Why the Emoluments-Clause Lawsuits Matter

Think tax returns, for starters.

By Paul Barrett

It sounds like a law school exam question: Can partisan opponents sue the president for alleged violations of the foreign emoluments clause of the U.S. Constitution?

But the recent cases seeking to test that question—Maryland and Washington, D.C., jointly filed one against Donald Trump on Monday, and congressional Democrats are expected to file another today—are anything but academic. The suits revive long-dormant anticorruption provisions in the Constitution, the main one of which forbids the president from accepting payments from foreign governments that might seek favors in return. If the judiciary allows them to move forward, the cases could cast badly needed sunlight on the murky workings of the Trump Organization. 

For one, think tax returns. The plaintiffs say one of their first steps will be to demand, via pretrial discovery, copies of Trump’s elusive personal tax filings. How better to assess the scope of the president’s international business affairs—and perhaps to discover why he has hidden his returns so defiantly?

The cases are also significant because they could land before the Supreme Court. The judiciary hasn’t previously interpreted the emoluments clause in Article I of the Constitution, which prohibits public officials, unless they have “the consent of the Congress,” from accepting “any present, emolument, office or title, of any kind whatever, from any king, prince, or foreign state.” The Supreme Court’s silence is less surprising than it might sound, as until now no president has attempted to grip the reins of state while retaining ownership of such a sprawling range of corporate interests. Given their constitutional significance, the emoluments cases, if allowed to develop, will probably interest the high court. 

The legal challenges trace to January, when Trump took office having refused to divest himself of his business empire. Days later, a nonprofit called Citizens for Responsibility and Ethics in Washington (CREW), which is led by Norman Eisen, the chief White House ethics lawyer for President Barack Obama, sued Trump in federal court in New York for violating the emoluments clause. As if on cue, foreign governments began patronizing the Trump International Hotel in Washington, which has specifically marketed to the diplomatic community. So far the governments of Kuwait, Saudi Arabia, Turkey, and Georgia have availed themselves of the hotel’s hospitality. CREW’s filing also mentioned that tenants at Trump Tower in New York include a Chinese government-controlled bank and the Abu Dhabi Tourism and Culture Authority.

An inevitable objection to such a test case is that the plaintiff lacks “standing.” To establish standing, a plaintiff has to show a personal injury caused by the defendant that a court can remedy. CREW initially offered the contrived-sounding argument that it had been forced to divert limited resources from other important matters to the emoluments fight. (I say contrived because a group like CREW is founded in the first place to harass politicians about conflicts of interest.) Soon, the organization amended its complaint to add other plaintiffs, including an association of restaurants and restaurant workers, who could more credibly maintain that the operation of the Trump hotel causes them competitive injury, meaning lost business.

The suit by Maryland and Washington, D.C., for which CREW is serving as co-counsel, rests on a more solid standing claim: that the Trump hotel may be siphoning off business that otherwise would flow to taxpayer-owned facilities, such as Washington’s convention center. Eisen told me by phone that he sees Maryland and D.C. as “perfect plaintiffs.” The reason, he said, is that “they are coequal parts of the government that have a strong interest in seeing the Constitution enforced.” Consider that Hawaii, Washington, and several other states overcame standing objections to win lower-court rulings blocking both versions of the Trump executive order temporarily banning immigration from certain predominantly Muslim countries.

The nearly 200 congressional Democrats expected to go to court today in Washington, D.C., presumably will assert that they have standing based on their authority, separate from that of the states, to oversee enforcement of the emoluments clause. Only litigation will reveal the identity of Trump’s far-flung business partners and investors, this argument would go.

There is, of course, a counterargument in these cases. Last Friday, the U.S. Justice Department filed a brief defending Trump in the original CREW suit. The government lawyers took the standing issue out for a spin and argued that the emoluments clause doesn’t apply to fair-market commercial transactions, such as hotel bills, golf club fees, or office rent. Past presidents have received income from foreign sources, the Justice Department pointed out. George Washington exported flour and cornmeal to England from his Virginia plantation. And Barack Obama received royalties on his books, some of which have been bought by public universities abroad.

The idea that foreign governments craftily deployed state librarians to gain favor with President Obama is every bit as silly as it sounds. More broadly, the best response to the past-presidents-did-it argument is that before Trump, we’d never had a president with business interests so vast and secret. If ever there were a time to test the emoluments clause, this is the time. Let’s have a look at the president’s conflicts of interest—with full disclosure, including his tax returns, and before the nation’s highest court—to decide whether they pass constitutional muster.