Federal Court rules congressional Democrats can proceed with Emoluments Clause lawsuit against Trump (updated)

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With all the crazy shit going on in the news this week, it would have been understandable to miss that a federal judge ruled Democrats in Congress can move ahead with their lawsuit against President Trump alleging that his private businesses violate the Constitution’s Emoluments Clause ban on gifts or payments from foreign governments. Congressional Democrats’ emoluments lawsuit targeting President Trump’s private business can proceed, judge says:

The decision in Washington from U.S. District Judge Emmet G. Sullivan (right) adopted a broad definition of the anti-corruption law and could set the stage for Democratic lawmakers to begin seeking information from the Trump Organization. The Justice Department can try to delay or block the process by asking an appeals court to intervene.

In a 48-page opinion (.pdf), the judge refused the request of the president’s legal team to dismiss the case and rejected Trump’s narrow definition of emoluments, finding it “unpersuasive and inconsistent.”

The lawsuit is one of two landmark cases against Trump relying on the once-obscure emoluments clauses of the Constitution.

In a case brought in Maryland by the attorneys general of D.C. and Maryland, Justice Department lawyers representing the president have succeeded in temporarily blocking subpoenas for financial records and other documents related to Trump’s D.C. hotel.

The congressional case, brought by about 200 Democrats, extends beyond the hotel and provides a potential new avenue for investigators to gain access to a broader array of Trump’s closely held finances.

* * *

Sullivan noted that the lawsuit alleges the president — without seeking permission from Congress — has received payments for hotel rooms and events from foreign governments, as well as licensing fees paid by foreign governments for his show “The Apprentice” and intellectual property rights from China.

The emoluments cases, which could eventually end up at the Supreme Court, appear to mark the first time federal judges have interpreted these clauses and applied their restrictions to a sitting president. The lawsuits were early arrivals to what is now a wide range of investigations and legal battles over the president’s business interests and what information he and his family will be required to provide about them.

[A] half-dozen House committees are seeking financial information related to the Trump Organization, its accountants and lenders. The president and his family filed suit late Monday in New York against their biggest lender and one of their banks, to try to stop them from complying with subpoenas from congressional committees.

Led by Sen. Richard Blumenthal (D-Conn.) and Rep. Jerrold Nadler (D-N.Y.), the Democrats filed their suit last year asking the court to force Trump to stop accepting payments they consider violations of the Constitution’s foreign emoluments clause. They say the provision was designed to guard against undue influence by foreign governments by barring any “emolument” — meaning a gift or payment — without prior approval from Congress.

Sullivan agreed, writing that dictionaries from the era of the Founding Fathers, as well as legal historians and government practice, point to the broader definition backed by the congressional Democrats that “ensures that the clause fulfills this purpose” of excluding the possibility of corruption and foreign influence. Sullivan described the record as “overwhelming evidence” from “over two hundred years of understanding the scope of the clause to be broad.”

“The Court is persuaded that the text and structure of the Clause, together with the other uses of the term in the Constitution, support plaintiffs’ definition of ‘Emolument’ rather than that of the President,” the judge wrote.

Although the president gave up day-to-day management of his businesses — including residential, office, hotel and golf properties in the United States, Europe and South America, he still owns them and can withdraw money from them at any time. A number of foreign embassies and leaders have stayed in or held events at Trump’s D.C. hotel.

Congressional Democrats and their attorneys from the nonprofit Constitutional Accountability Center have argued the payments from foreign governments received by Trump through his extensive enterprises ought to be considered emoluments under the Constitution and thus deemed illegal.

In fact, kudos2 Amicus Briefs Played Big Roles in Latest ‘Emoluments’ Ruling Against Trump:

“I think as a general matter [Sullivan’s] opinion is a testament to how important amicus briefs can be to a case,” said Brianne Gorod, chief counsel to the Constitutional Accountability Center, who argued on behalf of the 200 Democratic lawmakers in the case Blumenthal v. Trump.

