One thing America has learned an awful lot about this past year is nondisclosure agreements. We’ve learned how they’re signed, how they are litigated, and how they can turn into libel suits. The other thing we’ve learned a lot about is lawyers, and how they can use these agreements to do all sorts of things. With news about former Fox News host Bill O’Reilly’s settlement agreements emerging this week, we’ve also learned that a lawyer can represent one side in an agreement, then represent the opposing side.
More and more, it looks like there are only about eight guys negotiating, advising, and also mediating the shoddy NDAs that govern what women can and (mostly) can’t say about the men who rule Hollywood, the media, and the U.S. government. It’s all so cozy and beautiful, really. Unless you’re the alleged victim, and nobody lets you in on the joke.
Unsealed settlement agreements between O’Reilly and two of the women who have accused him of sexual misconduct were made public for the first time this week. A judge released them as part of an ongoing defamation lawsuit against O’Reilly and Fox News in the Southern District of New York. These settlement agreements are just two of the six known agreements adding up to about $45 million paid out to silence women who accused O’Reilly of sexual harassment and verbal abuse.
The defamation suit has three named plaintiffs: Andrea Mackris, a former Fox News producer, who filed a sexual harassment suit against O’Reilly in 2004; Rebecca Gomez Diamond, a former host on Fox Business Network, who accused O’Reilly of sexual harassment before settling with him in 2011; and Rachel Witlieb Bernstein, a former Fox News employee who settled with O’Reilly in 2002 after alleging abuse that did not include sexual harassment. The three women claim that O’Reilly, Rupert Murdoch, and Fox falsely depicted the women with whom he had signed confidentiality agreements as “liars, political operatives, and extortionists” after news of O’Reilly’s decadeslong history of sexual misconduct was reported by the New York Times a year ago. O’Reilly has consistently claimed that he did nothing wrong, and that he merely settled with these women to protect his children.
In an effort to get their defamation suit dismissed, O’Reilly cited the settlement agreements while moving to keep the documents sealed. He also tried to move the matter to confidential mandatory arbitration. On Tuesday, U.S. District Judge Deborah A. Batts refused to order the agreements sealed, saying that O’Reilly has “failed to present compelling countervailing factors that could overcome the presumption of public access to the agreements in question.” So the agreements, in all their glory, are now public.
Thanks to Batts’ ruling, we now know that the agreements signed by Mackris and Diamond required them to turn over all evidence to O’Reilly, including audio recordings and diaries. Mackris was also required to disclaim these materials “as counterfeit or forgeries” if they ever became public, a condition that Mackris’ new lawyers argue forced her to “lie even … under oath.”
The other truly jaw-dropping new revelation was that Mackris’ lawyer, Benedict Morelli, agreed to work for the other side. Here’s the exact text of the provision:
As an inducement to O’Reilly and Fox News to enter into this Agreement, and as a material condition thereof, the Morelli Firm (i) agrees to provide legal advice to O’Reilly regarding sexual harassment matters, and (ii) warrants and represents to O’Reilly and Fox News that it will not, and will not knowingly permit any of its employees, agents or representatives to represent, assist or cooperate with any other parties or attorneys in any action against O’Reilly, Fox News or the Companies arising out of actual or alleged sexual harassment issues, nor will they encourage any other parties or attorneys to commence any such action or proceeding.
In other words, the settlement provides that Morelli will give O’Reilly legal advice on sexual harassment issues and promises that Morelli’s firm will no longer provide any legal advice to anyone suing Fox or O’Reilly. It’s hard to read that as anything but Mackris’ lawyer changing sides and joining forces with O’Reilly as a condition of the settlement agreement. As the Times goes on to note, politely, “Such arrangements are considered unethical in the legal community because they can create conflicts of interest between lawyers and their clients and sideline lawyers who have the expertise to bring claims against companies and individuals.”
