2017 impeachment - because it's never too early

[LaCroix]

The standing requirement seems insurmountable in that one.

an associate found the theory compelling

[alfred russel]

The standing requirement seems insurmountable in that one.

If we are talking about Tim, that last preposition was unnecessary.

[Grinning_Colossus]

The standing requirement seems insurmountable in that one.

What do you make of the ACLU's idea? It seems like a competitor would be within the zone of interest.

[The Minsky Moment]

The standing requirement seems insurmountable in that one.

What do you make of the ACLU's idea? It seems like a competitor would be within the zone of interest.

More legs there, though raises the question of what the purpose of the clause really is.

[Scipio]

I'm sympathetic to the argument, but I think the standing hurdle is a real bitch. This is sweet, though, because it's definitely not a political question. For years, I've been trying to see if the Court would make a non-political question into one. This is one such case where if they punted it would destroy the legitimacy of the Court. Fun times.

[jimmy olsen]

Minsky, you were skeptical of the standing in the emolument lawsuit, what do you think of this alternate approach.

http://www.slate.com/articles/news_and_politics/jurisprudence/2017/02/how_state_attorneys_general_could_take_down_trump_over_emoluments.html

...

Last month, a government watchdog group called Citizens for Responsibility and Ethics in Washington and some of the country's leading ethics and constitutional law experts—among them Harvard's Laurence Tribe, Fordham's Zephyr Teachout, and University of California–Irvine's Erwin Chemerinsky—filed suit arguing that the president is in violation of the Constitution, and more urgently, that CREW has standing to sue. Without standing, or claims of a concrete and imminent injury to plaintiffs, a suit cannot go forward. CREW argues it has legal standing to bring this action because Trump's Emoluments Clause violations are using up the organization's time and resources. Many legal analysts have expressed doubt as to whether that claim will suffice to get CREW into a courtroom. But a new theory advanced by Fordham University Law School professor Jed Shugerman may present an end run around that standing problem.

Shugerman's approach uses a whole lot of Latin words, but in a nutshell, he wants to use state laws of incorporation to investigate and revoke Trump's business charter in New York. In an article last week, Shugerman laid out the theory that corporations are creatures of state law and that attorneys general have the authority to bring actions against corporations that are acting against the public interest. As he put it, "State attorneys general can bring quo warranto proceedings to access information about whether the entities are conduits for illegal emoluments." By asking state attorneys general in the states Trump businesses are incorporated to sue, the standing problem disappears. As Shugerman puts it: "Instead of private parties suing the public official (Trump), public officials can sue the private parties (the Trump hotels and other business entities). Corporations are a creature of state law, and state attorneys general have a special role in making sure that corporations adhere to federal and state law." Not only does the standing problem disappear but because standing requirements are lower in state court than in federal court, the state AGs will be more likely to be allowed to proceed.

Quo warranto is the Latin term for an old English writ that dates back to the 12th century. The idea here is that if a corporation is behaving in a fashion that is deemed ultra vires, or exceeding its legal authority, the state must investigate. In New York, the attorney general has the authority to bring an action against a corporation under New York Business Corporation Law § 1101 (a) (2), which allows the AG to dissolve a corporation if it finds "that the corporation has exceeded the authority conferred upon it by law, or has violated any provision of law whereby it has forfeited its charter, or carried on, conducted or transacted its business in a persistently fraudulent or illegal manner, or by the abuse of its powers contrary to the public policy of the state has become liable to be dissolved."

To that end, an advocacy group called Free Speech for People (FSFP) has asked New York Attorney General Eric Schneiderman to investigate whether to revoke the charter of The Trump Organization, Inc., due to the president's ownership stake in the corporation and its alleged history of illegal activity.

The 24-page letter is less interested in new legal arguments, or even in arcane questions of standing, than existing evidence that Trump's corporate entities are being used to funnel illegal emoluments to Trump. The group's claims run the gamut from allegations of discriminatory housing practices in the 1970s through last year's claims against Trump University. In addition to getting around the standing problem, the initiative also sidesteps the need to rope in Congress, the Justice Department, or any other entity disinclined to investigate or question Trump conflicts.

Schneiderman has been at the vanguard of state attorneys general who have pushed back on Trump's actions: He brought one of the cases against Trump University, launched an investigation of the Trump Foundation, and has opposed the president's executive order on immigration. But Shugerman insists that this legal move could work in many different jurisdictions. Actions under a state's quo warranto authorities could be brought, for instance, against the Trump Organization in Washington, where it appears to be in violation of the General Services Administration lease that bars any federal official from operating the hotel. And Shugerman adds that in some states, like California, entities beyond the state AG would be authorized to bring such an action. California law also grants this power to local governments and municipalities.

