After his administration announced the Doral site in October for the G-7, Trump came under fire from Democrats, government watchdog groups and some Republican congressional leaders for steering a huge government contract to his property. The president abandoned the idea days later, blasting critics and their “phony emoluments clause.”
The president’s adult sons also announced in October that the family would try to sell its lease for the Trump International Hotel on Pennsylvania Avenue in Washington rather than deal with the headache of responding to allegations of self-dealing. To try to avoid conflict, the Trump Organization had already said it does not market the property to embassies, and that it donates profits from business with foreign governments.
Donald Trump Jr., who with his brother Eric is running the Trump Organization while their father is in the White House, explained that while other luxury hotels in Washington rely on embassy clients, their property has attracted lawsuits for doing the same. “It’s almost easier to stay away from it,” he told Fox News.
Some liberal Democrats in Congress have pushed to add the president’s alleged emoluments violations to the articles of impeachment that House lawmakers intend to vote on before Christmas. But other lawmakers and House leadership have pushed back, preferring to focus on Trump’s dealings with Ukraine.
“A violation of the emoluments clause of this scope and scale would seem to be an impeachable act, but the House is not obligated to include every impeachable act,” Sen. Richard Blumenthal (D-Conn.), the lead plaintiff in the congressional lawsuit, said in an interview.
The pending lawsuits focus on the Constitution’s clauses designed to prevent undue, outside influences on U.S. officials by banning gifts, payments or “emoluments” from foreign or state governments. The cases mark the first time federal judges have interpreted these provisions and applied them to a sitting president.
So far, the cases have moved in starts and stops, with mixed results for the president and dozens of subpoenas to Trump properties ordered by judges but then put on hold by appeals courts.
Justice Department lawyers, representing Trump in his official capacity, say the ban refers only to compensation in exchange for an official action or to an employment-type relationship — and does not broadly include any profit or payment even indirectly through a private financial interest.
Before he took office, Trump announced at a news conference that he would not sell his financial assets or wall them off in a blind trust, as his predecessors for four decades had done, and noted that, as president, he is exempt from conflict-of-interest rules that apply to most other federal employees. He put his adult sons in charge of running the company.
On Monday, lawyers for Blumenthal and more than 200 Democrats in the House and Senate will ask the U.S. Court of Appeals for the D.C. Circuit to enforce the constitutional provision that requires the president to obtain consent from Congress before accepting payments from foreign governments and their representatives.
“The nation’s highest officeholder is making critical foreign policy decisions under a cloud of potentially divided loyalty caused by his enrichment from foreign states,” according to the lawmakers’ attorneys from the nonprofit Constitutional Accountability Center. “That is precisely what the Framers adopted the Foreign Emoluments Clause to prevent.”
Lawyers from the Justice Department argue that the individual members of Congress have no legal right to sue for an alleged injury to the entire legislative body.
The congressional case reached the D.C. appeals court after Judge Emmet G. Sullivan cleared the way for lawmakers to issue 37 subpoenas seeking financial information, interviews and other records, including ones related to Trump Tower and his Mar-a-Lago Club in South Florida.
But that request went on hold after the appeals court stepped in midstream and intervened — at Trump’s request and with Sullivan’s consent — to consider the untested separation-of-powers issues.
Separately, attorneys general for Maryland and D.C. succeeded a year ago in winning a Maryland judge’s approval to issue dozens of subpoenas for financial records from federal agencies and the president’s private entities. The subpoenas related to the Trump hotel in Washington were intended to shake loose details of some of the president’s closely held business information: Which foreign governments have paid the Trump Organization and how much?
Those subpoenas, too, are on hold. Five months ago, a three-judge panel of the U.S. Court of Appeals for the 4th Circuit unanimously dismissed the case, saying the attorneys general lacked legal grounds to sue. A full complement of as many as 16 judges on the Richmond-based court will take a second look Thursday.
Maryland Attorney General Brian E. Frosh and D.C. Attorney General Karl A. Racine, both Democrats, say the president’s hotel puts similar venues in their jurisdictions at a competitive disadvantage. They want the court to order Trump to stop accepting such payments.
In a third case in New York, brought by Trump’s hospitality-industry competitors, the U.S. Court of Appeals for the 2nd Circuit in September said a lower-court judge had improperly thrown out the case in late 2017. President Trump has asked the full 2nd Circuit to rehear the case — a request that is pending.
Trump’s D.C. hotel has been at the center of controversy over his potential conflicts of interest since before he entered office, both because he leases the property from the federal government and because the governments of Kuwait, Malaysia, Bahrain, Saudi Arabia and others have paid to hold events there or book rooms. An inspector general report found that the General Services Administration, which leases the property to Trump’s company, had improperly ignored the emoluments clauses in managing the property.
The 263-room D.C. hotel, despite its popularity in Republican circles, has been at about 57 percent occupancy this year compared with 75 percent for competitors, according to marketing materials obtained by The Post.
And inside the business, there is a sense the Trump brand may be a growing negative, according to the company’s own statements to tax authorities.
Having lost hotel management contracts in Toronto, Panama and the SoHo neighborhood of Manhattan since Trump entered politics, the company is battling to turn around steep financial declines at properties including the Doral resort and its Chicago hotel. The company has asked tax assessors for both properties to lower the company’s tax bill because of declining performance that officials attributed to the “Trump” brand.
Eric Trump said in an October statement that although the steps his father had taken to avoid conflicts at the D.C. hotel were not “legally required,” that “people are objecting to us making so much money on the hotel and therefore we may be willing to sell.”