New York AG presses in court to oversee Trump Organization

NEW YORK — Lawyers for former President Donald Trump asked a judge Thursday to reject state Attorney General Tish James’ bid to impose far-reaching supervision of Trump’s business empire as litigation proceeds over her claims that the firms engaged in vast bank and insurance fraud in real estate transactions.

The two sides squared off in a Manhattan courtroom for the first time since James drew national attention in September in a lawsuit arguing that pervasive fraud in the dealings of the Trump Organization warrants strict limits on the businesses’ activities in New York, as well as banning the former president and his three eldest children from serving as an officer of any New York corporation.

Supreme Court Justice Arthur Engoron, who has overseen earlier rounds of legal jousting between the attorney general and the former president, sounded highly skeptical of Trump’s legal arguments against imposing restrictions and oversight on the businesses during the year or more it could take for the case to go through fact-finding and trial.

Engoron declared that the government has to meet a “heavy burden” to get immediate relief, but he suggested Trump’s case against doing so consisted of little more than hot air, such as arguments from their attorneys without evidence to rebut the extensive collection of documents and deposition excerpts James presented from their three-year investigation.

“Let’s be real here …They submitted all these documents,” the judge said to a lawyer for Trump, Christopher Kise. “What kind of evidence do you want? This is a motion for preliminary injunction.”

An attorney from James’ office, Kevin Wallace, pressed Engoron’s point, arguing that the evidence the AG submitted should be weighed against the lack of proof offered by the other side.

“The Trump Organization didn’t field a team,” Wallace said. They didn’t put in any documents. … Most of the evidence is in their custody and they presented nothing.”

Kise, a Florida attorney who is also deeply involved in Trump’s response to the federal investigation into sensitive White House documents the former president kept at his Mar-a-Lago home after leaving office, repeatedly complained that the safeguards James is seeking now would amount to a “nationalization” of Trump’s businesses, effectively placing them into receivership.

“The order itself really borders on nationalization of a private enterprise,” said Kise, who said it would amount to “tremendous and staggering interference” in the ability of the Trump businesses to manage their own affairs. “It’s really more in the nature of seizing control of a successful corporation and interfering on a day-to-day basis with its financial arrangements.”

But the judge chided the Trump side for exaggerating the severity of the oversight the attorney general is proposing.

“Your papers kept using the word receiver. ... They’re not asking for one and that’s very different from a monitor. True or false?” the judge said to Kise.

Engoron, who issued no immediate ruling but promised to do so later Thursday, made clear his familiarity with the case. He noted that one of the claims raised by James is that Trump claimed to lenders that his Trump Tower apartment was 30,000 square feet, even though it was actually 11,000.

“Could that be a good faith disagreement ... ?” the judge asked.

“I would submit that it could be,” Kise replied, contending the claim was part of a broader financial statement that was reasonable when taken as a whole.

Kise also accused James of pursuing the injunction to score political points, looking to grab headlines as she campaigns for reelection next week.

“We’re a few days out from an election,” Kise told the judge. “I’m hoping that’s not behind the motivation and the timing here, but I’m candidly a little bit cynical about it. ... I hesitated to bring it up, but this really shouldn’t be about political theater.”

Speaking to reporters outside the courthouse after the 2½-hour hearing, Kise didn’t seem particularly reluctant to repeat his assertion that the attorney general is looking to capitalize on anti-Trump sentiment in New York.

“I can think of one reason. …There may be a rally this afternoon for campaign purposes. I hope that that cynicism isn't rewarded, but I certainly think there's a high probability that if an order comes out of favoring the attorney general, that you are going to see that order waved around and around,” Kise said, referring to a campaign event James is slated to attend with top Democratic women leaders.

The former Florida solicitor general also said that by delving into business transactions between the Trump organization and banks and insurance companies he called “corporate titans,” James was encouraging businesses to flee the state.

“Look at what's happening in Florida, go down to Miami, see the businesses that are moving from California, the businesses are moving from New York,” Kise told reporters. “This is why. Because there's this extraordinary interference with the free marketplace. And it's a dangerous precedent to set.”

Trump has fought a series of unusual and unsuccessful legal battles against James’ probe, beginning long before the attorney general’s massive suit against his business empire was filed in September.

The latest maneuver came just Wednesday in a state court in Florida, where Trump sued James for allegedly interfering with a Florida-based trust that holds many of the former president’s business assets.

As is typical with Trump suits, the complaint departs from the usual dry legalese to unleash withering rhetorical attacks on James that sounded more like fodder for political speeches.

The Florida suit details a series of sharply critical statements James made about Trump while running for office and accuses her of mounting a “political and personal vendetta” against the former president.

One shot the suit takes at James says she had no intention of fulfilling her oath of office when she took it in 2019. “Unfortunately, she must have had her fingers crossed behind her back when she did so,” the Florida suit says.

“What began as a cartoonish, thinly-veiled effort to publicly malign President Trump for personal political gain has morphed into a plot to obtain control of a global private enterprise ultimately owned by a Florida revocable trust,” the 41-page complaint says, attributing James’ sustained legal campaign against Trump to “deep animosity for him personally and an obsessive denial that he had the right to hold public office.”

The Florida suit, filed in Palm Beach County, which became Trump’s legal residence in 2019, seeks to block James from interfering with the trust and even from obtaining a copy of it. It doesn’t seek a money judgment against James, but says in a footnote that a move for that sort of compensation is planned.

The Trump lawsuit rehashes a series of arguments Trump’s lawyers have previously made in other venues without success, including in proceedings before Engoron where Trump resisted efforts to force him to testify in connection with the probe. Trump finally sat for such questioning in August, invoking his constitutional right against self-incrimination more than 440 times.

However, Kise insisted in court Thursday that the former president has no plans to try to evade James’ suit by moving any assets out of New York. He said just two of Trump’s New York buildings, Trump Tower and 40 Wall Street, could amply cover the $250 million in disgorgement that James seeks in her suit.

Trump had also filed a federal court lawsuit trying to shut down James’ investigation, but a district court judge in Syracuse tossed that case in May. Trump has appealed that decision to the 2nd Circuit Court of Appeals, which is expected to hear arguments on the case early next year. He also attempted to get James’ suit assigned to a different judge, but struck out on that effort.