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Group urges New York AG to put Trump out of business by revoking charter

Advocates are urging New York Attorney General Eric Schneiderman to try to dissolve the Trump Organization over its business practices and the president’s continued ownership of it while in office. (Photo by Spencer Platt/Getty Images)

A liberal advocacy group is urging New York Attorney General Eric Schneiderman, already a foe of President Trump, to investigate and consider revoking Trump’s business charter in New York for business practices that it argues have run afoul of state law.

Free Speech for People, one of the backers of a nascent campaign to try to impeach Trump, planned to deliver a 24-page letter Wednesday calling on Schneiderman to “investigate whether to bring proceeding to dissolve and revoke the charter of Trump Organization Inc.,” the New York-based company overseeing the president’s real estate, golf, hotel and other businesses that Trump founded and continues to own.

The group did not unearth any new information about Trump’s company. Instead, it dug up the company’s past legal infractions, such settlements over housing discrimination charges in the 1970s and fraud allegations at Trump University last year, and argued that Schneiderman ought to take action against the company now that Trump has become president and declined to sell his interests.

“By continuing to operate under Trump family ownership and control with President Trump in the White House, the Trump Organization flagrantly abuses its state-granted powers, contrary to the public policies of New York against corruption and conflicts of interest, and contrary to the U.S. Constitution,” the letter reads.

Ron Fein, legal director for the group, said that the combination of past legal abuses and current conflicts of interests constituted such a pattern of corporate misbehavior that the attorney general ought to revoke the company’s charter. Among Free Speech for People’s other efforts is a push to overturn the landmark Supreme Court case Citizens United v. Federal Election Commission.

“This action is identifying the ability of the attorney general of New York State, without needing permission from the U.S. Justice Department, without needing permission from the president, to use existing legal authority to investigate and possibly dissolve the Trump Organization,” Fein said.

A representative for Schneiderman issued a brief statement late Tuesday: “We will review the letter.” The Trump Organization did not immediately respond to a request for comment.

The letter marks the start of what could become a second legal attack on Trump generated from his continued ownership of a vast business empire while in office, following a suit filed last month by the watchdog group Citizens for Responsibility and Ethics in Washington. It alleges that because Trump-owned buildings take in rent, room rentals and other payments from foreign governments, the president has breached the emoluments clause of the Constitution.

Trump said before taking office that he would avoid conflicts of interest and potential violations of the emoluments clause, which bars the president from accepting presents or payments from foreign governments, by putting his sons Don Jr. and Eric in charge of the companies and vowing to donate and profits from foreign clients to the U.S. Treasury.

But in Schneiderman, Free Speech for People identified a very public Democratic foe of Trump who has not backed down from previous opportunities to confront the president in court over his business dealings.

Despite accepting a campaign donation from Trump in his run for attorney general, Schneiderman was among the plaintiffs in the Trump University case in which Trump agreed to a $25 million settlement to end fraud cases against his defunct real estate seminar program.

Schneiderman also announced two weeks ago that he would join the lawsuit against the president’s executive order on immigration restrictions. He has also spoken out against proposed rolling back of consumer and investor protection laws by the Trump transition team.

Trump has repeatedly taken public shots at Schneiderman as well, calling him “failing” and a “lightweight” on Twitter who was “trying to extort me with a civil law suit.”

Unlike the foreign emoluments clause, which has never been used in court, Free Speech for People suggests Schneiderman employ a section of New York law that has been previously used to dissolve state corporations, including a fraudulent educational services company in 1994.

Two law firms, Emery Celli Brinckerhoff & Abady, as well as Clements & Pineault, led by former federal prosecutor Ben T. Clements, joined the group in writing the letter. Also joining is Fordham Law Professor and author Jed Shugerman.

Fein said Trump had been given ample opportunity to divest from his businesses and was advised by the U.S. Office of Government Ethics to do so. When Trump declined, Fein said it was a sign that more aggressive action was needed.

“This was baked in the cake from his decision to ignore the best ethics advice that he was getting,” Fein said. “And we decided to bring this campaign to the attorney general’s attention precisely because we think it is important for the people of the State of New York, through their laws, to enforce those laws where the president is using his company to violate the fundamental principles of the republic.”

An earlier version of this mischaracterized the Citizens United case. This version has been corrected.