Today, in a major legal turnaround, a New York state appeals court has overturned the nearly $500 million civil fraud penalty imposed on President Donald Trump and his associates, while upholding the underlying finding that they committed fraud.
The deeply divided five-judge appellate panel concluded that, although Trump and his sons were legally liable for inflating asset values, the financial penalty originally mandated by Judge Arthur Engoron in February 2024 was “excessive” and potentially unconstitutional under the Eighth Amendment’s prohibition of excessive fines.
President Trump celebrated the decision as a “TOTAL VICTORY,” calling the prior judgment unlawful.
Meanwhile, New York Attorney General Letitia James defended the merits of her lawsuit, stating the court’s finding holds Trump and his company accountable and that she will seek review before the state’s highest court.
Although the financial penalty has been vacated, non-monetary restrictions—such as limitations on business roles in New York—may remain or be revisited pending further appeal.
