Trump Handed Court Loss Despite Claiming Victory

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1:00Michael Popok:We got some breaking news involving Donald Trump and that over$500 million with interest civil fraud judgment against him that was pending in New York. And it's not quite what the headlines are saying. What the headlines are saying is that Donald Trump won and the New York Attorney General lost about the$500 million judgment. Not quite. We are on our way to the top court in New York, the Court of Appeals, because there was no majority decision, except they all agreed that Donald Trump and those around him committed fraud, that Letitia James properly brought her case under 63-12 of the laws of New York for persistent fraud, that that liability case was proven and that she was entitled to at least an injunction against Donald Trump, putting a monitor in place, a former federal judge to watch their businesses, to make other changes in their business model, and to make sure that they never commit fraud again.

1:58Michael Popok:All that was fine by four out of the five justices of the first appellate division of New York, which is the court of appeals that sits over things in Manhattan. The highest court is the Court of Appeals. So there's agreement on that. Fraud by Trump, a lawful case brought by Letitia James, properly brought under the civil fraud statutes, and that an injunction was properly rendered. Four to one. The one outlier, Justice Friedman. We'll talk about him in a minute. What was not agreed to? Because there were three separate opinions, 333 pages in total. No one opinion got a majority support. But they agree and disagree in the following.

2:46Michael Popok:I had to do a map. I had to do a chart. Okay, here's the chart. That's the agreement. The thing that they all universally agree is that the amount of the fine that was entered by Judge Angoran was too large. That it violated the Eighth Amendment of the Constitution as an excessive fine. That it should have been lower. It could have been lower. it could have been recalculated or it should be recalculated with a trial. One part of that, two out of the five say injunction only for Letitia James, no, no, uh, disgorgement amount. That's the amount of the fine, right? Two others say disgorgement amount, but you got to go back to a new trial and calculate it.

3:29Michael Popok:And one in Friedman says this whole case should have been dismissed. I'm going to explain it all to you here on Midas Dutch Network and Legal AF. No smoke or sunshine. I practice in New York. I've practiced before this particular appellate court, and I want to break it down for you right now. Now, I had thought, based on the fact that two years ago, this appellate court allowed a bond to be posted for the amount of$175 million, having peeked under the hood about the case, this nine-week case that was led by Judge Angoran of the Supreme Court of New York, that's the trial court level in New York, I would have thought that, and I'm on record as saying that I thought the judgment would be affirmed, but at the level of about 175 million to 200 million.

4:16Michael Popok:But that's not what happened. Five judge panel, you had Moulton and Renwick, Renwick being basically the chief judge. So Justice Moulton and Renwick joined together in one decision. Rosado and Higgett joined together in a second opinion. And Friedman was out by himself. And basically, what the press has been reporting is really the Moulton-Renwick decision. But that's not the majority decision. But it does have some great language in it that establishes that Donald Trump has committed fraud and that Tish James was right to bring her case. Let me read you. And what that means procedurally is because there's only two votes for the Moulton opinion, two votes for the Higgett opinion, and one vote for the Friedman opinion.

5:05Michael Popok:We don't have a consensus except that. Fraud established, liability established, Tish James' right to bring the matter, injunctive relief is proper, but not the amount of the money. Now we go off to the Court of Appeals, and the bond stays in place, and the stay stays in place. Confused? You won't be when I'm done. Let me read to you from some of the findings by Judge Moulton in his concurrence. Again, not the majority decision. Presiding Justice Renwick, that's the chief justice there, and I find that the Supreme Court, Judge Angoran, correctly found defendants liable. We agree with the Supreme Court that the Attorney General acted well within her lawful power in bringing this action and that she vindicated a public interest in doing so.

