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Trump scores victory as court dismisses emoluments lawsuit over his D.C. hotel

Trump scores victory as court dismisses emoluments lawsuit over his D.C. hotel
The arched facade of the Trump International Hotel in Washington, D.C. (Alex Brandon / Associated Press)

A federal appeals court has ordered the dismissal of a lawsuit accusing President Trump of illegally profiting off the presidency through his luxury Washington hotel, handing Trump a significant legal victory on Wednesday.

A three-judge panel of the U.S. 4th Circuit Court of Appeals unanimously overturned the ruling of a federal judge in Maryland who said the lawsuit could move forward.

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The state of Maryland and the District of Columbia sued in 2017, claiming Trump violated the emoluments clause of the Constitution by accepting payments from foreign and domestic officials who stay at his Trump International Hotel. The provision prohibits federal officials from accepting benefits from foreign or state governments without congressional approval.

The 4th Circuit found the two jurisdictions lack standing to pursue their claims against the president, and granted a petition for a rare writ of mandamus, directing U.S. District Court Judge Peter Messitte to dismiss the lawsuit.

Trump heralded the decision in a tweet, saying, "Word just out that I won a big part of the Deep State and Democrat induced Witch Hunt." Trump tweeted that he doesn't make money but loses "a fortune" by serving as president.

Trump's personal attorney, Jay Sekulow, called the decision "a complete victory."

"We are pleased that the Fourth Circuit unanimously decided to dismiss this extraordinarily flawed case," Department of Justice spokeswoman Kelly Laco said in a statement.

"The decision states that there was no legal standing to bring this lawsuit in the first place," Sekulow said a statement. "This latest effort at Presidential harassment has been dismissed with prejudice."

During oral arguments before the panel in March, lawyers for Maryland and the District of Columbia said Trump's status as president is a driving factor for foreign and domestic government officials to stay at his hotel.

Just blocks from the White House, the iconic Old Post Office quickly became a hot spot for lobbyists and foreign officials after it reopened in October 2016 as the Trump International Hotel. A public relations firm working for Saudi Arabia spent nearly $270,000 on food and rooms. The Philippine and Kuwaiti embassies have also had parties there.

Maryland and the District of Columbia claim they have suffered harm because more people would stay at hotels in their jurisdictions if they weren't eager to curry favor with the president by staying at his hotel.

Trump's legal team argued that Maryland Atty. Gen. Brian Frosh and District of Columbia Atty. Gen. Karl Racine — both Democrats — lack authority to sue the president in his official capacity.

Trump's lawyers also argued that the emoluments clause only bars compensation made in connection with services provided in his official capacity or in "an employment-type relationship" with a foreign or domestic government.

The 4th Circuit's decision to hear the unusual mid-case appeal put the lawsuit on hold before deadlines to respond to subpoenas issued in December seeking tax returns, receipts and other records from more than 30 entities, including 13 Trump businesses and the federal agency that oversees the lease for Trump's hotel.

Racine and Frosh said in a joint statement that they would not abandon their efforts.

"Although the court described a litany of ways in which this case is unique, it failed to acknowledge the most extraordinary circumstance of all: President Trump is brazenly profiting from the Office of the President in ways that no other President in history ever imagined and that the founders expressly sought — in the Constitution — to prohibit," the attorneys general said.

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Racine has previously said that if the panel ruled against Maryland and the District, the legal team would seriously consider asking for a rehearing before the full 4th Circuit. He also said it wouldn't surprise him if the case ended up in the U.S. Supreme Court.

All three judges on the panel were nominated by Republican presidents: Paul Niemeyer by George H.W. Bush, Dennis Shedd by George W. Bush, and A. Marvin Quattlebaum by Trump.

A similar case brought by nearly 200 congressional Democrats in the District of Columbia's federal court is based on the fact that Congress is specifically mentioned in the emoluments clause. On Monday, the Justice Department petitioned for a writ of mandamus in the D.C. appeals court to have the case dismissed, and asked for a stay on the 37 subpoenas issued in that case.

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