Former President Donald Trump got a break this week when an appeals court cut down the amount of money he needs to put up to pause collection while he appeals a $454 million-plus judgment in his New York civil fraud case.
Here's a look at what happened and what could happen next:
What's the judgment? How did we get here?
The judgment reflects the $355 million — plus interest and growing daily — that state Judge Arthur Engoron ordered Trump to pay after a monthslong trial.
The trial stemmed from a lawsuit brought by state Attorney General Letitia James. She claimed that Trump, his company and key executives engaged in fraud by pumping up the tycoon-turned-politician's fortune on financial statements that helped secure loans and insurance.
Trump, now once again the presumptive Republican presidential nominee, denied the allegations, as did his co-defendants. The defense said bankers and insurers used the unaudited statements only to inform their own assessments of Trump's finances, rather than basing business decisions on them. He says the documents understated his wealth, anyway.
Engoron ruled last month for the attorney general. Trump appealed.
What did the appeals court do?
A five-judge panel of appeals judges agreed Monday to put the collection on hold if Trump puts up $175 million within 10 days. It was a considerable reprieve, especially given that one of the judges had turned down Trump’s earlier offer of a $100 million bond.
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Jury selection had initially been set for Monday, but the trial was put on hold so lawyers could examine tens of thousands of pages of new evidence.
Under New York law, someone can hold off enforcement of a judgment during an appeal by posting a bond — essentially, a guarantee that the money will be paid if the appeal fails — or otherwise covering the amount owed. The idea is to ensure that people who have won judgments will be able to collect if they’re upheld.
Usually, that means the whole amount, but appeals courts can consider whether debtors would suffer an irreparable loss if they covered the judgment but later won their appeals, explains Jay Auslander, a New York lawyer who specializes in collecting big judgments.
Trump, for example, suggested on social media last week that he’d have to sell or mortgage properties, “perhaps at Fire Sale prices, and if and when I win the Appeal, they would be gone. Does that make sense?”
His lawyers said he was unable to arrange a bond for the full $454 million-plus. They said potential underwriters were requiring 120% of the judgment, or over $557 million, in collateral and would take only cash or other liquid assets, not real estate.
The Trump Organization's top lawyer, Alan Garten, said in a sworn statement that posting the full amount could affect the company's ability to retain employees, meet obligations and otherwise sustain its business. Trump, meanwhile, said on his Truth Social platform that he has almost $500 million in cash but wants the option of spending some on his campaign.
James' office, meanwhile, had filed notice of the judgment, a technical step toward potentially moving to collect.
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What does Trump plan to do now?
Shortly after learning of the appeals court's decision, Trump said he would swiftly come up with a bond, equivalent securities or cash.
Various companies offer appeals bonds, for a fee. They typically also require collateral.
“The bonding company is not going to put up a bond unless they're assured that they’re going to get paid back if they have to pay,” says Gregory Germain, a Syracuse University College of Law professor whose focuses include commercial law and bankruptcy.
Collateral can come in various forms, such as providing cash or pledging an investment account or, at least in theory, real estate.
Before Monday's ruling, Trump insurance broker and friend Gary Giulietti told the appeals court in a sworn statement that major underwriters generally won't issue a single bond for over $100 million. State lawyers have suggested Trump could get bonds from multiple sources. That has happened in other cases.
As for Trump's coffers, he could reap a windfall from his stock in his social media company. Share prices shot up Tuesday during Trump Media & Technology Group Corp.'s first day of trading on the Nasdaq exchange.
Trump holds a nearly 60% stake in the company, which could be worth billions of dollars if gains hold. For now, though, the company's “lock-up” provision prevents insiders from selling their newly issued shares for six months.
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Trading was so intense at point point Tuesday, there was a brief pause in trading of DJT to allow investors time to address the stock's volatility.
What has Trump done in other cases?
Earlier this month, Trump obtained a $91.6 million appeals bond to cover money that a federal civil court jury awarded to writer E. Jean Carroll. She alleges that Trump sexually assaulted her in the 1990s and then defamed her when she publicly accused him in 2019. He denies all of Carroll's claims and is appealing.
Federal Insurance Co., a unit of the insurance giant Chubb, underwrote that bond. It covers 110% of the $83.3 million owed.
After an earlier but related federal civil trial involving Carroll, Trump put more than $5.5 million in cash in a court escrow account while appealing the jury verdict in that trial.
If the verdict is upheld on appeal, that money will cover the judgment. Anything left over would go back to Trump.
If the verdict is ultimately overturned, he'll get the full amount back.
