Emoluments: Not a Moisturizer, Yet Capable of Greasing the Skids!

During and after the 2016 Presidential campaign, Mr. Trump's potential to personally profit from his public office was the subject of much discourse.  For instance,  Trump's name appeared on the lease and canopy of a fancy, centrally located hotel in the District of Columbia--- a classic building that once housed the Old Post Office Building and was leased by the government to Trump's business.  Members of the Trump family had business dealings throughout the world.  The Secret Service paid corporate Trump a massive monthly rent for space in Trump Tower.  Never before had an administration had its hands so conspicuously and simultaneously dipped in the worlds of business and government.

Discussion about the propriety of this business/government interrelationship gave a visibility  boost to a previously obscure provision of the Constitution of the United States: the so-called "emoluments" clauses.   The word is not easy to say and had not been extensively interpreted over the years; nonetheless, the term may prove extremely meaningful as the courts investigate the legality of many actions by the current administration.

The term "emoluments" appears in two portions of the U.S. Constitution.  The so-called "Foreign Emoluments Clause: appears in  Article 1, §9, clause 8 and states that "no Person holding any Office of Profit or Trust under them [the United States], shall, without the Consent of the Congress, accept of any present, Emolument, Office, or Title, of any kind, from any King, Prince or foreign State."

The "Domestic Emoluments Clause" can be found in article II, §1, clause. 7: :The President shall, at states Times, receive for his Services, a Compensation, which shall neither be increased nor diminished during the Period for which he shall have been elected, and he shall not receive within that Period any other Emolument from the United States, or any of them."

With this background, the District of Columbia and the State of Maryland filed suit in the United States District Court for the District of Maryland in 2017.  Donald J. Trump as an individual and as the President, is the sole Defendant in this action.  The gist of the claims by these public entities is neatly summarized in an Opinion filed on July 25, 2018 by the presiding federal judge, the Honorable Peter J. Messitte: "Plaintiffs [the District of Columbia and the State of Maryland] have alleged that the violations consist of the President's actual or potential receipt, directly or indirectly, of payments by foreign, the federal, and state governments (or any of their instrumentalities) in connection with his and the Trump Organization's ownership of Trump International Hotel in Washington, D.C. They seek declaratory relief establishing their rights vis-a-vis the President's actions as well as injunctive relief prohibiting him from further violating the Clauses."  (Opinion dated July 25, 2018, Civil No. PJM 17-1596, Court Document No. 123, United States District Court for the District of Maryland, at p. 2).

In  factual support of their claims, the Plaintiffs provide information concerning the use (and thus profit to the Defendant) of the Trump Hotel by foreign heads of states, the governor of Vermont and other public figures seeking to curry favor.   One of the first actions taken by newly-elected Trump was to fire the then-head of the General Services Administration (the federal accounting branch), a long-standing public servant who had opined that Trump's continued operation  of the Hotel was in violation of the Emoluments clause. The GSA replacement, not surprisingly, was not critical of this Hotel arrangement. 

The Court noted at p. 5 of the Opinion:  "Plaintiffs further allege that the Hotel has received a benefit, which they say is an "emolument," from the Federal Government by virtue of the General Services Administration' (GSA) Lease which governs the Trump Organizations use of the Old Post Office Building, the site of the Hotel.  [citation to record omitted] Thus Section 37.19 of the Old Post Office Lease states: "No...elected official of the Government of the United States... shall be admitted to any share or part of this Lease, or to any benefit that may arise therefrom"  [citation omitted] Despite a previous statement from a GSA  official that the President would be in violation of the Lease unless he fully divested himself of all financial interest in the Lease, following the President's inauguration, the GSA reversed its position, determining that the President was in fact in compliance with the Lease. [citation omitted].   Since then, the Trump Organization and through it the President have enjoyed the benefits of the Lease." [Opinion at p. 5].

The Court also referenced the fact that while Trump said he would "donate" all profits earned by foreign governments who stayed at his luxury hotel to the U.S Treasure ---based on Trump's own estimates---there is no evidence that Trump has ever made such payments.   Trump's sons continue to report to their father on at least a quarterly basis the status of the business empire, including the Hotel.  While the President indicated he would put his business assets into a trust during his administration, the actual terms of the trust permit Trump to obtain distributions from the trust at any time.

Additionally, the Opinion described events and subsequent policy results associated with visits to Washington by state and foreign officials who stayed at the Trump International Hotel.

Judge Messite determined that the Plaintiffs provided plausible support for their claims that Defendant Trump's hotel dealings violate both the foreign and domestic emoluments clauses of the United States Constitution.  Both parties were ordered to file a "Joint Recommendation" on how to proceed within 21 days of this Opinion.  This 21-day deadline provides Trump, represented by Department of Justice attorneys at taxpayer expense,  time to appeal this Opinion.

The Court's 52-page opinion is a well-drafted legal and factual overview of the claims.  After considering all of the arguments (including extensive reference to old dictionaries, the custom and practice of other administrations and the actual implications of these clauses), the Court took the common-sense position that an "emolument" equates to receipt of a "benefit"

One reason why this civil action is important is that it is an opportunity for further discovery into the business dealings of the current President.  Financial documentation that has not emerged to date may well be relevant to the proceedings in this Maryland courtroom--- and proceedings brought by the Special Prosecutor,  questioning of Supreme Court nominee Judge Kavanaugh and possible impeachment actions.

Another reason why this Maryland federal case is important is that it prompts Trump's attorneys to voice factual and legal reasons for its positions.   The Justice Department attorneys have argued that Mr. Trump, as President, is not subject to these emoluments clauses. Judge Messite, in his thoughtful analysis, finds that Trump is not above the law, including the Constitution.


Mari Bush