* * *

The lawmakers drew support from six amicus briefs, but two in particular—by legal historians and former government ethics officials—carried the day in the judge’s analysis of the definition of emoluments and the clause’s scope; the consequences of adopting a broad definition, and how the clause has been applied by the executive branch over time.

The court appreciates the illuminating analysis provided by the amici,” Sullivan said in his ruling.

Melissa Maxman, managing partner of the Washington office of Cohen & Gresser, was counsel to the five historians who claimed the Justice Department “cherry-picks from two insignificant dictionaries and from the historical sources, despite a mountain of evidence to the contrary” for its narrow definition of emoluments.

They countered that an “investigation of English language dictionaries published from 1604 to 1806, of the influential writings of Blackstone, Pufendorf, and Adam Smith, and of the contemporary usage by the Founding generation in the constitutional debates and in their private writings all confirm a broad definition of the word.”

“When you’re working with legal historians, you kind of let them take the rope and run with it,” said Maxman, an antitrust litigator. “I don’t claim to be a legal historian. They really wrote it.”

Sullivan was persuaded that the “weight of the evidence” in “founding-era dictionaries and other contemporaneous sources” supported the position advocated by the historians and the lawmakers.

Back to the Post:

Sullivan had already ruled in September that the legislators had legal standing to sue. He wrote the case ought to be allowed to continue in part because the Constitution’s foreign emoluments clause “requires the President to ask Congress before accepting a prohibited emolument.”

But Sullivan still needed to rule on questions that include whether the Founding Fathers’ definition of “emolument” was broad enough to include a foreign embassy paying the president to rent a hotel ballroom.

In his ruling, Sullivan acknowledged concerns from Trump’s lawyers, who said allowing the case to move ahead would impose “significant burdens” on a sitting president.

But clarifying the definition of the clause, the judge wrote, should ensure the president can abide by his oath of office.

The president’s argument “regarding the ‘judgment’ and ‘planning’ needed to ensure compliance with the clause is beside the point,” the judge wrote. “It may take judgment and planning to comply with the clause, but he has no discretion as to whether or not to comply with it in the first instance.”

Sullivan did not rule Tuesday on the Justice Department’s previous request to make an immediate appeal of his finding on standing. He asked the president and congressional Democrats to file additional briefings before the end of May.

Recent academic research appears to bolster the plaintiffs’ position. During the past 150 years, the Justice Department issued more than 50 opinions interpreting the foreign emoluments clause as prohibiting federal officials from accepting any benefit from foreign governments, “even if the benefit is small in size, if it is part of an arms-length transaction, if the benefit is funneled through an intermediary, or if the official’s government responsibilities don’t affect the foreign government,” according to new research from Kathleen Clark, a professor at Washington University in St. Louis.

Under Trump, that changed, with [a corrupted] Justice Department deciding in 2017 to side with Trump’s personal lawyers in arguing that the clause permits the president and all federal officials to accept unlimited money from foreign governments “as long as the money comes through commercial transactions with an entity owned by the federal official,” Clark wrote.

In his opinion Tuesday, Sullivan quoted extensively from the similar ruling by U.S. District Judge Peter J. Messitte in the emoluments case against Trump in Maryland. Justice Department attorneys and the president’s personal lawyers have appealed the ruling from Messitte, who had allowed the attorneys general to begin issuing [discovery] subpoenas. That case is narrowly focused on transactions involving Trump’s D.C. hotel.

But a three-judge panel of the U.S. Court of Appeals for the 4th Circuit appeared skeptical during a March 19 hearing that Trump is illegally profiting from his D.C. hotel. The appeals court did not say when it would issue a ruling.

Jennifer Rubin at the Post adds:

Constitutional scholar Laurence Tribe, who consulted on the case, told me the ruling is “very gratifying but not surprising. It’s the president’s corrupt financial entanglements with foreign governments that I’ve always believed would bring him down in the end. The Constitution told us to follow the money — and that’s exactly what we’re doing.”

