A Big Victory in the Emoluments Clause Litigation Against Trump–But Might It Be Too Big To Last? A Search for Limiting Principles…

As many of our readers may already be aware, there was a significant and encouraging development last week in the litigation challenging President Trump’s ongoing business dealings with foreign and state governments as unconstitutional under the U.S. Constitution’s Foreign and Domestic Emoluments Clauses. For those readers who haven’t already been following this, here’s a quick synopsis. (Readers who have been following this issue can skip to the end of this bullet point list.)

  • Although President Trump claimed he would turn over his business operations to his sons Donald Jr. and Eric, in fact President Trump retains substantial interests in those businesses. Several of those businesses, particularly his hotels (and among those hotels, especially his DC hotel, located at a property leased from the federal government) do substantial amounts of business with representatives of foreign governments, as well as with state governments. Many people have argued that accepting foreign government or state government patronage at Trump hotels violates the Foreign and Domestic Emoluments Clauses, respectively. The Foreign Emoluments Clause states that “no Person holding any Office of Profit or Trust under [the United States] shall, without the consent of Congress, accept of any present, Emolument, Office, or Title, of any kind whatever, from any … foreign State.” In other words, no officer of the U.S. federal government can accept an “emolument” (whatever that is – more on this question in a moment) from a foreign government. The Domestic Emoluments Clause states that the President “shall not receive [during his term of office] any other Emolument [besides his official salary] from the United States, or any of them.” In other words, the federal government can’t provide any “emolument” to the President other than his official salary, nor can any state government provide any emolument to the President.
  • So, the argument goes, if a foreign government pays for rooms at a Trump hotel, which increases the Trump Organization’s profits and hence President Trump’s personal wealth, President Trump has received an “emolument” from a foreign state. Similarly, if a state government pays for rooms at a Trump hotel (or purchases other goods or services from a Trump business), the President is receiving an emolument from a state government. An additional violation of the Domestic Emoluments Clause may have occurred when the General Services Administration (GSA) (the federal government agency which is, in essence, the landlord for the Trump DC hotel) concluded that the Trump Organization could retain its lease even after Trump’s inauguration, despite the fact that the express terms of the lease appear to preclude this. The argument goes that in allowing the Trump Organization to keep its lease on the property, a federal government agency (in this case the GSA) had granted an “emolument” to the President, in violation of the Domestic Emoluments Clause.
  • Several separate lawsuits alleged these constitutional violations. When they were filed, many people (including me) expected the suits to be dismissed on jurisdictional grounds, in particular though not exclusively the inability of the plaintiffs in these cases to show that they were personally and directly harmed by the alleged constitutional violations. And that was indeed what happened to the first case, filed by a civil society nonprofit in New York. But in a separate lawsuit filed in Washington DC by the DC government and the state of Maryland, the judge last April determined that court had jurisdiction over at least some of the plaintiff’s claims (including the claims described above).
  • The President’s lawyers then filed a motion to dismiss, arguing that even if everything the plaintiffs alleged were true (a stipulation the President reserves the right to deny later), there’s no constitutional violation, because neither the profit from a business transaction nor a favorable regulatory decision would count as an “emolument.” Rather, on the President’s view, an “emolument” is only a payment made as compensation for official services.
  • Last week, the District Court issued an order denying the President’s motion to dismiss, rejecting the President’s narrow interpretation of “emolument” and instead endorsing a sweeping definition in which an emolument, for purposes of the relevant constitutional clauses, includes anything of value.

That ruling, as Joe Biden might say, is a big f’ing deal. It’s not the end of the case—far from it—but it’s a huge win for the plaintiffs. Among other things, it means there will now be more fact-finding, including discovery, and probably in a few months we’ll have motions for summary judgment and another judicial order in response, which will likely both keep the issue in the news and possibly bring to light even more damaging information about the President’s business dealings. (The President’s lawyers may try to get an appeals court to consider the jurisdictional issue before this process moves forward by asking for what’s called an interlocutory appeal, but by friends who are experts in civil procedure tell me that such a motion is extremely unlikely to succeed, or at least it would be in an ordinary case.)  So, speaking as someone who was initially skeptical of this litigation—who not only thought it was unlikely to succeed but who worried that it could backfire—I’m delighted to confess error. (I suppose we could still debate whether this was a smart gamble at the time, but it does seem that the gamble is paying off, and who am I to argue with success?)

