Below is my column in the New York Post on the appellate court decision to toss the entirety of the fine imposed against President Donald Trump in the civil action brought by New York Attorney General Letitia James.
Here is the column:
New York Attorney General Letitia James is going to need a bigger fish or a smaller trophy wall.
For months, James has paraded her victory over President Donald Trump in her civil judgment of half a billion dollars. It did not matter that many of us denounced the judgment as grotesque and raw lawfare.
Now, however, the appellate court has replaced that mounted Marlin with a mere minnow. It threw out the financial penalty as unconstitutional and unwarranted.
Even that downsized catch may have to be pulled down, since Trump can appeal the decision to leave the injunctive relief — including limits on doing business in New York — in place.
The problem is that this over-stuffed guppy has cost the people of New York tens of millions of dollars in staff, security and other costs. It was all just the cost of doing business with James, who ran on the pledge to bag Trump on something — anything! — if elected.
For James, it was worth it. For her base, the case was never about the merits or the law. James offered lawfare against political opponents, and New York Democrats elected her with a gleeful malice.
They were thrilled as James suggested that she was going to seize Trump buildings after the judgment and sought a massive bond.
Notably, even the judges who sided with James on her ability to bring this case were critical of her ethics or judgment in running on bagging an individual on unnamed crimes or civil actions. They simply chose not to do anything about it.
It was Judge David Friedman, who, on the appeal, offered an unblinking account of how James abused the legal system.
“Plainly, her ultimate goal was not ‘market hygiene’ . . . but political hygiene, ending with the derailment of President Trump’s political career and the destruction of his real estate business. The voters have obviously rendered a verdict on his political career. This bench today unanimously derails the effort to destroy his business.”
The five appeals court judges fractured on the rationale for their opinions. Two of the judges — Dianne T. Renwick and Peter H. Moulton — correctly found that “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.”
The rest of the judges found other reasons to negate the damages while preserving the fraud judgment.
In the end, James could not get a single vote on appeal to support Judge Arthur Engoron’s ridiculous fine. Engoron, like James, will continue to enjoy the status of a folk hero in New York. But he will go down in history as a judge who yielded to the demands of the mob rather than the law.
Yet nothing will change. With the exception of Judge Friedman, the mild rebukes of the appellate court of James show how Trump remains persona non grata, a disfavored figure who is entitled to no consideration, let alone sympathy, in New York.
The most courage that Judge Moulton could summon was to say, “One can reasonably question whether a candidate running for the top law enforcement position in statewide government should make such pointed statements.”
I suppose one could also reasonably question whether a judge faced with blatant, open targeting of a political opponent should do more than a judicial shrug.
Jonathan Turley is the Shapiro professor of public interest law at George Washington University and the author of the best-selling book “The Indispensable Right: Free Speech in an Age of Rage.”
Judge Moulton needs to re-read the state constitution. The Attorney General of New York is not the top law enforcement officer, none exists in the state constitution. Without the Martin Act, Ms. James has the same role as a county attorney. That is; defend the state in lawsuits and render opinions to state agencies.
Anyone think that the fine people of NY give a rat’s a– that it “cost the people of New York tens of millions of dollars” to terrorize Trump?
The best outcome will be when Trump gets the whole thing cancelled.
Well, check that.
The best outcome will be when Trump gets the whole thing cancelled and James and Engoron are both sued into bankruptcy and unemployed.
After spending so many NY tax dollars on this doomed-from-the-start travesty, New Yawkas should be more angry about that than they are Trump-deranged.
Where is your condemnation of Trump’s use of the judicial system to punish opponents and shut up opponents?
The further Trump goes off the reservation the stronger the support he gets. WHAT is in the Epstein files? Is everybody being blackmailed?
Booo hooo
The “legal” stretch the NY state system allowed her to do is the real crime. And Engoron and his daughter are part & parcel to this crimes purveyance.
*. It all breaks into vice. James and Engoron are thieves. In cahoots the attempt was to steal property and money. It’s part of normative ethics. In a world of thieves the normative ethic is theft. It can be called normative unethics. People who’ve always lived like this are blind to it. True of any vice. Lies are it’s brothers and sisters.
