Hunter Biden and his estranged wife Kathleen reach settlement in ugly divorce - but judge DENIES bid to keep it sealed

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Former Vice President Joe Biden's son Hunter and his estranged wife have finally reached a settlement in their bitter divorce - but a judge has denied their request to keep it sealed.

Hunter Biden and Kathleen Buhle Biden had asked to keep the details of their divorce private to save themselves and their family from further embarrassment. 

But Family Court Judge Craig Iscoe refused their request, saying that not only was embarrassment not a good enough reason to seal a public record, but that the cat was already out of the bag.

Hunter Biden (left) and Kathleen Buhle Biden (right) have finally reached a settlement in their bitter divorce

Earlier court filings had accused Hunter, who is now dating his brother Beau's widow Hallie, of blowing the married couple's money 'on drugs, alcohol, strip clubs and prostitutes.'

Each spouse then accused the other of cheating, with Kathleen adding that her now ex-husband spent $80,000 on a diamond, then lied and said he didn't have the rock.

'There is information in the file and the parties' marital settlement agreement that would be damaging and embarrassing to the parties and their families if it became public,' attorneys wrote in the motion to seal. 'To protect the parties and, most importantly, the children, it is essential that the file in this case be sealed.'

Iscoe noted the couple had not specified what damages, other than embarrassment, they might face.

Hunter (left with his estranged wife Kathleen in April 2016) is now dating his late brother Beau's widow Hallie (pictured with Beau in 2015)

'Embarrassment, however, is not a basis for sealing the record of a public case, even where a party arguably faces more embarrassment than do the parties do here,' he wrote.

'Furthermore, sealing the court's records now may not be effective in preventing the media from repeating their earlier reports about the parties' then-public filings.'

The judge granted the Bidens, who have since made efforts to tone down their bitter divorce in the press, request to lift a stay imposed last month in their contested divorce case and schedule an uncontested divorce hearing, which is set for April 14. 

If the settlement agreement is made part of the court record, Iscoe said the court would redact sensitive information about the Bidens' 16-year-old daughter, the youngest of their three children, as well as Social Security numbers, bank account numbers, email addresses and similar information.

Court records indicate that Kathleen asked her husband to leave the couple's Washington, D.C., home on July 5, 2015, prompted by his actions on the night of July Fourth. The filing does not offer details.

Damning allegation: Kathleen claims Hunter spends money on 'drugs, alcohol, prostitutes, strip clubs and gifts for women with whom he had sexual relations' in her new motion (above)

Biden bling: The motion claims that last month Kathleen learned Hunter 'was in possession of a large diamond ... worth approximately $80,000,' which he admitted was true (above)

Full court press: Kathleen made it clear in her filing last week that she is not holding back in this case (motion above)

The couple agreed to separate three months later because of what Kathleen describes as irreconcilable differences, including drug use and infidelity.

Kathleen filed for divorce in December although Hunter denied that his conduct resulted in the separation. Kathleen appears to disagree, based on the shocking claims she about her estranged husband Hunter in the documents.

Biden, an attorney and former lobbyist who works at an investment firm, was discharged from the U.S. Navy Reserve in 2014 after testing positive for cocaine.

In court papers, Kathleen's attorney described the couple's outstanding debts as 'shocking and overwhelming,' with maxed-out credit cards, double mortgages on two homes, and tax debt of more than $313,000.

Kathleen and Hunter have also 'bounced three checks to their housekeeper and owe medical providers and therapists for outstanding bills' according to the motion. 

In a motion that was submitted on February 27, Kathleen accused Hunter of 'dissipating hundreds of thousands of dollars of marital funds' by 'spending extravagantly on his own interests' in the year since the two made the decision to formally separate while asking the court to freeze his assets.

Separation time: This photograph was taken in October 2015, the same month that Hunter (left) split from his wife Kathleen. He and Hallie (center) are now in a relationship with the blessing of Joe (right)

Kathleen went on to claim that these interests include 'drugs, alcohol, prostitutes, strip clubs and gifts for women with whom he had sexual relations.'

The motion later details another big purchase made by Hunter recently - a diamond.

'On or about February 17, 2017, Ms. Biden learned that Mr. Biden was in possession of a large diamond, on information and belief worth approximately $80,000,' states the motion.

'When Ms. Biden, through counsel, asked Mr. Biden to place the diamond in a safety deposit box accessible only to both parties together, Mr. Biden, through counsel, denied possession of the diamond.'

Hunter has now admitted to being in possession of the diamond according to the motion, which was filed just days before it was revealed that the son of former vice president Joe Biden was dating his brother Beau's widow Hallie. 

