Trump’s Tax Returns Face Judgment Day at U.S. Supreme Court

(Bloomberg) -- The U.S. Supreme Court will end its term Thursday morning with historic rulings that will probably determine whether the public sees President Donald Trump’s long-hidden financial records before the November election.

House Democrats and a New York state prosecutor are each trying to get Trump’s personal and business records from his accounting firm. Lawmakers are also demanding information from his banks.

The court is expected to issue two rulings: one covering subpoenas issued by House committees and one concerning a subpoena from the New York grand jury.

The court will start issuing opinions at 10 a.m. Washington time Thursday. All three remaining opinions should be out by 10:20 a.m.

Here’s what to know before Thursday’s big decisions:

What is being sought, who’s seeking it and from whom?

There are five subpoenas. Four are from three House committees -- Oversight, Financial Services and Intelligence -- and one is from Manhattan District Attorney Cyrus Vance, who is conducting a criminal investigation.

The subpoenas are all directed to third parties -- to Trump’s accounting firm, Mazars USA, and his banks, Deutsche Bank AG and Capital One Financial Corp. The subpoenas seek years of Trump’s personal financial records, as well as those of his family members, plus records from the Trump Organization and his other business entities.

Only Vance’s subpoena to Mazars explicitly asks for Trump’s tax returns, but the broad language of the House subpoena to Mazars would seem to cover those as well.

If Trump loses, will his returns be released this year?

If he loses the House case, most likely. After years of battling for the public release of Trump’s tax forms and other financial documents, Democrats would be reversing themselves if they chose to keep them secret.

The exact timing would depend in part on Mazars and the banks, which aren’t contesting the subpoenas and have said they’ll comply with court rulings. They may wait until the Supreme Court issues its formal judgment, which usually happens about a month after the opinion.

After that, it would be up to the House committees and their Democratic majorities. The panels might hold a formal vote before any public release.

The Vance case is a different story because prosecutors will be bound by grand jury secrecy rules. Unless someone is charged with a crime in the investigation, the records he receives are likely to remain under seal.

Vance is investigating whether the Trump Organization falsified business records to disguise hush payments to two women who claimed they had sex with Trump before he took office.

What are the possible outcomes Thursday?

The two cases present very different legal issues, so there’s no guarantee they will come out the same way.

In each case, the Supreme Court could uphold lower court rulings and require the documents to be turned over.

The justices could also return the cases to the lower courts, saying that the committees and Vance must make a stronger showing that they need the president’s personal records. That type of ruling would mean more litigation and all but ensure that the records stay secret through the election.

And then the court could simply rule for Trump. In the House case, that would render the subpoenas unenforceable and keep the financial records under wraps.

In the Vance case, the practical effect of a Trump victory would depend on the results of the November election. Trump is seeking presidential immunity only while in office. So even if Trump wins at the Supreme Court, a victory for Democrat Joe Biden would mean Vance could try again after the Jan. 20 inauguration.

What are the biggest legal issues?

The congressional case is a classic separation-of-powers dispute. The House says its committees want the information for legislative reasons, including updating presidential ethics laws, fighting money laundering and trying to guard against foreign influence in U.S. elections. House lawyers say Congress’s powers to investigate are broad and deeply rooted.

The president’s lawyers say the committees’ real pursuit is law enforcement and exposing alleged wrongdoing. Trump’s team says those aims are beyond Congress’s constitutional authority, particularly when they involve pursuing a president’s personal records. The case isn’t directly connected to the impeachment inquiry conducted by the House last year.

During arguments in May, Justice Elena Kagan suggested the committees looking into presidential ethics and foreign election meddling -- Oversight and Intelligence -- might have a stronger claim for the material than the Financial Services Committee, which is probing money laundering. Kagan said the issues being investigated by the first two committees “address the president directly.”

In the New York grand jury case, Trump’s personal lawyers contend the president has complete immunity from criminal investigations while in office. He says any inquiry, even one in which the document demand goes to a third party, risks being a distraction from the chief executive’s weighty responsibilities.

The Justice Department, which filed a separate brief, is taking a less absolute position, saying a state grand jury must make a “heightened showing of need.”

Vance says any such shield would undercut the criminal justice system. He contends that presidential immunity is inappropriate in a case that doesn’t involve the president’s official duties and doesn’t require Trump himself to do anything.

©2020 Bloomberg L.P.