One Night with the King: Do Trump’s Hospitality Competitors Have Standing to Sue Over Violations of the Emoluments Clauses?

Photo by Paul Zajde (2016)

By: Paul Zajde

“Why wouldn’t I stay at his hotel blocks from the White House[?] . . . Isn’t it rude to come to his city and say, ‘I am staying at your competitor?’”[1] Indeed, as this foreign diplomat opined in 2016, it is quite rude, and a rude diplomat is an oxymoron. That is why over 200 high-end restaurants, hotels, and event spaces in New York City and Washington, D.C. are alleging that President Trump has used his office to gain an illegal advantage over them.[2] Trump v. Citizens for Responsibility and Ethics in Washington (CREW),[3] pending petition with the Supreme Court,[4] is the latest civil suit seeking redress for President Trump’s alleged violation of the Foreign[5] and Domestic[6] Emoluments Clauses of the Constitution, which proscribe the President from accepting domestic and foreign contributions. These clauses were meant to prevent the President from having a conflict of interest, especially when dealing with foreign governments.[7]

The central issue on appeal in CREW was standing, and the Second Circuit held in favor of President Trump’s business competitors, which sharply contrasts the Fourth Circuit’s vacated panel-opinion with almost identical facts (In re Trump).[8] The Fourth Circuit, via re-rehearing en banc, vacated its prior pro-President Trump panel-opinion in 2020,[9] but the panel’s overruled rationale is likely to resurface should either CREW or In re Trump be granted certiorari by the Supreme Court. The controversy is rooted in differing interpretations of Article III standing. Specifically, these differing interpretation bear on the central question of whether the President, by “incentivizing foreign and domestic government officials to patronize” the Trump International Hotel, has harmed competing hotels and restaurants.[10] Further, whether causation has been established, whether the harm is redressable, and whether the matter is a nonjusticiable political question beyond the judiciary’s role to decide. Both holdings have diametrically opposed answers to these questions.[11]

The Second Circuit relies on the “Competitor Standing Doctrine,”[12] which gives parties standing to sue competitors that economically benefit from illegal conduct.[13] Meanwhile, the In re Trump panel held that the plaintiffs could not establish the causal relationship between their economic harm and President Trump’s financial success.[14] The Supreme Court should affirm the Second Circuit’s well-supported use of the “Competitor Standing Doctrine” to grant the CREW plaintiffs Article III standing, as the threshold was clearly met by the CREW Complaint’s extensive economic data, which squarely pinned President Trump and the plaintiffs as competitors.[15]

Domestically, President Trump owns revenue-generating hotels, commercial buildings, and golf clubs in New York, Florida, Illinois, New Jersey, Virginia, Nevada, and Washington D.C., qualifying him as a nontrivial player in more than one market.[16] If the CREW plaintiffs are afforded standing and the President wins reelection, it stands to reason that additional Trump competitors will fashion lawsuits against him. And looking beyond the current president, CREW could provide the necessary teeth for courts to enforce the Emoluments Clauses against future presidents potentially far richer than President Trump. 


[1] Trump v. Citizens for Responsibility and Ethics in Washington (CREW), 953 F.3d 178, 186 (2d Cir. 2019) (quoting Jonathan O’Connell & Mary Jordan, For Foreign Diplomats, Trump Hotel is the Place to Be, Wash. Post (Nov. 18, 2016), http://wapo.st/2oPYggX). 

[2] See id. at 184. 

[3] (CREW), 953 F.3d 178 (2d Cir. 2019) (holding that President Trump’s business competitors met the standing requirement).  

[4] See Supreme Court of the United States, No. 20-330, https://www.supremecourt.gov/search.aspx?filename=/docket/docketfiles/html/public/20-330.html (last visited Oct. 28, 2020).

[5] U.S. Const. art. I § 9, cl. 8.

[6] U.S. Const. art. II § 1, cl. 7.

[7] See Claire Gianotti, Ethics in the Executive Branch: Enforcing the Emoluments Clause, 32 Geo. J. Legal Ethics 615, 616 (2019) (highlighting President Trump’s break from traditional ethics norms). 

[8] 928 F.3d 360 (4th Cir. 2019) (holding that President Trump’s business competitors failed to meet the standing requirement), abrogated by In re Trump, 958 F.3d 274 (4th Cir. 2020)).

[9] See In re Trump, 958 F.3d 274 (4th Cir. 2020) (denying President Trump’s petition for a writ of mandamus to dismiss District of Columbia v. Trump, 291 F. Supp. 3d. 725 (D. Md. 2018)). 

[10] CREW, 953 F. 3d at 178. 

[11] See In re Trump, 928 F. 3d. 360; CREW, 953 F. 3d. 178. 

[12] See CREW, 953 F. 3d. at 195.

[13] See Hardin v. Kentucky Utilities Co., 390 U.S. 1, 6 (1968).

[14] See In re Trump928 F. 3d. at 370 (quoting Citizens for Responsibility and Ethics in Washington v. Trump (CREW), 276 F. Supp. 3d. 174, 185–87 (S.D.N.Y. 2017), overruled by CREW, 953 F. 3d. 178 (2d Cir. 2019)).

[15] See CREW, 953 F. 3d. at 189–190.

[16] See Ford Fessenden & Iaryna Mykhyalyshyn, What Donald J. Trump Owns and Owes, N.Y. Times (Aug. 20, 2016), https://www.nytimes.com/interactive/2016/08/20/us/elections/donald-trump-owns-and-owes-debt-properties.html.

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