The New York Attorney General’s office, led by Letitia James, urged an appeals court on August 21 to affirm the $454 million civil fraud judgment against former President Donald Trump issued earlier this year.
In a 168-page filing, state attorneys argued that there is “overwhelming evidence” backing Manhattan Supreme Court Judge Arthur Engoran’s February 16 ruling, which found that former President Trump inflated his wealth to deceive insurers, banks, and other entities in order to grow his real estate empire.
Trump appealed the ruling in July, arguing that the judge “struggled to understand basic banking concepts” before issuing the penalty, leading to an erroneous decision.
State attorneys, responding in their submission to the First Department of the State Supreme Court’s Appellate Division on Aug. 21, said that Trump’s appeal is filled with “meritless legal arguments.”
They say his appeal disregards substantial evidence from the bench trial that demonstrated “fraud and illegality on an immense scale.”
“Supreme Court’s liability determinations are supported by overwhelming evidence that, in each Statement, defendants used a variety of deceptive strategies to vastly misrepresent the values of Mr. Trump’s assets,” Assistant Solicitor General Daniel S. Magy wrote, referring to annual statements they said misrepresented Trump’s wealth.
Magy stated that Trump, his company, and top executives engaged in deceptive practices to secure over $500 million in loans and unlawfully earned more than $360 million in profits.
“On appeal, defendants tellingly ignore almost all their deceptions. Instead, they primarily argue that [the New York State Office of the Attorney General] failed to prove that defendants’ counterparties relied on the misrepresentations to their financial detriment,” Magy added.
“But it is well-established that neither reliance nor victims’ losses—which are elements of common-law fraud—is required for fraud or illegality claims where, as here, OAG seeks disgorgement and injunctive relief rather than damages or restitution.”
In their July appeal, Trump’s attorneys challenged the legal basis of James’s lawsuit, claiming it misused a statute designed to protect consumers from fraud “in a way never seen before.”
Trump and his attorneys argued that there were “no victims and no losses.”
They argued that the case should never have gone to trial, that some allegations were barred by the statute of limitations, and that the state should not be regulating private business transactions.
They also argued that the ruling is a disaster for the New York economy, as it gives the attorney general’s office “limitless power to target anyone.”
State attorneys defended the statute of limitations, asserting that the law grants the attorney general the authority to take action against fraudulent business practices, whether they target consumers, small businesses, large corporations, or any other individuals or entities.
They also rejected Trump’s claims that the case should never have gone to trial and that the state should not interfere in private business transactions.
The Appellate Division has set the oral arguments for the appeal on September 26, with a ruling expected about a month later, just ahead of the November presidential election.
The appeal’s outcome could result in the court upholding, modifying, or overturning Engoron’s ruling. Meanwhile, the $485 million judgment continues to accure interest as the appeals process unfolds. Trump has posted a $175 million bond to temporarily halt collection while the appeal is pending.
If the ruling is upheld, Trump and his sons will be responsible for paying the entire amount.
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