Preview
FILED: NEW YORK COUNTY CLERK 01/04/2024 11:10 PM INDEX NO. 452564/2022
NYSCEF DOC. NO. 1661 RECEIVED NYSCEF: 01/04/2024
In The Matter Of:
People of The State of New York v.
Donald Trump
ELI BARTOV, KEVIN SNEDDON & ERIC LEWIS
December 12, 2023
Cheryl-Lee Lorient
Original File December 12 2023 People v. Trump.txt
Min-U-Script® with Word Index
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FILED: NEW YORK COUNTY CLERK 01/04/2024 11:10 PM INDEX NO. 452564/2022
NYSCEF DOC. NO. of1661
People The State of New York v. RECEIVED
ELI BARTOV, KEVIN NYSCEF:
SNEDDON 01/04/2024
& ERIC LEWIS
Donald Trump December 12, 2023
Page 6465 Proceedings Page 6467
1 SUPREME COURT OF THE STATE OF NEW YORK
COUNTY OF NEW YORK - CIVIL TERM - PART 37 1 COURT OFFICER: Part 37 is now in session. The
2 ---------------------------------------------X 2 Honorable Judge Arthur Engoron presiding. Make sure all
PEOPLE OF THE STATE OF NEW YORK, BY LETITIA
3 JAMES, ATTORNEY GENERAL OF THE STATE OF 3 cell phones are on silent. Laptops and cell phones will be
NEW YORK,
4 4 permitted but only to members of the press. There is
Plaintiff, Index No.
5 -against- 452564/2022 5 absolutely no recording or photography of any kind allowed
6 DONALD J. TRUMP; DONALD TRUMP JR.; ERIC
TRUMP; IVANKA TRUMP; ALLEN WEISSELBERG; 6 in the courtroom. Now, please be seated and come to order.
7 JEFFREY McCONNEY; THE DONALD J. TRUMP 7 THE COURT: Okay. Welcome, everyone. Good
REVOCABLE TRUST; THE TRUMP ORGANIZIATION,
8 INC.; TRUMP ORGANIZATION LLC; DJT HOLDINGS 8 morning. Today we are going to continue, and I hope, finish
MANAGING MEMBER; TRUMP ENDEAVOR 12, LLC;
9 401 NORTH WABASH VENTURE, LLC; TRUMP OLD 9 the cross-examination of Mr. Bartov, Professor Bartov. And
POST OFFICE, LLC; 40 WALL STREET, LLC; and
10 seven SPRINGS, LLC, 10 then the plaintiffs want to call two rebuttal witnesses; is
11 Defendants.
--------------------------------------------- 11 that correct?
12 TRIAL 60 Centre Street 12 MR. WALLACE: Correct, Your Honor.
New York, New York
13 December 12, 2023 13 THE COURT: So let's talk about that. They're
B E F O R E:
14 14 proposed by plaintiff and opposed by defendants and sort of
HONORABLE ARTHUR F. ENGORON,
15 15 as an aside, I'll just note, everything in this case gets
Supreme Court Justice
16 16 litigated. If somebody wants an expert, the other side
A P P E A R A N C E S: 17 says, no, they are not an expert. They can't testify. They
17 OFFICE OF THE ATTORNEY GENERAL
OF THE STATE OF NEW YORK - LETITIA JAMES 18 don't know what they're talking about, etc., etc. etc. And
18 Attorneys For the Plaintiff
28 Liberty Street 19 I'm going to draw now on this letter that just came hours
19 New York, New York 10005
BY: KEVIN WALLACE, ESQ. 20 ago. I am going to draw on my general knowledge and on the
20 COLLEEN K. FAHERTY, ESQ.
ANDREW AMER, ESQ. 21 letter itself for what I'm about to say.
21 ERIC HAREN, ESQ. 22 The basic purpose of a rebuttal witness is to
LOUIS SOLOMON, ESQ.
22 MARK LADOV,ESQ. 23 challenge or contradict, I'll say it's to be rebut, but that
SHERIEF GABER, ESQ.
23 ALEX FINKELSTEIN, ESQ. 24 would be a circular definition, the other side's testimony
24
25 (Whereupon, appearances continued on the following page.) 25 and its also going to be used to impeach which may be
Page 6466 Proceedings Page 6468
1 1 somewhat overlapping concepts. And the -- a rebuttal expert
2 Cont'd Appearances .....
3 2 is allowed to rely on matters in the record and personal
4 3 experience. I don't think personal experience will be much
CONTINENTAL PLLC 4 of an issue here, maybe. There's an exception which I
5 Attorneys For the Defendant
101 North Monroe Street, Suite 750 5 always like, it comes up in different areas of law, for an
6 Tallahassee, Florida 6 expert can rely on what experts generally rely on, what
BY: CHRISTOPHER KISE, ESQ. 7 experts consider reliable. That's a little bit of a dicey
7 JESUS SUAREZ, ESQ.
8 8 fraud issue. We'll see if it really comes up here.
9 ROBERT & ROBERT, PLLC 9 And I do want to correct three misimpressions that
Attorneys for Defendants
10 526 RXR Plaza 10 the letter might create. One is -- well, I'm not sure it's
Uniondale, New York 11556 11 correcting. The defendants came up with -- they would like,
11 BY: CLIFFORD ROBERT, ESQ. 12 if there are rebuttal -- if there are rebuttal witnesses, to
12
13 13 have sur-rebuttal witnesses. The only case that having
14 HABBA MADAIO & ASSOCIATES, LLP 14 support of that was in the criminal context, so I don't put
Attorneys for Defendants 15 much stock in that. They're different implications to
15 1430 US Highway 296, Suite 240
Bedminister, New Jersey 07921 16 criminal cases.
16 BY: ALINA HABBA, ESQ. 17 Second, there was an assertion or an implication
17 18 that plaintiff did not call any experts. I believe I deemed
18
CHERYL-LEE LORIENT 19 Michael McConney an expert; is that correct?
19 SHAMEEKA HARRIS 20 MR. WALLACE: Correct, Your Honor.
SENIOR COURT REPORTERS 21 THE COURT: Thank you. And, finally, there's
20
21 22 misinterpretation of the best evidence rule. The best
22 23 evidence rule basically says if you want to introduce a
23
24 24 document you have to introduce the original. If you can't
25 25 find or can't access the original, you have to give a good
Min-U-Script® Cheryl-Lee Lorient (1) Pages 6465 - 6468
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FILED: NEW YORK COUNTY CLERK 01/04/2024 11:10 PM INDEX NO. 452564/2022
NYSCEF DOC. NO. of1661
People The State of New York v. RECEIVED
ELI BARTOV, KEVIN NYSCEF:
SNEDDON 01/04/2024
& ERIC LEWIS
Donald Trump December 12, 2023
Proceedings Page 6469 Proceedings Page 6471
1 reason why you're not producing the original. I think that 1 have this surprised witness that we could have called
2 rule goes back centuries to when we didn't have 2 earlier. So it would be limited to rebutting but go ahead.
3 photocopiers, digital reproduction. We had scribblers so 3 MR. KISE: The same is true of Professor Lewis. If
4 they can make errors. That's why you wanted the original 4 the Court is going to ignore the Black Letter Law and allow
5 but the rule still exist but that's its limitation. 5 Professor Lewis to testify under these circumstances where
6 It is not some sort of catch all, well, we think 6 he clearly is their expert, should have been called, could
7 they could have introduced better evidence so this isn't the 7 have been called and should have been called in their
8 best evidence. No. I would say there is no general 8 case-in-chief to present affirmative evidence, evidence that
9 prohibition on introducing evidence that may not be the 9 we're not able to meet now because our experts can't testify
10 best. You could have trials on what's the best evidence, 10 about what they think Lewis is going to say on the stand or
11 trials within trials. So, I reject that particular 11 any other expert that hasn't testified. Mr. Wallace made a
12 assertion. I see no reason not to allow these two purported 12 big pitch on that last week when we even talked about
13 experts to testify subject to objections on the particular 13 hypothetical numbers.
