• Judge Juan Merchan held Donald Trump in contempt for repeatedly violating the gag order in his criminal hush money trial in New York.
• Merchan explicitly warned Trump that he could be put in jail if he willfully violates court orders again.
• Prosecutors then questioned Keith Davidson, the former attorney for porn star Stormy Daniels, whose hush money payment is at the center of the New York criminal trial of Donald Trump.

Prosecutors on Tuesday questioned the former attorney for porn star Stormy Daniels, whose hush money payment is at the center of the New York criminal trial of Donald Trump.

The attorney, Keith Davidson, took the stand after an explosive morning in the historic trial, when Manhattan Supreme Court Judge Juan Merchan held the former president in contempt of court for repeatedly violating his gag order.

Trump did so nine times in online posts targeting jurors and likely witnesses in the trial, Merchan ruled. He found that prosecutors failed to show that Trump violated the gag order in one other post they had flagged.

The judge fined Trump the maximum punishment of $1,000 for each of the nine violations, and ordered him to remove all of the posts by 2:15 p.m. ET on Tuesday. The posts were all deleted before 1:30 p.m.

Merchan also explicitly warned Trump that he could be put in jail if he willfully violates court orders again.

"Defendant is hereby warned that the Court will not tolerate continued willful violations of its lawful orders and that if necessary and appropriate under the circumstances, it will impose an incarceratory punishment," Merchan wrote in his ruling.

The judge read the order aloud before the trial resumed with more testimony from a banker who worked with the former president's lawyer on a $130,000 hush money payment in late 2016 to Daniels, who says she had sex with Trump years earlier.

The payment, aimed to bury Daniels' story about the alleged affair, is at the heart of Manhattan prosecutors' case accusing the ex-president of falsifying business records as part of a scheme to influence the 2016 presidential election.

Prosecutors later Tuesday called Davidson, an attorney for Daniels and Karen McDougal, a former Playboy model who was paid $150,000 for the rights to her story of having an extramarital affair with Trump.

Davidson is set to continue testifying when the trial resumes Thursday morning at 10 a.m.

Michael Cohen, the former Trump attorney who paid Daniels, applauded the gag order ruling Tuesday morning.

"The imposed fine is irrelevant," Cohen told NBC News in a statement. "Judge Merchan's decision elucidates that this behavior will not be tolerated and that no one is above the law."

A Trump campaign spokesman did not immediately respond to CNBC's request for comment on the court ruling.

In a hearing last week on the gag order violations, prosecutors told Merchan that Trump "knows what he's not allowed to do and he does it anyway."

Trump's attorney, Todd Blanche, responded that Trump's posts did not violate the gag order because they reposted articles and statements from other sources. He also argued that Trump's posts were in response to political comments and were not focused on witness testimony.

Blanche insisted in the hearing that Trump is trying to carefully comply with the gag order — prompting Merchan to warn the attorney that he is "losing all credibility with the court."

The judge in Tuesday's order rejected the argument that reposts are exempt from the gag order, writing, "the only credible finding is that the reposts constitute statements of the Defendant."

Merchan also highlighted one Truth Social post in which Trump paraphrased a claim from Fox News host Jesse Watters that "undercover Liberal Activists" are "lying to the Judge in order to get on the Trump Jury."

Trump "altered" Watters' words and posted them, "the purpose being to call into question the legitimacy of the jury selection process in this case," Merchan wrote. "This constitutes a clear violation of the Expanded Order and requires no further analysis."

Stormy Daniels' lawyer takes the stand

Davidson in sworn testimony first described how he approached Dylan Howard, the former top editor of the National Enquirer, in 2016 with information about McDougal's story of having an affair with Trump years earlier.

Davidson said he was negotiating with ABC News on McDougal's behalf at the same time he was talking to Howard.

"I was trying to play two entities off of each other," Davidson said, "to create a sense of urgency."

Prosecutors presented a slew of texts showing the negotiations between Davidson and Howard at the time.

"Time is of the essence. The girl is being cornered by the estrogen mafia," Davidson wrote in one text. He testified that he regretted using that language.

The deal with the Enquirer's publisher, American Media, was more attractive to McDougal, because she did not want her story to be made public, Davidson said.

The $150,000 deal McDougal ultimately signed with the tabloid publisher, effective Aug. 5, 2016, gave the "subject manager" life rights to her story about having an affair with a married man.

Davidson testified that he understood that man to be Donald Trump.

Interest in Daniels' alleged tryst with Trump, meanwhile, skyrocketed after the release of the infamous "Access Hollywood" tape, in which Trump is heard bragging about sexual misconduct, Davidson said.

More witnesses

Gary Farro, a former senior managing director at First Republic Bank, was the first witness to take the stand Tuesday morning.

On Friday, Farro said that he helped Cohen make the $130,000 hush money payment to Daniels. But he said Tuesday morning that his bank would "certainly ask additional questions" if it knew that Cohen was paying a porn star.

Two more witnesses followed Farro that morning. The first was Robert Browning, a Purdue University professor and longtime executive director of the C-SPAN archives, who briefly testified about the ins and outs of the television network pool system. Prosecutors played a handful of video clips from 2016 and 2017, in which Trump denied a number of allegations against him and praised Cohen as a "very talented lawyer," before dismissing Browning.

Prosecutors next called Phillip Thompson, a regional director of operations at Esquire Deposition Solutions, which provides services for court reporters and interpreters. Thompson verified the authenticity of a transcript of the October 2022 deposition of Trump from writer E. Jean Carroll's civil defamation trial against him.

Davidson took the stand early Tuesday afternoon.

On his way into the courtroom that morning, Trump repeated his call for Merchan to both recuse himself from the case and dismiss it entirely.

"The judge should terminate the case because they have no case," said Trump, who also complained of being unable to campaign for president because he is stuck in court.

The historic trial kicked off last week with opening statements and testimony from the first witnesses, including former National Enquirer publisher David Pecker and Trump's longtime personal secretary Rhona Graff.

Pecker, the former CEO of American Media, testified at length about his unofficial role as the "eyes and ears" for Trump's 2016 campaign, and his efforts to "catch and kill" damaging information about the reality-TV star turned presidential candidate.

American Media paid $30,000 for the rights to a former Trump Tower doorman's story about Trump having a secret child, Pecker testified, even though Pecker came to believe the story was untrue.

The company also signed the $150,000 deal with McDougal, Pecker said. Pecker, who believed McDougal's story, said he was never reimbursed by Trump or his company for the payment.

In both cases, Pecker testified that he bought the stories in order to keep them from coming to light and embarrassing Trump, or harming his campaign.

But Pecker said he did not pay to silence Daniels, who says she had sex with Trump while he was married years earlier.

Manhattan District Attorney Alvin Bragg alleges that Cohen, Trump's personal lawyer at the time, clandestinely paid for Daniels' story by opening a bank account for a nondescript shell company and transferring money into it using a home equity line of credit.

After winning the election, Trump secretly reimbursed Cohen through a series of monthly checks that were falsely labeled as being for legal services rendered in 2017, the DA alleges.

Trump, who lost to President Joe Biden in 2020 and is now campaigning to unseat him in November, is legally required to be in court for the duration of the trial, which is expected to last six weeks.

Trump has frequently vented rage about the hush money trial and his three other pending criminal cases, claiming they are intended to undermine his campaign.

Trump's outbursts, many of which targeted not only the people involved in the case but also their family members, prompted Merchan to impose the gag order that bars Trump from speaking about jurors and likely witnesses.

Prosecutors have accused Trump of violating the gag order a total of 14 times. A hearing on the four most recent alleged violations is set for Thursday.