A Federal Judge in Manhattan on Wednesday pushed back against the U.S. Government’s attempts to Narrowly Define the Constitution’s built-in Anticorruption Provisions, during a Hearing in a closely watched Lawsuit targeting President Trump’s Business Ties.

A Lawsuit filed by Citizens for Responsibility and Ethics in Washington (CREW), a Watchdog Group, in January alleges that Trump Violates the U.S. Constitution every time his Businesses, that he still Retains Ownership, receive Payments and Benefits from Foreign and State Governments, and Federal Agencies.

The U.S. Constitution’s Foreign Emoluments Clause Bars Officeholders from Accepting “any present, emolument, office, or title, of any kind whatever” from Foreign Governments. But Congress can Waiver each Emolument.

The Domestic Emoluments Clause Prevents the President from Receiving Compensation from State and Federal Governments other than a Salary set by Congress. Congress can Not Waiver Domestic Emoluments.

The Hearing Wednesday marked the First Public airing of Arguments over the Scope of the Provisions and the definition of an “Emolument.” Democrats in Congress and the Attorneys General of the District of Columbia and Maryland filed similar Lawsuits in June.

Brett Shumate, a Justice Department Lawyer, told U.S. District Judge George Daniels that an Emolument should be defined as a Benefit conferred in Return for a Personal Service provided by the Officeholder. “Why doesn’t emolument mean compensation?” asked Judge Daniels, who is considering the Government’s Motion to Throw Out the Case. “Why do we need a more complicated definition?”

At one point, Shumate reluctantly Agreed that the Emoluments Clauses could reach Private Business Transactions, in response to a Question from Judge Daniels, who asked whether the Constitution would allow the President to accept $1 Million from a Foreign Government seeking his Signature on a Treaty. Under Judge Daniels’ hypothetical, instead of Paying the President directly, however, the Foreign Government would Buy $1 Million in Hotdogs from the President’s Hotdog-Vending Business. Shumate said the $1 Million could be considered an Emolument, as long as the President Signed the Treaty.

Deepak Gupta, a Lawyer for CREW, argued for a Broader Definition of an Emolument as a “Profit, Gain or Advantage.”
Judge Daniels said the Nation’s Founders intended the Emoluments Clauses to be “all-inclusive,” rather than contingent on a Quid Pro Quo. According to CREW, Trump Violates the Constitution when Government Customers Pay his Hotels and Restaurants; when State-Owned Companies make Lease Payments for their Offices in Trump Tower; when Foreign Officials give Approvals and Issue Permits for Trump-branded Real-Estate Developments Abroad, among other examples.

Trump Declined to Divest his Business Assets before entering Office. He Placed them into a Trust and Appointed his Two Adult Sons to Run the Trump Organization, but retained his Majority Ownership of those Assets. The CREW Lawsuit seeks an Order Halting the alleged Violations.

Shumate said Judge Daniels had No Authority to Order the President to Divest his Assets, under an 1867 Ruling by the U.S. Supreme Court. “A court can’t enjoin the president in the performance of his official duties,” he said.
Judge Daniels, who was appointed by President Bill Clinton, said he could make a Finding that Trump is in Violation of the Emoluments Clauses, without Ordering him to do Anything.

Judge Daniels questioned, however, whether CREW and its Co-Plaintiffs, Businesses, that Compete with Trump’s, were the Proper Ones to crack down on the Alleged constitutional Violation. To bring a Lawsuit, Parties have to show that they have been Harmed or will be Harmed by the Conduct of the People or Entities they intend to Sue. Part of Wednesday’s Hearing focused on whether CREW, an Organization that seeks to Reduce the Influence of Money in Politics, and the other Plaintiffs have met that Bar.

CREW said in the Lawsuit that Trump’s Conduct has Forced it to “divert essential and limited resources” away from its other Matters. Judge Daniels was Skeptical, saying CREW made a Choice to Devote its Resources to Investigating potential Violations of the Emoluments Clauses. The other Plaintiffs include Restaurant Opportunities Centers United Inc., whose Members are Restaurants that Compete with Trump’s, and Eric Goode and Jill Phaneuf, who Own or Work for Hotels that vie for the Same Business as Trump’s.

Shumate said CREW’s alleged Injuries were “Self-Inflicted” and that the Allegations of Competitive Disadvantage were “Speculative.”

Gupta said the Hospitality Clients compete with Trump in a Small, Defined Market of Upscale Restaurants and Hotels in Areas in New York and Washington, D.C. “What our clients can’t offer is the ability to curry favor with the president of the United States,” said Mr. Gupta.

Judge Daniels, near the end of the nearly three-hour Hearing, wondered whether the dispute was better left to Congress, which can currently Consent to the Foreign Emoluments, on a single Emolument at a time.

Judge Daniels said he would Rule on the Motion to Dismiss the Case in the next 60 days.









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