Donald Trump and New York AG Letitia James spar over $485 million fraud case

Aysha Bagchi, USA TODAY
Updated ·3 min read

President-elect Donald Trump's lawyer and New York Attorney General Letitia James office are sparring over whether Trump's $485 million civil fraud loss should be wiped out because he won the November election.

In a letter publicly released Tuesday, New York Deputy Solicitor General Judith Vale told Trump lawyer John Sauer that the Constitution doesn't require her office to ask a court to toss out the judgment Trump was hit with in light of his presidential election. Trump is appealing a judge's February determination that he owed $454 million for inflating the value of his assets to get better loan and insurance terms over several years. With ongoing interest, the judgment now totals more than $485 million.

Trump has denied doing anything wrong is currently awaiting a ruling from a New York appeals court about whether the judgment can stand. He could choose to drop his appeal and simply pay, but he hasn't expressed interest in doing that. His lawyers are arguing the attorney general's lawsuit went too far because, they say, Trump's asset valuations didn't hurt his lenders.

Sauer, who didn't immediately respond to a request for comment, wrote to New York Attorney General Letitia James Nov. 26, arguing that she should voluntarily drop the civil fraud case. He argued that a provision of the Constitution that places federal law ahead of state law "prevents state prosecutors from proceeding against the sitting President in any way."

New York Attorney General Letitia James holds a press conference following a ruling against former U.S. President Donald Trump ordering him to pay hundreds of millions of dollars and barring him from doing business in New York State for three years, in the Manhattan borough of New York City, U.S., February 16, 2024.
New York Attorney General Letitia James holds a press conference following a ruling against former U.S. President Donald Trump ordering him to pay hundreds of millions of dollars and barring him from doing business in New York State for three years, in the Manhattan borough of New York City, U.S., February 16, 2024.

In arguing that the appeals process should play out just as it would if Trump hadn't been elected president, Judith Vale pointed to a unanimous 1997 Supreme Court decision that sided against Bill Clinton's efforts to block a civil sexual harassment lawsuit brought by a former Arkansas state employee, Paula Jones. The high court ruled in that federal case that a federal civil lawsuit dealing with a sitting president's unofficial conduct could go forward during that presidency.

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Trump's "appeals will be handled primarily by Mr. Trump’s appellate lawyers, and any consultations Mr. Trump may have with those attorneys about appeals will not plausibly impose an unconstitutional burden," Vale wrote in the letter.

"The ordinary burdens of civil litigation do not impede the President’s official duties in a way that violates the U.S. Constitution," Vale wrote.

Trump spokesperson Steven Cheung characterized Vale's letter as "sad and weak," and Sauer's letter as a "powerhouse submission," in a statement.

"AG James should heed President Trump’s call for national unity and drop this baseless, discredited witch hunt," he said.

The civil fraud judgment isn't the only massive financial judgment against Trump. Two New York federal juries determined that he should pay advice columnist E. Jean Carroll a total of $88.3 million for sexually abusing and defaming her. Trump has denied Carroll's allegations and is appealing those judgments as well.

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Sauer is Trump's nominee to serve as solicitor general in his upcoming presidential administration. If confirmed by the Senate, Sauer – who previously served as Missouri's solicitor general – would be responsible for the Trump administration's litigation at the Supreme Court.

(This story has been updated to add new information.)

This article originally appeared on USA TODAY: NY AG James and Trump spar over fate of $485 million civil fraud case

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