With Donald J. Trump on the clock to secure a nearly half-billion-dollar bond in his civil fraud case, a New York appeals court handed the former president a lifeline on Monday, saying it would accept a far smaller bond of $175 million.
The ruling by a panel of five appellate court judges was a crucial and unexpected victory for Mr. Trump, potentially staving off a looming financial disaster. Had the court denied his request for a smaller bond in the fraud case, which was brought by the New York attorney general, Mr. Trump risked losing control over his bank accounts and even some of his marquee properties.
For now, those dire outcomes might be on hold. If Mr. Trump obtains the smaller bond, it will prevent the attorney general from collecting while he appeals the $454 million judgment against him. The appeal in the case, in which a trial judge found that Mr. Trump fraudulently inflated his net worth, could take months or longer to resolve.
Mr. Trump has 10 days to secure the bond, and two people with knowledge of his finances said he should be able to, though doing so will effectively drain much of his cash. In order to obtain the bond — a promise from an outside company that it will cover his judgment if he ultimately loses the appeal and cannot pay — Mr. Trump will have to pay the company a fee and pledge about $200 million in cash and other investments as collateral.
In a statement, Mr. Trump said he would “abide by the decision” and either post a bond or put up the money himself. He added that the appellate court’s decision to reduce the bond “shows how ridiculous and outrageous” the $454 million judgment against him is.
While the court, the Appellate Division in Manhattan, did not rule directly on the merits of Mr. Trump’s appeal, its ruling suggests that some of the judges could be sympathetic to Mr. Trump’s case, legal experts said.
But the decision in Mr. Trump’s favor was eclipsed only an hour later by a decision against him in one of his four criminal cases, underscoring the remarkable breadth of his legal problems as he seeks to reclaim the White House. In his Manhattan criminal case, the judge finalized an April 15 trial date, rejecting the former president’s effort to delay.
In the civil fraud case, Mr. Trump’s lawyers had asked the appeals court to either accept a smaller bond or pause the bond requirement altogether. They argued that the court would be likely to overturn the $454 million penalty, contending that it was “grossly disproportionate and unconstitutional.”
A spokeswoman for the attorney general, Letitia James, noted that Mr. Trump was “still facing accountability for his staggering fraud” and that the judgment “still stands.”
But Mr. Trump’s legal team celebrated the ruling. “The ruling today represents a great first step towards the ultimate reversal of a baseless and reckless judgment,” said Christopher M. Kise, one of his lawyers.
Mr. Trump has repeatedly attacked Ms. James and the trial judge, Arthur F. Engoron, as politically biased Democrats leading a witch hunt against him.
After Monday’s hearing, Mr. Trump held a news conference at 40 Wall Street, a crucial property in his portfolio and one that Ms. James signaled her intent to seize if Mr. Trump did not post bond.
Mr. Trump once again made broad assertions that the legal system was being weaponized by his political opponents, accusing Ms. James, Justice Engoron and the prosecutors in his criminal cases of trying to “take as much of his money as possible.”
Justice Engoron found Mr. Trump liable last month for conspiring to inflate his net worth to reap financial benefits, including favorable loans from banks. The $454 million judgment reflected the interest payments Mr. Trump saved by misleading his lenders, as well as profits from the recent sale of two properties.
Justice Engoron imposed several restrictions on Mr. Trump and his family business, barring him from running a New York company and obtaining a loan from a New York bank for three years. The same restrictions apply to his adult sons for two years. The judge also extended the appointment of an independent monitor, a watchful outsider to keep an eye on the family business.
In a surprise move, the appeals court on Monday paused most of those restrictions, save for the monitor.
Mr. Trump is fighting all of the punishments, but it was the financial penalty that he feared the most.
To secure the full $454 million bond, he would have needed to pledge even more than that — about $557 million, his lawyers said — in collateral to a bond company, including as much cash as possible and stocks and bonds he could sell quickly. He would have also owed the bond company a fee that could have amounted to nearly $20 million.
In a recent court filing, Mr. Trump’s lawyers called securing a bond for the full amount a “practical impossibility,” and revealed that he had approached more than 30 bond companies to no avail.
The reason was clear: Much of Mr. Trump’s wealth is tied up in the value of his real estate, which bond companies rarely accept as collateral. A recent New York Times analysis found that Mr. Trump had more than $350 million in cash as well as stocks and bonds, far short of the $557 million he would have needed to post in collateral.
He did, however, have enough collateral to recently post a $91.6 million bond in the defamation case he lost to E. Jean Carroll. And he appears to have enough to secure a $175 million bond in the case brought by Ms. James.
Still, doing so will eat into much of his stockpile of cash and other liquid investments. So long as Mr. Trump has to pledge money as collateral, he cannot use it to fund his family business or presidential campaign.
While the bond does not represent a fatal threat to the Trump Organization, it could curb any hope the company has of growing and effectively reduce Mr. Trump’s net worth.
But it could have been worse. Without a bond, Ms. James could have wielded broad authority to freeze various bank accounts, and she could have begun the long, complicated process of trying to seize some of Mr. Trump’s buildings, including an estate in Westchester County.
This was an alarming prospect for Mr. Trump, whose identity is linked to his properties. In a social media post on Monday, Mr. Trump referred to them as “my babies.”
It is unclear whether these same five judges will also hear Mr. Trump’s appeal, but David B. Saxe, a former judge on the appeals court that ruled on Monday, said that the court’s decision to short-circuit Ms. James’s collection efforts suggests that some of the judges were uncomfortable with Justice Engoron’s ruling.
“My view is that the court indicates it has difficulty with the breadth of the lower court’s decision,” said Mr. Saxe, who retired in 2017 after 36 years on the bench, 19 of them on the appeals court.
“They had other options available to them, and they issued a broad-based stay,” he continued, which he said suggests “that there is a view that they’re going to need to take a hard look at the lower court’s decision.”
Michael Gold contributed reporting.
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