A decision handed down by a New York judge over the Thanksgiving holiday weekend bolstered most of the key arguments in the state attorney general’s lawsuit against the Donald J. Trump Foundation.
Judge Saliann Scarpulla rejected the Trump Foundation’s motion to dismiss the suit in a Friday ruling. She affirmed that a sitting U.S. president can be sued for activities unrelated to his conduct in office. And she wrote that New York Attorney General Barbara Underwood’s allegations that President Trump used his personal charity to settle personal financial affairs and further his political career were “very serious.”
Scarpulla’s ruling was a green light allowing the case to proceed, exposing Trump to millions of dollars in potential penalties. Trump’s legal team must file a response within 45 days of her decision.
Here’s what you need to know about Scarpulla’s assessment of the case.
Yes, you can sue the U.S. President
Citing the landmark Clinton v. Jones Supreme Court ruling and the more recent decision in a former Apprentice star’s defamation suit against Trump, Scarpulla confirmed that sitting U.S. presidents can be sued.
Scarpulla quoted from New York Supreme Court Judge Schecter’s ruling in the Trump v. Zervos case: “There is absolutely no authority for dismissing or staying a civil action related purely to unofficial conduct because defendant is the President of the United States.”
“I find that I have jurisdiction over Mr. Trump,” Scarpulla wrote.
She dismissed as “meritless” the Trump team’s claims that a federal court would be better suited to handle the matter, given that the entire case hinges on New York state charity laws.
Scarpulla noted that Trump’s attorneys have appealed the Schecter ruling in the Zervos case, and that she will dismiss the petition against Trump if the appeals court reverses it. The other respondents—Trump Foundation board members Ivanka Trump, Eric Trump, and Donald Trump Jr.—could still face penalties if Underwood re-files the petition, Scarpulla said,
Claims of political bias are not going to fly
Trump and his team have made much of the notion that disgraced former Attorney General Eric Schneiderman, who initiated the investigation of the Foundation, was unfairly biased against the President.
But Scarpulla agreed with Underwood’s office’s counter-argument: that investigating potential charitable fraud is well within the purview of the attorney general’s office, and that their findings were legitimate.
“Given the very serious allegations set forth in the petition, I find that there is no basis for finding that animus and bias were the sole motivating factors for initiating the investigation and pursuing this proceeding,” Scarpulla wrote.
She had hinted in court that she was uninterested in getting sucked into any partisan bickering related to the Republican president and ousted Democratic attorney general.
The Iowa fundraiser substantially benefited Trump
Scarpulla determined that a January 2016 Iowa fundraiser Trump held to raise money for veterans appeared to provide him with free publicity that boosted his presidential bid.
The attorney general’s office “sufficiently alleges that Mr. Trump’s interest in the alleged acts of self-dealing were financial in nature and were substantial,” she wrote.
Trump held the event just days ahead of the Iowa caucuses in lieu of attending a GOP primary debate, asking wealthy friends to donate millions to veterans’ groups and directly to the foundation. His campaign built the website that managed the funds and dictated which organizations received them, and Trump disbursed the money at a series of campaign rallies across the state.
Scarpulla rejected the Trump’s team’s claims that he was merely a “passive recipient” of the funds.
Trump’s conduct appears “willful and intentional”
Under New York state law, “willful and intentional” misconduct by a charitable organization allows the attorney general to seek “an amount up to double the amount of any benefit improperly obtained.”
Trump’s attorneys have said Underwood’s office can’t prove he knew that what he was doing was improper. But Scarpulla said that the evidence they offered sufficed to move forward with the case. That included Trump signing foundation checks for veterans and then presenting them at rallies, and using his campaign to disburse those funds.
“These allegations sufficiently support a claim that Mr. Trump intentionally used Foundation assets for his private interests knowing that it may not be in the Foundation’s best interest,” Scarpulla said.
The foundation blurred the lines between charity and political organization
Trump’s attorneys have insisted that he was acting in his “individual capacity” when he appeared at campaign events carrying foundation checks, and therefore was not violating a ban on charities engaging in political activity.
But to make that legal argument, Trump would have had to avoid making “partisan statements” at these public appearances. Instead, he appeared at a MAGA-festooned podium, boasted about how the events could boost his political performance, and mocked his Republican primary opponents.
As Scarpulla wrote, Trump’s quotes from the fundraiser and subsequent rallies “show that Mr. Trump was acting in both of his capacities as campaign candidate and president of the Foundation.”
“Moreover, considering the allegations of coordination between the Campaign and Foundation, as well as the control and authority that Mr. Trump and the Campaign allegedly wielded over the Foundation, the petition adequately alleges that the political acts by Mr. Trump and the Campaign are attributable to the Foundation,” Scarpulla added.