That doesn’t mean that these suits will ultimately succeed. Even if the plaintiffs prevail in the District Court, there will be an appeal, and I think the odds of the plaintiffs prevailing in the Court of Appeals are low. And even if they do win, the Supreme Court is almost certain to hear the case, and I predict that the Court would find a way to dismiss the case on jurisdictional grounds. (That said, if for some reason the Senate doesn’t confirm Judge Kavanaugh’s nomination to the Supreme Court, and in the November 2018 elections the Democrats take the Senate and vow to block any Trump nominee to fill the open seat, then it’s possible that the Supreme Court could deadlock 4-4, leaving any lower court decision in place.)

Now, in addition to the jurisdictional question, one of the issues on appeal will concern the breadth of the District Court’s definition of “emolument.” A lot of the arguments on this point concern matters of text and history. (How did 18th– century dictionaries define “emolument”? What do we learn from debates about the Emoluments Clauses at the Constitutional Convention and ratifying debates? What did early practice look like?) Those arguments are important, but I’m not going to explore them here. There is, however, a separate question of what definition of “emolument” would best serve the purposes of the Emoluments Clauses, which is closely related (if not necessarily identical) to the question of which definition would be the most sensible. I’m very sympathetic to the plaintiff and the District Court’s arguments that the main purpose of the Emoluments Clauses is to serve as broad prophylactic anticorruption measure, one that targets not only quid pro quo deals, but more broadly seeks to eliminate the possibility of governments currying favor with US officials by conferring benefits on them. And I agree that such benefits can take a wide variety of forms. Nonetheless, I do think that the breadth of the definition of “emolument”—as literally anything of value, or as any “profit, gain, or advantage”—might create some problems, and it’s important to think about how the potentially sweeping implications of this definition might be cabined.

I say this not because I’m terribly sympathetic to President Trump’s arguments that he’s not in violation of the Emoluments Clauses. Indeed, based on what I know thus far, I’m fairly confident that President Trump is violating the Emoluments Clauses, and should lose this case on the merits (though the jurisdictional arguments are a closer question). Rather, it’s important to think about appropriate limiting principles for two reasons. First, the likelihood of prevailing on appeal is higher if the plaintiffs and their allies can offer plausible rebuttals to the parade-of-horribles the President’s lawyers will argue follows from defining an emolument as “anything of value.” Second, whatever the appeals court (or perhaps the Supreme Court) says on this issue might have consequences for other cases—with other defendants and different sorts of conduct. So, in the remainder of this post I will first sketch out why the broadest version of the “emolument means literally anything of value” argument might create difficulties, and then consider a series of possible responses to those (alleged) problems. Continue reading

Expediting Corruption: The Dangers of Expediters in Licensing Markets

The scheme was as simple as it was brazen, and as brazen as it was frightening. On April 24, 2018, a New York City jury convicted attorney John Chambers of bribing New York Police Department (NYPD) personnel in exchange for gun permits for his numerous clients. Calling himself a “gun license expediter,” Mr. Chambers acted as an intermediary for individuals hoping to pass the necessary background check and obtain the mandatory permit in order to legally own a firearm in the city. But in a decentralized scheme involving numerous individuals inside and outside the police department, NYPD officers approved hundreds of licenses while skipping background checks, shortening license suspensions, and waving through applications containing glaring red flags—including improperly approving licenses for individuals convicted of illegal weapons possession. In return, the officers received expensive gifts, tickets to sporting events, lavish vacations, envelopes stuffed with cash—and even free guns.

At the center of the web of bribery were so-called “gun license expediters” like Chambers, who advertised their ability to help clients navigate the demanding and complex process of obtaining, renewing, or retaining a handgun license in New York City. Several of the expediters indicted in the scandal were retired police officers who had served in the NYPD Licensing Division, bribing former colleagues after leaving the police force in order to open their own expediting businesses. Fees varied depending on the difficulty and timing of the requests, but clients were routinely charged thousands of dollars per license—on top of the hundreds of dollars in mandatory city-imposed application fees. By leveraging experience, relationships, and sometimes illegal gifts, expediters such as Chambers were able to not only expedite but also to influence the outcome of applications.

