Issues to Watch

Corrupt Trump? Possible Violations of the Foreign and Domestic Emoluments Clauses


Bridget Mentzer*

 United States District Court for the District of Maryland Judge Peter J. Messitte permitted a lawsuit filed by the District of Columbia and Maryland against President Trump to proceed, contrary to the wishes of the Department of Justice.  District of Columbia v. Trump, 315 F.Supp.3d 875, 907 (2018); Peter Overby, Federal Lawsuit Against President Trump’s Business Interests Allowed to Proceed, Nat’l Pub. Radio (July 25, 2018, 5:00 PM), https://www.npr.org/2018/07/25/632300960/federal-lawsuit-against-president-trumps-business-interests-allowed-to-proceed.  The suit claims that President Trump, through his and the Trump Organization’s ownership of the Trump International Hotel in Washington, D.C., violated the Foreign and Domestic Emoluments Clauses of the Constitution by either directly or indirectly accepting payments from foreign and domestic governments.  Trump, 315 F.Supp.3d at 877, 907.

The Foreign Emoluments Clause states that “[n]o Person holding any Office of Profit or Trust under them, shall, without the Consent of the Congress, accept of any present, Emolument, Office, or Title, of any kind whatever, from any King, Prince, or foreign State.”  U.S. Const. art. I, § 9, cl. 8.  The Domestic Emoluments Clause states that “[t]he President shall . . . receive for his Services, a Compensation . . . during the Period for which he shall have been elected, and he shall not receive within that Period any other Emolument from the United States, or any of them.”  U.S. Const. art. II, § 1, cl. 6.  The intent of these Clauses is to prevent one in an “Office of Profit or Trust” (such as the President) from undue influence and coercion from foreign and domestic governments, as well as to prevent gaining personal profit from dealings with such governments.  Trump, 315 F.Supp.3d at 894–97; Overby, supra.

The crux of the issue in this case stems from President Trump’s continued ownership of the Trump Organization, and by extension, the Trump International Hotel.  Trump, 315 F.Supp.3d at 878.  While President Trump does not actively manage the Hotel, he does continue to own and control the Hotel, including its bar, restaurant, and event spaces.  Id.  This means that the President, either actually or potentially, directly or indirectly, shares in the profits that the Hotel and its amenities acquire.  Id.  President Trump appears to have tried to avoid the exact situation he is now in by announcing prior to his inauguration that he would be turning over management of the Trump Organization to his two eldest sons.  Id.; Sharon LaFraniere, In Ruling Against Trump, Judge Defines Anticorruption Clauses in Constitution for First Time, N.Y. Times (July 25, 2018), https://www.nytimes.com/2018/07/25/us/politics/trump-emoluments-lawsuit.html.  President Trump further stated that all profits from foreign governments would be donated to the U.S. Treasury.  Trump, 315 F.Supp.3d at 878 n.6.  By the end of 2017, however, the Trump Organization claimed to have donated only $151,470 in February of the same year, providing no further details.  Ann E. Marimow, Jonathan O’Connell & David A. Fahrenthold, Federal Judge Allows Emoluments Case Against Trump to Proceed, Wash. Post (July 25, 2018), https://www.washingtonpost.com/politics/federal-judge-allows-emoluments-case-against-trump-to-proceed/2018/07/25/c8070206-8fa4-11e8-8322-b5482bf5e0f5_story.html?utm_term=.53353d012510.  Additionally, while President Trump may have created a trust to hold all of his business assets, he seems to be able to obtain distributions from that trust at any time.  See Trump, 315 F.Supp.3d at 879.  The mess President Trump now finds himself in would not be as sticky if he had sought and received Congressional approval for receipt of such profits, as this would be consistent with the requirements of the Foreign Emoluments Clause.  U.S. Const. art. I, § 9, cl. 8; see Trump, 315 F.Supp.3d at 905–06.  Now, the President is being made to answer for his potential profiting from foreign and domestic governments through his interests in the Hotel.  Trump, 315 F.Supp.3d at 886–98.

