Trump wins major appellate court ruling erasing $500 million penalty

Fresh off a major appellate win, President Donald Trump on Sunday tore into New York Judge Arthur Engoron, who oversaw his state civil fraud trial, calling him “incompetent,” “crooked” and nearly as “corrupt” as New York Attorney General Letitia James.

Trump’s barbs followed an appellate ruling that erased a $500 million penalty in James’ high-profile civil fraud case, handing Trump one of his biggest legal wins yet. 

“The Appellate Court removed incompetent Judge Engoron, but he refused to go, or even to acknowledge them,” Trump wrote on Truth Social. “He’s a highly overturned, CROOKED Judge, who is retiring into a life of lawsuits, along with his Chief Clerk, soon! He is almost as Corrupt as Leticia James, but not quite!”

Engoron presided over the non-jury trial, and Trump allies accused him of bias against the president-elect, his family and his company. Trump was accused of inflating the value of his assets to get more favorable terms from a lender his real estate business worked with.

JUDGE WHO FINED TRUMP $500 MILLION GETS THE BOOKS THROWN AT HIM

The New York Appellate Division tossed the penalty, ruling the fine was excessive and violated the Eighth Amendment.

The five-member panel upheld findings that Trump and his company were liable, affirming James acted within her authority and that injunctive relief against the Trump Organization was appropriate.

The ruling left liability intact but wiped out the $364 million penalty plus interest, which totaled about $500 million.

TURLEY HAILS TRUMP’S ‘TREMENDOUS VICTORY’ AFTER CIVIL FRAUD PENALTY TOSSED, BLASTS ‘GROTESQUE’ USE OF NY LAW

NY Attorney General Letitia James speaks during a press conference on the Department of Government Efficiency (DOGE) at Manhattan Federal Courthouse on February 14, 2025, in New York City. (Michael M. Santiago)

Justice David Friedman dissented in part, arguing James’ true aim was political, and the case should be dismissed. He wrote her “ultimate goal was not market hygiene … but political hygiene, ending with the derailment of President Trump’s political career and the destruction of his real estate business.”

Friedman blasted James’ use of Section 63(12) of New York’s Executive Law, which gives the attorney general broad civil fraud powers.

He called the use unprecedented and political, giving James “essentially limitless power to prosecute her political enemies.”

NY APPEALS COURT THROWS OUT $500M PENALTY AGAINST TRUMP IN LETITIA JAMES CIVIL CASE

Justice Arthur Engoron presided over the civil fraud trial of President Donald Trump and his children at New York State Supreme Court on November 13, 2023 in New York City. ((Photo by Erin Schaff-Pool/Getty Images))

Friedman said Trump’s business deals involved sophisticated parties who profited without harming the public and concluded he would “reverse the judgment and dismiss the complaint.”

With judges split on liability, the case is likely headed to New York’s highest court, the Court of Appeals. James said she will appeal.

James, a Democrat elected in 2018, has long targeted Trump. On the campaign trail, she called him an “illegitimate president” and vowed to “use every area of the law” to investigate him and his businesses.

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Since Trump returned to office, the Justice Department has opened investigations tied to the case brought against Trump and also over allegations she committed mortgage fraud herself.

James alleges Trump is using the federal government to target her politically. DOJ is also investigating her for alleged mortgage fraud, including misrepresenting her primary residence on loans in Virginia and New York. She denies the claims and calls the probe a “revenge tour” for the civil fraud suit.

Fox News Digital’s Michael Dorgan and Maria Paronich contributed to this report.