I asked Shugerman whether there is any reason to believe the states would be willing to take as dramatic and draconian an action as threatening to dissolve Trump Organization entities. In an email, he explained that this remedy can be tailored to be more or less dramatic, but one meaningful benefit is that it allows for broad discovery:

Under quo warranto proceedings, the state attorneys general and the courts have flexibility to create a balanced remedy. The first step is discovery to find out about the Trump Organization's financial arrangements and entanglements with foreign and state entities. The next step is to take the emoluments and fraud claims into court. In the end, the attorneys general and the courts may craft a mix of injunctions, fines, divestment, and/or limited dissolutions of LLCs. It's important to recognize that the first step of transparency about the Trump Organization is a service to the public interest by itself, but so is the rule of law and anti-corruption. If this action prevents foreign entities from using payments and debts to manipulate American policy, some relatively minor and temporary instability is worthwhile and necessary.

As to whether one more lawsuit alleging yet more corruption can dislodge an intransigent president who believes himself above the ethics laws, Shugerman reminded me that allowing the appearance of corruption to persist is not costless. "Look how much instability the Trump Organization and its foreign entanglements have already created," he said. "This action will actually reduce that instability, legally, economically, and in national security."

It's become clear that the courts are the best hope for restoring at least some stability to the Presidency Inc. regime in which we now find ourselves and that the states have become powerful agents for accountability. This quo warranto business may feel airy and academic. But the logic behind it is persuasive, and the impacts of this legal theory could be very real.

[The Minsky Moment]

Minsky, you were skeptical of the standing in the emolument lawsuit, what do you think of this alternate approach.

It's true the state can seek to invalidate a charter under BCL 1101.  It's less clear that the standard for dissolution - very high - can be met.  And if successful - then what?  Doesn't impact Trump's position as President.  It's a problem for the Trump Org, but could be worked around using another entity structure.

[jimmy olsen]

I would prefer a million dollars in bratwurst.

http://www.slate.com/articles/news_and_politics/jurisprudence/2017/10/would_1_million_in_hot_dogs_violate_the_emoluments_clause.html

Would $1 Million in Hot Dogs Violate the Emoluments Clause?

A delicious hypothetical at oral arguments in an anti-Trump lawsuit.

By Dahlia Lithwick

In a federal courthouse in Manhattan on Wednesday morning, lawyers for the Department of Justice tried to persuade Federal District Judge George B. Daniels to toss the civil lawsuit accusing the president of violating the Constitution by accepting foreign money while in office. Perhaps the high point of the morning came when a Trump lawyer conceded that if the president were to accept $1 million in hot dogs purchased from an imaginary Trump hot dog business as a gift to sign a foreign treaty, he would probably run afoul of the most obscure constitutional provision you've never heard of. Metaphor, meet the president of the United States.

You may recall that back in November everyone was casting about trying to find a name for the phenomenon wherein a presidential candidate who promises to release his tax returns if elected and declines to do so, then promises to divest himself of his foreign business interests from which he would profit as president and fails to do so, and then stands next to a tower of empty folders and tells us ethics rules don't apply to the White House and he doesn't care if you're mad about that. You may also recall that this was around the time the word emoluments became something other than that stuff you use to keep your skin smooth and supple.

The Foreign Emoluments Clause can be found in Article I, Section 9 of the U.S. Constitution, and it bars anyone holding an "office" from accepting presents or emoluments from "any King, Prince or Foreign State" without "the consent of Congress." (The Constitution actually has three separate emoluments clauses, but only the foreign and domestic clauses came up in oral arguments on Wednesday.) In the simplest possible terms, the Emoluments Clause prohibits government officials from accepting gifts or payments from foreign governments. Here's the sticky bit: We don't have a lot of doctrine in this area because it's never been litigated, chiefly because most presidents haven't wanted to look like they were cashing in on the office with club fees, Chinese trademarks, and jacked-up hotel drink prices. But this president doesn't care about any of that.

Because he failed to fully divest from his businesses and because foreigners are dropping a whole lot of cash at Trump properties, the watchdog group Citizens for Responsibility and Ethics in Washington, or CREW, and co-plaintiffs Eric Goode, Jill Phaneuf, and the Restaurant Opportunities Center United filed a lawsuit in New York claiming the president was violating the Emoluments Clause. There are two similar suits pending in other courts.

Arguing today on behalf of the president, Deputy Assistant Attorney General Brett Shumate says the court should dismiss the entire proceeding. Shumate says the plaintiffs lack standing—that they have suffered no particularized injury that merits a court's intercession. He also argues that the court has no jurisdiction to enjoin a sitting president from participating in commercial business, and he says the plaintiffs have incorrectly defined emoluments so as to preclude anyone in office from holding any interest in a business with foreign income. Judge Daniels lets him proceed largely unchallenged as he states that CREW and the hospitality plaintiffs alleged harms too speculative to be cognizable and that CREW opted to "inflict injury on itself" by bringing this lawsuit and focusing money, research, and resources on this particular endeavor as opposed to other issues.