14 questions being offered. 14 Mr. Wallace said, oh, well, those numbers aren't in
15 MR. WALLACE: May I just offer one correction, Your 15 the record and they can't talk about this and they can't
16 Honor. One is a fact witness, that's Mr. Sneddon. And one 16 talk about that. It's all in the record. So, okay, if our
17 is an expert, that's Professor Lewis. 17 expert can't talk about anything because it's not in the
18 THE COURT: Most of the letter was about Lewis so. 18 trial record, they don't get to tactically now say, all
19 Anything else before I turn to defendants? I see no reason 19 right, now, we are going to bring in Lewis and deprive you
20 to allow -- not to allow these experts, but if you want to 20 of any opportunity to rebut -- to provide a sur-rebuttal to
21 reargue the letter, which I read very carefully, go ahead. 21 Lewis.
22 MR. KISE: I won't reargue the letter. Thank you, 22 I mean, in the first instance, any of his testimony
23 Your Honor. I am not going to reargue the letter, but I am 23 should have been provided on direct. They had full access
24 going to point out that this is clearly -- the Government 24 to the experts. As you know, from prior conversations, our
25 has held these witnesses back. They could have called these 25 initial and rebuttal reports are really somewhat of a
Proceedings Page 6470 Proceedings Page 6472
1 witnesses, particularly Mr. Sneddon, on their -- in their 1 misnomer because they were all exchanged at the same time.
2 affirmative case. The case law from the Court of Appeals is 2 So the experts were designated in most cases as both. They
3 quite clear that rebuttal is limited to just that rebuttal. 3 are not really one or the other. Professor Lewis put on an
4 If we didn't introduce the issue in our case, they can't now 4 affirmative -- provided an affirmative report. He also
5 say, oh, well, I'm rebutting your case by calling a witness 5 provided what we are calling our rebuttal report in this
6 that was fully available to them. They called Allen 6 case which responds to our experts, but in the nature of the
7 Weisselberg. They cross-examined Allen Weisselberg. They 7 timing, the way the case, according to the case law, should
8 called Jeff McConney. They cross-examined Jeff McConney. 8 have laid out is if the Government wanted to introduce
9 When Jeff McConney took the stand in our case, they also 9 Professor Lewis testimony, they would have called him in
10 cross-examined Jeff McConney. 10 their case-in-chief and introduced that testimony.
11 None of the issues that Mr. Sneddon -- at least 11 Then we would have rebutted it in the ordinary
12 from what we can see. Again, we have no proffer which I 12 course. We would have had the opportunity to challenge that
13 tried to get out of the Government last week and that was 13 testimony in the ordinary course. And then to the extent
14 rejected -- but none of the issues that Mr. Sneddon can 14 that new issues were raised or issues requiring rebuttal
15 possibly speak to relate to anything that happened in our 15 along the lines of the case law that Your Honor is
16 case. They may relate to testimony that they elicited in 16 acknowledging, they would then be able to, perhaps, recall
17 their case but the time to have dealt with that has passed. 17 Professor Lewis. But to come along now and introduce
18 THE COURT: Okay. I do -- plaintiff, do you agree 18 Professor Lewis opinions -- and I'll put that word in quotes
19 with what was just said? 19 because we are going to renew our challenge -- to the extent
20 MR. WALLACE: I do not agree. And, I believe, when 20 the Court is going to allow him to testify, we are going to
21 Mr. Sneddon testifies, it will be obvious that he is 21 renew our motion in limine. We can take that up after
22 rebutting evidence that came in during the defendants' case. 22 Professor Bartov is done so we don't waste court time at
23 THE COURT: And I completely agree with you, 23 this moment. But there has to be some opportunity for the
24 Mr. Kise, as a general proposition. You can't just hold 24 defense then to meet whatever evidence they've held back.
25 back on your case-in-chief and then say, oh, by the way, we 25 They don't get to, like, through some sort of
Min-U-Script® Cheryl-Lee Lorient (2) Pages 6469 - 6472
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FILED: NEW YORK COUNTY CLERK 01/04/2024 11:10 PM INDEX NO. 452564/2022
NYSCEF DOC. NO. of1661
People The State of New York v. RECEIVED
ELI BARTOV, KEVIN NYSCEF:
SNEDDON 01/04/2024
& ERIC LEWIS
Donald Trump December 12, 2023
Proceedings Page 6473 Proceedings Page 6475
1 parlor tricks -- this is exactly what the case law from the 1 our directed verdict motion, we had no choice but to put
2 Court of Appeals speaks to, that the two reasons for not 2 Mr. Flemmons on to testify to make sure that the record was
3 allowing this sort of practice is, one, to preclude 3 clear from the defense standpoint. We couldn't waive that
4 gamesmanship which there's -- 4 opportunity but that doesn't now give them license to come
5 MR. WALLACE: I apologize for interrupting 5 back in afterwards realizing that there is a hole, realizing
6 Mr. Kise. Mr. Lewis will testify in response to evidence 6 that they haven't established what they needed to establish
7 that Mr. Flemmons put in. That would be the scope of his 7 under ASC 274, whatever it is that Professor Lewis purports
8 testimony so that is rebuttal testimony. Flemmons offered 8 to testify about, those were matters that must and should
9 testimony about what GAAP says concerning some of the 9 have been taken up in their affirmative case.
10 compilation and the standards applicable. Professor Lewis 10 And, respectfully, I would suggest to this court to
11 will testify to that. He's not testifying as to valuations. 11 reconsider. This is reversible error respectfully. Letting
12 He's not doing other work. Flemmons said "X". Lewis will 12 this in under these circumstances where they had clear
13 say not "X". That will be the scope of the testimony. 13 notice of what the issues were, they had the clear burden of
14 MR. KISE: So with that proffer -- that's certainly 14 proof. They failed to meet that burden of proof. And I'm
15 helpful and I appreciate that and ordinarily I don't 15 not being disrespectful to the Court. I'm just laying this
16 appreciate the interruption but in this case it is helpful. 16 out. They had the clear burden of the proof and now to
17 If I am understanding clearly, nothing that is contained in 17 allow them to come along and backfill their case and then
18 Professor Lewis initial report will be the subject of his 18 later deprive us of any responsive opportunity on top of
19 testimony today; is that right? 19 that, I just don't see how that is supported under any of
20 MR. WALLACE: It could be issues that are 20 the cases that we've cited or any of the case law in
21 responsive to -- he has a view of ASC 274 that is different 21 New York.
22 from Mr. Flemmons. It may have been included in his 22 And I don't think that the Government can cite a
23 original report. We are not relying on ASC 274 as part of 23 single case where this can be allowed to happen where they
24 our case-in-chief, but the defendants have presented 24 could lay and wait, not prove their case, wait to see what
25 evidence on it. He is going to respond to that evidence. 25 we put on and then now come in and attack it as rebutting.
Proceedings Page 6474 Proceedings Page 6476
1 The form will be Mr. Flemmons said "X", what is 1 They are not rebutting anything. This is part of their
2 your view on that. It will be classic rebuttal. If there 2 affirmative case and that's what the case law speaks to as
3 is specific questions or areas that the defendants think go 3 well. It's not really rebuttal evidence when it is --
4 beyond the scope of rebuttal, they can object to those 4 directly corresponds to an affirmative element in their
5 questions. 5 case. There is nothing new here. So we would object to
6 MR. KISE: Setting aside whether Professor Lewis is 6 Your Honor allowing either of these witnesses to speak even
7 qualified to render those opinions, which we'll get to in 7 given the limitation that Mr. Wallace has so kindly
8 due course, then I just want to be clear what the scope of 8 provided. That still demonstrates that the testimony goes
9 the testimony is. If that's -- if that's clearly what it 9 to their affirmative burden.
