Court of Appeals says Trump must face suit under the Emoluments Clause

The Second Circuit has ruled that New York City business owners can sue the president under the Emoluments Clause, the constitutional provision that says the president (and other federal office holders) cannot "accept of any present, Emolument, Office, or Title, of any kind whatever, from any King, Prince, or any foreign state." Since this case conflicts with a ruling from the Fourth Circuit, this case is a candidate for the Supreme Court.

The case is Citizens for Responsibility and Ethics in Washington v. Trump, issued on September 13. The plaintiffs own hotels, restaurants and event spaces in New York City. The lawsuit alleges they directly compete with Trump's establishments for foreign, state, and federal government clientele. They also cite statements from Trump "implicitly soliciting patronage of government officials and apparently acknowledging that, in making governmental decisions, he favors governments that patronize his businesses." They also "allege that foreign governments have taken note of, and been influenced by, the message that enriching the President by giving patronage to his establishments earns his favor." The plaintiffs claim they are losing money because Trump is profiting off the presidency.

The Emoluments Clause received little attention until a few years ago, when Trump was elected president. Most of us never even heard of the Emoluments Clause until recently. The contours of litigation under this provision are not clear, including whether you can even sue the president under it. The district court ruled that this dispute is a "political question" that cannot be resolved by the courts, but the president's lawyers for some reason are not defending that ruling on appeal. Instead, they are defending the district court's finding that plaintiffs lack standing to bring this action.

Standing is a concept unique to litigation. Since the Constitution only allows the courts to resolve actual (and not theoretical) disputes, the plaintiffs in any case have to prove they will be directly impacted by the alleged unlawful governmental activity. Over the years, standing has killed off many good lawsuits. Not this one, at least in the Second Circuit (Leval, Droney, and Walker in dissent). Plaintiffs get around the standing rules with affidavits and expert input about how the president has invited foreign governments to use his private facilities, and how those entreaties have affected them financially as his competitors. The Circuit uses the traditional standing analysis as it would any other case, except that it knows this case involves the president. My guess is the Court proceeds this way to signal that the president is not above the law, and that if traditional legal principles require him to defend himself in court, so be it.

In dissent, Judge Walker notes the Emoluments Clause has never been directly litigated since the Constitution was drafted in 1787, and that nothing in the Clause "addresses competition in the marketplace or the conduct of business competitors generally." Nor can the Clause "be considered sweeping anti-corruption provisions." Judge Walker also addresses the elephant in the room: "this case is deeply political and thus finds itself in an area where federal courts ought to tread lightly. President Trump was democratically elected by the American people -- and he was elected with his business holdings and brand prominence in full view." He adds, "Whether the courts should properly play any role pertaining to that relationship [between the president and Congress] in the context of the Clauses will have to determined in the future." Ultimately, Judge Walker finds plaintiffs have no standing.

This case is heading to the Supreme Court. As I noted the Fourth Circuit has reached the opposite conclusion on the same issue, which makes this case certworthy, which is Supreme Court-speak for worthy of a certiorari petition to the Court asking the Justices to take on the case.