A New York state appeals court on Thursday overturned the more than $500 million civil fraud penalty imposed on US President Donald Trump and his company, ruling that the amount violated the eighth amendment’s ban on excessive fines, reported CNBC.
The decision, delivered by the first judicial department of the New York state appellate division, struck down the monetary penalties while upholding non-financial sanctions placed on Trump and other defendants by the lower court.
The civil lawsuit was filed by New York attorney general Letitia James, and led to a February 2024 ruling by Manhattan Supreme Court judge Arthur Engoron. The judge ordered Trump to pay about $454 million in penalties for overvaluing assets between 2014 and 2021 by as much as $2.2 billion. With interest, the amount had exceeded $500 million, according to the news outlet.
While the appeals court acknowledged that the “injunctive relief” issued by Engoron was “well crafted to curb defendants’ business culture,” it found the financial penalty excessive under constitutional protections.
In a concurring opinion, judge Peter Moulton wrote that James “did not carry her initial burden” in proving the approximate profits linked directly to the alleged violations. He added, “The calculation of the disgorgement in this case was far from a reasonable approximation,” as quoted by the CNBC.
Reacting to the verdict, Eric Trump, one of the defendants and executive vice president of the Trump Organization, posted on social media: “Total victory in the sham NY attorney general case!!! After 5 years of hell, justice prevailed!”
The attorney general’s office, the White House, and the Trump Organization have yet to issue formal comments. Both sides have the option to appeal the decision.
The decision, delivered by the first judicial department of the New York state appellate division, struck down the monetary penalties while upholding non-financial sanctions placed on Trump and other defendants by the lower court.
The civil lawsuit was filed by New York attorney general Letitia James, and led to a February 2024 ruling by Manhattan Supreme Court judge Arthur Engoron. The judge ordered Trump to pay about $454 million in penalties for overvaluing assets between 2014 and 2021 by as much as $2.2 billion. With interest, the amount had exceeded $500 million, according to the news outlet.
While the appeals court acknowledged that the “injunctive relief” issued by Engoron was “well crafted to curb defendants’ business culture,” it found the financial penalty excessive under constitutional protections.
In a concurring opinion, judge Peter Moulton wrote that James “did not carry her initial burden” in proving the approximate profits linked directly to the alleged violations. He added, “The calculation of the disgorgement in this case was far from a reasonable approximation,” as quoted by the CNBC.
Reacting to the verdict, Eric Trump, one of the defendants and executive vice president of the Trump Organization, posted on social media: “Total victory in the sham NY attorney general case!!! After 5 years of hell, justice prevailed!”
The attorney general’s office, the White House, and the Trump Organization have yet to issue formal comments. Both sides have the option to appeal the decision.
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