Same Game, Higher Stakes
Giant Claims, Tiny Evidence: Inside the Trump Legal Playbook
A Marc Kasowitz-led legal strategy from Donald Trump’s past is strangely familiar, but this time the stakes are much higher than a failed real estate deal.
The lawsuit is a decade old, but the high-profile Trump-manufactured drama is eerily familiar: unsupported allegations of legal wrongdoing, repeated invocations of Trump’s business mastery, reliance on the say-so of his personal friends, and, a team of lawyers willing to go all out against Trump’s antagonists.
That team was led by Marc Kasowitz, who has become a household name since his longtime client was elected president and shortly found himself in need of legal representation.
Kasowitz is now representing Trump as he battles allegations that he obstructed justice in an effort to hobble an FBI investigation into alleged Russian election-meddling and potential Trump campaign knowledge of or complicity in it.
Kasowitz’s years of legal work for Trump provide insight into his no-holds-barred strategy in representing Trump’s interests and defending him from his detractors. In the context of the FBI investigation, Kasowitz has alleged a conspiracy in the upper echelons of federal law enforcement to convict Trump in the court of public opinion through selective, illegal leaks.
Vague allegations of impropriety are not new to Kasowitz’s approach to defending Trump. But the strategy hasn’t always been successful, and one case in particular illustrates how Kasowitz has previously tried and failed to implicate Trump’s opponents in supposed schemes to undermine his client.
Kasowitz has represented Trump in various matters since the early 2000s, but this particular saga began in the mid-1980s, when Trump acquired a huge plot of land on New York’s upper-west side. He planned a massive, multi-billion-dollar development called Television City, the center of which would be a new NBC studio facility, with the anticipated aid of $700 million in city tax abatements.
The tax breaks never materialized, due in part to opposition from then-New York mayor Ed Koch. He and Trump engaged in a heated public exchange of threats and insults. Trump was “squealing like a stuck pig,” Koch said. The mayor, Trump shot back, had “no talent and only moderate intelligence.”
By the mid-1990s, the undeveloped property was hemorrhaging money, and Trump’s creditors forced him to sell a 70% stake in the land—Trump kept the remaining 30%—to a group of investors from Hong Kong for $82 million in cash and the assumption of $250 million of Trump’s debt.
The Cheng Group, as the investors’ venture was called, eventually developed condominiums on the property and paid Trump management fees and royalties for the use of his name on some of the buildings. In 2005, the Cheng Group sold the property for $1.76 billion.
That netted Trump a hefty return, but he was livid about the deal, insisting that the Cheng Group had accepted a price far below market value. Trump sued—first in federal court, before the case relocated to New York—and he brought on a team of lawyers, led by Kasowitz, to pursue claims of breach of contract and breach of fiduciary duty.
In support of those allegations, Kasowitz claimed in court filings that Trump “has to date uncovered fraud by the Cheng Group amounting to at least $19,666,459.”
“Defendants submitted false financial statements to Trump concerning the amount of distributions they had made to themselves, provided false records to conceal these misrepresentations and resisted Trump’s requests for documents and information that would have revealed the fraud,” according to Kasowitz’s complaint on Trump’s behalf.
It was a weighty allegation, and Kasowitz’s court filings alleged that the Cheng Group had withheld information from Trump in order to try to cover up its kickback scheme.
But Kasowitz never really detailed that alleged fraud, or how the Cheng Group had supposedly got “kickbacks” from the property’s eventual buyer. “Trump fails to explain what the alleged kickbacks were” or “how they were obtained,” the judge in the case noted in ruling against most of Trump’s allegations.
Despite the lack of grounding for many of the claims, they showed that Kasowitz was willing not just to go to bat for his client, but to officially lodge highly inflammatory accusations on his client’s behalf despite an apparent lack of supporting evidence. Kasowitz was a devoted attack dog for a man who seeks loyalty in those surrounding him.
The Cheng suit was one of dozens in which Kasowitz represented Trump’s personal and professional interests. He has lodged libel complaints against journalists, defended Trump’s attacks against an Apprentice contestant who alleged unwanted sexual advances, and this year settled fraud allegations against the defunct Trump University real estate training seminar.
Kasowitz is part of a small group of longtime Trump loyalists, and that group played into the Cheng saga in other ways. In order to bolster his claims that the Cheng Group had sold the property at below-market rates, Kasowitz invoked the informal promises of some of Trump’s friends and business associates.
The Cheng Group had received offers nearing $3 billion, the lawsuit claimed, from firms led by Trump friend and onetime business partner Tom Barrack, who helmed Trump’s inaugural committee this year, and Richard LeFrak, another friend and fellow New York real estate developer who has worked to promote the Trump administration’s infrastructure agenda.
But those were never firm offers, and the judge noted that the Cheng Group had “conducted several appraisals, using two prominent appraisers,” to settle on the $1.76 billion sale price.
It wasn’t just Trump’s friends who thought the property was worth more, Kasowitz wrote in his complaint. Trump himself was sure that the Cheng Group was being lowballed. In language familiar to a country accustomed to the president’s routine personal boasting, the complaint cited Trump’s supreme business acumen.
“Despite Trump’s incomparable and far superior market knowledge and his correct and exceedingly prescient advice [not to sell the property years earlier], the Cheng Group Defendants did not consult with Trump” before putting it on the market, the complaint alleged.
Trump’s allegations in the case, and Kasowitz’s dogged pursuit of them, hinged on allegations that the Cheng Group had forewent the hundreds of millions of dollars they would have earned from a sale price more than a billion dollars higher in order to pocket less than $20 million in kickbacks—or, perhaps, to stick it to Trump himself.
“What, you think [the Chinese are] giving up a billion dollars in order to cheat Donald out of $17 million? The whole thing’s a joke,” Gary Barnett, who led the company that bought the land from Cheng, told New York Magazine in 2010.
“It’s like so stupid, to be blunt,” Barnett added. “It makes zero sense, and the judge basically agreed.”
That earned the judge, former New York Supreme Court Justice Richard Lowe, Trump’s personal ire.
“I had an incompetent judge,” Trump said after most of his claims were tossed out. “This whole thing should be investigated. I don’t give a shit. This guy is a total gross incompetent, he’s an arrogant fool.” His friend Tom Barrack “would have paid more money,” Trump insisted.
But if Trump had lost on the merits, he at had a loyal foot soldier in Kasowitz. Now as the president faces a potential criminal investigation, Kasowitz is back in the trenches.