Emoluments clause cases likely to land at Supreme Court

Litigation against President Donald Trump for violating the emoluments clauses of the Constitution is likely to land on the doorstep of the U.S. Supreme Court in the future. Members of Congress, states and private parties have all sued Trump. They have had mixed success with Article III standing and their substantive claims, which stems in a large part from the fact that the clauses provide no explicit guidance on their meaning, scope or enforcement.

Article I, section 9, clause 8 (the foreign emoluments clause) prohibits the president from receiving any present or emolument "of any kind" from a foreign source without the consent of Congress. Its purpose is to prevent corruption and to thwart improper foreign influence. In contrast, Article II, section 1, clause 7 (the domestic emoluments clause) prohibits the president from receiving "any other Emolument from the United States, or any of them." It is broadly intended to prevent the federal or state governments from using financial incentives to improperly influence the president.

In Blumenthal, et al. v. Trump, 201 minority members of the Senate and House of Representatives sued Trump for violating the consent provision of the foreign emoluments clause. The clause requires congressional consent of Congress for the president to receive an emolument. Plaintiffs allege that the receipt of payments from foreign governments at Trump properties without consent is unconstitutional, and thus they sought declaratory and injunctive relief. Trump responded that the plaintiffs lacked standing and that he has not received any prohibited emoluments. The district court held that the plaintiffs had standing, because they had been deprived of the opportunity to vote under the consent requirement, and they had stated a claim against Trump. Blumenthal, et al. v. Trump, 335 F.Supp.3d 45 (D.D.C. 2018).

The U.S. Court of Appeals for the D.C. Circuit reversed the district court on Feb. 7, 2020. It reasoned that the "individual members" cannot sue for an alleged institutional injury to Congress as a whole. It reasoned: "The Members were not singled out -- their alleged injury is shared by the 320 members of Congress who did not join the lawsuit -- and their claim is based entirely on the loss of political power." No individual injury exists based on the Supreme Court decision in Virginia House of Delegates v. Bethune-Hill, 139 S. Ct. 1945 (2019). Thus, the court remanded the case to the district court with instructions to dismiss the complaint. Blumenthal, et al. v. Trump, 949 F.3d 14 (D.C. Cir. 2020).

In a second case, the District of Columbia and Maryland sued Trump for violating both the foreign and domestic emolument clauses. As Trump had done previously, he moved to dismiss the complaint for lack of standing and the failure to state a claim. The district court found that the plaintiffs had standing based on the "illegal competitive advantage" enjoyed by the Trump International Hotel. District of Columbia and Maryland v Trump, 291 F.Supp.3d 725 (D.Md. 2018). The court also held that the plaintiffs stated a claim for violations of the Foreign and domestic emoluments clauses. 315 F.Supp.3d 875 (D.Md. 2018). The holdings were appealed to a three-judge panel for the 4th Circuit, which reversed the district court. The panel reasoned that assuming the competitive standing doctrine applied, the plaintiffs' failed to sufficiently demonstrate causation or redressability. In re Trump, 928 F.3d 360 (4th Cir. 2019). A rehearing en banc was granted Oct. 15, 2019. 780 Fed. Appx. 36 (Mem). Oral argument was heard on Dec. 12, 2019, Case 19-5237, and a decision is pending.

In the third case, Citizens for Responsibility and Ethics in Washington (CREW) v. Trump, a nonprofit government ethics group and various organizations associated with the hospitality industries in Washington, D.C. and New York sued for violations of the foreign and domestic emoluments clauses. They maintained that his receipt of payments from the federal government and various foreign government officials at different Trump properties violated the constitution. Trump, as he had in the previous cases, argued the plaintiffs lacked standing and failed to state a claim. The district court agreed with Trump. Crew et al. v Trump, 276 F.Supp.3d 174 (S.D.N.Y. 2017). In a 2-1 decision, the 2nd Circuit reversed holding that the plaintiffs had standing on the theory of competitive harm resulting from the alleged violation. Crew et al. v Trump, 953 F.3d 178 (2nd Cir. 2019). Trump has petitioned for a rehearing en banc based, at least in part, that the panel's zone of interest holding creates a conflict of authority. The court recently deleted the zone of interest discussion from its opinion, which effectively eliminates this claim. It also clarified that the district court erred in relying on the zone of interest test as the basis for finding lack of jurisdiction: "The Supreme Court has unambiguously rejected that approach." March 20, 2020, Case 18-474. The remaining part of the petition for rehearing, which is pending, attacks the panel's holding that the plaintiffs adequately pled causation and redressability.

Prior presidents have voluntarily complied with the foreign and domestic emoluments clauses of the Constitution, which is the reason for the absence of case law involving the president. In contrast, Trump continues to assert unlimited executive power that strains the separation of powers jurisprudence with novel legal claims. Rather than draining the Washington swamp as promised, he appears to enjoy frolicking in it. 