New York, NY – In a dramatic legal twist just months after returning to the White House, President Donald Trump saw a $515 million civil fraud judgment against him wiped away Thursday by a New York appeals court that ruled the penalty excessive and unconstitutional.
The long-running case, launched by New York Attorney General Letitia James, accused Trump and his adult sons of inflating property values to secure better loan and insurance terms. But after five years of legal warfare, the state’s Appellate Division found the punishment levied in February—$355 million plus interest—violated the Eighth Amendment’s protection against excessive fines.
The court’s five-judge panel unanimously vacated the judgment, delivering a major legal and financial victory for the former president and his real estate empire. Trump had posted a $175 million bond to pause enforcement of the penalty while appealing the decision. That bond is now expected to be returned to the Trump Organization.
The initial case alleged that Trump, along with Eric Trump and Donald Trump Jr., manipulated financial statements for over a decade. Judge Arthur Engoron had ruled in January that the trio engaged in persistent fraud, ordering sweeping restrictions on Trump’s New York business operations and a ban on holding directorships in New York corporations. Those sanctions now appear nullified.
The lawsuit, which began in 2022, had been a central pillar of Attorney General James’ office and was one of several high-profile legal battles involving the former president in the state. Thursday’s appellate ruling significantly undercuts the state’s legal offensive, raising new questions about the viability of large-scale civil enforcement actions against prominent public figures.
Eric Trump called the decision a “total victory” on social media, while Donald Trump Jr. said the court’s reversal confirmed the case was a political “witch hunt” and an act of “election interference.”
Mike Crispi, chairman of America First Republicans of New Jersey called the lawsuit a scam.
“Tish James claimed Trump “overvalued” his property for more favorable loan terms. Meanwhile, even the bank who gave Trump the loan said he did NOTHING wrong. Scam from the start,” Crispi, a close Trump ally said today.
With the judgment overturned, Trump emerges from one of his most financially threatening legal battles to date unscathed, reinforcing his position just as the 2024 election cycle reaches its peak.
The Attorney General’s office has not yet indicated whether it will seek to appeal the ruling to the state’s highest court.
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Key Points
- New York appeals court overturned Trump’s $515 million civil fraud judgment, calling it excessive and unconstitutional
- The case stemmed from allegations of inflated property valuations to secure favorable loans
- Trump’s $175 million bond will be returned following the reversal
A stinging defeat for New York prosecutors as Trump walks away from a half-billion dollar civil penalty.