Theft, robbery are professions of a sort. Stealing what others have made including ideas is much simpler than having to work or create using intelligence and talent. The idea is: you work and buy stuff and I’ll steal it from you. That’s my job. – eventually the industrious quit work and there’s no tires to steal. No one has tires and one big ghetto of hungry people is made.
Some clever thieves think: I’ll work and steal too. – that lowers the standard of living. This is what is thought all people do. They , too, are blind.
Aren’t there laws that can remove James and Engoron? They’re simply thieves, common criminals.
*. The articles from 2016 have comments by people with names. Theyre much better. How are older articles accessed at this blog site?
https://web.archive.org/web/20160101000000*/https://jonathanturley.org/
Thanks anon, they all have names. I’m anon because I’m terrified. 😉.
Some anons post obscenity.
Compare the fake fraud the corrupt leftists accused Trump of, with the real fraud of actual leftists:
https://www.dailywire.com/news/california-anti-poverty-activist-and-dem-mega-donor-pleads-guilty-to-massive-carbon-credit-scam
*. Planting trees in Africa…
As an expert on law, accounting, finance, and valuations (four specialties intersecting in the Letitia James case against Donald Trump), I read the opinion of the Court of the State of New York Appellate Division, First Judicial Department and determined that it is rife with BS and defective analyses. There is no more diplomatic way that I can accurately express my utter contempt for the Democrat political hacks sitting on the Court of the New York Appellate Division who wrote that majority opinion.
So that I will not turn this post into an entire article, I’ll focus on just a single specific but important point from the opinion; that is, the valuation of Trump’s Mar-a-Lago real estate valuation. As the opinion correctly states:
“Defendants and Justice Friedman contend that Supreme Court erred in awarding the Attorney General partial summary judgment because it made valuation errors, specifically pointing to the court’s valuations for Mar-a-Lago. In Justice Friedman’s view, the court made a “glaring error” by relying on Palm Beach County’s assessed value for property taxes, which considered the restrictive use of the property and valued it in the range of $18 million to $27.6 million. Justice Friedman additionally cites evidence in “recent years” demonstrating that Mar-a-Lago generated more than $50 million in annual revenue.”
Defendants’ and Justice Friedman’s contention that the Supreme Court “erred” is ABSOLUTELY CORRECT, as I shall soon prove.
But first, I’ll present the fraudulent legal conclusion of the Supreme Court of the State of New York Appellate Division, so that you have the puported argument supporting their fraudulent legal position:
“We disagree. To determine whether defendants violated the statute, the relevant inquiry is whether the estimated current values were fraudulently inflated by amounts that were material to the user. To that end, Supreme Court compared defendants’ valuations for Mar-a-Lago with Palm Beach County’s assessed value for property taxes, which is one method that the preparer may use to calculate the estimated current values (see ASC 274-10.55-6e). Defendants’ valuations for Mar-a-Lago ranged between $347 million to $739 million for the periods 2014 through 2021 and did not consider the property’s restrictive use. Palm Beach County’s valuations ranged between $18 million to $27.6 million and considered the property’s restrictive use as a private club, not a private residence. The fact that a property’s assessed value does not necessarily equate to market value is irrelevant to Supreme Court’s determination that the estimated current values for Mar-a-Lago were materially inflated.”
Did you catch that PURE SOPHISTRY of the Democrat political hacks from the Supreme Court of the State of New York Appellate Division? If not, I’ll explain how the Supreme Court of the State of New York Appellate Division lied with their rubbish statement.
According to those Democrat political hacks, the fact that the Mar-a-Lago property had “restrictive use as a private club” somehow made the application of the property’s assessed value a proper valuation under Accounting Standards Codification (“ASC”) 274, which is the applicable financial standards for valuation of the property under Generally Accepted Accounting Standards (“GAAP”).
So, the real question is whether or not the existence of CURRENT restrictions on the use of the Mar-a-Lago property as a private club lowers the estimated market value of Mar-a-Lago from a range of $347-$739 million to $18-$27.6 million. The Democrat political hacks contend that is does reduce the market value under ASC 274. But they did so knowing that the opposite is true.
