story because it sought Cohen’s comment on the matter for a potential article, though The Wall Street Journal, citing anonymous sources, reported that AMI briefed Cohen on the deal with McDougal in detail. Either way, no one has credibly suggested that Cohen, or anyone else connected to the Trump campaign, instructed AMI to make the purchase on the candidate’s behalf.
Short of proving that a publisher, of whatever journalistic repute, has simply acted as a strawman for someone else, prosecutors face a nearly hopeless legal battle in trying to indict a publication over the alleged motivations behind a decision to pursue a story and ultimately not to publish it. Media organizations rightly enjoy especially robust protections under the First Amendment, and the bar to strip them of such protections is very high. Campaign finance law explicitly creates an exception for media organizations, stating that an “expenditure” doesn’t include news stories issued in an outlet’s “legitimate press function.”
It is not hard to understand why lawmakers made it difficult to prove media coverage of any stripe is a campaign contribution. If the National Enquirer’s relentlessly positive press about Trump during his presidential campaign could amount to an illegal form of support for his candidacy, then The Washington Post’s relentlessly negative reporting during the same period might next come under fire as illegal support for Trump’s opponent. It is not a path that prosecutors are apt to take, and if they do, the Supreme Court is very likely to stop them in their tracks.
There is another reason I doubt that prosecutors, regardless of their presumed disdain for the president, will move forward with the AMI case. Beyond the risk of losing a high-profile case against Trump’s allies, prosecuting AMI for illegal campaign collusion might threaten most, if not all, of the legal rationale behind restrictions on campaign financing altogether. Appearing in front of largely the same Supreme Court that issued Citizens United, prosecutors might unintentionally invite a finding that, at the very least, restrictions on in-kind contributions or coordination of activities between a campaign and third-party organizations are unconstitutionally vague. The court might also find that such restrictions violate constitutionally protected free speech outright – for instance, in a situation where the government put itself in charge of deciding what constitutes a “legitimate press function.” If the court finds either or both to be true, campaign finance rules will become looser, which is presumably the opposite of what the Manhattan U.S. attorney’s office hopes to achieve.
So when push comes to shove, the idea that a publisher is contributing to a political campaign through its editorial activities is a legal nonstarter. Prosecutors, even New Yorkers with no love for the National Enquirer or the presidential candidate it supported, are likely to recognize this and focus their energies elsewhere. And they may very well come to regret it if they don’t.
Larry M. Elkin is the founder and president of Palisades Hudson, and is based out of Palisades Hudson’s Fort Lauderdale, Florida headquarters. He wrote several of the chapters in the firm’s recently updated book,
Looking Ahead: Life, Family, Wealth and Business After 55. His contributions include Chapter 1, “Looking Ahead When Youth Is Behind Us,” and Chapter 4, “The Family Business.” Larry was also among the authors of the firm’s book
The High Achiever’s Guide To Wealth.
Posted by Larry M. Elkin, CPA, CFP®
photo by Robert Couse-Baker
It is entirely possible that federal prosecutors in Manhattan believe President Donald Trump is nothing more than a sleazy huckster. It is equally possible that they have the exact same opinion of Michael Cohen and American Media Inc., the publisher of the National Enquirer.
Assuming these opinions, it is not surprising that New York prosecutors seem to be paying a lot of attention to AMI’s apparent efforts to help Trump’s presidential bid.
While connections between Trump, his former attorney and the publishing company are numerous, prosecutors have reportedly focused in recent weeks on whether Cohen improperly coordinated with AMI to buy the rights to the story of an alleged affair (which the president has denied) between Trump and Karen McDougal. Earlier this year, McDougal told journalist Ronan Farrow that AMI purchased “exclusive ownership of her account of any romantic, personal, or physical relationship she has ever had with any ‘then-married man,’” for $150,000. The National Enquirer never ran her story, and it returned the rights to McDougal in April as part of a legal settlement.
The magazine said that it never ran McDougal’s story because it did not find her account credible. But to many, the incident looked like a case of “catch and kill,” in which a publication purchases exclusive rights to a story in order to ensure it is never published or discussed elsewhere. Farrow reported at The New Yorker that the Enquirer has used this practice in the past to bury major celebrity scandals.
