Trump New York Attorney General Letitia Jim was determined to prove that Donald Trump committed fraud. Trump went on the witness stand to attack James. Both sides shouted at their opponents that they were out of order and wasting time.
After 11 weeks of courtroom chaos, on Wednesday, the fate of Trump’s civil fraud case began to shift behind the scenes. It was now in the hands of Arthur Engoron, the unconventional New York Judge overseeing the trial. The judge, who will be deciding the verdict—there is no jury—will determine future role in the family business.
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An unconventional trial judge could remove Trump From His NY Empire
Engoron announced a first round of sanctions before the trial started after he ruled that Trump had fraudulently inflated his net worth. This blow changed the focus of the trial to a fight over the severity of the punishment that would be imposed on the former president. James indicated that she might ask for more than the $250 million fine she initially sought, concluding he had reaped more unjustified gains than previously thought. She also asked the court to ban Trump from operating a business within the state. This would effectively exile him from the industry that made him famous in decades past.
Under the New York law that underpins the case, the attorney general has broad authority to punish. After closing arguments, his decision could be made as early as next month.
The judge can use his extraordinary powers to punish and curtail the misconduct. This is bad news for , said Steven Cohen. He was a top official at the Attorney General’s Office and now teaches corporate law at New York Law School.
Engoron may have made a mistake when he ordered the dissolution of some of Trump’s New York-based companies.
The decision caused a furor and threatened to destroy much of Trump’s New York Empire. Interviews with legal experts and a review of court rulings suggest that the judge might not have had the authority to dissolve these companies.
Last week, an appeals court granted Trump’s application to pause punishment in order to consider Engoron’s ruling. This could be a sign of a thorough evaluation of the judge’s decision-making during the trial. Trump’s attorneys have put their hope in an appeal.
An unconventional trial judge could remove Trump From His NY Empire
Christopher Kise said that Trump “very much appreciated the court’s decision and consideration” in a press release after the appeals court granted the request. He added that this would “help pave the way for a much-needed and deliberative review of the many errors of the trial courts.”
Engoron can also adjust the order himself. could change his mind if his lawyers convince him.
Al Baker, the spokesperson for the court, stated that it was inappropriate to comment on an ongoing case and pointed out “the actions and rulings that are part of this matter and all public records.” A spokesperson for James refused to comment.
The trial is a result of a lawsuit James filed against trump, his sons, and their family company last year. He accused them of inflating the value of trump’s assets on the annual financial statements that they submitted to banks and other creditors.
James argued that the statements had been so exaggerated that the Trumps were frauding the banks. Her case was based on years of documentation and testimony from the Trumps, who admitted to playing a part in the creation of the statements.
The defense also called in expert witnesses who emphasized that real estate valuation is subjective and that there was no fraud. The defense called in bankers who said that they had done a thorough analysis of Trump’s wealth and concluded that it was safe for them to lend him money.
Spreadsheet cells, accounting rules, and financial arcana dominated the trial. But it had a schoolyard feel:
- A witness took his phone out while testifying.
- Kise compared James’ team with the Kremlin.
- An attorney general’s lawyer scolded Kise after he made “a bunch” of “ridiculous objections.”
Kise replied, “No,” to another attorney of the Attorney General’s office who demanded that Trump’s team be “more respectful.”
Engoron presided over the commotion. He often looked like a frustrated parent trying to restore order while defusing tensions with self-deprecating humor gently. He sent birthday greetings to lawyers and said once, “I’m really not as stupid as I seem.”
, a Republican-Democrat, targeted the judge, who is also a Democrat. He painted them as both members of a radical leftist conspiracy that was out to derail Trump’s latest bid for the presidency. Kise accused the judge repeatedly of bias in the courtroom. attacked Engoron’s parents on social media. Court officials said that many anti-Semitic comments were made about the judge.
Former President George W. Bush and his legal team attacked Engoron’s law clerk. The judge imposed a gag order, which prevented them from criticizing court employees. violated the gag order twice, which resulted in a $15,000 fine.
Trump’s situation is likely to worsen. Engoron is ready to punish for a wide range of crimes after the courtroom portion has concluded. Engoron had been sympathetic to James from the start.
Engoron, in addition to imposing a financial penalty, could impose five-year bans that would prevent him and his company from negotiating commercial real estate in New York or obtaining loans from New York banks. Engoron can permanently ban Trump from managing a business in New York. This would effectively remove the former president’s company from its operations.
Trump may have largely moved from business to politics, but those sanctions would still constrain his company. They would also be a shameful end to his 50-year career as a New York entrepreneur.
Engoron’s first punishment against —dissolving a few of his New York-based companies—is unlikely to stick.
The order was issued shortly before the start of the trial and canceled a type of special business certificate that allowed some of Trump’s New York-based companies to use certain names. The penalty would require 10 to 15 businesses, including Trump’s New York Golf Clubs and the entity that manages his Central Park hotel, to get new certificates. This is a minor inconvenience.
Engoron went on to say that the next line in his order was the “dissolution” of the canceled LLCs, legalese for Trump’s limited liability companies. The judge appeared to be removing not only the certificates that can be replaced but also the Trump companies that own and manage Trump’s golf resorts, hotels, and other assets. It appeared that the lights were out for those companies.
James himself had not asked for such a severe punishment. Experts said that under New York law, a judge could only dissolve an LLC if one member requested it.
David W. Lowden is a lawyer at Stroock & Stroock & Lavan who has specialized for many years in corporate and commercial law. Lowden stated that many observers predicted that the ruling would crush Trump’s New York operation, but it could ultimately just be a bureaucratic irritation that can be resolved through paperwork.
Experts also noted that the order of the judge applied to the 10 or so Trump companies in New York that hold this type of special business certificate and not only the smaller subset of Trump companies implicated in James’ complaint. Experts said that punishing a company without any allegations of wrongdoing would likely violate various legal principles and prompt the appeals courts to step in.
Cohen stated that “he may have created an appeals problem for himself and fuelled a dubious allegation of bias.”
Engoron’s sarcasm remained intact despite the long months of trial and the possibility of reversal. The judge was surprised when Kise told him this week that he wished to finish up a few loose ends in order to prepare for his appeal.