Under ASC 274, “estimated current value” for personal financial statements is the amount an asset “COULD BE EXCHANGED for in a transaction between a well-informed buyer and seller, neither of whom is compelled to buy or sell.” [Emphasis added.] The word “COULD” in GAAP informs the reader of ASC 274 that the circumstances of the future exchange DO NOT necessarily have to involve any currently existing restrictions. Put another way, if Mar-a-Lago is sold in the future, the buyer and the seller “COULD” arrange to have the provision of “restrictive use as a private club” ELIMINATED. There is no legal requirement whatsoever that Mar-a-Lago’s “restrictive use as a private club” remain forever! And the Democrat political hacks knew that fact, but lied anyway because their mission has always been to “get Trump”, not follow the law. And it would not be an overstatement to say that the Court of the State of New York Appellate Division willfully VIOLATED the law.
Additionally, GAAP states that valuations of nonfinancial assets such as real estate should base each valuation on “THE HIGHEST AND BEST USE” of each nonfinancial asset being valued. But to know about this you have to know some basics about valuations. According to ASC 820, “[t]he highest and best use concept is applicable to fair value measurements of nonfinancial assets. It takes into account a market participant’s ability to generate economic benefits by using an asset in a way that is physically possible, legally permissible, and financially feasible. The highest and best use of a nonfinancial asset is determined from the perspective of a market participant, even if the reporting entity intends to use the asset differently. In determining the highest and best use, the reporting entity should consider whether the nonfinancial asset would provide maximum value to a market participant on its own or when used in combination with a group of other assets or other assets and liabilities.”
The “highest and best use” is the most probable use that MAXIMIZES the asset’s value, from the perspective of market participants. This means the valuation is determined NOT by how a company is CURRENTLY using the asset, but by how A MARKET PARTICIPANT (or potential buyer) would use it to generate the MOST economic benefit. The fair value of a nonfinancial asset such as Mar-a-Lago is specifically measured under the assumption of its highest and best use. This is different from a valuation based on its current use. For example, a property currently used as a residential home may have a higher value if it were converted to a commercial property. In this case, the valuation would be determined based on its commercial potential, even if the current owner has no intention of changing its use.
Thus, we know with absolute certainty that–except for Justice Friedman–the Court of the State of New York Appellate Division consists of lying Democrat political hacks who don’t belong on any court and shouldn’t even be practicing law.
There is one other point that I should discuss in connection with my post above, although, unfortunately, it gets a bit technical. According to the AI function in Google:
“The meaning of “estimated current value” [in ASC 274] has been the subject of debate, notably in the New York civil case against Donald Trump. The dispute highlighted two opposing views on the valuation of assets under ASC 274: “As if” valuation: The defense in the case argued that “estimated current value” could mean the value of the asset as if it were fully developed or unencumbered by legal restrictions. This approach typically results in a higher valuation. “As is” valuation: The prosecution and many accounting experts argued that a proper interpretation required an “as is” valuation, reflecting the asset’s value today with all its current limitations. This view is often considered the standard interpretation for personal financial statements because it provides a more realistic picture of current net worth. Ultimately, the ambiguity of ASC 274’s language has led to different interpretations, which is why transparent disclosure of valuation methods is critical.”
However, as an expert in GAAP and its forensic accounting applications, I must inform you that the above “AI” summation is rubbish because there absolutely nothing contained within ASC 274 providing any guidance whatsover stating or even suggesting that an “as is” OR an “as if” circumstance should be used to determine “current estimated value” of real estate properties under ASC 274. ASC 274 simply defines “Current Estimated Value” as follows: “For an asset, the amount at which the item could be exchanged between a buyer and seller, each of whom is well informed and willing, and neither of whom is compelled to buy or sell.” And ASC 274 also states that “[r]ecent transactions involving similar assets and liabilities in similar circumstances ordinarily provide a satisfactory basis for determining the estimated current value of an asset[.]” ASC 274-10-55-1. But there is no guidance in ASC 274 for determining whether an “as if” valuation should be deployed, which includes the concept of the “highest and best use” of the asset referred to in ASC 805, or whether an “as is” valuation should be deployed, which would mean the valuation would consider the current restrictions on the property. For this reason, the AI Google statement above is false where it claims that the “as is” view “is often considered the standard interpretation for personal financial statements because it provides a more realistic picture of current net worth[.]” AI Google likely picked up that rubbish statement from some anti-Trump media disinformation as there is absolutely nothing in ASC 274 that would lead anyone to favor “as is” over “as if” valuations in ASC 274.
