New York Appeals Court appears receptive to reversing or reducing $454M Trump civil fraud judgment
Trump is appealing a $454 million civil fraud judgment stemming from New York AG James' lawsuit
{{#rendered}} {{/rendered}}Judges on a New York appeals court appeared open-minded and receptive to the possibility of reversing or reducing the $454 million civil fraud judgment in New York Attorney General Letitia James’ lawsuit against former President Trump.
Trump appealed the civil fraud ruling that demanded he pay more than $450 million. The former president’s attorneys called New York Judge Arthur Engoron’s ruling "draconian, unlawful, and unconstitutional."
TRUMP'S $454M JUDGMENT BOND SLASHED BY MORE THAN HALF IN APPEALS COURT RULING
{{#rendered}} {{/rendered}}Engoron ruled that Trump and other defendants were liable for persistent and repeated fraud, falsifying business records, issuing false financial statements, conspiracy to falsify false financial statements, insurance fraud and conspiracy to commit insurance fraud.
A five-judge panel on a New York appeals court in Manhattan heard oral arguments on the appeal on Thursday.
The former president did not attend the oral arguments but was instead represented by his legal team.
{{#rendered}} {{/rendered}}Trump attorney D. John Sauer argued that James’ lawsuit stretched New York consumer protection laws and said there were "no victims" and "no complaints" of Trump’s business from lenders and insurers.
New York Attorney General Letitia James speaks during the Congressional Black Caucus Foundation Annual Legislative Conference National Town Hall in Washington, D.C., on Sept. 21, 2023. (Jemal Countess/Getty Images for Congressional Black Caucus Foundation)
Sauer said the cause "involves a clear-cut violation of the statute of limitations," pointing to transactions used in the non-jury civil fraud trial that dated back more than a decade.
{{#rendered}} {{/rendered}}Sauer said that if the verdict is not overturned, "people can’t do business in real estate" without fear.
The Appellate Division typically rules about a month after arguments are complete, meaning a final decision could come before Election Day on Nov. 5.
Judge Peter H. Moulton questioned if James’ lawsuit turned into "something it was not meant to do."
{{#rendered}} {{/rendered}}Moulton said the "immense penalty in this case is troubling."
But the state argued that there is evidence to support the verdict.
TRUMP BARRED FROM OPERATING BUSINESS, ORDERED TO PAY OVER $350 MILLION IN NY CIVIL FRAUD CASE
{{#rendered}} {{/rendered}}In September 2023, before the non-jury trial began, Engoron ruled that Trump and the Trump Organization had committed fraud while building his real estate empire by deceiving banks, insurers and others by overvaluing his assets and exaggerating his net worth on paperwork used in making deals and securing financing.
Trump was hit with an initial penalty of $355 million. That sum is quickly increasing via interest accruals of approximately $112,000 a day until paid in full, now sitting around $470 million.
Justice Arthur Engoron presides over the civil fraud trial of former President Trump and his children at New York State Supreme Court in New York City on Nov. 13, 2023. (Erin Schaff-Pool/Getty Images)
Trump, the 2024 GOP presidential nominee, and his legal team had appealed and requested a stay on his $454 million civil fraud judgment. Trump's legal team said the initial requested bond was "unprecedented for a private company," and said to post it in the judgment's full amount was a "practical impossibility."
{{#rendered}} {{/rendered}}An appeals court slashed Trump's bond payment in March, and the former president paid $175 million.
Trump has vowed to fight the case "all the way up to the U.S. Supreme Court if necessary."
Trump and his family denied any wrongdoing, with the former president saying his assets had been undervalued. Trump's legal team insisted that his financial statements had disclaimers, and made it clear to banks that they should conduct their own assessments.
{{#rendered}} {{/rendered}}Former President Trump speaks to the media as he arrives for the start of his civil fraud trial at New York State Supreme Court in New York City on Oct. 2, 2023. (Michael M. Santiago/Getty Images)
Throughout the trial, Trump attorneys brought witnesses, including former Deutsche Bank top executives, who testified the banks sought additional business from Trump, whom they viewed as a "whale of a client."
Trump's defense also brought in expert witnesses, including New York University accounting professor Eli Bartov, who reviewed the Trump financial statements at issue in the case and said he found no evidence of accounting fraud.
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{{#rendered}} {{/rendered}}Bartov testified last month that Trump’s financial statements did not violate accounting principles, and he suggested that anything problematic — like a huge year-to-year leap in the estimated value of his Trump Tower penthouse — was simply an error.
"My main finding is that there is no evidence whatsoever of any accounting fraud," Bartov testified. Trump’s financial statements, he said, "were not materially misstated."
The Associated Press contributed to this report.