National News

Judge Dismisses Suit Against Trump Over Business Dealings

Posted December 21, 2017 8:56 p.m. EST

WASHINGTON — In a legal victory for the Trump administration, a federal judge dismissed a lawsuit on Thursday that accused President Donald Trump of violating the Constitution by continuing to own and profit from his business empire.

The complaint, filed this year in the Southern District of New York, said that Trump’s failure to divorce himself from his businesses had harmed companies or workers who compete against his restaurants or hotels in New York or Washington. By taking advantage of his official position, the lawsuit said, Trump violated clauses of the Constitution that prohibit a president from accepting any government-bestowed benefits, or emoluments, either at home or abroad.

Judge George B. Daniels of U.S. District Court in Manhattan found that the plaintiffs had failed to show that they had suffered as a result of specific actions by Trump intended to drum up business for his enterprises. Even before Trump took office, the judge said, “he had amassed wealth and fame and was competing against” the plaintiffs.

“It is only natural that interest in his properties has generally increased since he became president,” the judge said. Moreover, Daniels said, customers might be patronizing Trump’s hotels and his hotels’ restaurants because of price or quality — reasons totally unrelated to his presidency.

Beyond that, the judge found, the emoluments clauses of the Constitution are intended to protect the country against presidential corruption from foreign influences or financial incentives that might be offered by either states or the federal government. They were not meant to protect businesses from competition from presidentially owned enterprises, he ruled.

Were that the case, Daniels said, the Constitution would not have given Congress the power to allow a president to receive a foreign gift or benefit without considering how the president’s business rivals might be affected.

Daniels also said that it was up to Congress, not the courts, to decide whether Trump had violated the Constitution by accepting a gift or benefit from a foreign government.

“This court will not tell Congress how it should or should not assert its power in responding the defendant’s alleged violations of the foreign Emoluments Clause,” he wrote. “In short, unless and until Congress speaks on this issue, plaintiffs’ foreign Emoluments Clause claims are not ripe for adjudication.”

In a statement, Citizens for Responsibility and Ethics in Washington, a nonprofit legal watchdog group that initiated the lawsuit, called the ruling “a setback.” But Noah Bookbinder, the organization’s executive director, said, “We will not walk away from this serious and ongoing constitutional violation.”

The ruling is believed to be the first in 230 years interpreting what the constitutional framers meant by the emoluments clauses.

Two other lawsuits accusing Trump of similar violations are still pending. They claim Trump has illegally profiteered from his businesses in a number of ways, including accepting payments from foreign officials who patronize his hotels and accepting trademark approvals from foreign governments for his company’s goods and services.

The suits are part of a coordinated effort by critics of the president to force Trump to either sell his business holdings or place them in a blind trust. Trump’s opponents hope that at least one case will proceed to a stage where plaintiffs will be allowed to demand documentation of Trump’s finances, including his tax returns.

A lawsuit brought in June by the attorneys general of Maryland and the District of Columbia accused Trump of depriving facilities owned by their governments of business. Some legal experts have suggested that case may be less likely to be dismissed out of hand because Maryland is considered a “coequal sovereign” of the president, giving it stronger legal grounds to sue.

The third federal lawsuit was filed in June by nearly 200 Democratic members of Congress. Some legal authorities consider that suit to be a purely political move, with little likelihood of success.