The Washington Post

Trump case: A judge rules that an emoluments suit can proceed.

- BY ANN E. MARIMOW, JONATHAN O’CONNELL AND DAVID A. FAHRENTHOL­D ann.marimow@washpost.com jonathan.oconnell@washpost.com david.fahrenthol­d@washpost.com

A federal judge on Wednesday rejected President Trump’s latest effort to stop a lawsuit that alleges Trump is violating the Constituti­on by continuing to do business with foreign government­s.

The ruling, from U.S. District Judge Peter J. Messitte in Greenbelt, Md., will allow the plaintiffs — the attorneys general of Maryland and the District of Columbia — to proceed with their case, which says Trump has violated little-used anti-corruption clauses in the Constituti­on known as emoluments clauses.

This ruling appeared to mark the first time a federal judge had interprete­d those constituti­onal provisions and applied their restrictio­ns to a sitting president.

If the ruling stands, it could bring unpreceden­ted scrutiny to Trump’s businesses — which have sought to keep their transactio­ns with foreign states private, even as their owner sits in the Oval Office.

Messitte’s 52-page opinion said that, in the modern context, the Constituti­on’s ban on emoluments could apply to Trump — and that it could cover any business transactio­ns with foreign government­s where Trump derived a “profit, gain or advantage.”

“This includes profits from private transactio­ns, even those involving services given at fair market value,” Messitte wrote.

In the past year, the Trump Organizati­on has held several large events paid for by foreign government­s and reported about $150,000 in what it called “foreign profits” last year.

“In sum, Plaintiffs have plausibly alleged that the President has been receiving or is potentiall­y able to receive ‘emoluments’ . . . in violation of the Constituti­on,” Messitte wrote.

Trump still owns his company, although he says he has stepped back from day-to-day control.

The Trump Organizati­on and the Justice Department had urged Messitte to dismiss the case, arguing that the Founding Fathers had written this clause to stop officials from taking bribes — but not to stop them from doing business.

The company did not respond to requests for comment. The Justice Department released a short statement saying that it is reviewing the decision and that “we continue to maintain that this case should be dismissed.”

They could seek to appeal the ruling.

The plaintiffs now want to interview Trump Organizati­on employees and search company records to determine which countries have spent money at Trump’s hotel in downtown Washington — and how much they spent. They may also seek to review Trump’s tax returns, which — unlike other recent presidents — he has not made public.

“We are one step closer to stopping President Trump from violating the Constituti­on’s original anti-corruption provisions,” said D.C. Attorney General Karl A. Racine (D), who brought this case along with Maryland Attorney General Brian E. Frosh (D).

Frosh said his staff was already preparing to seek financial documents related to the president’s D.C. hotel, which is located in a federally owned building, the Old Post Office. Before he became president, Trump won a federal contract to operate the hotel in the historic building.

Frosh suggested that, eventually, the added scrutiny could cause Trump to divest himself of the hotel.

“I think the decision bodes ill for his ownership of the Old Post Office hotel,” Frosh said.

The lawsuit, filed last year, is one of a spate of legal challenges that have sought to pry into Trump’s past business and legal dealings. Two other lawsuits — one filed by Democratic members of Congress, another by a D.C. wine bar that believes it lost business to Trump — have alleged that he is violating the emoluments clause.

Trump also has been sued for defamation by Stormy Daniels, an adult-film star who alleges she had an affair with Trump in 2006, and Summer Zervos, a former contestant on “The Apprentice.”

In addition, the New York attorney general has sued Trump and his oldest children, alleging that there was “persistent­ly illegal conduct” at the Donald J. Trump Foundation, a charity they led. Separately, New York state’s taxcollect­ing authority is investigat­ing that charity to determine whether criminal laws were broken, state officials have said.

This suit, filed by the attorneys general, cleared an initial hurdle in March. Back then, Messitte settled one legal question, ruling that the plaintiffs had legal standing to sue the president in the first place.

He also limited the scope of the case to Trump’s Washington hotel; previously, the plaintiffs had wanted to search for foreign-government spending at other Trump properties as well.

The plaintiffs were able to file in Maryland in part because of the economic disadvanta­ge alleged to other hospitalit­y businesses and their employees in the state.

The next unsettled question: What, exactly, is an emolument?

That remained unanswered for more than 200 years.

The Constituti­on bars federal officials from taking emoluments from any “King, Prince, or Foreign State.” The Founding Fathers’ intent had been to stop U.S. ambassador­s overseas — emissaries from a new, poor, fragile country — from being bought off by jewels or payments from wealthy European states.

But the modern meaning of the clause had not been settled because most presidents — acting on the advice of their attorneys — had steered clear of business entangleme­nts while in office.

Trump, on the other hand, has kept ownership of his business empire, including more than 10 hotels and golf clubs worldwide.

Some of his customers have been foreign government­s. In particular, the Trump Internatio­nal Hotel on Pennsylvan­ia Avenue in downtown Washington — just blocks from the White House — has rented out large ballrooms to the embassies of Kuwait and the Philippine­s and hosted leaders from Malaysia and Romania.

At the hearing in June, the plaintiffs had argued that when applied in a modern context, the Constituti­on’s ban on emoluments should cover transactio­ns such as those.

They said emolument in this case should not mean just an outright gift but also any transactio­n that gave Trump “profit, gain or advantage.” That means it would apply to transactio­ns in which a foreign government paid Trump’s company for a service or a hotel room.

To back up that argument, they cited 18th-century dictionari­es showing that the term “emoluments” at the time the Constituti­on was written was defined more broadly than a simple gift or bribe.

But Justice Department lawyers, defending the president, said the proper definition was far more narrow.

They said the president is not breaking the law when foreign officials book rooms or hold events at his Washington hotel because they are paying for something and not giving Trump a gift.

If the plaintiffs are allowed to conduct “discovery” at Trump’s hotel — examining its books to identify its foreign customers — that could require the president to provide more detailed informatio­n about his personal finances.

Before Trump took office, his company said it would donate all “foreign profits” collected by the business to the federal Treasury. At the end of last year, the Trump Organizati­on said it donated $151,470 in February. But it declined to explain the details behind that number — giving no informatio­n about which countries those profits came from or what the Trump Organizati­on’s total revenue from foreign government­s had been.

 ?? ALEX BRANDON/ASSOCIATED PRESS ?? Guards stand outside the Trump Hotel in the District. The plaintiffs want to know which countries have spent money at the hotel.
ALEX BRANDON/ASSOCIATED PRESS Guards stand outside the Trump Hotel in the District. The plaintiffs want to know which countries have spent money at the hotel.

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