Trump's Lawyers Told the Court That No One Would Give Him a Bond. Then He Got a Lifeline, but They Didn't Tell the Judges.
[Trump's] lawyers had told the appellate court it was a "practical impossibility" to get a bond for the full amount of the lower court's judgment, $464 million. All of the 30 or so firms Trump had approached balked, either refusing to take the risk or not wanting to accept real estate as collateral, they said. That made raising the full amount "an impossible bond requirement."
But before the judges ruled, the impossible became possible: A billionaire lender approached Trump about providing a bond for the full amount.
The lawyers never filed paperwork alerting the appeals court. That failure may have violated ethics rules, legal experts say.
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.
It's unclear if Trump lawyer Alina Habba or the rest of his legal team were made aware that Hankey reached out about a deal for the full amount. Trump's legal team did not respond to requests for comment.
After ProPublica reached out to Trump's representatives, Hankey called back and revised his account. He said he had heard "indirectly" about ProPublica's subsequent inquiries to Trump's lawyers. In the second conversation, he said that accepting the real estate as collateral would have been complicated and that he wouldn't have been able to "commit" to providing a bond in the full amount "until I evaluate the assets."
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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.
In the rules of conduct for lawyers, the failure to update an important piece of evidence would fall under what's referred to as the "duty of candor to a tribunal," said Ellen Yaroshefsky, a professor of legal ethics at Hofstra Law.
"Any judge is going to be furious that this wasn't corrected," she said.
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In his first interview with ProPublica, Hankey said that when he heard Trump was having trouble getting a bond, he reached out to Trump's camp, several days before the bond was reduced, with an offer to help.