10 is, then we'll take it up on -- we still object to the 10 And if they haven't met their affirmative burden
11 manner in which they've gone about doing this. The way they 11 before that witness takes the stand, then -- then there's no
12 should have done this, again, is to call Professor Lewis in 12 basis for rebuttal before our case is closed and our
13 their case-in-chief. 13 directed verdict motion should be granted on the basis that
14 They have the affirmative burden in the case to 14 they have admitted they've left out a key element of their
15 establish their points. They didn't establish this point. 15 case.
16 In other words, it was their burden to establish in the 16 THE COURT: So now that the specter of reversal has
17 record that ASC 274 provides "X". That's their burden. 17 been raised again, do you still want to call these
18 It's not our burden. We're the defense. If they didn't 18 witnesses?
19 include that in their case-in-chief, they don't get now, 19 MR. WALLACE: Yes, Your Honor. This is in sane
20 under the guises of rebuttal to backfill their case. That's 20 that we are spending 20 minutes, 15 minutes discussing this
21 clearly what they're doing. They're essentially 21 issue. This is -- he is going to respond to points, as I
22 acknowledging that they have a hole in their case-in-chief 22 said, defendants chose to put in their case. It doesn't go
23 because all Mr. Flemmons testified to were matters that they 23 to our bread. It is classic rebuttal. It is pure rebuttal.
24 have full knowledge of and that they had the burden of proof 24 They can object to individual questions, but we should move.
25 on in their case-in-chief. Because Your Honor did not grant 25 And we have witnesses waiting and start taking the
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FILED: NEW YORK COUNTY CLERK 01/04/2024 11:10 PM INDEX NO. 452564/2022
NYSCEF DOC. NO. of1661
People The State of New York v. RECEIVED
ELI BARTOV, KEVIN NYSCEF:
SNEDDON 01/04/2024
& ERIC LEWIS
Donald Trump December 12, 2023
Proceedings Page 6477 Proceedings Page 6479
1 witnesses. 1 case-in-chief.
2 MR. KISE: The only other thing I'll add to that, 2 So, apparently, there is some discretion even in
3 Your Honor, I would, again, direct the Court's attention to 3 the defendants' case. Mr. Kise, as usual, you're the soul
4 the cases we cited particularly the Reinoso, R-E-I-N-O-S-O, 4 of reasonableness. I agree with a good portion, I wouldn't
5 recent First Department case. 5 try to put a percentage on that, of the basic principles
6 "The plaintiff's failure to offer expert testimony 6 you're citing. I just totally disagree with your
7 as parts of case-in-chief, deprived her of the right to make 7 application. I know we got facts and we got law. And
8 use of it as affirmative evidence." 8 you're not applying your reasonable correct law to the
9 And that's clearly what's taking place here. They 9 procedural history of this case in my view.
10 did not offer Professor Lewis testimony as part of their 10 And, finally, I just want to mention that you refer
11 case-in-chief. Simply because the evidence is evidence 11 to Mr. Wallace's something like gracious limitation of what
12 that -- that contradicts our evidence, that doesn't make it 12 rebuttal will be. Well, that's not Mr. Wallace. That's
13 rebuttal evidence. But what you have to look to is whether 13 what the law is. A rebuttal witness is there to rebut. So
14 or not it was part of their initial burden. And this 14 we wasn't really limiting plaintiff at all. Let's get the
15 evidence that Mr. Wallace is describing was clearly part of 15 witness in, okay. Thanks Mike.
16 their initial burden. They clearly had the burden to 16 COURT OFFICER: Witness entering.
17 establish that if there were any GAAP violations or any ASC 17 ELI B A R T O V, a witness called by and on behalf of
18 274 violations this is in their complaint. 18 the Defendant, upon being previously duly sworn, was examined
19 Their complaint alleges these types of violations. 19 and testified as follows:
20 They are bound to prove the claim that they have asserted in 20 THE COURT: I'll remind the witness as usual that
21 their complaint and part of that would be to call an expert 21 he's still under oath.
22 and to testify about whether or not there were GAAP 22 And, Mr. Solomon, please continue.
23 violations, accounting violations, violations of ASC 274, 23 MR. SOLOMON: Thank you, Your Honor.
24 etc. The failure to do that doesn't mean that now they can 24 CONT'D CROSS-EXAMINATION
25 come along and bring in evidence that contradicts -- that 25 BY MR. SOLOMON:
Proceedings Page 6478 Professor Bartov - by Defendant - Cross (Mr. Solomon) Page 6480
1 contradicts our evidence. It's not a rebuttal. It's 1 Q Good morning, Professor.
2 filling a hole. It is classic backfilling and clearly 2 A Good morning.
3 within the purview of the cases from the Court of Appeals on 3 Q Do you recall that the SOFC, Statements of Financial
4 down and the First Department that say that this 4 Condition, at issue in case are complications?
5 gamesmanship is not to be -- not to be allowed. 5 A I do.
6 Mr. Robert may have something to add. 6 Q Would Donald Trump free to have order audited SOFC's if
7 MR. WALLACE: Your Honor, we have been talking 7 he chose?
8 about this for 20 minutes. We already had your ruling. 8 A If he chose to, of course.
9 THE COURT: Well, Mr. Kise likes to rebut my 9 Q Do you recall that Mazars at first and then Whitley
10 rulings. 10 Penn were the external accountants?
11 MR. ROBERT: If it makes you feel better, 11 A Yes.
12 Mr. Wallace, I'll be brief. Your Honor, based on your 12 Q With respect to the SOFC's in this case and the
13 ruling, are you then denying the application for a 13 external accountants in this case, do you agree with the
14 sur-rebuttal witness being called by us? 14 following statement, quote, importantly, since the external
15 THE COURT: Most likely but I'll see. 15 accountant that prepared the SOFC's has not audited the SOFC's,
16 MR. ROBERT: Then I will reserve argument on that 16 it is in no position to express an opinion on whether the SOFC's
17 until you make a decision on it. Fair enough. Just wanted 17 are GAAP compliant.
18 to check. 18 Do you agree with that statement?
19 See, Kevin, it was quick. 19 A Absolutely.
20 THE COURT: This was from Reinoso versus New York 20 Q Do you agree with the statement that Mr. Haigh Trump
21 City Transit Authority. My research department has come up 21 was responsible for the preparation and fair presentation of the
22 with a quote, moreover in civil cases, the trial court has 22 statements in accordance with GAAP and let me limit that beyond
23 discretion to allow rebuttal testimony that wouldn't have 23 that quote to the years 2011 through 2016, the June 30, 2016,
24 been, I guess, that would have been more -- would more 24 SOFC?
25 appropriately have been adduced as part of the parties' 25 A Yes.
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FILED: NEW YORK COUNTY CLERK 01/04/2024 11:10 PM INDEX NO. 452564/2022
NYSCEF DOC. NO. of1661
People The State of New York v. RECEIVED
ELI BARTOV, KEVIN NYSCEF:
SNEDDON 01/04/2024
& ERIC LEWIS
Donald Trump December 12, 2023
Professor Bartov - by Defendant - Cross (Mr. Solomon) Page 6481 Professor Bartov - by Defendant - Cross (Mr. Solomon) Page 6483
1 Q After Mr. Haigh Trump became president, did you -- do 1 A Well, in practice, you can say, hey, here are the
2 you understand that the trustees were then responsible for the 2 numbers. They reported a hundred million dollars cash. I'll
3 preparation and fair presentation of the statements in 3 take a 50 percent discount, and I just consider it to be 50
4 accordance with GAAP? 4 million. They reported $1 billion of asset. I take 50 percent
5 A Yes. 5 off, and I consider it as 500 million, etc. So there is no
6 Q Can we please pull up PX519. It's already in evidence, 6 economic consideration whatsoever. It is completely arbitrary.
7 I believe. 7 Q So I understand the process, it could work that the
8 Do you recognize this? Do you recognize this document, 8 lender here, Deutsche Bank, takes an amount that's stated on the
9 Professor? 9 financial condition, say a million dollars, gives it a
10 A Give me a chance to review it. Well, I review it at 10 50 percent reduction or haircut then values it at 500,000,
11 one point not recently but this is the credit report prepared by 11 right?