5:53Michael Popok:We also find that whenever they say Supreme Court, they mean Judge Angoran, that Judge Angoran properly ruled on claims that are timely under the applicable statute of limitations. However, we would modify the remedy ordered by Judge Angoran. While the injunctive relief ordered by the court is well crafted to curb defendants' business culture, the court's disgorgement order, that's the$500 million amount, which directs the defendants to pay nearly half a billion dollars to the state of New York, is an excessive fine that violates the Eighth Amendment of the U.S. Constitution. It goes on to say, rightly, because none of the three decisions, the three concurrences, or the two concurrences and the one dissent, garners a majority, just as Higgett and Rosado joined the decretal of this decision for the purposes of finality affording the parties a path to the Court of Appeals.

6:48Michael Popok:Meaning we have a final decision because Higgett and Rosado joined with Moulton and Renwick about the liability issues, about the injunction issues, and about the amount of the fine issues. Even though they haven't agreed on what the amount of the fine is, two saying there should be no fine, no discouragement, and two saying there should be but with a new trial. That now goes to the next stop, Court of Appeals, State of New York, while the case is stayed. Now, how do we even get here to this matter with this muddled, confusing, and I've been doing this a long time, I've never seen a first department decision where the decision couldn't garner enough votes to be the majority opinion to take it up to appeal.

7:38Michael Popok:So there's enough in this 333 pages in total and 120 pages of the majority are the main concurrence, I'll call it, written by Moulton. There's enough in there for everybody. If you go through it carefully, I'm going to be doing other hot takes as I get through all 333 pages. There's plenty in there outlining the fraud committed by Donald Trump. You know that feeling after your morning coffee, bloated, jittery, and then the inevitable crash a few hours later. That used to be me every single day. But then I found Everyday Dose and everything changed. Everyday Dose offers coffee that does more. Coffee Plus features 100 % Arabica coffee, enhanced with functional ingredients for smooth energy, calm focus, gut health and skin support.

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8:59Michael Popok:Here's the exciting part. You can now find Everyday Dose in Target stores across the country. Celebrate with a buy one, get one deal. Just buy any two Everyday Dose products at a Target store near you, and they'll pay you back for one. Visit everydaydose.com slash LAFBOGO for more details. That's everydaydose.com slash LAFBOGO for more details. And I just did a Substack Live with Michael Cohen. A lot of references to Michael Cohen, that Michael Cohen is one of the reasons that the, I guess, the majority of this group found that Tish James was right to bring this case in the first place, that she couldn't ignore the testimony that Michael Cohen had made in his federal case, in which he said that Donald Trump was inflating his assets and deflating his assets at will in order to increase his financial statement and to pay less on taxes.

9:55Michael Popok:She could not ignore that. So there's a lot of like shout out to Michael Cohen in that part of it. But when they go through transaction by transaction, they agree with the fraud, the fraud and the evaluation of the triplex apartment in New York, you know, making it, you know, five, six times larger in terms of value. Because the claims, because it's been so long now, let me remind everybody, Tish James brought it as the Attorney General of New York, arguing that there was persistent fraud in the operation of the Trump Organization and by the Trump executives, including Donald Trump, because they pumped up and fudged the numbers on his personal financial statement to get him to be a several billionaire in order to lower his rate of interest charge on certain mortgages or get him out from having to guarantee loans, right?

10:44Michael Popok:Because if he didn't have to guarantee the loans, that's a benefit to him. And there's an amount of money there that she argued for each of these transactions, and there was a dozen of them involving golf courses, involving Mar-a-Lago, involving the old post office in Washington, that there was a, she tried to calculate a dollar amount that they benefited illicitly because the fundamentals of disgorgement, which is different than, to do a little teachable moment here, which is different than damages. When you're in a lawsuit, you hear somebody was won an amount from a jury or a judge or obtained it, you know, that is about damages.

11:20Michael Popok:That is money to make you whole for an injury that you've suffered, either contract or tort like defamation or abuse, sexual abuse or environmental harm, something like that, or breach of contract. Discorgement is something different. The concept of disgorgement is equitable in nature, not legal. And what it says is that if you have benefited and obtained an ill-gotten gain, literally it's called an ill-gotten gain. An amount of money or value that you should not have obtained and you would not have obtained, but for a fraud, that amount, if it's taken away from you or clawed back in a lawsuit or in a criminal prosecution, that's called disgorgement.

