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Judge denies Trump bid to quash NY AG subpoenas

MARY LOUISE KELLY, HOST:

Today, a state judge in New York ordered Donald Trump and his two eldest children to testify under oath. Under the decision, Trump, Donald Jr. and Ivanka have three weeks to provide sworn testimony about their family business. It's a firm rebuke to the Trumps. Their lawyer argued in court that they are victims of a politically motivated investigation and shouldn't have to testify.

Ilya Marritz covers Trump legal matters for NPR. Welcome.

ILYA MARRITZ, BYLINE: Hello.

KELLY: Tell us more about the judge's decision today, what exactly it says.

MARRITZ: Well, it says the Trumps have no basis for trying to get out of giving sworn testimony about their family business. Now, there was an online hearing this morning, and Trump's lawyers argued very forcefully that Attorney General - New York Attorney General Letitia James' subpoena constituted selective enforcement. They said James is biased. She's a Democrat. And they said there could be improper mixing of this civil probe with a separate but closely linked criminal case being led by the Manhattan district attorney.

Justice Arthur Engoron, of the New York State Supreme Court, was not persuaded. He wrote that A.G. James has already found, quote, "copious evidence of possible financial fraud," and so it makes sense that she would seek to question executives and former executives of that business in question, and she has every right to do so.

Now, the Trumps have testified many times in many different venues, in many different lawsuits connected to the family business over the years. What makes this so new and very, very rare is the possibility of a former president now being ordered to answer a prosecutor's questions under oath. That makes this a very big deal.

KELLY: Yeah, it does. Now, I am burning with interest and intrigue. Do we know what the Trumps could be asked?

MARRITZ: Yeah. Tish James, the New York attorney general, has already previewed a lot of her questions in court filings. We know she's interested, for example, in the deals behind the Trumps' D.C. hotel. She says Ivanka Trump, who kind of spearheaded that deal, quote, "caused misleading financial statements to be submitted to Deutsche Bank" - the lender - "and to the federal government." Now she'll have the opportunity to ask Ivanka Trump about that under oath.

She also pointed to Donald Trump tripling the reported square footage of his Trump Tower apartment in an effort to puff up his own wealth. She'll probably ask about that as well.

I should say the Trumps have denied all wrongdoing, but the thing to know here is that Tish James already is sitting on mountains and mountains of material. So this is probably really one of the last steps before she decides whether, in fact, to file a suit resulting from this investigation.

KELLY: Right. And what's interesting is that even as she's still weighing that, her investigation has already served up significant consequences for the Trumps. Just this week, we learned their accountant dropped them as a client.

MARRITZ: Not only that, the accountant, Mazars USA, basically retracted 10 years of financial statements prepared for the Trumps, saying they could not be relied upon. They said they advised the Trumps to tell any banks and lenders and other counterparties that those documents are no longer to be trusted. So even without a suit being filed, the account has caused big problems for this empire of Trump hotels and golf resorts and everything else that the Trumps do.

KELLY: So what's the next move here?

MARRITZ: You know, it's not clear what legal options the Trumps may have left to stop the subpoenas. They did recently file a separate federal suit aimed at blocking James' investigation. The former president also released a pretty rambling statement. He said that A.G. James, quote, "is doing everything within their corrupt discretion to interfere with my business relationships," and said he can't get a fair hearing in New York.

But barring a last-minute reprieve, Donald Trump, Donald Trump Jr. and Ivanka must now testify within three weeks. It's shaping up to be a year in which the Trumps spend a lot of money, most likely, on lawyers.

KELLY: NPR's Ilya Marritz, thank you.

MARRITZ: You're very welcome.

(SOUNDBITE OF SPIRO'S "YELLOW NOISE") Transcript provided by NPR, Copyright NPR.