A federal appeals court ruled that a lawsuit accusing President Trump of violating the Emoluments Clause of the Constitution by refusing to put his business assets in a blind trust while in office and profiting off the presidency can proceed.
A panel of judges with the 2nd Circuit Court of Appeals ruled, 2-1, in favor of Citizens for Responsibility and Ethics in Washington (CREW) in New York on Friday after a lower court had thrown out the case in December 2017.
CREW welcomed the reinstatement of the case that challenged profits Trump has received from foreign officials doing business with his Washington, D.C., luxury hotel and other Trump-branded properties. The suit also took issue with Trump Organization licensing arrangements approved by foreign governments.
“If President Trump would like to avoid the case going further and curtail the serious harms caused by his unconstitutional conduct, now would be a good time to divest from his businesses and end his violations of the Emoluments Clauses of the Constitution,” Executive Director Noah Bookbinder said in a statement.
The Emoluments Clause of the Constitution prohibits elected officials from receiving gifts or benefits from foreign governments without Congress’s approval.
Second Circuit Judge Pierre Leval said the 4th Circuit and his dissenting 2nd Circuit College Judge John Walker regarded the suits with too much skepticism because they appeared to be politically motivated.
“While it is certainly possible that these lawsuits are fueled in part by political motivations, we do not understand the significance of that fact,” wrote Leval, joined by Judge Christopher Droney. “While the existence of a political motivation for a lawsuit does not supply standing, nor does it defeat standing. … Whether a lawsuit has political motivations is irrelevant to these determinative issues.”
The judge who originally dismissed the CREW suit, George Daniels, said the plaintiffs’ claims of harm were too speculative and remote to let the suit go forward. However, Leval and Droney disagreed, ruling that the case was a viable one on the grounds of so-called “competitor standing.”
“It is eminently plausible that if two establishments provide otherwise comparable services, but one establishment offers an inducement that the other cannot offer, then the inducement will attract at least some patronage that might otherwise have gone to the other establishment,” Leval wrote. “Plaintiffs have plausibly pleaded that the President’s ownership of hospitality businesses that compete with them will induce government patrons of the hospitality industry to favor Trump businesses over those of the Plaintiffs so as to secure favorable governmental action from the President and Executive branch.”