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MANHATTAN (CN) — President Donald Trump will appeal a ruling in his civil fraud case that overturned a more than $500 million penalty for inflating his net worth on financial documents.
In a ruling last week, a mid-level New York appeals court found the fine amount “excessive” and struck it from the judgment against Trump. But the president on Tuesday filed a notice of appeal to the state’s highest court in an effort to toss the rest of the judgment, which features sanctions against the Trump Organization and its former executives, including some of his children.
The Tuesday filing only indicates Trump’s intent to appeal the ruling alongside his sons Donald Jr. and Eric, who are co-defendants in the case. It does not outline their arguments.
New York Attorney General Letitia James, who brought the bombshell case against the Trumps and the Trump Organization, also vowed to appeal the ruling, but has not yet filed her notice.
Last week, concurring justices in a 323-page divided ruling found that James’ case against Trump had merit and found aspects of the judgment sufficient.
“However, we would modify the remedy ordered by [the New York] Supreme Court,” Associate justices Peter Moulton and Dianne Renwick of the Appellate Division, First Department, wrote in one of the opinions shaping the ruling.
“While the injunctive relief ordered by the court is well crafted to curb defendants’ business culture, the court’s disgorgement order, which directs that defendants pay nearly half a billion dollars to the state of New York, is an excessive fine that violates the Eighth Amendment of the United States Constitution,” the judges added.
Their ruling kept intact injunctive penalties, such as temporary business bans for some of the Trumps and their former business executives — penalties that Trump seemingly now hopes to overturn, too. James will try to win back the roughly $400 million disgorgement penalty, which has since ballooned to more than $500 million with interest.
In a statement last week, James commended the court for ultimately approving the merits of her case, even if it negated the financial punishment.
“The First Department today affirmed the well-supported finding of the trial court: Donald Trump, his company and two of his children are liable for fraud,” James said in a statement. “It should not be lost to history: yet another court has ruled that the president has violated the law, and that our case has merit.”
James’ office declined to comment on Trump’s notice of appeal.
Trump last week declared the ruling a “TOTAL VICTORY” for his side, despite now filing his intent to appeal the order.
The case was destined for the state’s highest court, the New York Court of Appeals, since last week’s split ruling, in which the panel of five judges rendered three separate opinions. With none garnering a majority, the panel encouraged the parties to bring the case to the highest court for a final order on the judgment.
That judgment was the result of a 10-week bench trial in 2023 under New York Supreme Court Justice Arthur Engoron, who found that Trump engaged in rampant fraud for over a decade by using “blatantly false financial data” on yearly financial statements. Trump then used these documents to secure more favorable loans from banks in New York, Engoron ruled, shorting lenders out of millions of dollars in interest.
“The frauds found here leap off the page and shock the conscience,” Engoron wrote in his 92-page order, lambasting Trump for a “complete lack of contrition and remorse.”
Trump and his co-defendants maintain that any misstatements didn’t cause any material harm, since the banks were profitable in their deals with the Trump Organization. They also said the financial statements included clear disclaimers for the lenders to do their own due diligence.
“You’re allowed to do this,” Trump’s former appellate attorney John Sauer, who is now the U.S. solicitor general, told the First Department at oral arguments last September. “You’re allowed to make optimistic projections. You’re allowed to reject appraisals.”
It’s an argument Engoron rejected, and one that New York’s highest court could now weigh in on by the end of the year.
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