In a significant legal setback for former President Donald Trump, he is confronting the prospect of shelling out hundreds of millions of dollars as a result of two high-profile New York civil cases. Legal experts suggest that even if Trump chooses to appeal the recent defamation verdict and the impending judgment in a civil fraud trial, a substantial financial burden may loom over him.
Trump’s Financial Exposure
The first blow came when a Manhattan federal jury directed Trump to pay $83 million in defamation damages to E. Jean Carroll, a sexual assault accuser. Now, a potentially more substantial hit awaits as a Manhattan judge is set to issue a verdict in a civil fraud case brought by New York Attorney General Letitia James. Trump’s financial liability in this case could amount to a staggering $370 million.
Undertaking the Financial Responsibility
Experts assert that, even if Trump opts to contest the verdicts and pursue appeals, he may still have to front a considerable sum as an “undertaking” or security in the two cases. Legal authorities, including New York civil lawyer Melissa Levin, emphasize that Trump, given his claimed wealth, should be able to handle such financial obligations during the appeal process.
However, Levin raises a critical point regarding the authenticity of Trump’s wealth claims. If the actual financial figures deviate from Trump’s assertions, it could pose a substantial threat to both his business viability and personal financial stability.
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New York Law Complications
Under New York law, if Trump decides to challenge the verdicts, he would be required to provide the full amount owed to Carroll as security held in escrow until the appeal concludes. Additionally, in the event of an unsuccessful appeal, Trump would be subjected to hefty interest rates on the owed amount.
Civil lawyers Melissa Levin and Imran Ansari suggest that Trump might consider seeking a security bond to cover the financial obligations. However, they caution that such a bond, given the magnitude of the judgment, would involve significant fees and interest, making it a costly endeavor for the former president.
Bankruptcy as a Last Resort
In the face of difficulties in securing funds or obtaining a bond, Trump could explore the option of seeking bankruptcy protection. Nevertheless, experts highlight the complexities of such a choice, as filing for bankruptcy would expose Trump’s financial details, including assets and debts. This transparency might be an undesirable outcome for Trump, especially as he contemplates another presidential run in 2024.
Legal Battles and Political Implications
The civil fraud trial, brought by Attorney General Letitia James, alleges that Trump inflated his net worth for a decade to secure favorable loan and insurance terms. Manhattan Supreme Court Justice Arthur Engoron is expected to deliver a verdict by mid-February. Notably, Engoron had previously found Trump liable for one of the main fraud claims, leading to the suspension of the Trump Organization’s business license pending appeal.
Apart from the financial repercussions, Trump is entangled in multiple legal battles, including four criminal cases in different states. The first criminal case, focusing on alleged “hush money” payments, is scheduled to commence in Manhattan on March 25. Trump has consistently proclaimed his innocence, labeling both the criminal and civil cases as politically motivated “witch hunts.”
As the legal challenges mount for Donald Trump, the financial strain resulting from defamation and fraud cases threatens not only his personal wealth but also the stability of his business empire. The potential impact on his political aspirations for a 2024 presidential run adds an additional layer of complexity to the unfolding legal saga. Trump’s legal battles continue to capture public attention, setting the stage for a critical period ahead.