An appeals court appears likely to overturn the $478 million civil fraud judgment against Trump. The state received a frosty reception in the court yesterday.
Thursday, the court grilled attorneys for Donald Trump and the New York attorney general’s office over the $478 million civil fraud judgment against the former president. The questions raised were about the size of the penalty and the scope of the attorney general’s authority to bring the case.
The state of New York had claimed that Trump inflated the value of his assets to obtain more favorable loan rates.
The judge said Mar-A-Lago is only worth $18 million even though it is probably worth closer to $500 million to $1 billion.
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Trump used the equity in Mar-A-Lago to secure other loans at favorable rates. The state of New York claims Trump overvalued his assets and thus defrauded Deutsche Bank. Deutsche Bank disagreed with New York and lost no money on the loans with Trump.
Everyone made money, and everyone was happy. This case sent out alarms to New York investors on the political left and right. It signaled that the state could go after any real estate investor by playing games with the value of holdings.
Politico Report
During oral arguments on Thursday, some members of the five-judge appeals court panel suggested that New York Attorney General Tish James had overstepped by using the particular New York fraud statute she used to bring the case against Trump.
As soon as Deputy Solicitor General Judith Vale, arguing for James, began her opening remarks, she was cut off by Associate Justice David Friedman, who questioned whether her office had ever before used the statute “to upset a private business transaction that was between equally sophisticated partners.”
Associate Justice Llinet Rosado chimed in once Friedman finished to add, “and little to no impact on the public marketplace.”
The justices’ questions echoed one of Trump’s central lines of defense: He has argued that no one was harmed by the inflated valuations.
Vale fielded questions like that throughout the day. One of Donald Trump’s advantages, beside the case being nothing more than political lawfare, is that the court might consider how bad this is for business in New York.
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