Trump loses tax-return appeal

Judge rules subpoena proper, rejects ‘back-door’ immunity

A federal judge Thursday rejected President Donald Trump’s latest effort to block the Manhattan district attorney from obtaining his tax returns, dismissing Trump’s arguments that the prosecutor’s grand jury subpoena was “wildly overbroad” and issued in bad faith.

The ruling by Judge Victor Marrero of the U.S. District Court for the Southern District of New York marked another setback for the president in his yearlong fight to block the subpoena. The conflict has already reached the Supreme Court once and could end up there again as Trump’s lawyers quickly filed papers saying he would appeal.

The legal wrangling means an ultimate decision is unlikely before the November presidential election.

The district attorney, Cyrus R. Vance Jr., a Democrat, has been seeking eight years of Trump’s personal and business returns and other financial records as part of an investigation into the president’s business practices.

The Supreme Court, in a landmark decision last month, denied Trump’s initial argument that a sitting president had immunity from criminal investigation. But that ruling opened the door for the president to return to the lower court in Manhattan and raise other objections to the subpoena.

Trump renewed his fight with an argument that the subpoena was seeking information far beyond the jurisdiction of a local district attorney. His lawyers also argued it was issued in a “fit of pique,” simply copying a subpoena issued by congressional Democrats who had been frustrated in their efforts to obtain Trump’s financial information.

But in his decision, Marrero dismissed the president’s new objections, saying that the judicial process did not “transform automatically into an incidence of incapacitating harassment and ill will merely because the proceedings potentially may implicate the president.”

The judge was appointed to the federal bench in 1999 by former President Bill Clinton.

Marrero also agreed with prosecutors that throwing out the subpoena would effectively shield the president and his associates from an investigation, potentially allowing the statute of limitations to expire on any potential crimes. That would give the president the protection he had failed to win from the Supreme Court, the judge ruled.

“At its core, it amounts to absolute immunity through a back door,” Marrero wrote.

Reacting to the judge’s ruling, Trump told reporters in the Oval Office, “This is a continuation of the witch hunt, the greatest witch hunt in history. There’s never been anything like it.”

He added, “We’ll probably end up back in the Supreme Court.”

A spokesman for Vance declined to comment.

Soon after Marrero’s decision was released, William Consovoy, a lawyer for the president, filed an emergency motion asking the judge to bar Mazars USA, the president’s accounting firm, from turning over Trump’s tax returns and other financial records to the prosecutors until Trump can appeal.

It has been known that Vance was investigating whether any New York state laws were broken when hush-money payments were made in the run-up to the 2016 president election to two women who claimed that they had affairs with Trump.

But Vance’s office suggested recently in a court filing that its inquiry was broader, also focusing on potential bank and insurance fraud.

The prosecutors, defending their subpoena for Trump’s records, cited undisputed “public reports of possibly extensive and protracted criminal conduct at the Trump Organization.” Vance’s office made it clear in court recently that it viewed the tax returns as central evidence in its investigation.

Vance’s subpoena for Trump’s returns was first sent in August 2019 to Mazars USA.

The next month, Trump filed suit in U.S. District Court in Manhattan, where he made his initial argument about immunity.

Marrero, in a decision last October, rejected that position. In that ruling, Marrero also said that barring more evidence from the president, he did not believe the district attorney was acting in bad faith.

Eventually, the case reached the Supreme Court, which last month ruled against Trump by a vote of 7-2.

Vance’s office repeatedly accused the president of using delay tactics to keep from having to comply with a lawful subpoena.