Two new plaintiffs — an association of restaurants and restaurant workers, and a woman who books banquet halls for two D.C. hotels — plan to join a lawsuit alleging that President Trump has violated the Constitution’s emoluments clause because his hotels and restaurants do business with foreign governments.
The new plaintiffs will be added to the case on Tuesday morning, according to a spokesman for Citizens for Responsibility and Ethics in Washington (CREW), a D.C.-based watchdog group.
This is a significant development that does much to alleviate the “standing” problem, the legal requirement that the plaintiff suffered actual harm. (“Both [new plaintiffs] say that, as direct competitors of Trump’s restaurants and hotels, they may lose foreign clients, who may book with Trump properties to curry favor with the president.”)
“We’ve always felt we had strong standing in this case,” says CREW spokesman Jordan Libowitz. CREW argued that in having to devote resources to enforce the emoluments clause, it was harmed. Now, however, Libowitz says, “The new plaintiffs offer a different legal standing — taken together, our legal standing is unquestionable.” He added, “There are so many people and organizations that have reached out to us interested in joining our case [that] while these are the only new plaintiffs today, the possibility remains for more in the future.”
This is one more arena in which Trump’s refusal to release his tax returns becomes relevant. “One of the many problems with the president’s continuing business dealings with foreign countries is that without his tax returns, we do not know the full extent of his violation of the Emoluments Clause of the Constitution,” Libowitz explains. “We seek to change that.”
Indeed, where there is no legal compunction for the president now to release his tax returns absent action by Congress (which Republicans will never permit), litigation offers an avenue for ferreting out his finances. “All kinds of relevant information — including the tax returns Trump is fighting to hide — are likely to be demanded in the course of discovery,” says attorney Laurence H. Tribe, one of the lawyers on the case. He explains, “I think the district court will have every reason to compel disclosure of the tax returns in particular, given how much they (and only they) will reveal about the exact sources and amounts of many of the unconstitutional Foreign and Domestic Emoluments Trump has been receiving and stands to receive unless enjoined pursuant to the relief our lawsuit seeks.”
It is a misperception that tax returns are absolutely protected from the discovery process in litigation. Indeed, the notes in the applicable federal rule of civil procedures states that “a party’s income tax return is generally held not privileged.” The courts may take special precautions (e.g. sealing documents), but a court likely would be able to compel Trump to turn over information that would reveal what monies and/or other benefits (e.g. trademarks from China) he is receiving.
At most, Trump would enjoy merely a “qualified privilege” to conceal his tax records. As one court held, “A two-prong test has been utilized to assess whether the qualified privilege should be overcome and a party’s income tax returns should be disclosed. The court must determine whether (1) the tax return is relevant to the subject matter in dispute; and (2) a compelling need exists for the return, because the information sought is not obtainable from other sources. While the party seeking discovery of the tax returns bears the burden of establishing its relevance, the resisting party has the task to identify an alternative source for the information.”
In other words, for every property or income source Trump has, litigants may be found to assert that they have been harmed by the advantage he receives in exploiting his status as president to obtain monies from foreign governments. This is the essence of the emoluments clause, which was created to prevent foreign governments from corrupting our elected leaders. For now, Trump is refusing to release his tax returns, but keeping them secret in the face of metastasizing litigation is another thing entirely.