Rule 5.6(b) of the American Bar Association’s Model Rules of Professional Conduct bars lawyers from entering “an agreement in which a restriction on the lawyer’s right to practice is part of the settlement of a client controversy.” And the New York State Bar Association further provides that “[a] settlement proposal that calls on the lawyer to agree to keep confidential, for the opposing party’s benefit, information that the lawyer ordinarily has no duty to protect, creates a conflict between the present client’s interests and those of the lawyer and future clients.”
David Luban, who teaches legal ethics at Georgetown Law, explains that this “rule was put in to stop the common practice of including as a term in settling a case that the plaintiff’s lawyer can’t take any other cases suing the defendant on a related matter. The idea behind inserting a term like that was to take out an especially competent, nettlesome adversary who already understands the nature of the cases and knows a lot about the defendant.”
Luban adds that the clause in Mackris’ settlement agreement appears to be an end run around the rule by having O’Reilly retain Morelli—it’s not a promise not to work as much as a mechanism to ensure Morelli is conflicted out. His conclusion: “This is sleazy … but probably doesn’t violate the rules.” Subodh Chandra, a plaintiffs’ civil rights lawyer who has taught professional ethics, says, “The double dealing here is extraordinary. To throw yourself into the arms of the opposing parties while settling a case for your client? And to forswear you’ll ever represent anyone else against them again? That doesn’t just raise my eyebrows—it pops them right off of my head.”
Whether Morelli—who maintains that “Every step we took was to negotiate the best possible deal for Ms. Mackris”—has stepped in a steaming hot pile of ethics violations is a technical question. But it’s hard not to see a pattern of lawyers holding themselves out as defenders of women while working the back channels to help protect the accused.
If the O’Reilly gambit sounds familiar, it’s because we’ve heard a similar tale very recently. Last month, Karen McDougal filed a lawsuit in the Los Angeles County Superior Court against American Media Inc. (the parent company of the National Enquirer) seeking to invalidate an NDA preventing her from discussing an alleged affair with Donald Trump. Stephanie Clifford, aka Stormy Daniels, is famously attempting to have her NDA tossed out as well. Both women shared an attorney, Keith Davidson, who is also making news this week, because it’s no longer entirely clear whether he was working for his clients’ interests or those of the accused when he had them sign their NDAs. As Scott Pilutik wrote in Slate, McDougal claimed that while he was representing her, Davidson was also communicating with Donald Trump’s attorney, Michael Cohen, despite the fact that Trump and Cohen were not parties to McDougal’s agreement with American Media.
In an interview with CNN on Wednesday, Davidson claimed that while Cohen has urged him to speak publicly about his representation of Daniels and McDougal, he has been advised by an ethics lawyer not to do so. In that interview, Davidson “acknowledged reaching out to Cohen during the final stretch of the 2016 presidential campaign to let him know that he had just negotiated a deal with a powerful media company and McDougal that effectively kept her allegations of an affair with Trump out of public view.” He deemed the call “a professional courtesy.”
The cherry on top is that the 2004 settlement agreement between O’Reilly and Mackris evidently went to arbitration in 2007, at which point the settlement was amended. The mediation happened before Marc Kasowitz. As Eriq Gardner observes at Hollywood Reporter, Kasowitz isn’t just Donald Trump’s longtime personal attorney—he also later represented O’Reilly himself. After the Times reported on O’Reilly’s harassment settlements last year, it was Kasowitz who put out a statement saying that “Bill O’Reilly has been subjected to a brutal campaign of character assassination that is unprecedented in post-McCarthyist America. This law firm has uncovered evidence that the smear campaign is being orchestrated by far-left organizations bent on destroying O’Reilly for political and financial reasons.”
So, summing up? The guy who mediated the O’Reilly-Mackris agreement not only went to work for O’Reilly but also works for the president. But everything is aboveboard here, let us assure you. It’s more than depressing in this moment of unprecedented transparency to unearth a secret world of interconnected power lawyers who all row in the same direction for their interconnected power clients. It doesn’t much feel like a fair fight when everywhere you look, it’s the same eight guys versus Gloria Allred.
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