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Trump Fails to Move New York AG’s Fraud Lawsuit to a Court Other Than the One That Held Him in Contempt

Donald Trump, Letitia James

Donald Trump, Letitia James

Donald Trump and two of his adult children failed on Wednesday in their efforts to transfer New York Attorney General Letitia James’s (D) lawsuit accusing them of fraudulent practices with the family business to a different court.

The bid effectively would have moved the case out of the courtroom of a judge who held the former president in contempt during a related investigation.

On Sept. 21, James sued former Trump; his adult children Eric Trump, Donald Trump Jr., and Ivanka Trump; and several other people and entities.

The attorney general alleged that Trump, his family, and his businesses showed such a pervasive pattern of inflating and deflating assets to obtain tax benefits that dramatic action was required — including barring the Trumps from ever serving against as an officer or director of a New York corporation.

During the years-long investigation that proceeded it, Attorney General James sought evidence from the courtroom of Manhattan Supreme Court Justice Arthur Engoron, who imposed a $10,000 per day fine on Trump months ago for defiance of the attorney general’s subpoena.

“Mr. Trump, I know you take your business seriously, and I take mine seriously,” Engoron declared in April, later banging his gavel for emphasis.

The judge ultimately capped the penalty at $110,000, after finding that Trump and his lawyer Alina Habba satisfied his requirements for an exhaustive search of the subpoena. Habba lashed out at him at the time, calling the contempt ruling “inappropriate” and the fine “crazy.”

“The tactics employed by this Court, including the dramatic pounding of the gavel, the statements directed to our client from the bench, and direct comments to the press have reduced this hearing to the likes of a public spectacle,” Habba said in press statements about that ruling.

Once she officially filed suit, the attorney general argued that the case should be marked “related,” a designation that would keep the matter before Engoron.

The motion by Trump and two of his children — Donald Trump Jr. and Eric Trump — is not styled as a motion for a recusal. Instead, they asked to move the lawsuit to the Commercial Division “on grounds that this case meets both the monetary threshold” and the “subject matter criteria” for that assignment.

The attorney general objected, arguing that the proceedings before Engoron had developed a substantial record.

Adding that Judge Engoron “has [a] substantial degree of familiarity with the relevant information and matters at issue,” James noted that “this action is seeking to prove the very same facts under investigation in the Special Proceeding.”

On Wednesday, New York County Supreme Court Administrative Judge Adam Silvera issued a brief order denying the transfer — and keeping the case before Engoron.

“Consistent with court procedure, the General Clerk’s Office appropriately assigned this action to Judge Engoron, on grounds that plaintiff identified it as ‘related’ to the Special Proceeding,” the ruling states. “In the event Judge Engoron deems this action un-related to the Special Proceeding, pursuant to Section 202.70 (e) of the Rules of the Commercial Division of the Supreme Court, Judge Engoron may make a request to transfer this action to the Commercial Division. Contrary to Counsel’s assertion, the Special Proceeding is still pending before Judge Engoron and has not been marked disposed.”

Habba did not immediately respond to email requesting comment.

Read the ruling, here.

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Law&Crime's managing editor Adam Klasfeld has spent more than a decade on the legal beat. Previously a reporter for Courthouse News, he has appeared as a guest on NewsNation, NBC, MSNBC, CBS's "Inside Edition," BBC, NPR, PBS, Sky News, and other networks. His reporting on the trial of Ghislaine Maxwell was featured on the Starz and Channel 4 documentary "Who Is Ghislaine Maxwell?" He is the host of Law&Crime podcast "Objections: with Adam Klasfeld."