In response to the revelations, the NYPD announced substantial changes to its licensing program. First and foremost, the department barred any expediter from physically visiting the Licensing Division on behalf of a client—instead requiring that all applicants appear in person to submit their own paperwork. (Expediters, however, would presumably not be barred from contacting members of the Licensing Division or directing their clients whom to talk to when they arrive.) Second, the department mandated that all gun permit approvals could only be made by the top two officers in the unit. Despite these seemingly sweeping changes, the new policies sidestep the root causes of corruption in this instance—which reveal the danger of expediters in general. Continue reading

Lights, Camera, Integrity? From “Naming and Shaming” to “Naming and Faming”

“Can a reality TV show discourage corruption?” This was the recent attention-grabbing headline of an article in The Economist about Integrity Idol, the brainchild of the NGO Accountability Labs. It was started in Nepal in 2014, and has since spread to Pakistan, Mali, Liberia, Nigeria, and South Africa.

The format of the show is simple. Citizens are asked to nominate civil servants whom they believe display the highest standards of honesty and integrity. These nominations are then reviewed by a panel of judges comprising local and international experts, who select five finalists. Videos are then produced, each around 2-5 minutes long, containing excerpts from an interview with the finalists and their superiors, colleagues, and subordinates, along with glimpses into their work lives. (See here and here for examples). These videos are disseminated among the citizenry via traditional and non-traditional media. Citizens vote for their favorite, and the “Integrity Idol” is crowned.

This isn’t the first time a non-traditional cultural medium has been used to spread an anticorruption message. Other approaches, including museums, TV dramas, music, and poetry  have been discussed on this blog previously (see here, here, here and here). Thanks to Integrity Idol, reality TV can be added to the list. That might seem a bit surprising. Reality TV has a (deserved) reputation for depicting an over-dramatized, intentionally provocative, and often manipulated caricature of real life. One hopes that no one would cite Real Housewives of New York as a reliable source for understanding the lives of real housewives in New York! Integrity Idol is different: it is an intentional effort to draw attention to real stories of real people, and often the unaltered stories of these people are compelling in and of themselves. The vision of Accountability Labs and its founding director, Blair Glencorse, is to “support change-makers to develop and implement positive ideas for integrity in their communities, unleashing positive social and economic change.” Continue reading

Guest Post: Should Corruption Prosecutors Tweet? The Brazilian Example

Today’s guest post is from Victor Rodrigues, a researcher at the FGV School of Law in Rio de Janeiro, Brazil:

How openly should prosecutors investigating corruption or other high-level wrongdoing be about their activities and their views on the larger public policy questions that their investigations implicate? As has been discussed on this blog before, there is a longstanding debate on this issue, and considerable variation across countries. The United States represents one approach, in which federal prosecutors are exceedingly discreet and tight-lipped. Consider the fact that Special Counsel Robert Mueller, leading the high-profile investigation into possible wrongdoing by the Trump campaign, barely speaks in public.

Brazil seems to be going in a different direction. Not only does the Brazilian Public Prosecutor’s Office have verified accounts on Facebook and Twitter, but many of the individual prosecutors are also active on social media. Perhaps the most prominent example in Brazil is Deltan Dallagnol, the federal prosecutor coordinating the Car Wash Investigation (Lava Jato). Mr. Dallagnol has used his verified account to tweet over seven thousand times, and many of his posts mention Lava Jato cases.

While we can’t know for sure what impact these tweets have had, it’s unlikely that an account with almost half a million followers would have no impact at all. I imagine that for many readers, for example, those from the United States or countries with similar traditions regarding prosecutorial (non-)communication with the public, Mr. Dallagnol’s Twitter presence might be disconcerting, perhaps troubling. But in the context of a country like Brazil, these tweets, and prosecutorial openness more generally, are likely to have a positive impact not only on specific corruption cases but also on the development of legal and democratic institutions. In particular, this widespread use of social media by Lava Jato prosecutors can have three beneficial effects:

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Carr Center Conference Report on Links Between Corruption and Human Rights.

The many potential connections between anticorruption and human rights have long been recognized, but this topic seems to have attracted increasing interest in recent years. Indeed, we’ve had a few posts on this blog about the topic (see, for example, here, here, here, and here). Last spring, I had the opportunity to attend a conference at the Harvard Kennedy’ School’s Carr Center for Human Rights devoted to this topic. The organizers of that event have put together a conference report, which summarizes the main presentations and discussions. I hope that report might be of interest to GAB readers. I gather that at some point a video recording of the conference will be available online; when it is, I will post the link (or at least highlights) as well, perhaps along with some additional commentary.

“We Have to Reclaim Our City”: Lessons From the “Eye People”

Last year, a 22-year-old Afghan woman went to a local government office to get documentation to travel abroad. She was promptly turned away because she was not accompanied by her father or husband, and because she refused to pay the official a small bribe to overlook this detail. As recently as a few years ago, she may have paid the bribe. But things had changed. Defiantly, she confronted the official and proclaimed: “I will go to the eye people.”

