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Ethics
Judge rips lawyers for ‘egregious’ repetition in opinion finding Trump liable for inflating finances
Former President Donald Trump in August 2019. A New York state judge ruled in a civil lawsuit Tuesday that Trump inflated the value of his property in fraudulent statements provided to lenders and insurers. Photo from Shutterstock.
A New York state judge ruled in a civil lawsuit Tuesday that former President Donald Trump inflated the value of his property in fraudulent statements provided to lenders and insurers.
Judge Arthur F. Engoron of the New York Supreme Court’s 1st Judicial District granted partial summary judgment to Democrat New York Attorney General Letitia James in her suit seeking disgorgement of financial benefits obtained by inflating Trump’s net worth.
In biting words, Engoron also ordered five of Trump’s lawyers to pay $7,500 each for recycling arguments that were already rejected twice.
The New York Times called the Sept. 26 decision a “major blow” to Trump, while Law360 said it is a “significant victory” for James.
The Associated Press said the decision “is the strongest repudiation yet of Trump’s carefully coiffed image as a wealthy and shrewd real estate mogul turned political powerhouse.”
Engoron ruled that James is entitled to the revocation of business certificates for several New York properties, the dissolution of limited liability status for several entities, and an independent monitor to manage their dissolution, as well as an independent monitor to continue overseeing the Trump Organization.
Other defendants found liable include Donald Trump Jr., Eric Trump and the Trump Organization, Law.com reports.
Engoron issued the decision in advance of a bench trial on remaining issues—including the amount of money that must be disgorged—that is set for Monday.
Engoron said the defendants had relied “on bogus arguments” made by lawyers who continued to repeat rejected arguments.
“Defendants’ conduct in reiterating these frivolous arguments is egregious,” Engoron said. “We are way beyond the point of ‘sophisticated counsel should have known better;’ we are at the point of intentional and blatant disregard of controlling authority and law of the case. This court emphatically rejected these arguments, as did the First Department. Defendants’ repetition of them here is indefensible.”
The arguments include:
• Arguments against the New York attorney general’s standing and capacity to sue that “invoke the time loop in the film Groundhog Day.”
• Repetition of an “erroneous argument” that the case requires dismissal because it is not in the public interest.
• A “rehashed argument” that the complaint must be dismissed because it is not designed to protect consumers.
• An argument “yet again” that the suit must be dismissed because of disclaimers that financial statements have not been audited or reviewed.
• Repetition of the “untenable notion” in “flagrant disregard of prior orders” that disgorgement is not allowed.
The sanctioned lawyers are Michael Madaio of Habba Madaio & Associates, Clifford S. Robert of Robert & Robert, Michael Farina of Robert & Robert, Christopher M. Kise of Continental, and Armen Morian of Morian Law.
Kise said the Trumps “will seek all available appellate remedies to rectify this miscarriage of justice,” Law.com reports.
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