Donald Trump has vowed to fight the $83.3 million defamation penalty imposed by a federal jury on E.B. Jane Carroll – but he will need to turn that money over to the court while he pursues his appeal.
Unless Trump has that much money — and unless few people, even the really wealthy, tend to have that much capital — he will need to secure an appeal bond, an obscure type of insurance product that requires some very high sums. . Experts say the guarantees are valuable.
In this case, Trump can't just walk across the street from the courthouse to the bail bondsman's office, but he will need to hire a surety bond agent to secure the guarantee that Carroll will get her money if he loses on appeal.
“These bonds are required when there is an adverse judgment that the plaintiff intends to appeal,” said Mark Levinson, senior vice president of Brunswick Companies, which specializes in surety bonds in Cleveland, Ohio. “The purpose is to protect the plaintiff and limit the possibility of frivolous appeals.”
The bonds are usually guaranteed by an insurance company — in this case, given the size of the award, likely one of the top 20 in the country, Levinson said. He added that this policy is likely to be reinsured through other insurance companies.
Insurers and escrow agents will ask Trump to provide collateral equal in value to the size of the bond — whether that be cash assets, a piece of property, or an irrevocable line of credit issued by a financial institution.
Some legal experts have raised questions about Trump's ability to secure such bonds, but Levinson said he would be surprised if Trump couldn't convince a bank to give him a line of credit or obtain enough assets as collateral.
A message left with Trump's legal team in the Carroll case was not immediately responded to.
To secure the bonds, Trump will be required to provide extensive financial records to verify the value of any property he offers as collateral, Levinson said. But the process will be simpler if Trump succeeds in securing a line of credit from a bank with which he already has a relationship.
The only thing insurance companies will take into consideration is any further lawsuit the client faces and the possibility of requesting further payouts, which is high in Trump's case.
He has already had to pay $5 million in cash while appealing a separate civil suit in New York state court, where he was found liable for sexually assaulting and defaming Carole. A federal jury on Friday found the former president responsible for making derogatory statements against Carroll after she wrote an article saying he raped her in a New York City department store dressing room in the 1980s, and awarded her $83.3 million.
Trump denied sexually assaulting Carroll, saying: “She's not my type.”
Trump is also awaiting ruling in a civil case brought by the New York State Attorney General, who is seeking $370 million in damages and a lifetime ban against Trump from operating in New York over allegations that he illegally inflated the value of his assets while seeking insurance and damages. Shrinkage when paying taxes.
Trump denied the accusations and said the case was politically motivated.
He also faces several criminal cases on charges of racketeering, election tampering, incitement of insurrection, improperly withholding classified documents, and violating campaign finance laws by paying hush money to women who allegedly had affairs with him.
Trump has denied these accusations in all cases.
For the appeal bond in the Carroll case, Trump will likely pay between 1% and 3% of the total bond annually, depending on the strength of his finances and the assets he pledges — that is, between $833,000 and $2.5 million each year. The appeal is ongoing, Levinson said.
But the bond only functions as a placeholder of sorts. If Trump ultimately loses, he will have to pay the prize to Carroll out of his own pocket. Levinson says the likelihood of Trump having to pay is high.
“We write these policies with the understanding that you are likely to lose,” Levinson said. “Although the amount may eventually be reduced, approximately 90% of all appeals fail.”
