A New York appeals court on Thursday threw out a $500 million civil fraud fine against President Donald Trump, ruling that the “excessive” penalty imposed last year in Democratic state attorney general Letitia James’s case is unconstitutional.
A lower court’s order demanding that Trump, his two sons, and other Trump Organization executives pay around half a billion dollars amounted to “an excessive fine that violates the Eighth Amendment of the United States Constitution,” Judges Dianne Renwick and Peter Moulton wrote in an opinion that guided the ruling of the five-judge appeals panel, according to the Associated Press.
Another judge on the panel, David Friedman, blasted James for bringing the lawsuit in the first place. “Plainly,” Friedman wrote, the attorney general’s “ultimate goal” was “the derailment of President Trump’s political career and the destruction of his real estate business.”
The case began in September 2022, when James filed a civil fraud lawsuit accusing Trump of inflating his net worth by billions to secure favorable loans and insurance. In a February 2024 ruling, Manhattan judge Arthur Engoron found Trump liable and ordered him to pay $464 million, a sum that has grown to more than $500 million with interest.
All five judges on the appeals panel dismissed the fine but split on the merits of the lawsuit and Engoron’s finding that Trump is liable. They upheld Engoron’s other punishments, which have been on hold since Trump last year posted $175 million bond in the case. The split leaves “a pathway for an appeal to the state’s highest court, the Court of Appeals,” the Associated Press reported.
Trump has repeatedly denied wrongdoing, calling the prosecution a politically motivated “witch hunt” by the attorney general. James “campaigned on it four years ago,” Trump said in September 2022. “It was a vicious campaign, and she just talked about Trump and ‘We’re going to indict him, we’re going to get him.'”
Trump and his allies aren’t alone in accusing James of abusing her prosecutorial powers.
In May, a former high-ranking official in James’s office, Brian Ginsberg, said in a court filing that James was misusing her authority in an ongoing Title IX case against a western New York school district over four sexual misconduct allegations. Ginsberg said that James has a history of allegedly abusing her powers, citing comments from a justice of the New York Supreme Court in November 2024 who reprimanded James for bringing forward a politically charged environmental case against Pepsi. The court went on to toss that lawsuit.
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