Former President Donald Trump asked a New York appeals court Friday to pause the trial that began this week against him and his company, as he seeks to overturn an earlier ruling by the judge in the trial that found him liable for fraud and ordered the dissolution of his business certificates.
The defendants in the case—Trump, the Trump Organization and his business associates, including his sons—asked the court to pause last week’s ruling, which found the defendants liable for fraud, as well as to pause the ongoing trial while the appeal plays out.
Judge Arthur Engoron’s summary ruling, issued September 26, sided with New York Attorney General Letitia James and found Trump and his company committed fraud by repeatedly misstating the value of their assets, and ordered business certificates held by Trump and his co-defendants to be canceled, which could effectively shutter his company’s operations in New York.
The court “clearly does not comprehend the scope of the chaos its decision has wrought,” attorneys claimed in the request to pause the trial, arguing the order dissolving the business certificates “will unquestionably inflict severe and irreparable harm” on Trump and his associates, as well as “innocent nonparties and employees who depend on the affected entities for their livelihoods.”
Trump’s attorneys also took issue with the statute of limitations in the case, which only allows the court to judge misconduct starting in 2014, but Engoron has ruled the AG’s office can use evidence from before 2014 if it helps prove fraud within the statute of limitations—which Trump and his legal team oppose.
While Engoron found Trump liable for fraud, the trial, which began on Monday, is considering other allegations in the case—like insurance fraud and falsification of business records—as well as whether Trump intentionally committed fraud and any further penalties that should be imposed.
The AG’s office heavily opposed delaying the trial in a court filing Friday, arguing it “would severely undermine the fair and orderly administration of justice.” Prosecutors said they also opposed pausing Engoron’s order because they’ve already told Trump’s lawyers they’re “willing to discuss” delaying the business certificates being canceled until after the trial is over.
Trump’s lawyers argued a delay was necessary to “avoid an avalanche of compounding errors” at the current trial, and to ensure “any semblance of process let alone the due process guaranteed to any litigant regardless of status or social standing.”
What To Watch For
It’s not clear how long it will take for the appeals court to rule. The trial is scheduled to continue until late December. In addition to the cancellation of Trump’s business certificates, James’ office is also asking the court to impose a $250 million fine on the defendants, as well as impose such penalties as barring Trump and his sons from running any New York businesses for the next five years, and prohibiting the former president from commercial real estate acquisitions during that time.
What We Don’t Know
If the appeals court still allows it to move forward, it’s still largely unclear what the full scope of the ruling ordering Trump’s business certificates to be canceled will be. Insider notes a company dissolution on this scale has only ever really been attempted before when James tried to shut down the National Rifle Association, which was unsuccessful. The order says an independent receiver will be appointed who will essentially be responsible for taking control of the companies and selling off their assets. It won’t end the Trump Organization as a whole, which the New York Times notes is made up of a collection of smaller LLCs, and is expected to primarily affect Trump’s business operations in New York. That being said, it’s still hard to say how the order would play out in practice—and it will likely involve a lot of further litigation—including to what extent it could affect Trump properties outside of New York and those that weren’t directly named as defendants in the lawsuit, such as Trump Tower.
James sued Trump and his company in November 2022 following a yearslong investigation that began in 2019, accusing the ex-president of making more than 200 false statements that misstated the value of his assets for personal gain. Trump has vehemently opposed the allegations, with his attorneys arguing in court the valuations were subjective and Trump’s numbers were based on his real estate expertise. Engoron sided with James and found Trump inflated the numbers, writing in his ruling that Trump’s argument the valuations were subjective was out of “a fantasy world, not the real world.” Among the valuations Engoron took issue with were the value of Trump’s Mar-A-Lago estate in Florida, a building on Park Avenue and an estate in Westchester County, as well as Trump exaggerating the size of his penthouse in Trump Tower. “A discrepancy of this order of magnitude, by a real estate developer sizing up his own living space of decades, can only be considered fraud,” Engoron wrote, calling Trump’s argument “absurd.” In addition to canceling Trump’s business certificates, Engoron also sanctioned several of Trump’s attorneys for $7,500.