By Obinna Uballa
A New York state appeals court on Thursday overturned a civil fraud penalty of more than $500 million imposed on President Donald Trump, ruling that the monetary sanction violated the U.S. Constitution.
The Appellate Division of the New York State Supreme Court held that the fine—initially set at $454 million and now exceeding $500 million with interest—constituted an “excessive fine” under the Eighth Amendment.
While the court upheld non-monetary penalties in the case, it concluded that the financial penalty ordered by Manhattan Supreme Court Justice Arthur Engoron was disproportionate.
Engoron had ruled in February 2024 that Trump and his company allegedly engaged in business fraud by purportedly inflating the value of assets in statements of financial condition between 2014 and 2021. According to the judge, the inflated valuations ranged from $812 million to $2.2 billion.
The lawsuit was filed by New York Attorney General Letitia James, who accused Trump, the Trump Organization, and other executives, including Eric Trump and Donald Trump Jr., of persistent fraud.
In its ruling, the appeals court said the trial judge’s injunctive relief, designed to “curb defendants’ business culture,” was “well crafted,” but the monetary sanction violated constitutional limits.
Eric Trump, reacting to the decision in a social media post, declared: “Total victory in the sham NY Attorney General case!!! After 5 years of hell, justice prevailed!”
The Attorney General’s office and the Trump Organization have yet to comment publicly on the ruling. Both sides have the option to appeal.