Judge Daniels stops to ask a question only when Shumate contends that Trump is taking no government action over the hotel and restaurant markets, saying he's merely participating in them. "But you can be in a market and also control it," notes Daniels. Shumate replies that this is a highly competitive market with hundreds of businesses and that no two entities are actually competing. Judge Daniels stops him to say the plaintiffs allege they lost business to Trump properties. Shumate says no, they are asking the court to infer injury.

The lawyer and judge spar for a few moments on the question of remedies. Shumate says it's appalling to imagine a federal court micromanaging and monitoring Trump's business dealings, while Daniels says he could impose different remedies, or the president could perhaps decide to divest on his own. But when Shumate turns to the actual definition of emoluments favored by the DOJ in this case, the wheels start to come off. The DOJ has urged that—at least according to some dictionaries—an emolument requires a connection between the payment made and the president's office or employment. Daniels thinks this is a tortured reading of the clause. "Why can't we just say it's addressing the compensation the president gets?"

Shumate keeps insisting that it's only an emolument if the president exchanges the gift for services. Judge Daniels keeps telling him that if a foreign power gives Trump $1 million to sign a treaty, it doesn't matter if the president signs that treaty. Shumate keeps insisting this is a "gift." "Well, not from the foreign country's perspective," snaps Daniels. People titter. They go round and round this mulberry bush multiple times as Daniels changes the hypo: "If you say you're going to sell me a car for $10,000," says Daniels, "and I show up tomorrow and there's no car, are you saying that's a gift?"

Shumate says the gift-giver's subjective intent doesn't matter. Daniels says there is no difference between an official and unofficial act of the president. "Everything he does is official," Daniels says. "It doesn't matter if it's in exchange for his services, whether he sleeps all day or works all day, his services arise out of the office of the president." Shumate says none of the framers understood the Emoluments Clause to "apply to private business concerns."

Cue the hot dogs.

Daniels: "So a foreign government says to the president, 'Sign this favorable treaty and we will give you $1 million. You own a hot dog stand so we will buy a million dollars in hot dogs.' "

Shumate: "That might be a present."

Daniels: "You are not arguing that $1 million in hot dogs is a present."

Shumate concedes that he is not.

Based on the DOJ's reading of emoluments, no government official could ever be in violation of anything.

Deepak Gupta of Gupta Wessler argues on behalf of CREW, and he has a tough time getting past the standing arguments. Daniels isn't really buying that at least one of the CREW plaintiffs has standing, and he doesn't seem at all persuaded that CREW itself does. He tells Gupta that the Emoluments Clause "is not an anti-competitive provision. It's an anti-corruption provision." He repeats several times that there is a vast universe of people who want to stay at Trump properties because they believe Trump is awesome, and that those people don't suffer an Emoluments Clause injury. Gupta says the Emoluments Clause doesn't confer a right, but it does mean courts can step in and remedy violations. But when Daniels begins putting air quotes around phrases like "diverting resources," it's clear he doesn't think CREW has standing to claim harm.

"They're not diverting resources if they just want to play policeman," Daniels insists. "I don't know if CREW had even thought of the Emoluments Clause before this. Most people had not." Tittering.

Daniels is perhaps most animated when he starts telling Gupta that this is a political problem, to be sorted out between the president and Congress. "Why," he asks, "is this a legal question for the courts? It's an issue between two branches of government. ... The president has the ability to do this. I'm not sure there's anything in the Constitution that says Congress couldn't consent even if they thought it was a bribe. ... Why should the president fight this out in a street brawl with individuals?"

Gupta replies that the fact that Congress could make exceptions to the emoluments ban doesn't mean it's not also justiciable. He spends what's left of his time agreeing with Judge Daniels that $1 million in hot dogs is an emolument.

Top Comment
$1 million in hot dogs would be a violation of the Condiments Clause. 

Shumate ends his rebuttal where he began: that if Trump can't take money from foreigners at his hotels, President Obama can't take foreign book royalties and retired military men can't hold stock in hotels. In a strange echo of what the Supreme Court said in the Bob McDonnell case, it seems it can't be bad to profit off high office if everyone does it all the time.

The subtext to today's hearing is that if Daniels allows this case to go forward to trial, CREW would be entitled to discovery, granting the group access to the kinds of evidence of corruption and self-dealing that everyone has only guessed at until now. The stranger subtext is that, based on the DOJ's cramped reading of emoluments, it's hard to imagine any government official could ever be in violation of anything. As we walk out of the building wondering aloud whether the same president who profits daily off his hotels and clubs and trademarks might take $1 million in hot dog–based bribes, it's hard to believe he couldn't get away with that and a whole lot more.