First and foremost, the court in the present case quickly concluded that (1) textual interpretation, (2) the original public meaning and purpose of the Clauses, as well as (3) the practice and precedent of the executive branch, favored the finding that the presidency is subject to the Clauses’ restrictions.  Id. at 883–85.  The court then moved to the substance of the case, providing a definition to the term “emolument.”  Id. at 885.  In the Constitution’s over 200-year history, this case is the first instance in which a federal judge has interpreted the Emoluments Clauses and applied the provisions to the President.  Marimow et al., supra.  Plaintiffs argued for a broad definition, arguing “emolument” “means any ‘profit,’ ‘gain’, or ‘advantage.’”  Trump, 315 F.Supp.3d at 886.  In contrast, the President argued for a narrower interpretation of “emolument,” stating that it only refers to “a payment made as compensation for official services,” or, in other words, bribery.  Id. at 887.  Ultimately, the court adopted the definition offered by the Plaintiffs, finding the argument proffered by the President unconvincing.  Id. at 887–98.  The court stated that to accept the President’s definition of “emolument” to mean bribery would be repetitive, because bribery is addressed elsewhere in the Constitution and is an incredibly difficult crime to prove.  Id. at 898.

The court moved forward with “emolument” meaning any profit, gain, or advantage to determine if Plaintiffs had stated actions by the President to which the Emoluments Clauses applied.  Id. at 880, 898, 905–06.  The court ultimately found that when the President owns a hotel that accrues millions of dollars in profits annually, it is reasonable to find that he, consciously or subconsciously, may be influenced by those governments that spend substantial amounts of money at that hotel.  Trump, 315 F.Supp.3d at 898.  This type of situation is why the Emoluments Clauses were put in place—to prevent these possible influences from occurring.  Id.  Specifically examining the President’s actions with respect to the Foreign Emoluments Clause, the court looked to Plaintiffs’ contentions that foreign governments have frequented the Trump International Hotel, using government funds to stay there and utilize the Hotel’s various amenities.  Id. at 905–06.  For example, the Hotel has rented out its event spaces to the embassies of Kuwait and the Philippines.  Marimow et al., supra.  The Kingdom of Saudi Arabia also spent thousands of dollars at the Hotel between the fall of 2016 and early 2017.  Trump, 315 F.Supp.3d at 905.  These two examples are just a few of the multiple instances in which foreign governments have frequented the Trump International Hotel.  Id.; see also Marimow et al., supra.  From such instances, it is possible that the President received, or could have received, profits originating from these foreign governments through President Trump’s continued ownership of the Hotel via the Trump Organization.  Trump, 315 F.Supp.3d at 905.  Therefore, the court found that Plaintiffs had alleged plausible claims under the Foreign Emoluments Clause.  Id. at 905–06.

Looking to the Domestic Emoluments Clause, the court addressed Plaintiffs’ contentions that Maine state funds supported Governor Paul LePage and his staff to stay at the Hotel during an official visit to D.C.  Id. at 906; LaFraniere, supra.  During that visit, the President announced at a news conference with LePage that he would review decisions regarding national monuments and parks adopted by the Obama administration that LePage had opposed.  LaFraniere, supra.  As such, the court found a plausible claim under the Domestic Emoluments Clause.  Trump, 315 F.Supp.3d at 906.

Following the court’s decision, the President filed a motion for interlocutory appeal and for a stay pending appeal on August 17, 2018.  Mot. of the President, in His Official Capacity, for Certification of this Court’s March 28 and July 25, 2018 Orders Pursuant to 28 U.S.C 1292(b) and for a Stay Pending Appeal 1 (Aug. 17, 2018).  It will be interesting to see if the case moves into the discovery phase as Plaintiffs’ plan to interview Trump Organization employees and review company records to determine which foreign governments have spent money at the Hotel, and how much money.  Marimow et al., supra.  Discovery is also likely to include the request for sensitive financial information from the President (such as his tax returns); if Judge Messitte’s ruling stands, it may bring about even more scrutiny of President Trump.  Id.; Overby, supra.  Additionally, further investigation into the possible Emoluments violations by President Trump may lead to greater understanding as to how he could be profiting from his presidency.  LaFraniere, supra.  Overall, this case will aid future U.S. presidents to better understand how their private interests will be impacted by their taking office, and it serves as a reminder that as President, your duty is first and foremost to be fair and true to the welfare of the American people.  Trump, 315 F.Supp.3d at 889, 895–97, 902.

*Bridget Mentzer is a second-year day student at the University of Baltimore School of Law, where she is a staff editor for Law Review and a Distinguished Scholar of the Royal Graham Shannonhouse III Honor Society. Next summer, she looks forward to serving as a summer associate with Miles & Stockbridge.

 

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