Trump responds to Maryland lawsuit questioning foreign 'gifts'

President Donald Trump moved Friday to dismiss a lawsuit filed by Maryland and the District of Columbia alleging that his real estate empire has received unconstitutional gifts from foreign governments since he took office.

In a filing in U.S. District Court in Greenbelt, Justice Department attorneys said that neither Maryland nor the District has standing to sue the president over the contentious issue. They also argued that the local jurisdictions are misreading the Emoluments Clause of the Constitution.

Trump has been dogged since before the election by questions about how he would separate his vast business holdings from the White House. Much of the focus of that criticism has centered on the luxury hotel the president’s company manages on Pennsylvania Avenue in Washington — a site that frequently hosts diplomats and their staff.

Attorney General Brian E. Frosh, a Democrat, filed a lawsuit in June claiming in part that Maryland loses tax revenue because its hotels compete with Trump International Hotel. The plaintiffs also said states that grant zoning variances or tax breaks to a Trump property could win favor at the White House, harming those that do not.

In a 78-page motion filed late Friday, Trump administration attorneys wrote that Maryland and the District of Columbia had failed to demonstrate how they had actually been harmed by the hotel. The Justice Department wrote that much of the lawsuit was based on speculative claims.

“They assume that the operation of a single luxury hotel in downtown Washington, D.C., would have an extraordinarily wide-ranging impact on D.C.’s and Maryland’s economies,” Trump’s attorneys wrote in the motion. “It is highly doubtful that the economic ripple effect of the Trump International Hotel would have any perceptible impact on [Maryland and D.C.] venues.”

A spokeswoman for Frosh said her office is reviewing the motion.

The president has already moved to dismiss a similar case filed this summer by Democratic lawmakers in Congress using many of the same arguments. But the Maryland litigation marked the first time a state government sued Trump over the matter, and so the legal questions at hand are influenced by a different set of facts.

In both cases, the administration argues that the Emoluments Clause was intended to cover payments made in exchange for official actions, not a blanket prohibition on commercial transactions.

Trump announced shortly before his inauguration that he would retain ownership of his real estate company but turn its daily operation over to members of his family. Ethics specialists from both parties, who had pushed Trump to put his companies into a blind trust, have said the arrangement has done little to quiet concerns.

A central question for Emoluments Clause claims is who has standing to sue — in other words, who has been harmed by the defendant’s actions. The attorneys general alleged in their suit that Trump has harmed Maryland's "sovereign interests."

To make that argument, Frosh reached back to the nation's founding. He said the Emoluments Clause was a "material inducement" — a provision intended to entice states to join the union — because many, including Maryland, had similar prohibitions on accepting gifts in their own constitutions. Not enforcing the rule, they said, is tantamount to the federal government breaking a 229-year-old promise.

The Justice Department attorneys wrote that accepting that line of argument would open the federal government up to litigation on any number of issues that a state could claim it believed was a condition of joining the union.

The plaintiffs’ “novel and far-reaching claim that a state can seek to enforce what it purportedly bargained for when entering the union is well outside the traditional bounds” of judicial doctrine, the attorneys wrote.

The lawsuit, they added, “contains no plausible allegations that delegates to Maryland’s ratifying convention in 1788 held the state’s current view of the Emoluments Clauses, much less that such [a] view was material to their decision to ratify the Constitution.”

In the initial lawsuit, Maryland and the District of Columbia said states that provide zoning variances or tax breaks to a Trump property could curry favor at the White House — and, conversely, those who deny them could be blacklisted. But Maryland isn’t home to any Trump properties, the Justice Department said, and Frosh was unable to point to an example of such a request having been made.

Pointing to the fact that the lawsuit was brought entirely by Democrats, the White House has cast the litigation as a political stunt and said that the president's business interests do not violate the Constitution.

Democrats disagree.

“Trump and his crony cabinet continue to show little regard for the rule of law,” Sean Rankin, executive director of the Democratic Attorneys General Association, said in a statement. “Democratic Attorneys General will continue to stand up against Trump, those around him, or any other government officials of either party who act unethically in the execution of their office.”

The lawsuit is arguably the most prominent case in a broader effort by Frosh to challenge Trump and his administration’s policies after the General Assembly granted him the power this year to do so unilaterally. Frosh joined another lawsuit this month challenging the administration’s immigration policies, and has filed or joined other cases dealings with chemical accidents, pesticide regulation, vehicle emissions and offshore drilling.

Frosh isn’t the only Maryland official eager to see the Trump administration in court. Republican Gov. Larry Hogan has directed Frosh to file two lawsuits as well. One case demands the Environmental Protection Agency to address air pollution from upwind states. The other deals with new air traffic control patterns that have drawn complaints from neighbors of the Baltimore-Washington International Thurgood Marshall Airport.

Frosh filed the EPA lawsuit on Wednesday.

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