As reported by The Wall Street Journal, among other outlets, New York prosecutors now seem to be trying to build a case that AMI’s helpful spending amounted to an unreported, illegal corporate contribution to Trump’s 2016 campaign. Alleged ties between Cohen, Trump and AMI have come into sharper focus during investigations into Cohen’s personal business dealings, including his emails and a recently released recording of a conversation between Cohen and Trump. The Journal reported that the Manhattan U.S. attorney’s office also subpoenaed AMI and the Trump Organization in April, on the same day it raided Cohen’s home. Investigations into Cohen’s conduct are ongoing; he has not been charged.
Prosecutors like to prosecute. It’s in their DNA. But in AMI’s case, I am reasonably certain that however much they dislike the appearance of collusion between a publisher and a political candidate, they will choose to do nothing about it. There is nothing they can do without courting worse consequences than leaving the issue alone.
AMI bought the rights to McDougal’s story and, under the First Amendment, the publisher was perfectly free to publish it – or not. The only plausible way prosecutors could make a successful case for campaign finance violations is if they could show that the publisher bought McDougal’s story at the direct request of Trump or representatives of his campaign. So far, there is no hint that anyone made such a request.
In fact, there is at least indirect evidence to the contrary. First, when Trump wanted to buy someone’s silence, he clearly had no problem doing it himself. Contrast McDougal’s situation with the case of Stephanie Clifford, who performs in adult films under the name Stormy Daniels. Clifford reportedly attempted to sell her story to AMI too, but the publisher declined to purchase the rights. Cohen, however, was willing to pay up, purchasing Clifford’s silence for $130,000 through a shell corporation less than a month before the 2016 election. While Trump initially denied any knowledge of the payment, he reversed that position in May. Regardless of the particular details of Clifford’s case, which are still a matter of dispute, the incident makes clear that if Trump wanted to buy McDougal’s silence outright, he could have.
Second, in the now-famous secret recording that Cohen made of fragments of a conversation with Trump, Cohen told the candidate that the McDougal transaction was already a done deal. They even considered, according to some accounts, having Trump repurchase the rights to her story from AMI. The publisher said Cohen knew about the story because it sought Cohen’s comment on the matter for a potential article, though The Wall Street Journal, citing anonymous sources, reported that AMI briefed Cohen on the deal with McDougal in detail. Either way, no one has credibly suggested that Cohen, or anyone else connected to the Trump campaign, instructed AMI to make the purchase on the candidate’s behalf.
Short of proving that a publisher, of whatever journalistic repute, has simply acted as a strawman for someone else, prosecutors face a nearly hopeless legal battle in trying to indict a publication over the alleged motivations behind a decision to pursue a story and ultimately not to publish it. Media organizations rightly enjoy especially robust protections under the First Amendment, and the bar to strip them of such protections is very high. Campaign finance law explicitly creates an exception for media organizations, stating that an “expenditure” doesn’t include news stories issued in an outlet’s “legitimate press function.”
It is not hard to understand why lawmakers made it difficult to prove media coverage of any stripe is a campaign contribution. If the National Enquirer’s relentlessly positive press about Trump during his presidential campaign could amount to an illegal form of support for his candidacy, then The Washington Post’s relentlessly negative reporting during the same period might next come under fire as illegal support for Trump’s opponent. It is not a path that prosecutors are apt to take, and if they do, the Supreme Court is very likely to stop them in their tracks.
There is another reason I doubt that prosecutors, regardless of their presumed disdain for the president, will move forward with the AMI case. Beyond the risk of losing a high-profile case against Trump’s allies, prosecuting AMI for illegal campaign collusion might threaten most, if not all, of the legal rationale behind restrictions on campaign financing altogether. Appearing in front of largely the same Supreme Court that issued Citizens United, prosecutors might unintentionally invite a finding that, at the very least, restrictions on in-kind contributions or coordination of activities between a campaign and third-party organizations are unconstitutionally vague. The court might also find that such restrictions violate constitutionally protected free speech outright – for instance, in a situation where the government put itself in charge of deciding what constitutes a “legitimate press function.” If the court finds either or both to be true, campaign finance rules will become looser, which is presumably the opposite of what the Manhattan U.S. attorney’s office hopes to achieve.
So when push comes to shove, the idea that a publisher is contributing to a political campaign through its editorial activities is a legal nonstarter. Prosecutors, even New Yorkers with no love for the National Enquirer or the presidential candidate it supported, are likely to recognize this and focus their energies elsewhere. And they may very well come to regret it if they don’t.
Related posts:
The views expressed in this post are solely those of the author. We welcome additional perspectives in our comments section as long as they are on topic, civil in tone and signed with the writer's full name. All comments will be reviewed by our moderator prior to publication.