Court Rules Against Trump’s Business in Fraud Case Stemming from Sale of Controversial Hotel – By Jerry Lambe (Law and Crime) / March 30 2020
A federal court in Manhattan on Monday ruled against President Donald Trump’s private business, finding that a former business partner could pursue fraud claims stemming from allegations that the president’s company evaded income taxes and under-represented expenses at its scandal-plagued Panama hotel and condominium complex.
The plaintiffs, Ithaca Capital Investments (Capital), purchased a majority of the units in the Panama project in 2016, nearly two years before the Trump International Hotels Management (Trump International) entirely withdrew from the project, which is now JW Marriott.
In a 26-page opinion, U.S. District Judge Edgardo Ramos ruled that Ithaca could amend a previous lawsuit to add fraud claims against Trump International alleging the company induced purchase of a majority of the units by fraudulently misrepresenting the hotel’s performance. Ramos also dismissed Trump International’s counterclaims of breach of contract and fraudulent concealment and inducement against Ithaca.
According to the complaint, Trump’s company repeatedly provided Ithaca with false information while the company was conducting due diligence on the hotel’s financials prior to a potential purchase.
“At a meeting on August 1, 2016, Defendants’ representative falsely stated, among other things, that they had ‘[s]uperior market share’ and ‘the Hotel was achieving better financial results than the market in Panama, which was due to [Defendants’] operation of the Hotel,’” the complaint stated. “Plaintiffs allegedly relied on these representations in their later decision to purchase the units. Plaintiffs further allege that despite reviewing the Hotel’s financials, they could not have known at the time that the records provided by Defendants artificially deflated the Hotel’s expenses, as they discovered later after taking control of the Hotel in March 2018.”
Continue to article: https://lawandcrime.com/lawsuit/court-rules-against-trumps-business-in-fraud-case-stemming-from-sale-of-controversial-hotel/
