Trump’s Lawyer Urges NY Appeals Court to Toss $489M Civil Fraud Ruling

Lawyers for Donald Trump asked a New York appeals court on Thursday to overturn a $489 million civil fraud ruling, arguing that the penalty is excessive and based on flawed legal reasoning.
At least two of the justices from the five-justice panel from the Appellate Division, First Judicial Department—the state’s second-highest court—seemed skeptical about the enormity of the judgment handed down in the case, which has ballooned to $489 million.
During the hearing, Trump lawyer John Sauer argued that the judgment was “draconian” and suggested that there were no direct victims since the banks involved in the transactions were satisfied. Sauer also questioned the state’s reliance on the “continuing wrong doctrine,” which allowed for the consolidation of multiple alleged frauds over several years.
An attorney for New York state countered that the figure accurately represents the size of Trump’s profits from fraud. “There was a lot of fraud and illegality. It went on for seven years,” Deputy Solicitor General Judith Vale said, highlighting that Trump’s businesses gained significant financial benefits from the alleged scheme.
The state claims Trump inflated his net worth on financial statements by as much as $800 million to $2.2 billion per year. Trump’s legal team has consistently challenged a ruling by New York Judge Arthur Engoron, which found that Trump deceived banks, insurers and others for years by inflating his wealth on documents used to secure deals and loans.
They argue that Engoron’s decision was “egregious” and have repeatedly complained about his handling of the case, accusing the judge of “tangible and overwhelming” bias and exceeding his authority.
New York Attorney General Letitia James’ office, which brought the case against Trump, his sons and his company, dismissed those claims and has argued that Engoron’s decision is backed by “overwhelming evidence.”
In February, Engoron ruled that Trump padded his net worth by billions of dollars by hugely overvaluing his assets on his annual financial statements. Those assets include golf courses and hotels bearing his name, his Mar-a-Lago estate in Florida and his Trump Tower penthouse in Manhattan.
The judge issued his verdict after a two-and-a-half-month trial that saw testimony from 40 witnesses, including Trump. Engoron decided the case because state law doesn’t allow for juries in this type of lawsuit and neither side asked for one.
Engoron found Trump, his company and executives, including sons Eric and Donald Jr., liable for falsifying records, conspiring to defraud insurers and issuing false financial statements. He also found former Trump Organization executives Allen Weisselberg and Jeffrey McConney liable for insurance fraud.
Trump and his lawyers say that the penalties imposed on the former president were “grossly unjust,” that some allegations should have been barred by the statute of limitations, and that the state shouldn’t be policing private business transactions. They also say James improperly sued Trump under a consumer protection statute normally used against businesses that rip off customers.
Trump insists that he did not lie about his wealth or the value of his properties and argues that no one was harmed by his actions. He has condemned the verdict as “election interference” and a “weaponization against a political opponent,” claiming he is being punished for “having built a perfect company, great cash, great buildings, great everything.” Both James and Engoron are Democrats.
In response, Trump’s lawyers argue that if the ruling stands, it would grant James “limitless power to target anyone she desires, including her self-described political opponents.”
A decision from the Appellate Division is typically issued about a month after arguments, meaning the verdict could come before Election Day. The court has several options. It could uphold the ruling, reduce or modify the penalty or overturn Engoron’s verdict entirely.
Should either side be dissatisfied with the decision, it can petition the state’s highest court, the Court of Appeals, to take up the case. Trump has vowed to challenge the ruling “all the way up to the U.S. Supreme Court if necessary.”
While Trump maintains he is worth several billion dollars, James has indicated that if Trump’s appeals fail and he cannot pay the judgment, she will seek to seize some of his assets.
Since this is a civil case, there is no risk of prison time for the former president.