President Donald Trump’s long running push to put one of his biggest political enemies in the dock hit another wall on Thursday, as a federal grand jury refused to indict New York Attorney General Letitia James for a second time.
Prosecutors from the Justice Department took a revised mortgage fraud case against James to a grand jury in Norfolk, Virginia, hoping to revive charges that had been thrown out less than two weeks earlier. Instead, jurors declined to return an indictment, dealing the Trump administration another public defeat in its effort to criminally charge the Democrat who successfully sued Trump in New York’s blockbuster civil fraud case.
The proposed indictment accused James of bank fraud and making false statements to a financial institution over a home she bought in Norfolk in 2020, alleging she misrepresented the property to secure a better mortgage rate. James has denied the allegations and previously pleaded not guilty, calling the case a political hit job.
The Justice Department’s latest setback comes on the heels of a stinging ruling on November 24, when U.S. District Judge Cameron McGowan Currie dismissed the first case without prejudice. The judge found that Trump ally Lindsey Halligan, the interim U.S. attorney who signed the indictment, had been unlawfully appointed and therefore had “no legal authority” to bring the charges in the first place.
🚨MAJOR BREAKING: In a HUGE embarassing defeat for Donald Trump, a New York Grand Jury has DECLINED to indict NY Attorney General Letitia James.
Justice wins. Trump loses. pic.twitter.com/aEb9asLJVj
— CALL TO ACTIVISM (@CalltoActivism) December 4, 2025
Halligan, a former Trump personal lawyer and White House aide, had been installed after a previous U.S. attorney reportedly refused to pursue James and former FBI Director James Comey for lack of evidence. Her appointment bypassed Senate confirmation, a move the court said violated the rules that govern interim federal prosecutors.
Despite that rebuke, the department chose to present a new version of the James case to the same grand jury. That gamble backfired on Thursday, with jurors again refusing to indict. Legal analysts said the result only strengthens James’ arguments that she is being selectively and vindictively prosecuted because of her role in taking on Trump.
Former federal prosecutor Andrew Weissmann said the Justice Department technically still has options, but warned that every new step could hurt its position. “By law, the Department of Justice CAN go to another grand jury and try again,” he wrote on Bluesky. “But even if they succeed (a big IF in this case), the DOJ will have handed Letitia James even more evidence for her vindictive prosecution motion to dismiss the charges. And that motion was already quite strong.”
Norm Eisen, a former ethics czar in the Obama White House, was even more blunt about the message the grand jury sent. “The grand jury’s refusal to indict AG Letitia James is a clear rebuke of using the justice system for political revenge,” he posted on X, adding that Trump’s repeated efforts to weaponize the Justice Department show why strong checks on presidential power are crucial.
James’ legal team has already filed a motion to dismiss the case permanently as a vindictive prosecution, citing Trump’s public calls for her to be charged and his calls on prosecutors to go after his critics.
For now, the Justice Department has not said whether it will try a third time or finally walk away. What is clear is that Trump’s drive to turn the power of federal prosecutors against the New York attorney general has suffered another very public blow, and given James fresh ammunition to claim that the entire case is about politics, not justice.