In the December 9 filing, Kathleen also asked for sole custody of her minor child. 

Kathleen continues to live in the home she kicked Hunter out of in July 2015 with 16-year-old daughter Maisy. 

Hunter is fighting her on custody, asking that he get joint physical and legal for Maisy.

Daughters Finnegan, 18, and Naomi, 23, do not feature as much in the divorce documents, though Kathleen does request support for the two older children.

On to the next one: Hunter is now dating his brother Beau's widow Hallie (pair above in August)

In the dark: Friends of the Biden family said they had no idea this affair was going on, and were also shocked Hunter and his wife Kathleen split in October of 2015 (Kathleen and Michelle Obama above in April) 

Kathleen went on to explain in her Plantiff's Motion to Enjoin Dissipation of Assets that her estranged husband has been the 'sole source of funds to support the family throughout the entirety of the parties' marriage.'

She claims that Hunter's office had been sending her a monthly transfer of approximately $17,000 for herself and their three daughters - Naomi, Finnegan and Maisy - but that this amount was drastically decreased to just $7,500 in October of last year.

And while he was decreasing the money to his estranged wife and children, Hunter 'secretly continued to spend lavishly' according to Kathleen's motion, and at one point 'instructed a large payment of marital income ($122,179) be made to a TD Bank account in his sole name.'

That money could not be touched by Kathleen or Hunter's office according to the filing, which then claims: 'On information and belief, taxes were not withheld from these funds.'

Hunter later dissipated the funds however according to court papers. 

Kathleen also claims Hunter 'continued to incur debt on any available cards,' 'maxed out all available cash advances,' and 'transferred money to himself from an account solely in [Kathleen's] name.'

Broken family: Kathleen asked for Hunter to provide support payments for their three children that are above the standard DC rate (l to r: Finnegan, Hunter, Maisy, Joe, Dr, Jill and Kathleen)

The charges and cash advances Hunter takes are 'rarely' being spent on 'legitimate family expenses' according to the filing, and instead 'focuses on his own travel ( at times multiple hotel rooms on the same night), gifts for other women, alcohol, strip clubs, and other personal indulgences.'  

When asked for comment about Kathleen's filing, Hunter's lawyer Sarah Mancinelli told DailyMail.com: 'Hunter and Kathleen have been separated for some time and are in the process of finalizing a divorce. Hunter loves and admires Kathleen as a person, a mother, and a friend. He hopes their privacy can be respected at this time. ' 

The relationship between the couple appeared to fall apart quickly after the death of Beau Biden in May of 2015.

July 4, 2015, is when Hunter allegedly committed the offense that Kathleen references in her divorce filing.

Hunter and Kathleen's minor daughter Maisy was not at their Washington DC home at the time, but instead in Los Angeles with her grandfather Joe and best friend Sasha Obama watching the World Cup.

Hallie's two children were also not home as her father-in-law also took along her son Hunter and daughter Natalie on the trip.

'His recent conduct creates situations that are unsafe or traumatic for the parties' children and his judgment, is frequently impaired,' wrote Kathleen in the filing. 

Hunter Biden and Kathleen Buhle Biden (together last year) had asked to keep the details of their divorce private to save themselves and their family from further embarrassment 

It was then reported a month later in August of 2015 that a Robert Biden's name was found among the hacked records of users on the extramarital affair site Ashley Madison. 

Hunter denied having an account on the site. 

Two months after that report emerged however the couple formally separated, which would have also been right around the same time that Joe Biden announced he would not seek office.

The former vice president has gone on to say publicly that he is complete support of the new relationship. 

Soon after, Hallie's father Ron Olivere echoed that sentiment in an interview with Delaware Online , saying he 'stands with the Bidens' before adding: 'I'm in total support of the family and what they've gone through and what they continue to go through.' 

Friends of the Biden family felt a bit different however, with multiple people revealing they have no idea Hallie and Hunter had been having an affair.  

Page Six was the first to break the news of the relationship between Hallie and Hunter. 

In a statement Hunter said of the relationship: 'Hallie and I are incredibly lucky to have found the love and support we have for each other in such a difficult time, and that’s been obvious to the people who love us most. We’ve been so lucky to have family and friends who have supported us every step of the way.'

Joe and Dr. Jill Biden said in their statement: 'We are all lucky that Hunter and Hallie found each other as they were putting their lives together again after such sadness. They have mine and Jill’s full and complete support and we are happy for them.' 

The two have been spotted together a number of times since Beau's death in May 2015, but never alone.