AG Files Motion to Dismiss Trump Lawsuit to Halt the AG’s Investigation, Citing Baseless Arguments and Ignoring the Ongoing State Court Proceeding
New York Attorney General Letitia James today took action to stop Donald J. Trump’s baseless efforts to thwart the ongoing lawful and justified investigation into his and the Trump Organization’s financial dealings. On December 20, 2021, Donald J. Trump took the unwarranted action of filing a lawsuit against Attorney General James in federal court seeking to stop this investigation and interfere with the related state court proceeding. In a motion to dismiss the federal lawsuit, filed today in the U.S. District Court for the Northern District of New York, Attorney General James argues that the lawsuit is a baseless attempt to forum shop and should be dismissed on both procedural and substantive grounds.
The motion to dismiss argues that the federal court should decline to hear the case in deference to the ongoing state court action under well-settled legal doctrines that bar federal courts from considering claims that could be more efficiently and appropriately brought in ongoing state court actions. It also argues that Donald J. Trump and the Trump Organization have acknowledged the legitimacy of this investigation and largely complied with it for almost three years, which precludes them from contesting the basis for the investigation or asserting their claims in federal court.
“This lawsuit is nothing but a baseless and meritless collateral attack by Donald Trump to stop our legal and legitimate investigation into his and the Trump Organization’s financial dealings,” said Attorney General James. “In the three years that we have been conducting this investigation, the Trump Organization and its principles have never challenged the legality of the investigation, until now, when Mr. Trump himself was subpoenaed to testify. We will not be deterred by frivolous lawsuits and will continue to follow the facts of this case because no one is above the law.”
Since this investigation began almost three years ago, neither the Trump Organization nor Donald J. Trump has ever challenged the underlying legal basis for this investigation or the Office of the Attorney General's (OAG) authority to conduct this investigation. In fact, both the Trump Organization and Mr. Trump have acknowledged its legitimacy by largely complying with subpoenas and other legal actions. To date, the Trump Organization has produced more than 900,000 documents, has brought in more than a dozen employees for testimony, and has been subject to multiple orders entered by the presiding state court judge requiring compliance with OAG’s subpoenas. None of these orders has ever been appealed. Only now that Mr. Trump himself has been subpoenaed to testify has he suddenly contested the legitimacy of the investigation.
The motion to dismiss also argues that this case should be dismissed for failure to state a claim. As set forth in OAG’s 113-page supplemental petition recently filed in the state court proceeding, OAG has gathered significant evidence indicating that the Trump Organization used fraudulent or misleading asset valuations to obtain a host of economic benefits, including loans, insurance coverage, and tax deductions, clearly establishing a legal basis for this investigation. Additionally, the judge presiding over the state court proceeding has compelled the Trump Organization and its employees and agents to comply with numerous OAG subpoenas, confirming that OAG has a sufficient factual and legal basis under New York law to issue the subpoenas.
Lastly, Mr. Trump and the Trump Organization are using their federal action to improperly collaterally attack the state court orders entered in New York Supreme Court that rejected their efforts to oppose OAG’s subpoenas and compelled their compliance. Under settled law, Mr. Trump and the Trump Organization are “state-court losers,” and therefore cannot ask a federal court to review and reject the state court orders that required compliance with OAG’s subpoenas.
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