Trump Cherry-Picks Law Journal Commentary on his Civil Trial

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Former President Donald Trump cited an article in the New York Law Journal as evidence that a civil business fraud case against him is a “hoax.” The author of the article argued that dissolution of Trump businesses is not a remedy included in the law, but he also wrote that “the judge was 100% right in holding that the Trump actions were fraudulent” and that Trump ought to face penalties.

“The respected New York Law Journal writes that the ‘Dissolution Ordered in “‘People of the State of New York v. Trump‘” Appears Unwarranted.’ Wow, that’s BIG. The whole trial is a Democrat inspired HOAX,” Trump wrote on Truth Social on Oct. 4, the third day of the civil trial.

It’s true that David W. Lowden, a consultant for a New York law firm and an expert on compliance and governance policies and procedures, argued in an opinion piece for the New York Law Journal on Oct. 2 that the possible dissolution of Trump’s limited liability companies is not warranted by state law.

Former President Donald Trump addresses the press during a lunch break on the third day of his civil fraud trial at New York State Supreme Court on Oct. 4 in New York City. Photo by David Dee Delgado/Getty Images.

However, Lowden also made clear that he thinks the judge “rightly held” that “the activities of various Trump Organization entities … have persistently violated provisions of the Executive Law by committing ‘repeated fraudulent or illegal acts’ in grossly inflating the value of various Trump properties in financials provided to various lenders.”

In September 2022, New York Attorney General Letitia James filed a $250 million civil fraud lawsuit against Trump, alleging he repeatedly inflated the value of his assets to bilk banks and insurance companies.

“With the help of his children and senior executives at the Trump Organization, Donald Trump falsely inflated his net worth by billions of dollars to unjustly enrich himself and cheat the system,” James said at the time.

On Sept. 26, New York Supreme Court Justice Arthur Engoron awarded a partial summary judgment to prosecutors, finding that Trump and some executives of the Trump Organization had “persistently” violated New York laws related to fraud or illegality in conducting business. The judge also canceled the company’s business certificates in New York and extended the oversight of an independent monitor. The judge left some charges up to a trial (which began this week), as well as any determination of the amount the Trump Organization might be forced to pay in penalties.

The judge also ordered that “within 10 days of the date of this order, the parties are directed to recommend the names of no more than three potential independent receivers to manage the dissolution of the canceled LLCs.”

CNBC wrote that it “is not clear whether Engoron’s decision means the Trump Organization and related entities will have to completely cease doing business in New York, or whether the companies can be legally reconstituted later.”

In his opinion piece for the New York Law Journal, Lowden wrote, “I see no language in the statute giving any authorization to order the cancellation or dissolution of the business entities.”

Nonetheless, Lowden added that he “thinks that the judge was 100% right in holding that the Trump actions were fraudulent and that summary judgement on that issue was totally appropriate.”

Lowden noted that the state complaint did not ask for dissolution of the LLCs. Instead, it asked for the cancellation of any New York certificates, an independent monitor to “oversee compliance, financial reporting, valuations, and disclosures to lenders, insurers, and governmental authorities, at the Trump Organization, for a period of no less than five years,” and “any additional relief the Court deems appropriate.”

“A better approach by the judge might have been to issue his opinion upholding summary judgment that fraud had been committed, reserving for the trial whether dissolution is an appropriate remedy,” Lowden wrote.

$18 Million for Mar-a-Lago?

Trump also argued in his social media post that the “case should never have been brought” because the judge mistakenly valued Mar-a-Lago at just $18 million.

Trump wrote, “The corrupt A.G., Letitia James, convinced the Judge that Mar-a-Lago is only worth $18,000,000 when, in fact, it may be worth 50 to 100 times that amount. Based on their fake lowball number, the Judge ruled that I committed Fraud.”

In his order, Judge Engoron noted, “From 2011-2021, the Palm Beach County Assessor appraised the market value of Mar-a-Lago at between $18 million and $27.6 million.”

A real estate broker who specializes in high-value properties in Palm Beach told the court he believed the property was worth $1.5 billion, though Engoron said that opinion was offered “without relying on any objective evidence” and was, ultimately, “unpersuasive.”

Numerous real estate experts have questioned the judge’s reliance on the property tax assessments, noting that assessed values and market values are often very different. Some put the value at closer to $300 million.

In court on Oct. 2, Trump lawyer Alina Habba claimed that “we have experts, renowned experts, who have said that properties like Mar-a-Lago are worth over a billion dollars, $1.5 billion, and I assure you that there is a person out there that would buy that property, that spectacular property, for way over a billion dollars.”

In his Sept. 26 order, Engoron said Trump overvalued the property at between $427 million and $612 million. Engoron said those values didn’t account for land use restrictions on the property.

In court on Oct. 2, Engoron said that in his earlier order he noted, “I’m not valuing or evaluating properties.” 

“Please, press, stop saying that I valued it at $18 million,” Engornon said. “That was a tax assessment. Or, something in that range. There would have been issues of fact as to what the value was.”

Moreover, the judge did not base his summary judgment solely on the alleged overvaluation of Mar-a-Lago, but rather the overvaluation of numerous properties, including several golf courses.

For example, Engoron said Trump submitted Statements of Financial Condition listing the Trump Tower property where he lived at 30,000 square feet, even though it was only 10,996 square feet, resulting in an overvaluation of the property between $114 million and $207 million. And executives at the Trump Organization had “clear knowledge” that was false because Forbes had provided written notification that Trump had been overestimating the square footage by a factor of three, Engoron said, but the executives decided to continue to use that false square footage figure to transact business.

In another example, the order notes that the Trump Organization repeatedly reported the value of the Seven Springs Estate, more than 200 acres of land in Westchester County, New York, at either $261 million or $291 million, although an appraisal at the time done by the Trump Organization put the market value of the land at about $56.6 million.


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