New York appeals court rejects Trump’s efforts to stop $250mn civil fraud trial, ET LegalWorld | Court Practice News



Trump has dropped his $500 million suit against his former attorney Michael Cohen.

Trump also had to backtrack in the legal mayhem by dropping his $500 million dollar suit against Cohen’s earnings from his memoirs of their love hate relationship calling it a “fictionalized story”.

The saving grace for Trump was that the judge, Associate Justice Peter Moultin did not break up his Trump Businesses, media reports said, claiming if the earlier order of Judge Erodogon had been pursued, Trump could have faced bankruptcy.

A New York appeals court judge on Friday rejected Donald Trump’s attempt to stop the on-going $250 million civil fraud trial but temporarily halted the process of breaking up the former president’s businesses.

Associate Justice Peter Moulton issued the ruling after a brief hearing Friday afternoon.

It leaves Trump’s empire untouched for at least another month and perhaps offers the former president and his family a glimmer of hope to safeguard their businesses under attack from Manhattan DA Letitia James.

Trump sought to put on hold Judge Arthur Engoron’s surprise summary judgement order last week that he is liable for fraud and must cancel business certificates for many of his business entities pending further appeal, CNN reported.

If Trump’s business entities in New York had been dissolved in pursuance of that order it would have caused irreparable damage to his real estate businesses and hit a 1,000 employees on his payroll, Trump attorney Christopher Kise argued in court.

“We are very pleased the First Department upheld New York law and put a halt to any cancellation of business certificates, receivers or dissolution,” Kise said following Friday’s ruling.

“The trial court’s attempt to reach issues, entities and assets beyond the scope of this case has been suspended,” CNN reported.

Judge Engoron, sitting over DA Letitia James’ $250 million dollar suit against Trump’s businesses acquiring loans illegally from banks through inflated assets and availing insurance and tax concessions,had ordered Trump to propose potential receivers by October 26, to begin the process of dissolution. However, in the appeals court hearing, Justice Moulton speculated that such a broad interpretation of Engoron’s ruling could mean LLCs holding the private homes of Trump and the other defendants could be at risk of being sold.

“Engoron clearly does not comprehend the scope of the chaos its decision has wrought,” Trump’s lawyers said in a court filing earlier in the day.

The DA’s office had in its response to Trump’s appeals had said any delay would be disruptive to the court and its witnesses, creating a “cascade of delays in not only this case but also other litigation involving Trump”, media reports said.

“If the trial here is delayed at all, there is a significant risk that defendants will request further delays of trial based on the deadlines in these other cases. Indeed, defendants already appear to be attempting to play one court against the other,” the DA’s motion read.

Even as his once jailed former Attorney Michael Cohen , who reportedly paid hush money on behalf of Trump to silence adult porn star Stormy Daniels and othersduring the 2016 presidential race said: “There’s no way for him to escape this time.”

Trump abandoned his $500 million suit against the lawyer for what he termed telling fictionalised stories to the public through his memoirs of their relationship.

“I can assure you that, as I had stated once again before the House Oversight Committee, everything that happened at the Trump Organization happened with the direct knowledge and at the direction of, and ultimately signed off by, Donald J. Trump,” Cohen said in a CNN interview on Friday.

New York prosecutors argued that Trump and his sons committed business fraud by intentionally inflating and deflating the value of their assets in order to get more favorable loans and insurance rates.

Cohen, who served time in prison after he testified against Trump in a separate criminal case, said he has evidence against the former president and plans to testify in court. Cohen claimed he had receipts now handed over to the AG.

“The damages, in my estimation, with interest and penalty, will exceed $600 million,” Cohen said, referring to Judge Erdogon’ ruling last week on DA Letitia James’ $250 million suit.

Trump does not have the liquid cash to pay that off, Cohen said when asked if the judges ruling would have put him into bankruptcy.

“If you want to get to Donald, the way to do it is through his bank book,” he continued.

Former President Donald Trump abandoned a lawsuit seeking $500 million from his former attorney, Michael Cohen, over his earnings from a memoir about their relationship. A Florida federal judge ordered the case closed Friday. Trump brought the lawsuit in April, arguing that Cohen gave “fictionalised accounts” of interactions with Trump that were barred by a confidentiality agreement through Cohen’s 2020 book, Disloyal: A Memoir, media reports said.

Michael Cohen wrote the book while facing jail time. Trump accused Cohen of breaching his duty as Trump’s lawyer, violating the pair’s contract, and unjustly enriching himself, including by telling “fictionalized information” about Trump’s personal and business life.

  • Published On Oct 9, 2023 at 12:08 AM IST

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