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On Thursday, New York Attorney General Letitia James requested sanctions in the amount of $10,000 per day until Donald Trump complies with the New York Supreme Court’s discovery order in her office’s four-year investigation of the former president and his eponymous company. On Friday, she filed a motion to compel Cushman & Wakefield, longtime appraisers for the Trump Organization, to comply with subpoenas for documents.

The motion treads familiar territory for anyone who has been closely observing the OAG’s efforts to pry loose information on the company’s allegedly hinky real estate valuations. The Seven Springs property in Westchester County gets a mention. Trump valued it at $291 million in 2012 when he was trying to buy the Buffalo Bills, but Cushman appraised it for just $56 million in 2015. And Trump’s golf course in Los Angeles, for which his lawyers at Morgan Lewis are reported to have aggressively managed Cushman’s appraisal, is in there, too.

There are also a whole lot of black redaction bars relating to 40 Wall Street, AKA the Trump Building in Manhattan. But the exhibits, particularly a March 3, 2022 letter to Cushman’s attorneys at Holland & Knight, give us a pretty good clue as to why negotiations with the OAG broke down.

Here’s the relevant passage:

First, our investigation is not limited to the actions of the Trump Organization. We are also investigating whether any other parties may have engaged in fraudulent or misleading practices in connection with certain commercial transactions involving the Trump Organization. Cushman prepared an Appraisal Report for 40 Wall Street as of June 1, 2015 for Ladder Capital Finance LLC (the “Appraisal”). That Appraisal was material to the $160 million loan obtained by the Trump Organization and was material to three later transactions securitizing that loan. The Appraisal more than doubled the stated value of the building from an appraisal prepared three years earlier for Capital One when it was assessing its loan on 40 Wall Street. At our meeting on January 5, 2022, you asserted that this valuation increase resulted from an overall increase in the New York real estate market between 2012 and 2015. We asked if you could identify any other similarly situated buildings that more than doubled in value (which you acknowledged was a “good question”) and you promised to look into it. Eight weeks later, however, we have received no follow-through from Cushman on any of the factual questions it committed to answer at that meeting.

Apparently, the OAG asked for comps to corroborate the claim that there was nothing odd about doubling the appraisal between 2012 and 2015, including asking for samples of that particular appraiser’s work, at which point Cushman stopped complying.

But wait, there’s more:

And there are issues on the face of the Appraisal that warrant our further investigation. Almost $170 million of the $340 million increase in the appraised value of 40 Wall Street is attributable to an increase in the assumed rental rates in the building. That increase is not supported by the rent roll at 40 Wall Street as the building was leasing space in June 2015, the same month as the date of the Appraisal, at rates 10-17 percent below the assumed market rate. Therefore, the accuracy of the market assessment made by the authors of the 40 Wall Appraisal is highly relevant to the accuracy of the overall Appraisal.

Which is … not a great look.

Cushman, like Trump, didn’t move to quash the subpoenas. Rather, it dispatched its lawyers to send long, nasty letters saying the requests were burdensome, overbroad, and part of a campaign of harassment. It even purported not to understand the phrase “Downtown Office Market,” despite using it itself in the 40 Wall Street appraisal.

The OAG counters that it is well within its jurisdiction to investigate how these appraisals came about, whether Trump got special treatment, including purpose-oriented valuations to suit a lender’s requirements, and why Cushman recently fired Trump as a client.

On April 25, Justice Arthur Engoron will hold yet another hearing on the discovery issues, including the sanctions request. Will attorney Alina Habba demand that the court investigate Hillary Clinton while Ron Fischetti yells that his client can’t plead the Fifth because it will be all over the papers, the way they did last time?

Fingers crossed!

Elizabeth Dye lives in Baltimore where she writes about law and politics.

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