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NYC hotel owner joins lawsuit against Trump alleging violation of emoluments clause

The Trump International Hotel in Washington. A watchdog filed a lawsuit against President Trump in January saying he has breached the emoluments clause because Trump-owned buildings take in rent, room rentals and other payments from foreign governments. (Kevin Lamarque/Reuters)

A part-owner of several New York City hotels and restaurants has joined a lawsuit alleging that President Trump has violated the Constitution’s emoluments clause, which bars federal officials from taking payments from foreign governments.

Eric Goode is a part-owner of four boutique hotels and three restaurants in Manhattan. On Wednesday, he officially joined a lawsuit that was filed just days after Trump’s inauguration by a watchdog group, Citizens for Responsibility and Ethics in Washington. That group formerly had strong ties to Hillary Clinton's campaign, but it says it has cut those ties and become a nonpartisan entity.

The lawsuit alleges that Trump is in violation of the Constitution because his business continues to accept payment for hotel rooms, banquet halls and food from foreign states and state-owned businesses. Although Trump has said that he no longer has day-to-day control of the Trump Organization — having passed it to his sons Donald Jr. and Eric — documents show that Trump remains the beneficiary of his businesses, and he can legally withdraw money from them at any time.

What is the ‘Emoluments Clause’? Does it apply to President Trump?

The heart of the lawsuit has remained the same since January: Citizens for Responsibility and Ethics in Washington asked a federal judge to bar Trump from accepting foreign payments and to provide financial records to prove he has done so. The group’s complaint says that Trump “has violated the Constitution since the opening moments of his presidency and is poised to do so continually for the duration of his administration.”

The Trump Organization declined to comment Thursday, noting that the president — and not his business — was formally named as a defendant in the case. White House spokeswoman Sarah Huckabee Sanders did not respond to a request for comment.

Trump’s attorneys have said previously that the plaintiffs are misinterpreting the emoluments clause. It was designed to stop foreign kings from bribing ambassadors and officers of the young United States with gifts. But, the attorneys said, it does not preclude Trump from taking payments for things of value — like, for instance, accepting a fee to rent a banquet hall to a foreign embassy.

The lawsuit against Trump will face a key legal hurdle at the outset. Before the plaintiffs can make their case about the meaning of “emolument,” they must convince a judge that they have standing to sue Trump. To do that, the plaintiffs will need to show that they suffered harm because of Trump’s conduct.

Previously, three plaintiffs were involved in the suit, each with a different rationale for why they had standing.

Citizens for Responsibility and Ethics claimed it had been injured by an increase in its workload. The argument was, in essence, that Trump’s conduct was so wrong that it required this good-government group to work harder in response.

Another plaintiff is Jill Phaneuf, who runs a Washington-based business that books hotel banquet rooms. Phaneuf's claim to standing was that Trump’s D.C. hotel might take business away from her, if foreign embassies move their events to the president's hotel to curry favor.

The other plaintiff was an association whose members include restaurants. Again, the argument was that foreign governments would shift their business to the president’s properties.

Goode, the new plaintiff, partly owns the Maritime Hotel in Manhattan’s Chelsea neighborhood, the Jane Hotel in the Meatpacking District, and the Bowery and Ludlow hotels on the Lower East Side. He also is part-owner of three restaurants. The legal complaint notes that Travel & Leisure magazine called them “buzzy.”

Goode doesn’t know of a specific instance in which he has lost business to a Trump-owned hotel or restaurant. But the complaint contends he might, saying that Trump’s businesses and Goode’s occupy similar niches in the same city.

“The case is really about changing the marketplace with unfair competition,” said Jordan Libowitz, a spokesman for Citizens for Responsibility and Ethics. He meant that Trump’s businesses could offer foreign clients something Goode could not: a chance to impress the president.

Goode did not respond Thursday to a request for comment.