Donald Trump Scores $5 Million Defamation Win in Ugly Dispute Over Miss USA Pageant

The Associated Press, Tuesday, December 18, 2012, 2:06pm (PST)

The Hollywood Reporter -- Donald Trump's Miss Universe L.P. has won $5 million in an arbitration dispute from a former contestant, Sheena Monnin, who publicly declared that the competition was rigged.

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According to retired U.S. District Court Magistrate Judge Theodore Katz's decision, the pageant organization has met its burden in proving defamation after Monnin defaulted by failing to respond properly.

Monnin first objected to the process within minutes of being eliminated from the 2012 Miss USA competition on June 3, sending a message to the director of the Miss Pennsylvania USA Pageant stating, among other things, "It's obviously rigged so the girl that they want can shine; they kept several beautiful girls out for that reason."

The next morning, she resigned her title as Miss Pennsylvania 2012, announcing on Facebook, "In good conscience I can no longer be affiliated in any way with an organization I consider to be fraudulent, lacking in morals, inconsistent, and in many ways trashy."

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The following day, she went back on Facebook to tell her followers that she had heard another contestant claim to have seen the "Top 5" list before they were announced. The comments were picked up by media organizations around the country, and on June 8, Monnin appeared on NBC's Today show and repeated her accusations. The interview clarified that it was Miss Florida USA who purportedly had made the Top 5 comment, even though that contestant had said it was an offhand joking remark.

To prevail in its claim, Miss Universe L.P. had to demonstrate "actual malice" on Monnin's part because the organization was deemed to be a public figure. It's a high standard -- one that Trump has never liked in criticizing the nation's libel laws.

This time, Trump met the test.

Katz said Monnin's statements "were false," that they were "obviously harmful to MUO's business reputation" and "made with actual malice."

Explaining the last part, the judge wrote that "Monnin claimed the Pageant was rigged within minutes of being passed over as one of the sixteen semifinalists, and before she had any purported factual basis for her allegation of rigging. Moreover, there can be no doubt that she was subjectively aware of the falsity of her statements, as she fabricated the story about being told the names of the five semifinalists."

The judge went on to say that Monnin's motivation was twofold: that she was a "disgruntled contestant" and that she "strongly disagreed with the Pageant's decision to allow transgender contestants to compete."

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Commenting on the arbitrator's decision, Trump has called Monnin's actions "disgraceful" and said, "We cannot allow a disgruntled contestants to make false and reckless statements which are damaging to the many people who have devoted their hearts and souls to the Miss Universe, Miss USA and Miss Teen USA pageant systems."

Monnin's attorneys haven't yet commented, but it appears from the decision that she didn't put up much of a fight during the arbitration proceeding. The judge noted in a 19-page ruling that "Monnin's default in this proceeding and failure to respond to MUO's document request leads the Arbitrator to draw the adverse inference that Monnin knew that her statements were false and proceeded to publish them with actual malice."

The $5 million in damages was awarded by the arbitrator after one of MUO's experts testified about his conclusions that MUO's loss of potential contestants and sponsors would mean a 7.8 percent-13.8 percent loss of market value, or between $4.3 million and $7.6 million. The arbitrator wasn't convinced on this evidence but awarded $5 million nonetheless. It's worth noting that MUO's expert seems to have valued the competition's market value at about $55 million. Previously, it was estimated by Trump in a financial disclosure document to be worth $20 million.

E-mail: eriq.gardner@thr.com; Twitter: @eriqgardner

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