12:03Michael Popok:You're being disgorged of your illicit profits. And Tish James tried to prove with her economists and the people that she put on, that the amount was over$330 million of disgorgement,$363 million of disgorgement, and$100 million of running interest. And that's where the four that were on her side, four justices of the First Department of Appellate Division of New York that were on her side, that's where they got off the train. They were fine with liability, fraud, Donald Trump committed fraud. They were fine with, you brought the case. They were fine with statute of limitations. This case was brought on time.

12:44Michael Popok:They were fine with the transactions that she used and the injunctive relief that she obtained. You know, there's still a court-ordered monitor doing reports on the Trump administration, sorry, on the Trump organization, should be on the Trump administration, even as we speak. But they're not okay with the amount. Now, they didn't say, and we came up with an alternative amount, which is what we thought they were going to do. They didn't come up with an amount at all. Two of them, Moulton and Redwick, think the injunction's enough. Two of them, as I've outlined, Rosado and Higgett, justices, believe that go back to the drawing board and redo the numbers.

13:20Michael Popok:Problem with that is Donald Trump's in office. And none of that's going to happen now. It would only happen three years from now. Because it would be stayed pending, you know, because Donald Trump's, he's the president. And Friedman thinks, why are we even here? this whole case should have been dismissed he was basically the Trumper of the five and it's no surprise because Friedman had been the judge we were worried about because they had run to him a couple of times in the case to get stays or get emergency relief and he granted it a couple of times he got reversed but he granted it a couple of times so we were like oh Friedman's terrible for us and most of what Moulton and and Renwick wrote was basically a call in response to what Friedman had written in his, I call it a dissent, his vote no or vote yes for Donald Trump.

14:14Michael Popok:It was, well, Friedman said this, but he's wrong. Friedman said that, but he's wrong. It was as much calling out Justice Friedman as it was calling out Judge Engoron, who issued the order. It was very, very strange. As I said, But I would not be disappointed as much in the attorney general's office because they've got a clear path to prove now to the court of appeals just on the money, that the money's right and money as disgorgement is proper in this case, period. Now, just to wrap up this hot take, we know that Pam Bondi and Ed Martin, her special attorney, are going to use this. They're going to misstate what just happened.

14:54Michael Popok:Donald Trump won. She should never have brought this case to continue to go after because they're investigating through John Sarkoni, who is the Northern District U.S. attorney, fake U.S. attorney for Donald Trump. They're investigating the attorney general's office for having brought the case as a civil rights violation for Donald Trump. But if they read carefully, and I'm telling you straight, if you read carefully the 333 pages I'm posting on Legal AF Substack, this is not a win for Donald Trump. just on the money, just on the money, not on the fraud, not on the liability, not on the injunction, all right, not on the statute of limitations, just on the money.

15:31Michael Popok:And that is a completely, that's a horse of a completely different color when you're talking about what just happened, but you know they're going to distort it. That's why I wanted to bring it to you here on Legal AF. Until my next report, I'm Michael Popak on the Midas Touch Network. Can't get your fill of Legal AF? Me neither. That's why we formed the Legal AF Substack. Every time we mention something in a hot take, whether it's a court filing or a oral argument, come over to the Substack. You'll find the court filing and the oral argument there, including a daily roundup that I do call, wait for it, Morning AF.

16:04Michael Popok:What else? All the other contributors from Legal AF are there as well. We got some new reporting. We got interviews. We got ad-free versions of the podcast and hot takes. Where? Legal AF on Substack. Come over now to free subscribe.

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17:01So I thought it would be fun if we made$15 bills. But it turns out that's very illegal. So there goes my big idea for the commercial. Give it a try at mintmobile.com slash switch. Upfront payment of$45 for three months,$90 for six months, or$180 for 12-month plan required. $15 per month equivalent. Taxes and fees extra. Initial plan term only. Greater than 50 gigabytes may slow when network is busy. See terms.