Appeals Court Rules House Democrats Can Subpoena Trump’s Financial Records

The D.C. Circuit Court of Appeals on Friday upheld a subpoena that House Democrats sent to President Donald Trump’s accounting firm for his financial records and tax returns.

The court issued a 2-1 ruling that the House Oversight & Reform Committee has the constitutional authority to investigate wrongdoing by the president of the United States and can therefore subpoena his financial records in pursuit of that investigation.

The subpoena was initially filed by the committee to Mazars LLP, the president’s accounting firm, as part of its pursuit to evaluate and update existing ethics legislation. It came after former Trump lawyer Michael Cohen told the committee that the president routinely manipulated his finances to obtain loans and evade taxes.

Lawyers for the committee argued that the pursuit of these documents was part of its legislative function as it evaluated new executive branch financial disclosure and conflict of interest laws. Trump’s personal lawyers intervened to argue that the House did not have a legitimate legislative purpose in pursuing the documents from the accounting firm and that the only valid way to subpoena any document connected to the president was through an impeachment.

The two judges who voted to uphold the subpoena ― David Tatel, appointed by President Bill Clinton, and Patricia Millett, appointed by President Barack Obama ― ruled that the committee was acting under its legislative function in pursuit of potential legislation. They also ruled that the committee issued its subpoena under valid authority granted by House Rules and the Constitution.

In doing so, Tatel and Millett upheld multiple precedents enabling congressional investigations into the executive branch that could uncover law-breaking and other wrongdoing.

[W]e detect no inherent constitutional flaw in laws requiring Presidents to publicly disclose certain financial information. And that is enough.
majority opinion

The judges knocked down arguments made by Trump’s lawyers that the public statements of committee members showed the committee was not pursuing a legitimate legislative purpose, but rather an unconstitutional law-enforcement action targeting the president.

“Following that course, we conclude that the public record reveals legitimate legislative pursuits, not an impermissible law-enforcement purpose, behind the Committee’s subpoena,” Tatel and Millett wrote. “As a result, we need not decide precisely what deference we owe Congress, as we would reach the same conclusion absent any deference at all.”

They also found that the committee was pursuing legislation that could be enacted. Trump’s lawyers tried to argue that the legislation would be found unconstitutional and therefore was not legitimate.

“[W]e detect no inherent constitutional flaw in laws requiring Presidents to publicly disclose certain financial information. And that is enough,” the majority opinion reads.

Their ultimate conclusion: “At bottom, this subpoena is a valid exercise of the legislative oversight authority because it seeks information important to determining the fitness of legislation to address potential problems within the Executive Branch and the electoral system; it does not seek to determine the President’s fitness for office.”

Judge Neomi Rao, a Trump appointee, issued a dissent that broke with long-standing Supreme Court precedent by arguing that Congress has no right to investigate the president except under its impeachment authority.

“[A]llegations of illegal conduct against the President cannot be investigated by Congress except through impeachment,” Rao wrote in her dissent.

Such a determination would overturn a 1962 Supreme Court precedent that “a congressional committee which is engaged in a legitimate legislative investigation need not grind to a halt whenever…crime or wrongdoing is disclosed.”

“The dissent would reorder the very structure of the Constitution,” Tatel and Millett argue in their majority opinion. “Throughout history, the Constitution has left to Congress the judgment whether to commence the impeachment process. But the dissent’s approach would not even allow Congress to make the quintessentially legislative judgment that some concerns about potential misconduct or illegality are better addressed through oversight and legislation than impeachment.”

If Rao’s opinion overturned past precedent, Congress would be left with no recourse to investigate impeachable executive branch officials for wrongdoing unless it immediately opens an impeachment inquiry. This would gut congressional investigatory powers and tilt the balance of power between the branches of government even further to the benefit of the executive branch.

House Democrats previously leaned on this case as an argument against pursuing impeachment earlier in 2019. House Speaker Nancy Pelosi (D-Calif.) argued that Democrats needed to pursue the president’s documents through the courts as part of the ordinary course of business. 

A whistleblower’s disclosure that Trump pressured the president of Ukraine to interfere in the 2020 election, however, changed that equation. The House is now engaged in an impeachment inquiry.

This decision is expected to be appealed to the Supreme Court, to which Trump has appointed two justices: Neil Gorsuch and Brett Kavanaugh.

Former House Speaker Newt Gingrich, an ally of Trump’s, was asked in 2018 whether the courts would allow House Democrats to obtain the president’s tax returns.

Then they’ll be trapped into appealing to the Supreme Court, and we’ll see whether or not the Kavanaugh fight was worth it,” Gingrich replied.