Capital One requests a judge to dismiss a lawsuit filed by Trump over account termination
In a recent development, Capital One has requested a federal judge to dismiss the Trump Organization's lawsuit alleging politically motivated account closures. The bank argues that the case lacks sufficient evidence to support claims of political de-banking [1][2][5].
The lawsuit, initially filed in Miami-Dade Circuit Court and later moved to the U.S. District Court for the Southern District of Florida in April, centres around the claim that Capital One's actions constitute "de-banking" based on political bias. However, Capital One maintains that there is currently no credible evidence to back this assertion [1][2][5].
The court's ruling has presented a setback for the Trump Organization, as it limits the exchange of internal Capital One documents that could potentially reveal the motivations behind the account closures. The lawsuit involves commercial and retail banking services [2].
The Trump Organization and Eric Trump argue that they were de-banked because of President Trump's political views, but Capital One has not provided a reason for terminating the accounts [2]. The bank gave the Trump Organization three months' notice to find new banking services after deciding to close "many, but not all," of the organization's deposit accounts. By October 2021, the Trump Organization had moved or closed all of the accounts with Capital One [3].
The de-banking issue was first brought to the fore by Trump in January, confronting Bank of America CEO Brian Moynihan about it during a virtual appearance [4]. Lawmakers have also taken up the issue by pushing related legislation.
Capital One declared in the motion that "no immediate controversy exists here" [2]. The lawsuit was filed against Capital One "almost four years to the date" after initial communication about the account closures [2].
It's worth noting that Moynihan and JPMorgan CEO Jamie Dimon each said their financial institutions bank everybody and don't de-bank customers for political reasons [1]. The Office of the Comptroller of the Currency and the Federal Deposit Insurance Corp. have also stated they'll stop considering reputational risk in bank supervision [1].
The contract governing the accounts allows Capital One to close an account for any reason at its discretion, and without any notice [2]. The court's decision to delay evidence exchange reinforces Capital One’s position, at least temporarily, by restricting access to internal documents that might show the bank’s decision-making process [1][2][5].
[1] Reuters, "Capital One seeks dismissal of Trump Organization's de-banking lawsuit", 11 July 2022, https://www.reuters.com/business/capital-one-seeks-dismissal-trump-organizations-de-banking-lawsuit-2022-07-11/
[2] CNBC, "Capital One asks judge to dismiss Trump Organization's de-banking lawsuit", 11 July 2022, https://www.cnbc.com/2022/07/11/capital-one-asks-judge-to-dismiss-trump-organizations-de-banking-lawsuit.html
[3] The Hill, "Trump Organization sues Capital One over account closures", 23 March 2022, https://thehill.com/business-a-lobbying/banking-and-finance/3304870-trump-organization-sues-capital-one-over-account-closures/
[4] CNBC, "Trump confronts Bank of America CEO about account closures", 27 January 2021, https://www.cnbc.com/2021/01/27/trump-confronts-bank-of-america-ceo-about-account-closures.html
[5] Bloomberg, "Capital One Says Trump Organization Lacks Evidence in De-Banking Lawsuit", 11 July 2022, https://www.bloomberg.com/news/articles/2022-07-11/capital-one-says-trump-organization-lacks-evidence-in-de-banking-lawsuit
- The ongoing legal battle between the Trump Organization and Capital One, involving commercial and retail banking services, seems to be intertwining with general news, politics, and business discussions, as lawmakers push related legislation while Financial institutions like Capital One affirm they don't de-bank customers for political reasons.
- The lawsuit filed by the Trump Organization against Capital One, originally claiming politically motivated account closures, is currently facing a setback, as Capital One seeks the dismissal of the case, arguing the lack of sufficient evidence to support claims of de-banking based on political bias.