Sen. Richard Blumenthal (D-Conn.), who along with House Judiciary Committee Chairman Jerrold Nadler (D-N.Y.) has led the litigation, was likewise pleased. He told me, “This is another tremendous step, another tremendous victory for the Constitution.” He added that the court should not allow an interlocutory appeal. “There is no reason this case should be treated any differently. This 48-page opinion is extraordinarily well-reasoned. The next step should be disclosure and discovery.”

Blumenthal stressed that unlike the case brought by Maryland and the District of Columbia, the congressional case is not limited simply to his D.C. hotel. Blumenthal said that “this lawsuit is much broader” and could entail transactions in “Saudi Arabia, Russia, Indonesia, go down the list.” The financial documents at issue would include records of the Trump Organization and, of course, Trump’s tax returns.

If Trump is denied an appeal at this stage, he will be obligated to comply with the court’s order and proceed to discovery. Blumenthal warned that Trump dare not defy the court(s). “Ultimately, his defiance of a legitimate court order would put him at serious legal jeopardy, ” Blumenthal said. This is not a subpoena from Congress that must be enforced in court, but rather court order(s) “from litigation where the legitimacy of the claims has been upheld.”

Former prosecutor Renato Mariotti told me, “If Judge Sullivan does not permit an immediate appeal, or if the Court of Appeals or Supreme Court rules in favor of the plaintiffs, Trump could be subject to extensive discovery about his business dealings and his inauguration. Given that there are ongoing criminal investigations of Trump’s businesses and inaugural committee, this should be a significant concern to his attorneys.”

[Trump’s] Achilles’ heel has always been his finances. It is those finances that congressional litigants will get to examine. Likewise, Trump’s finances continue to be the subject of interest for the New York state attorney general and the Southern District of New York prosecutors.

Nothing clarifies the mind like a raft of discovery requests asking for everything “which may lead to the discovery of relevant evidence.” C’mon Judge! Let’s proceed to discovery.

UPDATE:  Reuter reports that Foreign government leases at Trump World Tower stir more emoluments concerns:

The U.S. State Department allowed at least seven foreign governments to rent luxury condominiums in New York’s Trump World Tower in 2017 without approval from Congress, according to documents and people familiar with the leases, a potential violation of the U.S. Constitution’s emoluments clause.

The 90-story Manhattan building, part of the real estate empire of Donald Trump, had housed diplomats and foreign officials before the property developer became president. But now that he is in the White House, such transactions must pass muster with federal lawmakers, some legal experts say. The emoluments clause bans U.S. officials from accepting gifts or payments from foreign governments without congressional consent.

The rental transactions, dating from the early months of Trump’s presidency and first revealed by Reuters, could add to mounting scrutiny of his business dealings with foreign governments, which are now the subject of multiple lawsuits.

Congressional staffers confirmed to Reuters that the Trump World Tower lease requests were never submitted to Congress. Elijah Cummings, chairman of the House Oversight and Reform Committee, said his committee has been “stonewalled” in its efforts to obtain detailed information about foreign government payments to Trump’s businesses.

“This new information raises serious questions about the President and his businesses’ potential receipt of payments from foreign governments,” Cummings said in a statement to Reuters. “The American public deserves full transparency.”




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3 COMMENTS

  1. Justice Department Seeks to Appeal Emoluments Case Against Trump, https://www.nytimes.com/2019/05/14/us/politics/trump-emoluments-appeal.html

    “The Justice Department moved on Tuesday to challenge a federal district judge’s ruling last month that allowed congressional Democrats to proceed with a lawsuit claiming that President Trump had violated the Constitution by profiting from his businesses while in office.

    In a filing, the department asked Judge Emmet G. Sullivan of the United States District Court for the District of Columbia to allow them to appeal his ruling and to halt the proceedings in the meantime.

    The department said the case should not advance any further without a review by the United States Court of Appeals for the District of Columbia Circuit because it involved legal questions of “extraordinary significance” and a complaint with no historical precedent.

    “Plaintiffs are now poised to seek civil discovery against the president, including into his personal finances and official actions, which will distract the president from his official duties,” the agency’s lawyers said in a 21-page brief.”

    His official duties of “executive time” watching FOX News and tweeting Twitter rages? A distraction would be a good thing.

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