12 Deutsche Bank Private Wealth Management, Risk Management. 12 A Only if they -- if the 50 percent is the determined
13 Q If we could please turn to page 11. At the top, it 13 arbitrarily without any economic analysis.
14 carries over from the bottom of ten, Financial 14 Q In my example, I would say they take 50 percent. I
15 Analysis-Guarantor. So pages 10 to 11 Financial Analysis 15 want to make sure I understand how the math works. You take the
16 Guarantor. Do you see that, Professor? 16 million dollars from the stated number on the SOFC, 50 percent
17 A Mine is page nine. Mine version is page 9 and 10, I 17 of that Deutsche Bank decides that's the number they want to use
18 think. 18 so the Deutsche Bank adjusted value for that asset would be
19 MR. ROBERT: Mr. Solomon, I think he is looking at 19 $500,000?
20 the document number as opposed to how much produced at the 20 MR. KISE: Is he stating that this is what Deutsche
21 bottom. 21 Bank or he is making up a hypothetical?
22 Q If you look at the bottom PX519 and -- 22 MR. SOLOMON: Your Honor, can I finish my
23 A Yes, I see that. 23 examination or we excuse the witness.
24 Q So, the carryover paragraph, the last two sentences 24 MR. KISE: There is no excusing the witness. The
25 "based on the results of this due diligence, we made certain 25 question is whether he is mischaracterizing the evidence
Professor Bartov - by Defendant - Cross (Mr. Solomon) Page 6482 Professor Bartov - by Defendant - Cross (Mr. Solomon) Page 6484
1 assumptions that resulted in adjustments to reported values. 1 that comes before or whether he is stating a hypothetical.
2 Details on such adjustments are included in the analysis that 2 THE COURT: I believe it is a hypothetical.
3 follows. Pardon me. It's three sentences. Additional details 3 MR. SOLOMON: For the moment, Your Honor, it is a
4 are included in the guarantor financial statements." 4 hypothetical.
5 The we in the first sentence, do you understand that to 5 MR. KISE: If it is a hypothetical, it is an
6 be Deutsche Bank? 6 improper hypothetical because it fully contradicts the
7 A It sounds like it, yeah. I didn't read the whole 7 evidence in the record.
8 document, but it sounds like due diligent -- due diligence was 8 THE COURT: Totally disagree. Overruled.
9 prepared by Deutsche Bank, yes. 9 Q I am asking the mechanics of it. Thank you. If I
10 Q Do you recall testifying on your direct that when you 10 understand your testimony is that the mechanical automatic
11 reviewed credit memos, you came to the conclusion that Deutsche 11 discount was not done for the assets identified in Mr. Trump's
12 Bank did not perform a mechanical automatic discount to the 12 statement of financial condition?
13 value of the assets on the statements of financial condition? 13 A That's true.
14 A Well, to be accurate, yeah. That's true. That's true. 14 Q Can we please look at PX302 which is the 2018 DB credit
15 Yes, that's true. Okay. 15 memo.
16 Q That was your testimony on direct? 16 THE COURT: I just want to add, I understand your
17 A That was testimony. I provided explanation why but 17 point, Mr. Kise, and I shouldn't have shut it down like that
18 this was my testimony, yes. 18 but it was just a hypothetical. If you're going to use this
19 Q What did you mean by a mechanical automatic discount to 19 type of method, it is sort of automatic haircut, that's how
20 the value of assets on the statements of financial condition? 20 you would do it.
21 A Mechanical adjustment means that it doesn't base on 21 MR. SOLOMON: Yes, Your Honor. That question at
22 economic analysis. You don't care about economic analysis. You 22 that the time was a hypothetical.
23 care about arbitrary with the percentage, you take it off of the 23 THE COURT: Okay. So it's not assuming that that's
24 reported numbers without economic considerations. 24 what Deutsche Bank did. That's just if they did that that's
25 Q So how would that work in practice? 25 what it would have --
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FILED: NEW YORK COUNTY CLERK 01/04/2024 11:10 PM INDEX NO. 452564/2022
NYSCEF DOC. NO. of1661
People The State of New York v. RECEIVED
ELI BARTOV, KEVIN NYSCEF:
SNEDDON 01/04/2024
& ERIC LEWIS
Donald Trump December 12, 2023
Professor Bartov - by Defendant - Cross (Mr. Solomon) Page 6485 E.Bartov - Defendant - Cross/Mr.Solomon Page 6487
1 MR. SOLOMON: At that time, the question was a 1 CROSS EXAMINATION
2 hypothetical, that assumption, yes. 2 BY MR. SOLOMON:
3 Q If you could please turn to page ten -- withdrawn. 3 MR. SOLOMON: Let's go back to page nine of
4 Do you recognize this document, Professor? 4 25 on this document.
5 A I do. I do recognize it, yes. 5 Q. Professor, if you look at the bottom of PX 302, it
6 Q And what do you recognize it to be? 6 will tell you page nine of 25.
7 A This is the credit report, again, just like before 7 A. I see.
8 different date. 8 Q. Are you on this page that's on the screen?
9 Q And this is one that you looked at on your direct 9 A. I am.
10 examination, correct? 10 Q. Here, again, the last three sentences are the same
11 A I did, yeah. 11 or similar to the ones we saw in the earlier credit memo,
12 Q Could you please turn to page ten and if you look under 12 correct?
13 4 Trophy Properties. 13 A. Yes.
14 A Yes. 14 Q. I want you to look at the chart below now.
15 Q Was that the analysis you were looking at on your 15 A. Okay.
16 direct when you said that DB did its own valuation and did not 16 Q. Please, focus on the third row "real estate net
17 rely on the valuations in the statements of financial condition? 17 equity."
18 A Yes, I did. 18 A. Okay.
19 Q Do you recall testifying on your direct examination in 19 Q. If you go to the column "DJT 6/30/2014 client
20 response to questions from counsel that this analysis 20 reporting" do you see that?
21 demonstrates to you that Deutsche Bank did not use the numbers 21 A. I do.
22 in the SOFC's but rather did its on valuation? 22 Q. That is -- is this 3,000,000,867 or 3,867,000?
23 A This analysis means not only the table also the amount 23 A. My reading it is three billion.
24 of the language, the comment above and below. The -- you have 24 Q. 3,000,000,867. If you look right to it, to the
25 to consider the entire document not just the table in order to 25 right, "DB adjusted."
Page 6486 E.Bartov - Defendant - Cross/Mr.Solomon Page 6488
1 figure out that the analysis was based independently and not on, 1 Do you see that?
2 yeah, if you read the entire document, that's the conclusion. 2 A. I do.
3 Q So your conclusion is that Deutsche Bank did not use 3 Q. 1,933,000,500, right?
4 the numbers in the SOFC's but rather did its own valuation? 4 A. Yes.
5 A Based on the entire document. 5 Q. You can check my math if you want. But, I get
6 Q Based on? 6 that that's, exactly, fifty percent of the reported value,
7 A The entire document. 7 right?
8 Q The entire document? 8 A. Yes. Maybe. I trust your -- that's okay. Yes, I
9 A Yes. 9 accept that.
10 Q Thank you. 10 Q. Don't accept it. Is that, exactly, fifty percent
11 (Continued on next page) 11 of the client to credit --
12 12 A. Yes, it is.
13 13 Q. Okay. Now, look for the years 2015, client
14 14 reported 4,390,000,000, DB adjusted 2,000,000,195; fifty
15 15 percent again?
16 16 A. Yes.
17 17 Q. 2016, fifty percent again?
18 18 A. Yes.
19 19 Q. For the DB adjusted amount as compared to client
20 20 reported, right?
21 21 A. Yes.
22 22 Q. 2017, fifty percent?
23 23 A. Yes.
24 24 Q. That's the adjustment Deutsche Bank did again?
25 25 A. Yes.
