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Trump to face New York lawsuit over alleged financial fraud following judge's ruling

Trump claims the investigation is a politically motivated "witch hunt" and has tried unsuccessfully to block the Democratic AG's probe through the courts.

Published: January 9, 2023 11:10am

Updated: January 9, 2023 11:51pm

(The Center Square) -

(The Center Square) — Former President Donald Trump will face a civil lawsuit by the state's attorney general accusing him of fraudulent business dealings after a New York judge rejected a motion to toss out the case.

In a ruling issued Friday, state Supreme Court Justice Arthur Engoron denied Trump's motion to dismiss the $250 million lawsuit filed by New York Attorney General Letitia James against the Trump organization, and chastised his lawyers for repeatedly making "frivolous" claims.

James filed the lawsuit against Trump, Donald Trump Jr., Eric Trump and Ivanka Trump in September, alleging that they used fraudulent financial statements to obtain favorable rates of insurance and business loans, and tax benefits. The suit followed a year-long investigation by her office.

Trump claims the investigation is a politically motivated "witch hunt" and has tried unsuccessfully to block the Democratic AG's probe through the courts.

In April, Engoron issued a ruling holding Trump in contempt of court for failing to comply with a subpoena from the AG's office. He has also appointed an independent monitor to oversee the Trump Organization’s handling of its annual financial statements.

In his latest ruling, Engoron dismissed claims about a "witch hunt," and criticized the president's lawyers for rehashing rejected legal arguments in their attempt to quash the lawsuit.

"Reading these arguments was, to quote the baseball sage Lawrence Peter (‘Yogi’) Berra, ‘Déjà vu all over again,'" he wrote. "Sophisticated defense counsel should have known better."

Engoron wrote that he had considered imposing sanctions on the Trumps’ lawyers but decided against it, saying the move was unnecessary because the court has "made its point.”

The judge also rejected Trump's arguments in the motions to dismiss that some of the alleged fraudulent conduct was beyond the statute of limitations allowed under the law.

He also rejected a motion to dismiss, filed by Ivanka Trump, who had argued in court filings that she couldn't be held legally liable in the attorney general's lawsuit because she left the organization in 2017. He suggested she had been less than truthful in her deposition to the court.

In a statement, James said the court's ruling "makes clear that Donald Trump is not above the law and must answer for his actions in court."

"Once again, Donald Trump’s attempts to evade the law have been rejected," she said.

The case, which is set to go to court in October, is one of several legal challenges swirling around the former president as he seeks a return to the White House in 2024.

He’s also facing federal investigations into his handling of classified documents at the Mar-a-Largo complex, and his actions surrounding the Jan. 6, 2021 attack on the U.S. Capitol.

Trump is also being investigated by the Manhattan district attorney's office over his hush money payment to a porn star during the 2016 presidential campaign.

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