That means that the conversation took place about a month after American Media Inc., the publishers of the National Enquirer, bought the exclusive rights to former Playboy model Karen McDougal’s story about an affair with a married man. That man, she alleged earlier this year, was Trump and, in the recorded conversation with Cohen, the rights to her story appear to be the primary subject of conversation.
We know that because CNN got a copy of the tape from Cohen’s attorney, Lanny Davis.
We’d assessed the pertinent legal questions about the tape when its existence was first reported last week, but hearing the fuller recording gives us a better sense of what is and isn’t important in the conversation.
1. This was a conversation about the campaign. One of the central issues determining whether or not money being spent is reportable as a campaign expense is whether or not the money was being spent to aid the campaign. Here it’s clear that Cohen and Trump are speaking primarily about the campaign, covering Burns’ ability to continue to aid the campaign and polling.
Perhaps more importantly, Cohen also raises a lawsuit by the New York Times aimed at unsealing documents related to Trump’s divorce from his first wife Ivana.
“All you have to do is delay it for…” Trump says.
“Even after that, it’s not going to be opened,” Cohen interjects.
After what? After Election Day, clearly. Just need to delay the release of those documents until Election Day, Trump is suggesting. This is a conversation about making sure things are settled before the campaign is over.
In this case, the rationale for discussing the payment doesn’t matter because the money wasn’t spent. It reinforces, though, that Cohen and Trump were talking about payments aimed at burying negative stories as part of their conversations about aiding the campaign.
2. Cohen appears to be an agent of the campaign. When Cohen spent that $130,000 on keeping adult film actress Stormy Daniels quiet about her alleged relationship with Trump, he paid with his own money.
The ramifications of spending money are different if someone is or isn’t acting on behalf of the campaign. Were he a random guy, that payment falls into one category under federal election law. But in February, former general counsel for the Federal Election Commission Lawrence Noble told The Washington Post that such a payment from an agent of the campaign is illegal.
3. How and when Cohen and AMI spoke about the McDougal payment becomes even more interesting. Our initial analysis of the reported recording focused heavily on when Cohen learned that AMI and McDougal had reached an agreement. Did AMI tell him directly? Did Cohen learn from McDougal’s then attorney, Keith Davidson — the same attorney who helped Daniels make her deal with Trump?
More importantly, why wasn’t the money ever paid?
Pay attention to how Cohen and Trump talk about the need to buy the rights to McDougal’s story from AMI.
“I need to open up a company for the transfer of all of that info regarding our friend, David, you know,” he says. Eventually, in mid-October, he does set up a company, Essential Consultants, that is used to shunt the payment to Daniels. The important part here, though, is that mention of “David” — a reference to AMI boss David Pecker, a long-time friend of Trump’s.
Cohen and Trump discuss the company for a bit but then clearly allude to the need to bring McDougal’s story in house. If Pecker is holding on to it, it seems, they’re not worried about the National Enquirer or another AMI property running the story.
The two aren’t satisfied with simply hoping AMI sits on it. “You never know where that company — you never know what he’s gonna be —” Cohen says.
“David gets hit by a truck,” Trump says.
“Correct,” Cohen replies. “So, I’m all over that.”
If Pecker gets hit by a truck, all of a sudden the legitimately newsy story about an alleged affair could be published. So Trump and Cohen want to bring it in-house.
But they didn’t. Why not? Were there assurances made by AMI? Did Pecker promise that it would never get out? Was it just luck, Trump and Cohen assuming that Pecker would avoid trucks for the next two months?
The answer to that question has legal ramifications for AMI. The company can buy stories and then not run them. But if it coordinated with the campaign, Noble said last week, things get much trickier.
“If one of the options was buying it from AMI and AMI convinced them they didn’t need to buy it, that bolsters the argument that it’s a campaign contribution because that would be a discussion with AMI about it,” Noble said. A guarantee to spike the story “would be strong evidence that AMI made a campaign contribution,” he said. “That this wasn’t a journalistic decision, that this was in coordination with the campaign.”
4. Was Trump’s impulse to pay in cash? “So what’re we going to pay, 150?” Trump asks at one point. That’s the amount that AMI paid McDougal in the first place and Cohen agrees that this is the right amount.
Then there’s the question of how to pay the money. Cohen mentions the financing, prompting a question from Trump.
“Listen. What financing?” Trump says. As Cohen responds, Trump says something that’s hard to make out, followed by “pay with cash.”
“No. No no no no no no. I’ve got— no no no,” Cohen replies. The tape cuts out.
If Trump’s instinct was to pay AMI $150,000 in cash, as many have suggested, you don’t need to speak with a legal expert to understand the ramifications.
To Fox News’ Laura Ingraham, former New York mayor Rudolph W. Giuliani, now on Trump’s legal team, suggests that this is why it’s clear that Trump didn’t say “pay with cash.” What Trump said, Giuliani says, was “don’t pay with cash.”
The payment didn’t happen. As a result, Trump and Cohen may be in the clear on campaign finance issues as regards McDougal.
Not necessarily, though. In an email to The Post, Noble notes that “if Trump offered to buy the story because he was concerned it would come out before the election and AMI told him he did not have to and assured him they would not release it, then that understanding may result in AMI making an illegal contribution and Trump accepting it.”
Even if that didn’t happen, the recording helps fill in the shading a bit on the other known payment by Trump — in a way that doesn’t do him or Cohen much good.
This article was updated with Giuliani’s and Noble’s emailed comments.