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FILED: NEW YORK COUNTY CLERK 01/04/2024 11:10 PM INDEX NO. 452564/2022 NYSCEF DOC. NO. 1661 RECEIVED NYSCEF: 01/04/2024 In The Matter Of: People of The State of New York v. Donald Trump ELI BARTOV, KEVIN SNEDDON & ERIC LEWIS December 12, 2023 Cheryl-Lee Lorient Original File December 12 2023 People v. Trump.txt Min-U-Script® with Word Index 1 of 121 FILED: NEW YORK COUNTY CLERK 01/04/2024 11:10 PM INDEX NO. 452564/2022 NYSCEF DOC. NO. of1661 People The State of New York v. RECEIVED ELI BARTOV, KEVIN NYSCEF: SNEDDON 01/04/2024 & ERIC LEWIS Donald Trump December 12, 2023 Page 6465 Proceedings Page 6467 1 SUPREME COURT OF THE STATE OF NEW YORK COUNTY OF NEW YORK - CIVIL TERM - PART 37 1 COURT OFFICER: Part 37 is now in session. The 2 ---------------------------------------------X 2 Honorable Judge Arthur Engoron presiding. Make sure all PEOPLE OF THE STATE OF NEW YORK, BY LETITIA 3 JAMES, ATTORNEY GENERAL OF THE STATE OF 3 cell phones are on silent. Laptops and cell phones will be NEW YORK, 4 4 permitted but only to members of the press. There is Plaintiff, Index No. 5 -against- 452564/2022 5 absolutely no recording or photography of any kind allowed 6 DONALD J. TRUMP; DONALD TRUMP JR.; ERIC TRUMP; IVANKA TRUMP; ALLEN WEISSELBERG; 6 in the courtroom. Now, please be seated and come to order. 7 JEFFREY McCONNEY; THE DONALD J. TRUMP 7 THE COURT: Okay. Welcome, everyone. Good REVOCABLE TRUST; THE TRUMP ORGANIZIATION, 8 INC.; TRUMP ORGANIZATION LLC; DJT HOLDINGS 8 morning. Today we are going to continue, and I hope, finish MANAGING MEMBER; TRUMP ENDEAVOR 12, LLC; 9 401 NORTH WABASH VENTURE, LLC; TRUMP OLD 9 the cross-examination of Mr. Bartov, Professor Bartov. And POST OFFICE, LLC; 40 WALL STREET, LLC; and 10 seven SPRINGS, LLC, 10 then the plaintiffs want to call two rebuttal witnesses; is 11 Defendants. --------------------------------------------- 11 that correct? 12 TRIAL 60 Centre Street 12 MR. WALLACE: Correct, Your Honor. New York, New York 13 December 12, 2023 13 THE COURT: So let's talk about that. They're B E F O R E: 14 14 proposed by plaintiff and opposed by defendants and sort of HONORABLE ARTHUR F. ENGORON, 15 15 as an aside, I'll just note, everything in this case gets Supreme Court Justice 16 16 litigated. If somebody wants an expert, the other side A P P E A R A N C E S: 17 says, no, they are not an expert. They can't testify. They 17 OFFICE OF THE ATTORNEY GENERAL OF THE STATE OF NEW YORK - LETITIA JAMES 18 don't know what they're talking about, etc., etc. etc. And 18 Attorneys For the Plaintiff 28 Liberty Street 19 I'm going to draw now on this letter that just came hours 19 New York, New York 10005 BY: KEVIN WALLACE, ESQ. 20 ago. I am going to draw on my general knowledge and on the 20 COLLEEN K. FAHERTY, ESQ. ANDREW AMER, ESQ. 21 letter itself for what I'm about to say. 21 ERIC HAREN, ESQ. 22 The basic purpose of a rebuttal witness is to LOUIS SOLOMON, ESQ. 22 MARK LADOV,ESQ. 23 challenge or contradict, I'll say it's to be rebut, but that SHERIEF GABER, ESQ. 23 ALEX FINKELSTEIN, ESQ. 24 would be a circular definition, the other side's testimony 24 25 (Whereupon, appearances continued on the following page.) 25 and its also going to be used to impeach which may be Page 6466 Proceedings Page 6468 1 1 somewhat overlapping concepts. And the -- a rebuttal expert 2 Cont'd Appearances ..... 3 2 is allowed to rely on matters in the record and personal 4 3 experience. I don't think personal experience will be much CONTINENTAL PLLC 4 of an issue here, maybe. There's an exception which I 5 Attorneys For the Defendant 101 North Monroe Street, Suite 750 5 always like, it comes up in different areas of law, for an 6 Tallahassee, Florida 6 expert can rely on what experts generally rely on, what BY: CHRISTOPHER KISE, ESQ. 7 experts consider reliable. That's a little bit of a dicey 7 JESUS SUAREZ, ESQ. 8 8 fraud issue. We'll see if it really comes up here. 9 ROBERT & ROBERT, PLLC 9 And I do want to correct three misimpressions that Attorneys for Defendants 10 526 RXR Plaza 10 the letter might create. One is -- well, I'm not sure it's Uniondale, New York 11556 11 correcting. The defendants came up with -- they would like, 11 BY: CLIFFORD ROBERT, ESQ. 12 if there are rebuttal -- if there are rebuttal witnesses, to 12 13 13 have sur-rebuttal witnesses. The only case that having 14 HABBA MADAIO & ASSOCIATES, LLP 14 support of that was in the criminal context, so I don't put Attorneys for Defendants 15 much stock in that. They're different implications to 15 1430 US Highway 296, Suite 240 Bedminister, New Jersey 07921 16 criminal cases. 16 BY: ALINA HABBA, ESQ. 17 Second, there was an assertion or an implication 17 18 that plaintiff did not call any experts. I believe I deemed 18 CHERYL-LEE LORIENT 19 Michael McConney an expert; is that correct? 19 SHAMEEKA HARRIS 20 MR. WALLACE: Correct, Your Honor. SENIOR COURT REPORTERS 21 THE COURT: Thank you. And, finally, there's 20 21 22 misinterpretation of the best evidence rule. The best 22 23 evidence rule basically says if you want to introduce a 23 24 24 document you have to introduce the original. If you can't 25 25 find or can't access the original, you have to give a good Min-U-Script® Cheryl-Lee Lorient (1) Pages 6465 - 6468 2 of 121 FILED: NEW YORK COUNTY CLERK 01/04/2024 11:10 PM INDEX NO. 452564/2022 NYSCEF DOC. NO. of1661 People The State of New York v. RECEIVED ELI BARTOV, KEVIN NYSCEF: SNEDDON 01/04/2024 & ERIC LEWIS Donald Trump December 12, 2023 Proceedings Page 6469 Proceedings Page 6471 1 reason why you're not producing the original. I think that 1 have this surprised witness that we could have called 2 rule goes back centuries to when we didn't have 2 earlier. So it would be limited to rebutting but go ahead. 3 photocopiers, digital reproduction. We had scribblers so 3 MR. KISE: The same is true of Professor Lewis. If 4 they can make errors. That's why you wanted the original 4 the Court is going to ignore the Black Letter Law and allow 5 but the rule still exist but that's its limitation. 5 Professor Lewis to testify under these circumstances where 6 It is not some sort of catch all, well, we think 6 he clearly is their expert, should have been called, could 7 they could have introduced better evidence so this isn't the 7 have been called and should have been called in their 8 best evidence. No. I would say there is no general 8 case-in-chief to present affirmative evidence, evidence that 9 prohibition on introducing evidence that may not be the 9 we're not able to meet now because our experts can't testify 10 best. You could have trials on what's the best evidence, 10 about what they think Lewis is going to say on the stand or 11 trials within trials. So, I reject that particular 11 any other expert that hasn't testified. Mr. Wallace made a 12 assertion. I see no reason not to allow these two purported 12 big pitch on that last week when we even talked about 13 experts to testify subject to objections on the particular 13 hypothetical numbers. 14 questions being offered. 14 Mr. Wallace said, oh, well, those numbers aren't in 15 MR. WALLACE: May I just offer one correction, Your 15 the record and they can't talk about this and they can't 16 Honor. One is a fact witness, that's Mr. Sneddon. And one 16 talk about that. It's all in the record. So, okay, if our 17 is an expert, that's Professor Lewis. 17 expert can't talk about anything because it's not in the 18 THE COURT: Most of the letter was about Lewis so. 18 trial record, they don't get to tactically now say, all 19 Anything else before I turn to defendants? I see no reason 19 right, now, we are going to bring in Lewis and deprive you 20 to allow -- not to allow these experts, but if you want to 20 of any opportunity to rebut -- to provide a sur-rebuttal to 21 reargue the letter, which I read very carefully, go ahead. 21 Lewis. 