New York Attorney General Letitia James is refusing to retreat in her civil fraud case against former President Donald Trump, even after a divided appeals court on Thursday threw out the roughly $500 million penalty against him and his company.
The ruling left James’s case intact but deemed the massive monetary judgment “unlawfully excessive,” cutting Trump’s liability from more than $527 million with interest to zero—at least for now. James immediately pledged to appeal to the state’s highest court, keeping the high-profile clash alive.
The decision comes as James herself faces escalating scrutiny. Federal prosecutors in the Northern District of New York have issued subpoenas linked to her cases against Trump’s company and the National Rifle Association (NRA). Separately, the Justice Department is investigating allegations that she misrepresented her residency on mortgage documents for a Virginia home. Trump allies, including DOJ official Ed Martin, have pressed her to resign—moves James’s attorney, Abbe Lowell, blasted as “made-for-media stunts” outside the bounds of professional conduct.
James, a Democrat, has long been one of Trump’s fiercest critics. In 2022 she secured a sweeping trial court victory against Trump, his eldest sons, and the Trump Organization, with a judge finding they inflated net worth figures for tax and insurance advantages. The appeals panel left those findings intact, though its fractured opinions underscored divisions over the appropriate penalty.
“This looks like retribution,” said veteran New York trial lawyer Catherine Christian, arguing the DOJ probes mirror Trump’s repeated vows to punish his political adversaries.
James has faced similar pushback in her case against the NRA, where a judge found former chief Wayne LaPierre misspent millions on personal luxuries and ordered restitution. Conservatives have accused her of targeting right-leaning groups, charges she has denied.
Still, Thursday’s ruling sets the stage for a high-stakes showdown before New York’s Court of Appeals. Legal scholars say the stakes extend beyond Trump’s finances.
“Everybody knows this case involves the fate of the president of the United States—his business, his reputation,” said Bennett Gershman, a law professor at Pace University. “That makes it unlike any other fraud case.”
