ProPublica has a new story out that raises a very serious question: Did Donald Trump’s lawyers lie to the the appellate court when they told the court that it was a “practical impossibility” to get a bond for the full amount of the lower court’s judgment of $464 million for falsifying financial statements?
You may recall that Trump’s lawyers told the appellate court that they got rejected by over 30 companies to cover a bond for $464 million, and the appellate court — without explanation — lowered the bond amount to $175 million — which is being covered by billionaire Don Hankey’s Knight Specialty Insurance Company. However, ProPublica’s interview with Hankey seems to show that Trump’s lawyers lied when they claimed to the court that raising the full amount was “an impossible bond requirement.” That’s because prior to the court lowering the amount, Trump’s lawyers were already in serious negotiations with Hankey to cover the full $464 million, but didn’t disclose this to the courts — a clear ethics violation. (Side note: ProPublica notes that Hankey took a break from a game of bocce to speak to them, LOL.)
In an interview with ProPublica, billionaire California financier Don Hankey said he reached out to Trump’s camp several days before the bond was lowered, expressing willingness to offer the full amount and to use real estate as collateral.
“I saw that they were rejected by everyone and I said, ‘Gee, that doesn’t seem like a difficult bond to post,’” Hankey said.
As negotiations between Hankey and Trump’s representatives were underway, the appellate court ruled in Trump’s favor, lowering the bond to $175 million. The court did not give an explanation for its ruling.
Hankey ended up giving Trump a bond for the lowered amount.
After his first interview with ProPublica, Hankey apparently realized that he had stepped in it and reached back out to them to try to muddy the waters and about exactly what he promised to Trump’s lawyers and when he did so, but even his revised timeline, whether true or not, could spell trouble for Trump’s lawyers.
New York state’s rules of professional conduct for lawyers forbid attorneys from knowingly making false statements to a court. At the time Trump’s lawyers told the court that meeting the bond would be impossible, Hankey said he had not yet reached out to the Trump team.
But the rules of conduct also dictate that lawyers must “correct a false statement of material fact or law previously made” to the court.
“If that deal was on the table for the taking, the representation from the earlier time would be untrue, and the lawyer would have an obligation to correct,” said Stephen Gillers, a legal ethics professor at New York University Law School.
Trump’s lawyers never followed up to correct their false statements to the appellate court.
It will be interesting to see if Judge Engoron brings this up in the April 22 hearing regarding the validity of the bond. Per Michael Popok over at the MeidasTouch Network, Engoron has the power to make a grievance referral to the bar.
I encourage you to hear Popok’s detailed and expert take on these new and disturbing revelations: