SCOTUS: Trump’s Tax Returns (Trump v. Vance and Trump v. Mazars)

The Supreme Court decided on two landmark cases regarding executive power on July 9, 2020. In the cases of Trump v. Vance and Trump v. Mazars USA, LLP, the justices ruled that in Trump v. Vance, New York County District Attorney’s attempt to subpoena (order to appear in court) President Donald Trump’s tax returns was valid and did not require a heightened standard. Separately, in Trump v. Mazars, the court ruled that the House of Representatives’ subpoena to obtain the tax returns were not valid.

Since most presidents in recent history have released their tax returns to the public, there had been a call for Donald Trump to release his tax returns. However, after he assumed office in 2017, he refused to publicize these returns, claiming that voters were not interested in them.

In the 2018 midterm elections, the Democrats gained control of the House, and in 2019, they formally requested the Internal Revenue Service (IRS) for six years of Trump’s tax returns, which was a power vested in Congress. The IRS declined these requests. Therefore, the House Committee on Oversight and Reform filed a subpoena to Mazars, Trump’s accounting firm, to obtain the information. Although the Trump Administration refused, saying it lacked a “legitimate legislative purpose,” Mazars (as well as Capital One and Deutsche Bank, where Trump had accounts), had to comply with the subpoenas. This resulted in Trump trying to block the subpoenas and eventually led to the case of Trump v. Mazars USA, LLP after the case had been consolidated with Trump et al. v. Deutsche Bank AG.

Separately, the city of New York had been investigating the Stormy Daniels scandal with Donald Trump (where the WSJ revealed in 2018 that actress Stormy Daniels had been paid $130,000 to sign a nondisclosure agreement just before the 2016 election about an affair that she had with Trump in 2006). In August 2019, Manhattan District Attorney Cyrus Vance Jr. had issued a subpoena to Mazars for Trump’s tax returns to aid with the investigation. Trump tried to stop the subpoena by filing a lawsuit in the U.S. District Court for the Southern District of New York against the district attorney (and Mazars), arguing that sitting presidents could enjoy “absolute immunity from criminal process of any kind.”

Prosecutors argued that that Trump was “seeking to invent and enforce a new presidential ‘tax return privilege,’ on the theory that disclosing information in a tax return will necessarily reveal information that will somehow impede the functioning of a president.” The District Court ordered Trump to turn over his records, pending a ruling from the U.S. Court of Appeals for the Second Circuit. The Circuit court ruled that the president is not immune from a state’s grand jury subpoena to order a third party to disclose non-privileged material. Trump petitioned the Supreme Court to hear the case, leading to Trump v. Vance.

Oral arguments for both cases were heard in May 2020, after a delay due to the coronavirus pandemic. Both cases were treated differently as one was related to a criminal subpoena while the other, a congressional subpoena.

The Supreme Court announced its ruling on July 9, 2020. In a 7-2 ruling for both cases, the Court said that in Trump v. Vance, the President had to comply with the subpoena for the criminal investigation, but for the congressional subpoena in Trump v. Mazars, sent the case back to a lower court to review.

In Trump v. Vance, the majority decision written by Chief Justice John Roberts stated that former Chief Justice John Mashall had established 200 years ago, the principle that no citizen, including the President, can escape the common duty to produce evidence when called upon in a criminal proceeding. The Supreme Court affirmed that principle, holding that the President enjoys no absolute immunity from state criminal subpoenas, and that no heightened standard is required fur such subpoenas. He wrote that absolute immunity is not granted by Article II nor Article VI (Supremacy Clause) of the Constitution.

However, in Trump v. Mazars, the Supreme Court overturned the Circuit Court’s decision that granted the congressional subpoena and sent the case back to a lower court for further review. The majority decision said that the Circuit had not fully considered the separation of powers and said the following:

“The standards proposed by the president and the solicitor general — if applied outside the context of privileged information — would risk seriously impeding Congress in carrying out its responsibilities…The House’s approach fails to take adequate account of the significant separation of powers issues raised by congressional subpoenas for the president’s information. Far from accounting for separation of powers concerns, the House’s approach aggravates them by leaving essentially no limits on the congressional power to subpoena the president’s personal records. Any personal paper possessed by a president could potentially ‘relate to’ a conceivable subject of legislation, for Congress has broad legislative powers that touch a vast number of subjects.”

In other words, the court claimed that the arguments Congress used to try and obtain Trump’s finances were too broad and that it basically removed all limits of congressional power. The opinion also gave some considerations when determining whether a subpoena was appropriate. These were whether other sources could provide similar information, whether the subpoena is no broader than reasonably necessary to support legislation, whether the evidence will actually advance a legislative purpose, and whether the subpoena was issued due to partisan politics.

This basically ensured that the public would not be able to obtain Trump’s financial documents before the general election in November, allowing Trump to “live on another day.”

Justices Clarence Thomas and Samuel Alito dissented in both cases.

Yet, these cases still gave everyone something to call a win. It was a win for Trump because he won’t be forced to produce any documents before his reelection bid in November, but a win for everyone else too, as the court affirmed that executive power was not unlimited and no one in the country, not even the President, was immune from the rule of law. These cases will join the cases of United States v. Nixon (1974), requiring then-president Richard Nixon to hand over tape recordings related to the Watergate scandal in a subpoena, and Clinton v. Jones (1997), establishing that the sitting president enjoys no immunity from civil law litigation for actions done before assuming office.

Obviously, Trump was still annoyed at the Supreme Court and lashed out about it on Twitter, calling it a “political witch hunt,” “prosecutorial misconduct,” “presidential harassment,” and describing it as a “political prosecution.”

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