Donald Trump and his Bond Posting Issues Explained

If you are like me and have seen the headlines about Trump having to post bond on multiple money judgments, but weren’t quite sure of the mechanics, this post is for you.

In short, appellants are often required to post a bond before prosecuting an appeal. Under Fed. R. Bankr. P. 8007(a)(1)(C), the purpose of requiring a bond is to indemnify the party prevailing in the original action against loss caused by an unsuccessful attempt to reverse the holding of the bankruptcy court.

In other words, it would be unfair and possibly an “abuse of process” to file frivolous appeals as a delay tactic, and requiring a bond makes the appellant put their money where their mouth is, so to speak.

There are other contexts in American jurisprudence where bonds are required. Both Section 337 of the Tariff Act and The Miller Act, 40 U.S.C.S. § 270(a) require “surety” bonds in commerce transactions.

For the purpose of this article, former President Donald Trump has suffered several jury verdicts recently. One of these is a several hundred million dollar verdict in a civil fraud case. If Mr. Trump is unable to post a bond worth $454 million dollars, his appeal will likely fail. I think this indicates warning lights flashing for the Trump Estate coffers, though that is admittedly purely speculative.

This verdict occurred in the Southern District of New York—a jurisdiction I’ve practiced in over the years and think very highly of. Yet this issue is indicative of the tenor of the nation now. There are real legal consequences to Mr. Trump, and I would imagine that even “Teflon Don” is losing some sleep over these cases.

But whether you love or hate him, Mr. Trump highlights many important questions of American Jurisprudence consistently. I feel like you could teach a torts, criminal, and constitutional law course all using scenarios he’s been involved in.

As always, nothing in this article shall be construed as legal advice. Neither the words contained herein or their thoughts and perspectives shall form an attorney-client relationship. Bankruptcy cases are complex and if you need legal advice in this area please seek legal counsel forthwith. James Olsen Law gives no legal or business/investing advice by virtue of these articles.