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How Common Are Nondisclosure Agreements?

MINNEAPOLIS (WCCO) -- A porn actress could have to pay $1 million for breaking her silence about President Donald Trump.

Stormy Daniels told "60 Minutes" she had sex with Trump in 2006. The president denies that, but his personal attorney paid Daniels to keep quiet in the run-up to the election.

"For sitting here talking to me today, you could be fined a million dollars. I mean, aren't you taking a big risk?" Andersoon Cooper asked Stormy Daniels in the interview.

"I am," she replied.

But it's a risk people take every day. In its true form, a "nondisclosure agreement" -- or NDA -- is essentially a confidentiality agreement between two parties.

"They can agree by signing. They can agree by their actions. They can agree through a handshake and then write it down later," Carol Chomsky, a professor at the University of Minnesota Law School, said.

What they're writing down in an NDA is exactly what information can and can't be disclosed. Chomsky said NDAs are legal and common and range from business to personal. Minnesota and Wisconsin have similar laws.

"The general principles are the same across the states," said Chomsky.

Companies use NDAs to keep employees from leaking trade secrets. In personal matters, nondisclosure violations can be wide-ranging.

"They are saying every time she says something that violates the agreement not to disclose, it constitutes a separate violation," Chomsky said.

Violating a nondisclosure can result in a lawsuit or an injunction to stop the behavior immediately. But in Daniels's case, she could argue that she felt pressured, or even threatened, to sign the nondisclosure.

"The story was coming out again. I was concerned for my family and their safety," Daniels said on 60 Minutes.

"The other side of that, of course, is she did take the funds that were offered and that is an action that suggests agreement," Chomsky said.

Daniels received $130,000 from Trump's attorney, Michael Cohen. In the spirit of confidentiality, it could be up to a judge to decide who violated what.

"There are so many issues related to this one that I hesitate to predict what the outcome will be," Chomsky said.

Chomsky says in some sexual harassment cases a judge can order someone to testify. In that scenario, a nondisclosure agreement is no longer valid.

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