May 28, 2019 / 10:07 AM / a month ago

Factbox: Courts poke holes in Trump’s stonewall of Congress

(Reuters) - A bitter legal battle over the power of the U.S. Congress to investigate President Donald Trump is expected to widen in coming days following decisions by two federal court judges against Trump.

Businessman-turned-politician Trump’s refusal to cooperate in numerous congressional investigations of him, his family and his administration is forcing Democrats, who control the House of Representatives, to look to the courts to enforce their oversight powers under the U.S. Constitution.

Trump, who is seeking re-election in 2020, and most of his fellow Republicans dismiss the inquiries as grandstanding or political harassment by Democrats to please certain voters.

Democrats say the investigations are needed to hold to account a president who scorns respect for the law and governing norms, posing a threat to the U.S. Constitution.

Trump and his legal team have filed two lawsuits, an unusual step for a sitting U.S. president, in an attempt to block congressional subpoenas seeking his financial records. The judges rejected Trump’s lawsuits and he is appealing.

In most of the cases where Trump and his advisers are refusing to cooperate, they run the legal risk of contempt of Congress citations and court enforcement actions that could result in fines and even imprisonment.

Trump’s stonewalling hardened after the mid-April release of a redacted report from Special Counsel Robert Mueller on how Moscow interfered in the 2016 U.S. presidential election in Trump’s favor and his attempts to impede Mueller’s probe.

The following is a summary of some of the legal matters:

MAZARS ACCOUNTING FIRM

In a win for House Democrats, a judge on May 20 said financial records from Trump’s long-time accounting firm Mazars LLP should be produced to Congress.

Lawyers for Trump asserted that a subpoena filed by Democrats seeking the records was unlawful, and that Congress was on a quest to turn up “something that Democrats can use as a political tool against the President now and in the 2020 election.”

Democrats on the House Oversight Committee said they needed the documents to examine whether Trump faces conflicts of interest or broke the law by not disentangling himself from his businesses as previous presidents have done. Douglas Letter, a lawyer for the committee, said the subpoena fell within Congress’s authority.

U.S. District Judge Amit Mehta in Washington, D.C. agreed with Letter, ruling that Congress was “not engaged in a fishing expedition” and that Mazars must comply with the committee’s subpoena.

Trump called Mehta’s decision “crazy” and appealed.

DEUTSCHE BANK, CAPITAL ONE

Another judge ruled against Trump last week in a similar case involving Deutsche Bank AG and Capital One Financial, banks that Trump did business with.

Two House committees sent subpoenas to the banks and, as in the Mazars case, Trump sued to try to block them, arguing that the committees were reaching beyond their legislative role.

U.S. District Judge Edgardo Ramos in New York said Congress has the legal authority to demand the records, clearing the way for the banks to comply with subpoenas. He also rejected Trump’s argument that the subpoenas were barred by the Right to Financial Privacy Act, saying the law does not apply to congressional investigations.

The Deutsche subpoena seeks accounts, transactions and investments linked to Trump, his three oldest children, their immediate family and several Trump Organization entities, as well as records of ties they might have to foreign entities.

Deutsche Bank has long been a principal lender for Trump’s real estate business. A 2017 disclosure form showed that Trump had at least $130 million of liabilities to the bank.

The Capital One subpoena records related to multiple entities tied to the Trump Organization’s hotel business. In March, before issuing their subpoena, Democrats asked Capital One for documents concerning potential conflicts of interest tied to Trump’s Washington hotel and other business interests.

TAX RETURNS

Unlike past presidents in recent decades, Trump refuses to make public his tax returns, raising questions about what is in them. Democrats are investigating Trump’s past business dealings and possible conflicts of interest involving him.

Treasury Secretary Steven Mnuchin has defied a subpoena from the head of the House tax committee seeking six years of Trump’s past individual and business tax returns.

The committee’s chairman, Richard Neal, said on May 23 that he plans to take the Trump administration to court to enforce the subpoena.

MUELLER REPORT

The redacted Mueller report, released on April 18 by Attorney General William Barr, left some questions about the probe unanswered. Democrats have subpoenaed the unredacted report and the evidence Mueller relied on.

Barr, a Trump appointee, has refused to comply with the subpoena. The House Judiciary Committee voted on May 8 to recommend that the full House cite Barr for contempt of Congress. “We are now in a constitutional crisis,” Jerrold Nadler, the committee’s Democratic chairman, told reporters.

The committee voted hours after the White House asserted the seldom-used principle of executive privilege to keep the full Mueller report under wraps, even though Trump earlier allowed aides to speak with Mueller during his investigation.

House Intelligence Committee Chairman Adam Schiff, a Democrat, has also subpoenaed Barr for Mueller-related documents. After Barr disregarded the subpoena, Schiff said the committee planned to take “enforcement action.”

Nadler’s panel has demanded testimony from Mueller. Nadler said on MSNBC on May 23 that Mueller wants to mostly testify in private and then have a transcript be made public. Trump has said that Mueller should not testify, but Barr has said he would not stop Mueller from doing so.

EX-WHITE HOUSE COUNSEL MCGAHN

Nadler has threatened to hold former White House counsel Don McGahn in contempt because he failed to show up to testify at a hearing. McGahn has been directed by the White House not to produce documents in response to a committee subpoena.

McGahn’s testimony to investigators outlined in the special counsel’s report has been cited by Democratic lawmakers as evidence Trump sought to obstruct justice by telling McGahn to demand the Department of Justice fire Mueller in 2017. Trump has denied any wrongdoing and said he did not ask McGahn to have Mueller removed.

CENSUS AND CITIZENSHIP

The Justice Department has rebuffed an Oversight Committee request for an interview with John Gore, an official involved in the administration’s decision to include a citizenship question in the 2020 census.

IMPEACHMENT

Trump has vowed to fight any effort by congressional Democrats to launch impeachment proceedings against him, promising to go to the Supreme Court, even though it has no say in the constitutional impeachment process.

FBI HEADQUARTERS

Congressional Democrats say the administration has responded too slowly to their requests for documents about Trump’s abandonment of a plan to relocate the FBI’s headquarters.

Before he became president, Trump supported moving the headquarters to the suburbs of Washington from the center of town, said Democrats looking into the matter.

They said that after Trump was elected and disqualified from bidding to buy the FBI’s present headquarters site for commercial development, he switched his position. Democrats have raised questions about a possible Trump conflict of interest.

IMMIGRATION AIDE

The White House has refused a request for Trump’s top immigration aide Stephen Miller to testify to Congress, in a letter to the House Oversight Committee.

Compiled by Caroline Stauffer and David Morgan; Writing by Kevin Drawbaugh; editing by Jonathan Oatis, James Dalgleish and Grant McCool

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