By Karen Freifeld and Jonathan Stempel
NEW YORK (Reuters) -A lawyer for Donald Trump on Friday accused New York Attorney General Letitia James of ignoring "everything" as she pursues a civil lawsuit alleging that the former president ran a systematic fraud at his family business.
Christopher Kise, Trump's lawyer, made the accusation at a hearing in a New York state court, just 10 days before the scheduled Oct. 2 trial.
Justice Arthur Engoron is considering arguments by Trump, his sons Donald Jr. and Eric, and the Trump Organization that the case should be thrown out because there was no fraud, no one was harmed, and the claims are too old.
James, in contrast, wants a ruling even before the trial starts that the defendants are liable for fraud.
Engoron plans to rule on Sept. 26 on both sides' motions, and suggested that bigger principles are at stake.
"We're talking about fairness and honesty in the marketplace," he said at the hearing, which lasted nearly five hours. "The fact that nobody was hurt doesn't mean the case gets dismissed."
James wants at least $250 million in penalties, and to bar Trump and his adult sons from running businesses in New York.
Trump holds a big lead in the race for the 2024 Republican presidential nomination, despite also facing four criminal indictments where he has pleaded not guilty.
He has denied all wrongdoing, and branded the cases a Democrat "witch hunt" against him.
THROUGH THE LOOKING GLASS
James accused Trump of lying in financial statements between 2011 and 2021 to obtain better terms on loans and insurance, defrauding banks and insurers.
She said the lies included overvaluing properties including his Mar-a-Lago club in Florida and Trump Tower penthouse in Manhattan, and inflating his fortune by as much as $3.6 billion.
Kise said the evidence was not there, that James' contrary statements did not make it so, and that valuation disputes were immaterial.
"The foundation of the case is to ignore everything," Kise said. "The case comes down to prosecuting the defendants for engaging in successful business transactions."
James maintains that Trump knew his valuations were false.
This allegedly included valuing Mar-a-Lago at $739 million by pretending it was unrestricted property though Trump had given up rights to develop it other than as a club, and reporting that the penthouse was nearly triple its actual size.
"In (the) defendants' world, there's no objective truth," said Andrew Amer, a lawyer from James' office. "Defendants have clearly stepped through the looking glass."
LAWSUIT AGAINST JUDGE
In June, a state appeals court in Manhattan dismissed claims against Trump's daughter Ivanka Trump and various other claims predating July 2014 or February 2016 because of statutes of limitations.
The court left it to Engoron to determine which parts of the case could proceed. Engoron will also rule on James' request to sanction the defendants for repeatedly raising "frivolous" arguments he had already rejected.
At Friday's hearing, the judge appeared dissatisfied when Kise suggested that banks might not have relied on Trump's valuations when making loans.
"You cannot make false statements and use them in business," Engoron said, banging his fist.
Last week, Trump sued Engoron, accusing him of taking too long to narrow the case.
The lawsuit sought to delay the trial, to allow the defendants to prepare properly after Engoron decides which claims the attorney general can pursue.
Defense lawyers have also accused James of ignoring the June appeals court decision.
The appeals court is expected to decide next week whether the trial should proceed as scheduled.