Trump Triumphs As Appeals Court Voids ‘Excessive’ Civil Fraud Fine
President Donald Trump scored a major legal victory Thursday as a New York appeals court threw out the nearly half-billion-dollar civil fraud penalty leveled against him by a lower court, declaring the fine violated the Eighth Amendment’s protection against excessive penalties.
The five-judge appellate panel ruled that the $355 million judgment handed down by Manhattan Supreme Court Judge Arthur Engoron was unconstitutional. With interest, the original penalty imposed on Trump, his sons Eric and Donald Jr., and the Trump Organization had ballooned to over $527 million. The panel found the punishment vastly disproportionate to the alleged conduct.
The civil suit, spearheaded by far-left New York Attorney General Letitia James, accused Trump of inflating the value of his real estate holdings to obtain favorable loan terms. Engoron had agreed with the claims, asserting that Trump exaggerated his net worth by as much as $2.2 billion between 2014 and 2021, and issued a three-year ban preventing Trump from conducting business in New York.
Although the appeals court left the fraud finding intact and upheld some restrictions, it granted Trump the ability to seek an extended stay on enforcement of the remaining penalties. It also opened the door for further appeal to the state’s highest court.
Trump celebrated the ruling as a resounding vindication. “TOTAL VICTORY in the FAKE New York State Attorney General Letitia James Case!” Trump declared on Truth Social. “I greatly respect the fact that the Court had the Courage to throw out this unlawful and disgraceful Decision that was hurting Business all throughout New York State… This was a Case of Election Interference.”
Judge David Friedman criticized James directly, stating, “Plainly, her ultimate 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 voters have obviously rendered a verdict on his political career. This bench today unanimously derails the effort to destroy his business.”
Judge Peter Moulton, in a concurring opinion, blasted the financial calculations used to justify the fine, noting that the disgorgement figure was not a “reasonable approximation.” The court issued over 300 pages of opinions, reflecting deep divisions among the judges. While most agreed the fine was excessive, they differed on whether James even had the authority to bring the case. One judge emphasized that no lender ever sued Trump, questioning the justification for a state-led prosecution.
Letitia James, who launched the lawsuit after campaigning on a promise to go after Trump, had publicly smeared the former president as “incompetent” and “an embarrassment.” Her politically charged rhetoric now appears to have undermined the credibility of the case.
Trump’s legal team had long insisted the case was baseless. “Letitia James is not going to get away with it,” said attorney Alina Habba after the original judgment. “President Trump has done nothing wrong. All he has done is win a campaign, and that is scaring them because they know when he goes back in November 2024 he is going to clean house.”
Following the appeals court ruling, Trump slammed James once again, calling her a “Trump Deranged Lunatic,” and criticized the forced bonding of hundreds of millions of dollars just to challenge the fine in court. “It should have never been allowed to happen, and everyone knew it,” he said.