When Donald Trump Sued Bill Mahr

Donald Trump

In 2012, Donald Trump, flirting with a run for the presidency of the United States and criticizing its incumbent, Barak Obama, pressured the President to confirm his U.S. citizenship by publicly disclosing his birth certificate.

Despite Obama having done so, Trump sustained the pressure, posting a video on the internet on October 24, 2012—the last week of the election campaign—in which he offered to pay $5 million to Obama as consideration for the President publishing his college and passport applications and records.

Trump was serious, even suggesting charities, clarifying his goal of producing the information, and committing to pay within one hour. The offer also had a deadline: October 31, 20012 at 5:00 p.m. That hour having come and gone without Obama accepting, the offer terminated Obama’s power of acceptance.

On January 7, 2013, the comedian and political talk show host, Bill Maher, appeared on the Tonight Show with Jay Leno. After calling Trump a liar and racist, he characterized some of Trump’s public ramblings as “syphilitic monkey.” Then came what Trump portrayed as an offer: “suppose that perhaps Donald Trump had been the spawn of his mother having sex with an orangutan. . . . I hope it’s not true . . . , but, unless, he comes up with proof, I’m willing to offer 5 million dollars to Donald Trump . . . that he can donate to a charity of his choice. . . .”

Trump formally submitted his “acceptance” of this “offer” the next day, sending a copy of Trump’s birth certificate attesting that he is “the son of Fred Trump,” and naming the charities designated as beneficiaries of the $5 million. In Trump’s view, a contract was formed “the moment the Acceptance Letter was sent,” a reference to the usual rule of acceptances, which makes them effective on dispatch (affectionately referred to as the “mailbox rule”).

On February 4, 2013, Trump sued Maher. The lawsuit, of course, was an inherent loser, and Trump soon withdrew it. But in their filings, Trump’s lawyers got much of contract doctrine right, in both the Obama background and Maher interactions.

In relation to Obama, the lawyers correctly noted that (1) an offer creates the power of acceptance, (2) an unrevoked offer may be accepted by following the route to acceptance stated in the offer and a binding contract results, and (3) that the power of acceptance terminates upon any expiration stated (or upon the offer’s revocation of it, the offeree’s rejection of it, or the offeror’s death).

So why did Trump file such a patently frivolous lawsuit?  For a hint and another example of how Trump is a prolific frivolous litigator in American courts, see this companion post.

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About the Author

Lawrence A. Cunningham
Larry is a professor of law at the George Washington University Law School. He joined the GW Law School faculty in 2007, having previously taught for 6 years at Boston College (where he served a 2-year term as Academic Dean) and for 8 years at Cardozo (where he served a 5-year term as Director of the Heyman Center on Corporate Governance). He also taught courses at many other schools in the US and abroad, including Central European University, Columbia University, Hebrew University, University of Navarra, and Vanderbilt University. Before entering academia, he practiced corporate law for 4 years at Cravath, Swaine & Moore. He earned his BA from University of Delaware and his JD magna cum laude from Cardozo. Larry writes extensively in corporate and securities law, with a special emphasis on law and accounting and investor perspectives. He teaches courses in those fields as well as Contracts. He has published a dozen books and 50 law review articles. His recent books include: Contracts in the Real World: Stories of Popular Contracts and Why They Matter (Cambridge University Press 2012), The AIG Story (Wiley 2013), The Essays of Warren Buffett: Lessons for Corporate America (Carolina Academic Press 2013), and Berkshire Hathaway’s Value of Values (Columbia University Press 2014). Areas of Interest: Accounting, Auditing, Contracts, Corporate Law, Finance, Investing, Legal Education, Securities Regulation

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