The Law May Finally Be Closing in on Yet Another Alleged Trump Family Grift

How can you sue Donald Trump? Let us count the ways. One of the many private lawsuits filed against Trump in the last three years, this one for an allegedly fraudulent investment scheme promoted by Trump and his kids, made headlines (again) earlier this week when a New York judge allowed the case to proceed. The case offers a window into the kinds of activities allegedly used by the Trumps to generate income, and what it might reveal moving forward may not be great for Trump as he heads towards the November election. So what exactly is the case about?

The lawsuit goes back to October 2018, when plaintiffs filed a federal class action suit against Trump, his three eldest children (Don Jr., Eric, and Ivanka), and the family business for their role in an alleged pyramid scheme that caused them to suffer significant financial losses. The lawsuit initially included a civil RICO claim—essentially claiming that the Trump Organization operated as a criminal enterprise—which was dismissed by the court in July 2019.

White collar defense lawyer and former federal prosecutor Ken White explained to me that the dismissal of the RICO claim is not surprising, given both the complexity of the civil RICO statute and the reluctance of judges to entertain such claims outside the criminal context. However, the judge allowed the plaintiffs to proceed on their remaining claims of fraud, false advertising, and unfair competition—which ultimately constitute the real meat of the lawsuit.

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