An appeals court threw out a civil fraud penalty against Donald Trump in New York's suit alleging exaggeration of his wealth. A mid-level appellate panel found the disgorgement order excessive given the Eighth Amendment. A lower court had found Trump committed fraud by padding financial statements and ordered $355 million in penalties; with interest the sum exceeded $515 million, and combined penalties against other executives topped $527 million. Judges preserved injunctive relief aimed at curbing business practices while rejecting the nearly half-billion-dollar disgorgement. Previously imposed bans on corporate leadership were paused during appeal, and Trump posted a $175 million bond to stay collection.
While the injunctive relief ordered by the court is well crafted to curb defendants' business culture, the court's disgorgement order, which directs that defendants pay nearly half a billion dollars to the State of New York, is an excessive fine that violates the Eighth Amendment of the United States Constitution, Judges Dianne T Renwick and Peter H Moulton wrote in one of several opinions shaping the appeals court's ruling.
An appeals court has thrown out the massive civil fraud penalty against Donald Trump, ruling on Thursday in New York state's lawsuit accusing him of exaggerating his wealth. The decision came seven months after the Republican returned to the White House. A panel of five judges in New York's mid-level appellate division said the verdict, which stood to cost Trump more than $515m and rock his real estate empire, was excessive.
After finding that Trump engaged in fraud by flagrantly padding financial statements that went to lenders and insurers, Judge Arthur Engoron ordered him last year to pay $355m in penalties. With interest, the sum has topped $515m. The total combined with penalties levied on some other Trump Organization executives, including Trump's sons Eric and Donald Jr now exceeds $527m, with interest.
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