A New York state judge on Tuesday ordered one of the world’s largest real estate firms — which appraised several of former President Donald J. Trump – in contempt of court in connection with a civil investigation into whether he falsely inflated the value of his assets.
The judge, Arthur F. Engoron, said the firm, Cushman & Wakefield, had failed to comply with subpoenas from the New York attorney general’s office in the investigation into Mr. Trump and his family business. He ordered the firm to pay a daily fine of $10,000 starting Thursday until it provides the requested documents to Attorney General Letitia James.
Judge Engoron, who separately held Mr Trump in contempt in April, chastised the firm for failing to respond to the court’s demands before a deadline earlier this month. “Cushman & Wakefield has only itself to blame if it chose to flout the looming deadlines,” Judge Engoron wrote in an order late Tuesday.
A spokesman for the real estate firm said on Wednesday that the company had gone to “great expense and effort” to comply with the subpoenas and would appeal the decision.
“The decision to hold Cushman & Wakefield in contempt demonstrates a misunderstanding of the extraordinary efforts Cushman has made to comply with the court’s order,” said spokesman Michael Bonshoft.
The contempt order comes at a critical time in Ms. James’ investigation into whether Mr. Trump and his family business, the Trump Organization, fraudulently overstated the value of his golf clubs, hotels and other real estate in annual financial statements.
Her investigators are due to question Mr Trump and two of his children under oath next week, the culmination of a three-year investigation.
Her office could file a lawsuit against Mr. Trump and the company in the weeks after the interviews, accusing them of fraudulently inflating the value of Mr. Trump’s properties to secure favorable loan terms and other financial benefits.
Cushman & Wakefield, which employs 50,000 people in more than 60 countries, was founded in New York more than a century ago and has become one of the largest real estate firms in the world. In addition to its brokerage services, the company also performs commercial property appraisals for clients.
The company was hired by the Trump Organization to appraise three of its properties at the center of Ms. James’s investigation — the Seven Springs estate in Westchester County, New York; Trump National Golf Club, Los Angeles in California; and 40 Wall Street in Lower Manhattan.
Ms. James sought information about those valuations from Cushman & Wakefield and information about the broader relationship with Mr. Trump.
“Cushman & Wakefield’s work for Donald Trump and the Trump Organization is clearly relevant to our investigation, and we are pleased that the court has recognized this and acted to compel Cushman to comply with our subpoenas,” Ms James said in statement. “No person or company, no matter how powerful, is above the law.”
The firm’s spokesman said the company had provided “hundreds of thousands of pages of documents and over 650 assessments” to the attorney general’s office since February. In his ruling Tuesday, Judge Engoron acknowledged that the subpoenas included voluminous documents, but said state rules allow for such requests.
Ms. James, a Democrat, has already written in court filings that the Trump Organization’s business practices are “deceptive or misleading” but has argued that her office should question Mr. Trump — as well as his two oldest children, Ivanka Trump and Donald Trump Jr. — to determine which employees of the Trump Organization are responsible for misconduct.
Find out about the New York AG’s Trump investigation
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Empire under the microscope. Letitia James, the New York state attorney general, is currently conducting a civil investigation into the business practices of former President Donald J. Trump. Here’s what you need to know:
The origin of the query. The investigation began after Michael D. Cohen, Mr. Trump’s former personal lawyer and go-between, testified before Congress that Mr. Trump and his staff manipulated his net worth to suit his interests.
Contempt judgment. A judge held Mr. Trump in contempt of court for failing to hand over documents to Ms. James, ordering him to provide the records and be fined $10,000 a day until he did so. Two weeks later, the judge lifted the injunction on the condition that Mr. Trump pay the $110,000 fine he had accrued during that period.
Because the investigation is civil, Ms. James could face a lawsuit, but not criminal charges. Still, a lawsuit could deal a significant blow to the former president. If Mr. Trump is found guilty at trial, a judge could impose severe financial penalties and curtail the Trump Organization’s operations in New York, at a time when Mr. Trump could run for president again.
Mr. Trump, who had to pay $110,000 to have his own contempt order lifted this spring, has denied any wrongdoing and called Ms. James’ investigation a “witch hunt.”
Judge Engoron concluded that Mr. Trump had not fully complied with Ms. James’s subpoena for his personal documents. Mr. Trump was eventually cleared of contempt, but only after he paid the fine and his lawyers clarified the extent to which they had searched his records.
Mr. Trump also resisted Ms. James’s efforts to impeach him under oath, arguing in part that he should not answer her questions while he also faces a criminal investigation by the Manhattan district attorney’s office for some of the same behavior.
But Judge Engoron disagreed and ordered Mr. Trump to sit for the deposition, a decision that was upheld by the New York State Court of Appeals.
The criminal investigation was headed toward indicting Mr. Trump earlier this year, until District Attorney Alvin L. Bragg raised concerns about whether his office had enough evidence to prove that Mr. Trump had intentionally misrepresented misrepresent the value of your property on your annual financial statements.
Some of the same challenges may arise in Ms. James’s civil case. At trial, Mr. Trump’s legal team is likely to argue that property valuations are subjective and that the errors were not intentional. They may also note that his financial statements contain numerous disclaimers, including that property valuations are unaudited.
Still, Ms. James appears to believe she has amassed enough evidence to take action against Mr. Trump. The former president, she said recently, “was caught” using “ridiculous numbers in his financial documents.”
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