22 MR. KISE: I won't reargue the letter. Thank you, 22 I mean, in the first instance, any of his testimony 23 Your Honor. I am not going to reargue the letter, but I am 23 should have been provided on direct. They had full access 24 going to point out that this is clearly -- the Government 24 to the experts. As you know, from prior conversations, our 25 has held these witnesses back. They could have called these 25 initial and rebuttal reports are really somewhat of a Proceedings Page 6470 Proceedings Page 6472 1 witnesses, particularly Mr. Sneddon, on their -- in their 1 misnomer because they were all exchanged at the same time. 2 affirmative case. The case law from the Court of Appeals is 2 So the experts were designated in most cases as both. They 3 quite clear that rebuttal is limited to just that rebuttal. 3 are not really one or the other. Professor Lewis put on an 4 If we didn't introduce the issue in our case, they can't now 4 affirmative -- provided an affirmative report. He also 5 say, oh, well, I'm rebutting your case by calling a witness 5 provided what we are calling our rebuttal report in this 6 that was fully available to them. They called Allen 6 case which responds to our experts, but in the nature of the 7 Weisselberg. They cross-examined Allen Weisselberg. They 7 timing, the way the case, according to the case law, should 8 called Jeff McConney. They cross-examined Jeff McConney. 8 have laid out is if the Government wanted to introduce 9 When Jeff McConney took the stand in our case, they also 9 Professor Lewis testimony, they would have called him in 10 cross-examined Jeff McConney. 10 their case-in-chief and introduced that testimony. 11 None of the issues that Mr. Sneddon -- at least 11 Then we would have rebutted it in the ordinary 12 from what we can see. Again, we have no proffer which I 12 course. We would have had the opportunity to challenge that 13 tried to get out of the Government last week and that was 13 testimony in the ordinary course. And then to the extent 14 rejected -- but none of the issues that Mr. Sneddon can 14 that new issues were raised or issues requiring rebuttal 15 possibly speak to relate to anything that happened in our 15 along the lines of the case law that Your Honor is 16 case. They may relate to testimony that they elicited in 16 acknowledging, they would then be able to, perhaps, recall 17 their case but the time to have dealt with that has passed. 17 Professor Lewis. But to come along now and introduce 18 THE COURT: Okay. I do -- plaintiff, do you agree 18 Professor Lewis opinions -- and I'll put that word in quotes 19 with what was just said? 19 because we are going to renew our challenge -- to the extent 20 MR. WALLACE: I do not agree. And, I believe, when 20 the Court is going to allow him to testify, we are going to 21 Mr. Sneddon testifies, it will be obvious that he is 21 renew our motion in limine. We can take that up after 22 rebutting evidence that came in during the defendants' case. 22 Professor Bartov is done so we don't waste court time at 23 THE COURT: And I completely agree with you, 23 this moment. But there has to be some opportunity for the 24 Mr. Kise, as a general proposition. You can't just hold 24 defense then to meet whatever evidence they've held back. 25 back on your case-in-chief and then say, oh, by the way, we 25 They don't get to, like, through some sort of Min-U-Script® Cheryl-Lee Lorient (2) Pages 6469 - 6472 3 of 121 FILED: NEW YORK COUNTY CLERK 01/04/2024 11:10 PM INDEX NO. 452564/2022 NYSCEF DOC. NO. of1661 People The State of New York v. RECEIVED ELI BARTOV, KEVIN NYSCEF: SNEDDON 01/04/2024 & ERIC LEWIS Donald Trump December 12, 2023 Proceedings Page 6473 Proceedings Page 6475 1 parlor tricks -- this is exactly what the case law from the 1 our directed verdict motion, we had no choice but to put 2 Court of Appeals speaks to, that the two reasons for not 2 Mr. Flemmons on to testify to make sure that the record was 3 allowing this sort of practice is, one, to preclude 3 clear from the defense standpoint. We couldn't waive that 4 gamesmanship which there's -- 4 opportunity but that doesn't now give them license to come 5 MR. WALLACE: I apologize for interrupting 5 back in afterwards realizing that there is a hole, realizing 6 Mr. Kise. Mr. Lewis will testify in response to evidence 6 that they haven't established what they needed to establish 7 that Mr. Flemmons put in. That would be the scope of his 7 under ASC 274, whatever it is that Professor Lewis purports 8 testimony so that is rebuttal testimony. Flemmons offered 8 to testify about, those were matters that must and should 9 testimony about what GAAP says concerning some of the 9 have been taken up in their affirmative case. 10 compilation and the standards applicable. Professor Lewis 10 And, respectfully, I would suggest to this court to 11 will testify to that. He's not testifying as to valuations. 11 reconsider. This is reversible error respectfully. Letting 12 He's not doing other work. Flemmons said "X". Lewis will 12 this in under these circumstances where they had clear 13 say not "X". That will be the scope of the testimony. 13 notice of what the issues were, they had the clear burden of 14 MR. KISE: So with that proffer -- that's certainly 14 proof. They failed to meet that burden of proof. And I'm 15 helpful and I appreciate that and ordinarily I don't 15 not being disrespectful to the Court. I'm just laying this 16 appreciate the interruption but in this case it is helpful. 16 out. They had the clear burden of the proof and now to 17 If I am understanding clearly, nothing that is contained in 17 allow them to come along and backfill their case and then 18 Professor Lewis initial report will be the subject of his 18 later deprive us of any responsive opportunity on top of 19 testimony today; is that right? 19 that, I just don't see how that is supported under any of 20 MR. WALLACE: It could be issues that are 20 the cases that we've cited or any of the case law in 21 responsive to -- he has a view of ASC 274 that is different 21 New York. 22 from Mr. Flemmons. It may have been included in his 22 And I don't think that the Government can cite a 23 original report. We are not relying on ASC 274 as part of 23 single case where this can be allowed to happen where they 24 our case-in-chief, but the defendants have presented 24 could lay and wait, not prove their case, wait to see what 25 evidence on it. He is going to respond to that evidence. 25 we put on and then now come in and attack it as rebutting. Proceedings Page 6474 Proceedings Page 6476 1 The form will be Mr. Flemmons said "X", what is 1 They are not rebutting anything. This is part of their 2 your view on that. It will be classic rebuttal. If there 2 affirmative case and that's what the case law speaks to as 3 is specific questions or areas that the defendants think go 3 well. It's not really rebuttal evidence when it is -- 4 beyond the scope of rebuttal, they can object to those 4 directly corresponds to an affirmative element in their 5 questions. 5 case. There is nothing new here. So we would object to 6 MR. KISE: Setting aside whether Professor Lewis is 6 Your Honor allowing either of these witnesses to speak even 7 qualified to render those opinions, which we'll get to in 7 given the limitation that Mr. Wallace has so kindly 8 due course, then I just want to be clear what the scope of 8 provided. That still demonstrates that the testimony goes 9 the testimony is. If that's -- if that's clearly what it 9 to their affirmative burden. 10 is, then we'll take it up on -- we still object to the 10 And if they haven't met their affirmative burden 11 manner in which they've gone about doing this. The way they 11 before that witness takes the stand, then -- then there's no 12 should have done this, again, is to call Professor Lewis in 12 basis for rebuttal before our case is closed and our 13 their case-in-chief. 