President Donald Trump's hefty civil fraud penalty overturned by the New York appeals court
In a divisive ruling, the New York appeals court has overturned a massive financial penalty imposed on former President Donald Trump. The decision, which came seven months after Trump returned to the White House, spares him from a potential half-billion-dollar fine but bans him and his two eldest sons from serving in corporate leadership for a few years.
The ruling, issued by the Appellate Division of the state’s trial court, upheld a finding that Trump engaged in fraud by exaggerating his wealth for decades. However, the court found the monetary penalty excessive and violative of the Eighth Amendment of the United States Constitution.
The court's decision was not unanimous. The panel issued 323 pages of concurring and dissenting opinions, with no majority. One judge wrote that New York Attorney General Letitia James exceeded her legal authority in bringing the suit, while another judge, David Friedman, appointed by Republican Gov. George Pataki, criticized James, stating that her goal was not "market hygiene" but "political hygiene, ending with the derailment of President Trump’s political career and the destruction of his real estate business."
The lawsuit against Trump and his companies was justifiable, according to two judges, but the penalty was too severe. Engoron's other punishments, upheld by the appeals court, have been on pause during Trump’s appeal.
Trump and his lawyers maintain that his financial statements were not deceptive, as they came with disclaimers noting they weren't audited, and that bankers and insurers independently evaluated the numbers, with the loans being repaid.
This ruling is not the only legal obstacle Trump has faced. During his campaign, he was embroiled in a civil fraud case, a criminal hush money case, and a lawsuit for sexual abuse and defamation. In the hush money case, Judge Juan Merchan in New York made the decision. Trump was sentenced to an unconditional discharge, sparing him jail, probation, a fine, or other punishment. He is appealing the decision.
Trump is also appealing a subsequent verdict that requires him to pay writer E. Jean Carroll $83.3 million for additional defamation claims, following the court's affirmation of a $5 million judgment against him for sexually abusing Carroll in the mid-1990s and later defaming her.
The appeals court took an unusually long time to rule on Trump’s appeal, weighing it for nearly 11 months after oral arguments last fall. The decision on the case is expected to have significant implications for Trump’s political future and business dealings.
