Judge Urges Trump Foundation to Settle Lawsuit on Dissolution

(Bloomberg) -- President Donald Trump’s personal charity should reach an agreement with New York Attorney General Barbara Underwood to dissolve, resolving much of a lawsuit alleging that the foundation willfully engaged in a decade-long pattern of self-dealing, a judge said.

At a hearing in state court in Manhattan Tuesday, Judge Saliann Scarpulla told the two sides to work out issues by Aug. 15, including whether Trump’s children Ivanka, Eric and Donald Trump Jr. will agree not to serve on any New York charity board for a year without admitting fault. The rest of the case against Trump would continue, drawing the president into yet another legal battle in the months leading up to the mid-term election in November.

New York filed a petition to dissolve the charity earlier this month alleging a litany of violations, including improperly using foundation assets for political purposes. The state is also seeking to bar the president from serving on a New York not-for-profit for 10 years.

A lawyer for the Trump family, Alan Futerfas told the judge that the foundation had already announced it would dissolve in 2016, although it still needs to distribute about $1 million in funds. The judge asked the lawyers for the state and Trump to reach an accord on how that would be handled.

"I don’t want to resolve an issue that both sides agree will happen," Scarpulla said. "I’m trying to whittle this down."

The judge set a court date of Oct. 11 for remaining claims against Trump. Futerfas said he was unsure whether Trump will assert, as he has in other lawsuits, that he is immune from the claims.

"We’ve laid out all the facts in the petition," Assistant Attorney General Yael Fuchs told the judge. The case will show a "willful disregard of relevant law," she said.

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