Trump Gets Reprieve From Release of N.Y. State Tax Returns

(Bloomberg) -- Donald Trump should have a chance to block House Democrats from obtaining his New York state tax returns, a federal judge decided, in a boost for the president as he fends off other subpoenas for his financial records while facing an impeachment inquiry.

U.S. District Judge Carl Nichols in Washington ruled late Monday night that the House Ways and Means Committee must notify the court and the president if it plans to ask the state’s Department of Taxation and Finance to turn over Trump’s records. The lawmakers then must wait two weeks for the documents, giving the judge time to rule on whether the Democrats’ request is lawful.

The ruling by Nichols, whom Trump named to the bench this year, came about 90 minutes before the expiration of his prior order requiring New York to tell the court if it had received such a request from Ways and Means Committee Chairman Richard Neal, a Massachusetts Democrat.

It’s the second ruling of the day to give the president a reprieve from House pressure to obtain his business and personal financial records. Supreme Court Chief Justice John Roberts on Monday temporarily blocked another panel, the House Oversight and Reform Committee, from getting business records from the president’s accountants at Mazars USA LLP while the full court considers issuing a longer stay pending its review of a ruling upholding the committee’s subpoena.

New York made Trump’s records available this year through the enactment of its Trust Act, which lets certain congressional committee chairmen obtain tax records of public officials. Trump sued in July to void the law, claiming it was adopted to punish him for his views and speech, in violation of the U.S. Constitution’s First Amendment.

The two New York state officials, Attorney General Letitia James and tax commissioner Michael Schmidt, last week won dismissal of the case against them after arguing that any lawsuit seeking to strike down a New York law ought to have been filed in a court within the state.

The Ways and Means Committee, too, sought dismissal of the suit, arguing its lawmakers were immune under the Constitution’s speech or debate clause and that, in any event, the president hadn’t suffered the requisite harm needed to maintain his suit.

Nichols rejected both those premises.

“In the Court’s view,” he wrote, “there is a sufficiently substantial risk that future harm could occur to warrant limited relief under the All Writs Act,” a statute granting the court wide latitude to fashion a legal remedy, including one for a case not yet ready for adjudication.

Previous courts have held that “relief may be appropriate when a claim is not yet ripe for judicial review but may both ripen and become moot almost instantaneously, thereby depriving the court of jurisdiction to decide the claim,” Nichols said in a 19-page ruling. He was referring to the fact that Chairman Neal hasn’t requested the tax returns from New York but that if and once he did, the state could deliver them immediately.

House Democrats have argued that the suit should be dismissed because Congress has the authority to ask for the returns as part of its government oversight and investigatory work. Paradoxically, the judge said he can’t throw out the case now because the Democrats haven’t made the records request, so he can’t conclude one way or the other whether their motive for seeking the information fell within their rights to do so.

The case is Trump v. Committee on Ways and Means, 19-cv-2173, U.S. District Court, District of Columbia (Washington).

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