13 directed verdict motion should be granted on the basis that 14 They have the affirmative burden in the case to 14 they have admitted they've left out a key element of their 15 establish their points. They didn't establish this point. 15 case. 16 In other words, it was their burden to establish in the 16 THE COURT: So now that the specter of reversal has 17 record that ASC 274 provides "X". That's their burden. 17 been raised again, do you still want to call these 18 It's not our burden. We're the defense. If they didn't 18 witnesses? 19 include that in their case-in-chief, they don't get now, 19 MR. WALLACE: Yes, Your Honor. This is in sane 20 under the guises of rebuttal to backfill their case. That's 20 that we are spending 20 minutes, 15 minutes discussing this 21 clearly what they're doing. They're essentially 21 issue. This is -- he is going to respond to points, as I 22 acknowledging that they have a hole in their case-in-chief 22 said, defendants chose to put in their case. It doesn't go 23 because all Mr. Flemmons testified to were matters that they 23 to our bread. It is classic rebuttal. It is pure rebuttal. 24 have full knowledge of and that they had the burden of proof 24 They can object to individual questions, but we should move. 25 on in their case-in-chief. Because Your Honor did not grant 25 And we have witnesses waiting and start taking the Min-U-Script® Cheryl-Lee Lorient (3) Pages 6473 - 6476 4 of 121 FILED: NEW YORK COUNTY CLERK 01/04/2024 11:10 PM INDEX NO. 452564/2022 NYSCEF DOC. NO. of1661 People The State of New York v. RECEIVED ELI BARTOV, KEVIN NYSCEF: SNEDDON 01/04/2024 & ERIC LEWIS Donald Trump December 12, 2023 Proceedings Page 6477 Proceedings Page 6479 1 witnesses. 1 case-in-chief. 2 MR. KISE: The only other thing I'll add to that, 2 So, apparently, there is some discretion even in 3 Your Honor, I would, again, direct the Court's attention to 3 the defendants' case. Mr. Kise, as usual, you're the soul 4 the cases we cited particularly the Reinoso, R-E-I-N-O-S-O, 4 of reasonableness. I agree with a good portion, I wouldn't 5 recent First Department case. 5 try to put a percentage on that, of the basic principles 6 "The plaintiff's failure to offer expert testimony 6 you're citing. I just totally disagree with your 7 as parts of case-in-chief, deprived her of the right to make 7 application. I know we got facts and we got law. And 8 use of it as affirmative evidence." 8 you're not applying your reasonable correct law to the 9 And that's clearly what's taking place here. They 9 procedural history of this case in my view. 10 did not offer Professor Lewis testimony as part of their 10 And, finally, I just want to mention that you refer 11 case-in-chief. Simply because the evidence is evidence 11 to Mr. Wallace's something like gracious limitation of what 12 that -- that contradicts our evidence, that doesn't make it 12 rebuttal will be. Well, that's not Mr. Wallace. That's 13 rebuttal evidence. But what you have to look to is whether 13 what the law is. A rebuttal witness is there to rebut. So 14 or not it was part of their initial burden. And this 14 we wasn't really limiting plaintiff at all. Let's get the 15 evidence that Mr. Wallace is describing was clearly part of 15 witness in, okay. Thanks Mike. 16 their initial burden. They clearly had the burden to 16 COURT OFFICER: Witness entering. 17 establish that if there were any GAAP violations or any ASC 17 ELI B A R T O V, a witness called by and on behalf of 18 274 violations this is in their complaint. 18 the Defendant, upon being previously duly sworn, was examined 19 Their complaint alleges these types of violations. 19 and testified as follows: 20 They are bound to prove the claim that they have asserted in 20 THE COURT: I'll remind the witness as usual that 21 their complaint and part of that would be to call an expert 21 he's still under oath. 22 and to testify about whether or not there were GAAP 22 And, Mr. Solomon, please continue. 23 violations, accounting violations, violations of ASC 274, 23 MR. SOLOMON: Thank you, Your Honor. 24 etc. The failure to do that doesn't mean that now they can 24 CONT'D CROSS-EXAMINATION 25 come along and bring in evidence that contradicts -- that 25 BY MR. SOLOMON: Proceedings Page 6478 Professor Bartov - by Defendant - Cross (Mr. Solomon) Page 6480 1 contradicts our evidence. It's not a rebuttal. It's 1 Q Good morning, Professor. 2 filling a hole. It is classic backfilling and clearly 2 A Good morning. 3 within the purview of the cases from the Court of Appeals on 3 Q Do you recall that the SOFC, Statements of Financial 4 down and the First Department that say that this 4 Condition, at issue in case are complications? 5 gamesmanship is not to be -- not to be allowed. 5 A I do. 6 Mr. Robert may have something to add. 6 Q Would Donald Trump free to have order audited SOFC's if 7 MR. WALLACE: Your Honor, we have been talking 7 he chose? 8 about this for 20 minutes. We already had your ruling. 8 A If he chose to, of course. 9 THE COURT: Well, Mr. Kise likes to rebut my 9 Q Do you recall that Mazars at first and then Whitley 10 rulings. 10 Penn were the external accountants? 11 MR. ROBERT: If it makes you feel better, 11 A Yes. 12 Mr. Wallace, I'll be brief. Your Honor, based on your 12 Q With respect to the SOFC's in this case and the 13 ruling, are you then denying the application for a 13 external accountants in this case, do you agree with the 14 sur-rebuttal witness being called by us? 14 following statement, quote, importantly, since the external 15 THE COURT: Most likely but I'll see. 15 accountant that prepared the SOFC's has not audited the SOFC's, 16 MR. ROBERT: Then I will reserve argument on that 16 it is in no position to express an opinion on whether the SOFC's 17 until you make a decision on it. Fair enough. Just wanted 17 are GAAP compliant. 18 to check. 18 Do you agree with that statement? 19 See, Kevin, it was quick. 19 A Absolutely. 20 THE COURT: This was from Reinoso versus New York 20 Q Do you agree with the statement that Mr. Haigh Trump 21 City Transit Authority. My research department has come up 21 was responsible for the preparation and fair presentation of the 22 with a quote, moreover in civil cases, the trial court has 22 statements in accordance with GAAP and let me limit that beyond 23 discretion to allow rebuttal testimony that wouldn't have 23 that quote to the years 2011 through 2016, the June 30, 2016, 24 been, I guess, that would have been more -- would more 24 SOFC? 25 appropriately have been adduced as part of the parties' 25 A Yes. Min-U-Script® Cheryl-Lee Lorient (4) Pages 6477 - 6480 5 of 121 FILED: NEW YORK COUNTY CLERK 01/04/2024 11:10 PM INDEX NO. 452564/2022 NYSCEF DOC. NO. of1661 People The State of New York v. RECEIVED ELI BARTOV, KEVIN NYSCEF: SNEDDON 01/04/2024 & ERIC LEWIS Donald Trump December 12, 2023 Professor Bartov - by Defendant - Cross (Mr. Solomon) Page 6481 Professor Bartov - by Defendant - Cross (Mr. Solomon) Page 6483 1 Q After Mr. Haigh Trump became president, did you -- do 1 A Well, in practice, you can say, hey, here are the 2 you understand that the trustees were then responsible for the 2 numbers. They reported a hundred million dollars cash. I'll 3 preparation and fair presentation of the statements in 3 take a 50 percent discount, and I just consider it to be 50 4 accordance with GAAP? 4 million. They reported $1 billion of asset. I take 50 percent 5 A Yes. 5 off, and I consider it as 500 million, etc. So there is no 6 Q Can we please pull up PX519. It's already in evidence, 6 economic consideration whatsoever. It is completely arbitrary. 7 I believe. 7 Q So I understand the process, it could work that the 8 Do you recognize this? Do you recognize this document, 8 lender here, Deutsche Bank, takes an amount that's stated on the 9 Professor? 