Court Orders NY Attorney General to Withdraw Letter Saying $464 Million Trump Bond Not ‘Impossible’

(Left) Then-former President Donald Trump. (Right) New York Attorney General Letitia James. Brandon Bell; David Dee Delgado/Getty Images

Shortly after New York Attorney General Letitia James filed a letter asking the New York Supreme Court to “not consider“ that the $464 million bond former President Donald Trump needs to post to keep his assets from being seized is a ”practical impossibility,” the court ordered her to remove it.

The letter was attached to a request to file a surreply—a reply to a reply—which generally isn’t done unless the court grants express permission.

In a March 21 letter, the defense argued that, predictably, the letter received widespread media coverage even though it was “improperly filed” and taken down the same day, refiled with only the request and no letter.

“The Court may draw its own conclusions about the propriety of this maneuver. In doing so, the Court is ‘not required to exhibit a naiveté from which ordinary citizens are free,’” the defense wrote, urging the court to deny the attorney general’s request.

In the original letter, Ms. James had asked the court not to accept the testimonies of a Trump attorney and broker who detailed the efforts they'd gone through in trying to obtain a $464 million bond, claiming they were unreliable sources. The defense faulted the state for not providing any “reason to doubt any of their assertions,” however, and only making a blanket statement.

“While attempting to cynically and wrongfully tar the Defendants’ witnesses as ‘unreliable,’ the Attorney General does not actually dispute the truth of a single one of their specific claims,” the defense’s letter reads.

The sworn affidavits submitted revealed that the defense had sought out the large bond since before final judgment was entered—raising the fine from $250 million to more than $350 million during the last days of trial—and that negotiations by four brokers with 30-plus surety companies still resulted in no deal. One of the brokers provided additional context, saying a $100 million bond was considered large and a $464 million bond (which includes the ordered interest) is something few sureties have the ability to issue and would issue only for large publicly traded companies.

The attorney general had argued that these affidavits still didn’t provide enough information on why the defendants had been turned down, suggesting that Trump Organization assets aren’t as valuable as the defense claims.

The defense sought to rebut several such details in the March 21 letter to the court, arguing that the state was wrong in its assertion that the defendants didn’t spend enough time trying to obtain a bond, arguing they had undergone critical negotiations just this past week and that efforts were ongoing even while the defense tried to obtain a stay.

“The Attorney General is inartfully attempting a losing argument of ‘heads I win, tails you lose,’” the letter reads.

How Much Cash?

After these negotiations, the defense found that a $464 million bond would require about $557 million in cash, on top of any operating expenses to continue The Trump Organization, because sureties require about 120 percent as collateral, plus additional premiums.

This is at least $200 million more than the original judgment figure, which the defense could have put in an escrow account if the cash were available.

The attorney general had suggested that the defense be required to put up a total of $464 million through several “smaller” bonds of $100 million or $200 million apiece, and the defense argued that this doesn’t resolve the cash issue.

The judgment total is $363 million, with about $355 million of that specifically applying to President Trump, $4 million to be recovered from Eric Trump, $4 million to be recovered from Donald Trump Jr., and $1 million to be recovered from Allen Weisselberg.

With the applied 9 percent interest, court filings say the bond comes out to more than $464 million, with a little more than $10 million of that attributed to judgment on Eric Trump, Donald Trump Jr., and Allen Weisselberg.

Fire Sale?

President Trump had posted on social media that to divest of his buildings in a “fire sale” would create irreparable damage—he would lose the buildings he was appealing to keep.

“Perhaps worst of all, the Attorney General argues that Defendants should be forced to dispose of iconic, multi-billion-dollar real-estate holdings in a ‘fire sale,’” the defense’s letter reads. They called it ”textbook irreparable injury” to require the defendants to appeal without penalty only after taking such losses.

“It would be completely illogical—and the definition of an unconstitutional Excessive Fine and a Taking—to require Defendants to sell properties at all, and especially in a ‘fire sale,’ in order to be able to appeal the lawless Supreme Court judgment, as that would cause harm that cannot be repaired once the Defendants do win, as is overwhelmingly likely, on appeal,” the defense argued.

They additionally cited several media articles and editorials about the shocking figure the state is demanding from President Trump and Ms. James’s possible political motives.

The state had also argued that if the defense knew they couldn’t get a $464 million bond, they should have “at a minimum consented to have their real estate interests held by Supreme Court to satisfy the judgment.”

“The suggestion is both impractical and unjust,” the defense argued. “The Attorney General cites no New York case law to support this contention.”

The case indeed puts The Trump Organization in uncharted territory; the appeals court has put a temporary stay on the judgment orders that would prohibit Eric Trump and Donald Trump Jr. from continuing to run the company, but it may lift the administrative stay after ruling on present motions. The trial court had also ordered monitorship of The Trump Organization to continue and the appointment of an additional risk officer.