0% found this document useful (0 votes)
339 views

People of NY V Trump (2023-00717)

New York Attorney General Letitia James’ $250 million lawsuit alleging Ivanka Trump engaged in business fraud while at the Trump Organization has been dismissed by a state appeals court.

Uploaded by

Tom Ozimek
Copyright
© © All Rights Reserved
Available Formats
Download as PDF, TXT or read online on Scribd
0% found this document useful (0 votes)
339 views

People of NY V Trump (2023-00717)

New York Attorney General Letitia James’ $250 million lawsuit alleging Ivanka Trump engaged in business fraud while at the Trump Organization has been dismissed by a state appeals court.

Uploaded by

Tom Ozimek
Copyright
© © All Rights Reserved
Available Formats
Download as PDF, TXT or read online on Scribd
You are on page 1/ 5

Supreme Court of the State of New York

Appellate Division, First Judicial Department


Webber, J.P., Singh, Kennedy, Scarpulla, Pitt-Burke, JJ.

553 PEOPLE OF THE STATE OF NEW YORK, by LETITIA Index No. 452564/22
JAMES, ATTORNEY GENERAL OF THE STATE OF Case No. 2023-00717
NEW YORK,
Plaintiff-Respondent,

-against-

DONALD J. TRUMP et al.,


Defendants-Appellants.

Habba Madaio & Associates, New York (Alina Habba of counsel), and Continental PLLC,
Tallahassee, FL (Christopher M. Kise of the bar of the State of Florida, admitted pro hac
vice, of counsel), for Donald J. Trump, Allen Weisselberg, Jeffrey McConney, Donald
Trump, Jr., Eric Trump, The Trump Organization, Inc., Trump Organization LLC, The
Donald J. Trump Revocable Trust, DJT Holdings LLC, DJT Holdings Managing
Member LLC, Trump Endeavour 12 LLC, 401 North Wabash Venture LLC, Trump Old
Post Office LLC, 40 Wall Street LLC and Seven Springs LLC, appellants.

Troutman Pepper Hamilton Sanders LLP, New York (Bennet J. Moskowitz of counsel),
for Ivanka Trump, appellant.

Letitia James, Attorney General, New York (Judith N. Vale of counsel), for respondent.

Order, Supreme Court, New York County (Arthur F. Engoron, J.), entered

January 9, 2023, which denied defendants’ respective motions to dismiss the complaint,

unanimously modified, on the law, to dismiss, as time-barred, the claims against

defendant Ivanka Trump and the claims against the remaining defendants to the extent

they accrued prior to July 2014 (with respect to those defendants subject to the August

2021 tolling agreement) and February 2016 (with respect to those defendants not

subject to the August 2021 tolling agreement), and to modify the caption to reflect that
Donald J. Trump, Jr., is sued both personally and in his capacity as trustee for the

Donald J. Trump Revocable Trust, and otherwise affirmed, without costs.

The New York Legislature enacted Executive Law § 63(12) to combat

fraudulent and illegal commercial conduct in New York. Under this provision,

“[w]henever any person shall engage in repeated fraudulent or illegal acts or otherwise

demonstrate persistent fraud or illegality in the carrying on, conducting or transaction

of business, the attorney general may apply, in the name of the people of the state of

New York, to the supreme court of the state of New York” for disgorgement and other

equitable relief (Executive Law § 63[12]). The Attorney General is not suing on behalf of

a private individual, but is vindicating the state’s sovereign interest in enforcing its legal

code – including its civil legal code – within its jurisdiction (see Alfred L. Snapp & Son,

Inc. v Puerto Rico ex rel. Barez, 458 US 592, 601 [1982]; see also People v Coventry

First LLC, 52 AD3d 345, 346 [1st Dept 2008] [finding that claims including a claim

under Executive Law § 63(12) “constituted proper exercises of the State’s regulation of

businesses within its borders in the interest of securing an honest marketplace”], affd 13

NY3d 108 [2009]). We have already held that the failure to allege losses does not

require dismissal of a claim for disgorgement under Executive Law § 63(12) (see People

v Ernst & Young LLP, 114 AD3d 569, 569-570 [1st Dept 2014]). Finally, in authorizing

the Attorney General to sue for any repeated or persistent fraud or illegality, the

Legislature necessarily “invested that party with authority to seek relief in court”

(Matter of World Trade Ctr. Lower Manhattan Disaster Site Litig, 30 NY3d 377, 384

[2017]; see Silver v Pataki, 96 NY2d 532, 537-538 [2001]).

