Lead
On Sept. 4, 2025, New York Attorney General Letitia James filed an appeal asking the state’s highest court to reinstate a $500 million penalty that the Appellate Division recently voided in a business fraud case involving former President Donald J. Trump and his company.
Key Takeaways
- Letitia James appealed the Appellate Division’s decision to the New York Court of Appeals on Sept. 4, 2025.
- The First Judicial Department had vacated a $500 million fine, finding it violated the Eighth Amendment’s ban on “excessive fines.”
- The Appellate Division affirmed the trial judge’s finding that Trump and others committed business fraud by inflating asset values.
- The trial judge’s original findings cited inflated valuations used to secure better loan terms and other financial benefits.
- The AG’s notice of appeal is brief; substantive legal arguments will appear in later filings.
- James seeks reversal so the trial court’s penalty can be reinstated; the case now rests with the New York Court of Appeals.
Verified Facts
The Appellate Division of the New York Supreme Court recently set aside a $500 million penalty that a Manhattan trial judge had imposed on Donald Trump and associated defendants for business fraud. The appellate panel said the monetary punishment ran afoul of the U.S. Constitution’s Eighth Amendment protection against “excessive fines.”
Despite tossing the fine, the appellate court left intact the trial judge’s central finding that the defendants overstated the value of real estate assets tied to the Trump Organization. According to the trial record, those valuations were used to present an inflated net worth that helped secure more favorable loan terms and other financial advantages.
On Sept. 4, 2025, Attorney General Letitia James filed a notice of appeal asking the New York Court of Appeals to reverse the Appellate Division’s decision. The filing itself is concise and does not disclose the detailed arguments; those will be submitted in subsequent briefs as the case proceeds.
A spokeswoman for the AG’s office declined to comment on the filing. Media outlets have requested comment from Trump’s legal team; responses had not been posted publicly at the time of this report.
Context & Impact
The appeal shifts the dispute to the New York Court of Appeals, the state’s highest tribunal. That court will consider whether the Eighth Amendment precludes the level of monetary relief the trial judge awarded, and whether the penalty was properly tailored to the misconduct the judge found.
If the Court of Appeals reverses the Appellate Division, the $500 million penalty could be reinstated and subject to enforcement. A ruling for the defendants would uphold the Appellate Division’s view that the size of the fine exceeded constitutional limits.
Beyond this case, the outcome could shape how state courts apply the Excessive Fines Clause to civil penalties in corporate and financial-fraud cases. Lower courts will look to any precedential guidance from the state’s high court when evaluating proportionality between wrongdoing and monetary sanctions.
Official Statements
“The fine violated the Eighth Amendment’s prohibition on excessive fines.”
First Judicial Department, New York Supreme Court Appellate Division (excerpt)
Unconfirmed
- A photo caption associated with coverage referenced a separate ruling ordering $354.9 million and a three-year ban on doing business in New York dated Feb. 16, 2024; the relationship between that figure and the $500 million penalty here is not detailed in the appeals filing and remains unclear in the public record reviewed for this piece.
Bottom Line
The AG’s appeal puts the fate of the $500 million penalty before New York’s highest court. The case will test the boundary between robust civil penalties for corporate fraud and constitutional limits on excessive monetary sanctions; further briefs and a court ruling will determine whether the trial court’s punishment can be revived.