9 financial condition, say a million dollars, gives it a 10 A Give me a chance to review it. Well, I review it at 10 50 percent reduction or haircut then values it at 500,000, 11 one point not recently but this is the credit report prepared by 11 right? 12 Deutsche Bank Private Wealth Management, Risk Management. 12 A Only if they -- if the 50 percent is the determined 13 Q If we could please turn to page 11. At the top, it 13 arbitrarily without any economic analysis. 14 carries over from the bottom of ten, Financial 14 Q In my example, I would say they take 50 percent. I 15 Analysis-Guarantor. So pages 10 to 11 Financial Analysis 15 want to make sure I understand how the math works. You take the 16 Guarantor. Do you see that, Professor? 16 million dollars from the stated number on the SOFC, 50 percent 17 A Mine is page nine. Mine version is page 9 and 10, I 17 of that Deutsche Bank decides that's the number they want to use 18 think. 18 so the Deutsche Bank adjusted value for that asset would be 19 MR. ROBERT: Mr. Solomon, I think he is looking at 19 $500,000? 20 the document number as opposed to how much produced at the 20 MR. KISE: Is he stating that this is what Deutsche 21 bottom. 21 Bank or he is making up a hypothetical? 22 Q If you look at the bottom PX519 and -- 22 MR. SOLOMON: Your Honor, can I finish my 23 A Yes, I see that. 23 examination or we excuse the witness. 24 Q So, the carryover paragraph, the last two sentences 24 MR. KISE: There is no excusing the witness. The 25 "based on the results of this due diligence, we made certain 25 question is whether he is mischaracterizing the evidence Professor Bartov - by Defendant - Cross (Mr. Solomon) Page 6482 Professor Bartov - by Defendant - Cross (Mr. Solomon) Page 6484 1 assumptions that resulted in adjustments to reported values. 1 that comes before or whether he is stating a hypothetical. 2 Details on such adjustments are included in the analysis that 2 THE COURT: I believe it is a hypothetical. 3 follows. Pardon me. It's three sentences. Additional details 3 MR. SOLOMON: For the moment, Your Honor, it is a 4 are included in the guarantor financial statements." 4 hypothetical. 5 The we in the first sentence, do you understand that to 5 MR. KISE: If it is a hypothetical, it is an 6 be Deutsche Bank? 6 improper hypothetical because it fully contradicts the 7 A It sounds like it, yeah. I didn't read the whole 7 evidence in the record. 8 document, but it sounds like due diligent -- due diligence was 8 THE COURT: Totally disagree. Overruled. 9 prepared by Deutsche Bank, yes. 9 Q I am asking the mechanics of it. Thank you. If I 10 Q Do you recall testifying on your direct that when you 10 understand your testimony is that the mechanical automatic 11 reviewed credit memos, you came to the conclusion that Deutsche 11 discount was not done for the assets identified in Mr. Trump's 12 Bank did not perform a mechanical automatic discount to the 12 statement of financial condition? 13 value of the assets on the statements of financial condition? 13 A That's true. 14 A Well, to be accurate, yeah. That's true. That's true. 14 Q Can we please look at PX302 which is the 2018 DB credit 15 Yes, that's true. Okay. 15 memo. 16 Q That was your testimony on direct? 16 THE COURT: I just want to add, I understand your 17 A That was testimony. I provided explanation why but 17 point, Mr. Kise, and I shouldn't have shut it down like that 18 this was my testimony, yes. 18 but it was just a hypothetical. If you're going to use this 19 Q What did you mean by a mechanical automatic discount to 19 type of method, it is sort of automatic haircut, that's how 20 the value of assets on the statements of financial condition? 20 you would do it. 21 A Mechanical adjustment means that it doesn't base on 21 MR. SOLOMON: Yes, Your Honor. That question at 22 economic analysis. You don't care about economic analysis. You 22 that the time was a hypothetical. 23 care about arbitrary with the percentage, you take it off of the 23 THE COURT: Okay. So it's not assuming that that's 24 reported numbers without economic considerations. 24 what Deutsche Bank did. That's just if they did that that's 25 Q So how would that work in practice? 25 what it would have -- Min-U-Script® Cheryl-Lee Lorient (5) Pages 6481 - 6484 6 of 121 FILED: NEW YORK COUNTY CLERK 01/04/2024 11:10 PM INDEX NO. 452564/2022 NYSCEF DOC. NO. of1661 People The State of New York v. RECEIVED ELI BARTOV, KEVIN NYSCEF: SNEDDON 01/04/2024 & ERIC LEWIS Donald Trump December 12, 2023 Professor Bartov - by Defendant - Cross (Mr. Solomon) Page 6485 E.Bartov - Defendant - Cross/Mr.Solomon Page 6487 1 MR. SOLOMON: At that time, the question was a 1 CROSS EXAMINATION 2 hypothetical, that assumption, yes. 2 BY MR. SOLOMON: 3 Q If you could please turn to page ten -- withdrawn. 3 MR. SOLOMON: Let's go back to page nine of 4 Do you recognize this document, Professor? 4 25 on this document. 5 A I do. I do recognize it, yes. 5 Q. Professor, if you look at the bottom of PX 302, it 6 Q And what do you recognize it to be? 6 will tell you page nine of 25. 7 A This is the credit report, again, just like before 7 A. I see. 8 different date. 8 Q. Are you on this page that's on the screen? 9 Q And this is one that you looked at on your direct 9 A. I am. 10 examination, correct? 10 Q. Here, again, the last three sentences are the same 11 A I did, yeah. 11 or similar to the ones we saw in the earlier credit memo, 12 Q Could you please turn to page ten and if you look under 12 correct? 13 4 Trophy Properties. 13 A. Yes. 14 A Yes. 14 Q. I want you to look at the chart below now. 15 Q Was that the analysis you were looking at on your 15 A. Okay. 16 direct when you said that DB did its own valuation and did not 16 Q. Please, focus on the third row "real estate net 17 rely on the valuations in the statements of financial condition? 17 equity." 18 A Yes, I did. 18 A. Okay. 19 Q Do you recall testifying on your direct examination in 19 Q. If you go to the column "DJT 6/30/2014 client 20 response to questions from counsel that this analysis 20 reporting" do you see that? 21 demonstrates to you that Deutsche Bank did not use the numbers 21 A. I do. 22 in the SOFC's but rather did its on valuation? 22 Q. That is -- is this 3,000,000,867 or 3,867,000? 23 A This analysis means not only the table also the amount 23 A. My reading it is three billion. 24 of the language, the comment above and below. The -- you have 24 Q. 3,000,000,867. If you look right to it, to the 25 to consider the entire document not just the table in order to 25 right, "DB adjusted." Page 6486 E.Bartov - Defendant - Cross/Mr.Solomon Page 6488 1 figure out that the analysis was based independently and not on, 1 Do you see that? 2 yeah, if you read the entire document, that's the conclusion. 2 A. I do. 3 Q So your conclusion is that Deutsche Bank did not use 3 Q. 1,933,000,500, right? 4 the numbers in the SOFC's but rather did its own valuation? 4 A. Yes. 5 A Based on the entire document. 5 Q. You can check my math if you want. But, I get 6 Q Based on? 6 that that's, exactly, fifty percent of the reported value, 7 A The entire document. 7 right? 8 Q The entire document? 8 A. Yes. Maybe. I trust your -- that's okay. Yes, I 9 A Yes. 9 accept that. 10 Q Thank you. 10 Q. Don't accept it. Is that, exactly, fifty percent 11 (Continued on next page) 11 of the client to credit -- 12 12 A. Yes, it is. 13 13 Q. Okay. Now, look for the years 2015, client 14 14 reported 4,390,000,000, DB adjusted 2,000,000,195; fifty 15 15 percent again? 16 16 A. Yes. 17 17 Q. 2016, fifty percent again? 18 18 A. Yes. 19 19 Q. For the DB adjusted amount as compared to client 20 20 reported, right? 21 21 A. Yes. 22 22 Q. 2017, fifty percent? 23 23 A. Yes. 24 24 Q. That's the adjustment Deutsche Bank did again? 25 25 A. Yes. Min-U-Script® Cheryl-Lee Lorient (6) Pages 6485 - 6488 7 of 121 FILED: NEW YORK COUNTY CLERK 01/04/2024 11:10 PM INDEX NO. 4