Defendants’ arguments that the Executive Law § 63(12) claims are governed by a

three-year limitations period are unavailing (see CPLR 213[9]). We have already found

2
that CPLR 213(9) applies retroactively (Matter of People v JUUL Labs, Inc., 212 AD3d

414, 416-417 [1st Dept 2023]). We reject defendants’ invitation to reconsider our

decision that retroactive application is inconsistent with certain decisions of the Court of

Appeals (see id. at 416; People v Allen, 198 AD3d 531, 532 [1st Dept 2021], lv dismissed

38 NY3d 996 [2022], lv denied, appeal dismissed 39 NY3d 928 [2022]). We also find

that retroactive application of CPLR 213(9) – enabling the Attorney General to continue

lengthy and complex investigations, which often cannot begin until years after the

conduct at issue, and which may have been extended in reliance on the six-year statute

of limitations – was a reasonable measure to address an injustice (see World Trade Ctr.,

30 NY3d at 399-400; PB-36 Doe v Niagara Falls City Sch. Dist., 213 AD3d 82, 84-85

[4th Dept 2023]; cf. Brothers v Florence, 95 NY2d 290, 299-300 [2000] [describing

necessity of retroactive application of legislation shortening statute of limitations in

response to judicial decision]).

Similarly, we decline to reconsider our decisions finding that certain executive

orders tolled statutes of limitations during the pandemic (see Murphy v Harris, 210

AD3d 410, 411 [1st Dept 2022]), and that this toll was properly authorized (Brash v

Richards, 195 AD3d 582, 584-585 [1st Dept 2021]).

Applying the proper statute of limitations and the appropriate tolling, claims are

time barred if they accrued – that is, the transactions were completed – before February

6, 2016 (see Boesky v Levine, 193 AD3d 403, 405 [1st Dept 2021]; Rogal v Wechsler,

135 AD2d 384, 385 [1st Dept 1987]). For defendants bound by the tolling agreement,

claims are untimely if they accrued before July 13, 2014. The continuing wrong doctrine

does not delay or extend these periods (see CWCapital Cobalt VR Ltd. v CWCapital

Invs. LLC, 195 AD3d 12, 19-20 [1st Dept 2021]; Henry v Bank of Am., 147 AD3d 599,

3
601-602 [1st Dept 2017]). We leave Supreme Court to determine, if necessary, the full

range of defendants bound by the tolling agreement. The record before us, however,

indicates that defendant Ivanka Trump was no longer within the agreement’s definition

of “Trump Organization” by the date the tolling agreement was executed (see Johnson v

Proskauer Rose, LLP, 2014 NY Slip Op 30262[U], *19-22 [Sup Ct, NY County 2014],

affd 129 AD3d 59 [1st Dept 2015]). The allegations against defendant Ivanka Trump do

not support any claims that accrued after February 6, 2016. Thus, all claims against her

should have been dismissed as untimely.

Plaintiff has provided evidence that defendants Donald J. Trump Revocable

Trust, DJT Holding, Managing Member, Trump Endeavor 12 LLC, and 401 North

Wabash Venture LLC have their principal place of business in New York (see Cruz v City

of New York, 210 AD3d 523, 524 [1st Dept 2022] [“General jurisdiction exists over a

corporate entity only in the state(s) in which it is incorporated and has its principal

place of business”]; see also Ford Motor Co. v Montana Eighth Jud. Dist. Ct., 141 S Ct

1017, 1024 [2021]; compare Chufen Chen v Dunkin’ Brands, Inc., 954 F3d 492, 500 [2d

Cir 2020]). Thus, plaintiff has made a “sufficient start” in demonstrating personal

jurisdiction over these defendants (see Matter of James v iFinex Inc., 185 AD3d 22, 30

[1st Dept 2020]). Although the Trust should have been sued through its trustees (see

e.g. Liveo v Hausman, 61 Misc 3d 1043, 1044-1045 [Sup Ct, Kings County 2018]), the

record indicates that the sole trustee is a defendant in this case and has been fully able

to represent the Trust’s interests. Thus, relief for this error should be limited to

amending the caption (see Harlem 2201 Group LLC v Ahmad, 2018 NY Slip Op

30588[U], *44 [Sup Ct, New York County 2018]; see also Matter of People v Leasing

Expenses Co. LLC, 199 AD3d 521, 522 [1st Dept 2021] [affirming relief under Executive

4
Law § 63(12) against family trusts and trustees, where the defendants were trustees in

their capacity as such]).

THIS CONSTITUTES THE DECISION AND ORDER


OF THE SUPREME COURT, APPELLATE DIVISION, FIRST DEPARTMENT.

ENTERED: June 27, 2023

You might also like