The “eye people” she invoked are three activists—Lima Ahmad, Kabir Mokamel, and Omaid Sharifi—who in 2014 founded a grass-roots anticorruption movement in Afghanistan called ArtLords. ArtLords (whose name is a deliberate play on the “warlords” and “drug lords” that too often define Afghanistan’s image) seeks to raise awareness about corruption and other social issues (including women’s rights and domestic terrorism) by empowering youth to “have a say in how we run the government” and giving them the courage and a forum to speak out on these issues. ArtLords’ founders began their work by organizing small group discussions to better understand young people’s concerns. Unsurprisingly, corruption was the most frequently mentioned. The founders sought a way to publicize these concerns and provide an outlet for discussions to shape the national dialogue. To do this, ArtLords creates public art projects, in which artists trace beautiful, powerful designs on blast walls (concrete barriers constructed to protect buildings and people from terrorist-related explosions) across Afghanistan. To date ArtLords has painted more than 400 murals in almost half of Afghanistan’s 34 provinces; the most famous is a piercing set of feminine, hazel eyes glaring onto the front entrance of the National Directorate of Security in Kabul (which is why the group is known to some as “the eye people”).

Through these projects, the group has inspired a generation of younger Afghans. As Faisal Imran, a student in Afghanistan, noted as he painted a mural on a blast-wall, “this art has a message of hope.” It is this message that has driven young girls to draw murals with the words “I can’t go to school because of your corruption. I can see you.” Moreover, beyond providing an outlet and educational opportunity for the youth of Afghanistan, ArtLords has achieved concrete success by both naming and shaming corrupt officials and naming and family good civil servants, working with the national government to drive change, and inspiring grass-roots social movements, including a recent campaign to challenge warlords and corrupt government officials who drive around Afghanistan with black tinted windows and no license plates. Additionally, one of the founders of ArtLords, Lima Ahmad, was invited to serve as the Director of Monitoring and Evaluations in the Office of the President of Afghanistan, a position from which she advocated for anticorruption and other social reform. In fact, over the past year, the group and its founders have been invited by government officials to speak at conferences and engage in substantive policy decisions.

I recently had the opportunity to interview Ms. Ahmad about her experience, and about what lessons that experience might hold for other civil society groups focused on combating corruption. Our conversation highlighted several important messages for other civil society groups seeking to use similar artistic tools—whether art, music, dance, or others—to combat corruption and promote broader social reform.

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The Case for Preserving South Korea’s Crackdown on Gifts

In September 2016, South Korea’s Improper Solicitations and Graft Prohibition Act, better known as the “Kim Young-ran Law,” came into effect. The Kim Young-ran Law, regarded by some as the strictest anti-graft law in the world, included important provisions aimed at combating Korea’s deep-seated gift-giving culture that infested the public sector and cultivated corruption (including, for example, the corruption blamed for the 2014 Sewol ferry disaster, as well as the scandals that ultimately led to the impeachment of former President Park Geun-hye in 2017). The law’s provisions on gifts ban public servants, educators, and journalists from receiving free meals worth over 30,000 won ($28), gifts over 50,000 won ($46), and congratulatory or condolence money over 100,000 won ($92)—the so-called “3-5-10” restriction.

Although a majority of the Korean public believes that the Kim Young-ran Law has been effective in reducing bribery, the restrictions on gifts were widely perceived as too strict, with almost two-thirds of surveyed Koreans supporting an amendment that would loosen the 3-5-10 thresholds. In light of this, in December 2017 the legislature revised the law to double the price limits on gifts for agricultural, livestock, and fishery goods to 100,000 won, and to reduce the allowance for congratulatory or condolence money to 50,000 won—so, it’s still a “3-5-10” restriction, though the “5” and the “10” have flipped. However, scholars are concerned that even this alteration of the original rules would set a precedent for changes and exceptions that would defeat the initial spirit and purpose of the Kim Young-ran Law. Indeed, the arguments for relaxing the gift limitations do not withstand scrutiny; it was likely a mistake for South Korea to give in to pressure to amend the law, and it would certainly be a much graver mistake to relax the 3-5-10 thresholds further. Those who believe that the Kim Young-ran law’s limits on gifts are too stringent have advanced three major critiques, but none of them is persuasive:

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