So, if ASC 274 doesn’t inform readers whether an “as if” valuation (with “highest and best use” of the property) should be used or an “as is” valuation (with “restrictive use as a private club” incorporated) should be used, how did I determine that an “as if” valuation was the appropriate basis for valuation? I simply relied on GAAP’s own “Hierarchy of GAAP”, as stated in ASC 105 for the best answer. ASC 105-9 gives the following guidance: “If the guidance for a transaction or event is not specified within a source of authoritative GAAP for that entity, an entity shall first consider accounting principles for similar transactions or events within a source of authoritative GAAP for that entity[.]”
And the most similar transactional standard to the “Current Estimated Value” valuation standard in ASC 274 is the “Fair Value” valuation standard in ASC 820-10-20, which is defined as “[t]he price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.” Although the definition of “Current Estimated Value” under ASC 273 is broader than the definition of “Fair Value” under ASC 820, the latter is certainly appropriate to use for determining the “Estimated Current Value” as well. And there is certainly nothing prohibiting the use of the Fair Value Standard as the basis for valuing Mar-a-Lago. ASC 820-10-35-10A states that the concepts of the valuation premise and highest and best use are applicable when measuring the fair value of nonfinancial assets (such as Mar-a-Lago, for example). Additionally, the Fair Market Value standard would also be appropriate to use, even though it is not part of GAAP. The Fair Market Value (“FMV”) standard defines the price at which an asset would trade in the open market between a knowledgeable, unpressured buyer and seller, neither of whom is compelled to act. This standard appears in many contexts, including tax matters (like IRS regulations), business transactions (such as mergers and acquisitions), insurance claims, bankruptcy proceedings, and real estate assessments. And the reason I bring this up is that ther FMV standard also applies the concepts of the “highest and best use” for valuations and is also similar to the “Estimated Current Value” standard in ASC 274.
Therefore, the facts and the above standards establish that Donald Trump’s personal financial statements fully complied with the “Current Estimated Value” standard under ASC 274 and that the “highest and best use” concept is entirely appropriate for the valuation of Mar-a-Lago as it comports with the most important valuation standards in the world today, namely the Fair Market Value Standard and the Fair Value Standard. Moreover, the Democrat political hacks on the Court of the State of New York Appellate Division lied when they wrote–without any support whatsoever, real or manufactured–that the assessed value of Mar-a-Lago should be used, which incorporated its “restrictive use as a private club”. There is absolutely no basis in the accounting, valuation, or real estate literature supporting the bogus conclusions of the Democrat political hacks. And only Justice David Friedman applied the rules with integrity. And, notably, unlike the Democrat political hacks, Justice David Friedman has some relevant background training and expertise in the field, as he was once an Adjunct Assistant Professor of Real Estate at the New York University Real Estate Institute.
Friedman showed that the property was not subject to a restriction on its use as a private residence, so long as it was also used as a social club. Trump has been living there for years, relying on this reading of the restriction. So even without a change in this, the property could be valued on the basis that it could be used as a private residence.
*. It’s a golf course. It’s taxes are a particular use. The private club fees aren’t taxed as income. I don’t think anyone from the public can use it except as guest. It’s exclusive. In addition there’s the adjoining land agreement as a wildlife preserve. Private residence doesn’t play. The valuation perhaps was the golf course. It’s quite intricate. DJT certainly takes every tax advantage that can be mustered. Only his tax attorneys understand it.
Maralago takes the idea of client protection seriously. Virginia Guifree was released from employment after questionable attempted behavior and complaint as was Epstein. Epstein was a guest when at Maralago.
Some people take no risks in reputation. It’s their business.