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Supreme Court rules Trump will have to fight to keep secret his taxes, financial records

Two cases against the president involving the Manhattan DA and House Democrats go back to the lower courts.
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WASHINGTON — The U.S. Supreme Court on Thursday gave President Donald Trump a chance to beat back House Democrats' efforts to obtain his financial records but ruled he is not immune from the Manhattan district attorney's attempt to get his taxes.

Manhattan District Attorney Cyrus Vance Jr. wants years worth of Trump's tax returns as part of his probe into hush-money payments to two women while House Democrats sought financial records from the Trump Organization's accounting firm and two banks to determine if foreign governments, including Russia, hold sway over him.

Both matters will go back to lower courts to determine if Trump needs to turn over any documents, which will not likely be settled before Election Day.

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In our judicial system, "the public has a right to every man's evidence," Chief Justice John Roberts wrote in the decision on the New York case. "Since the earliest days of the Republic, 'every man' has included the president of the United States. Beginning with Jefferson and carrying on through Clinton, presidents have uniformly testified or produced documents in criminal proceedings when called upon by federal courts."

He added: "(W)e cannot conclude that absolute immunity is necessary or appropriate under Article II or the Supremacy Clause."

The rulings, both 7-2, with Justices Samuel Alito and Clarence Thomas dissenting, represent a mixed bag for the president, allowing him to drag out the legal process but not providing him with any clear-cut victories.

Trump blasted the efforts to gain his financial information, tweeting after the rulings that it was "a political prosecution."

The president later said at a White House event that he was partly satisfied by the court's decisions, but that the cases are "a political witch hunt" against him.

"Well, the rulings were basically starting all over again, sending everything back down to the lower courts and you start all over again," Trump told reporters. "And so, from a certain point I’m satisfied, from another point I’m not satisfied because, frankly, this is a political witch hunt the likes of which nobody’s ever seen before. It’s a pure witch hunt. It’s a hoax, just like the Mueller investigation was a hoax that I won, and this is another hoax, this is purely political."

The president's attorney, Jay Sekulow, said after the rulings that Trump would continue to challenge the efforts to get his financial records.

"We are pleased that in the decisions issued today, the Supreme Court has temporarily blocked both Congress and New York prosecutors from obtaining the president's financial records," Sekulow said. "We will now proceed to raise additional Constitutional and legal issues in the lower courts."

White House press secretary Kayleigh McEnany called the rulings "a win for the president" during an afternoon news briefing, saying the decisions essentially "laid out a roadmap" with "ample arguments" that the president could deploy in the courts.

Vance, meanwhile, lauded what he called "a tremendous victory for our nation's system of justice and its founding principle that no one — not even a president — is above the law."

"Our investigation, which was delayed for almost a year by this lawsuit, will resume, guided as always by the grand jury's solemn obligation to follow the law and the facts, wherever they may lead," the prosecutor said in a statement.

Vance sought eight years of Trump's business and personal tax records for an investigation of payments made to two women who claimed they had affairs with him — allegations the president has consistently denied.

Trump's lawyers argued that because sitting presidents cannot be indicted, they are beyond the reach of any part of the criminal justice process, including grand jury subpoenas. One of his lawyers even told an appeals court during an earlier stage of the case that a president could not be investigated for shooting someone on New York's Fifth Avenue.

Vance is said to be looking at whether the hush-money payments violated state tax or business regulations.

Because of grand jury secrecy, however, Trump's tax returns would be unlikely to become public if they are handed over to the DA unless prosecutors file criminal charges against current or former employees of the Trump Organization. And even then, disclosure of the returns would probably be limited.

Trump's lawyers called the case unprecedented and said no local prosecutor had ever tried to subject a president to the criminal process. A ruling for Vance, they warned, would "weaponize" the nation's 2,000-plus state and local district attorneys.

"The decision would allow any DA to harass, distract, and interfere with the sitting president," Sekulow had argued before the Supreme Court.

But Vance said the issue was much narrower. He said the grand jury wasn't seeking anything from the president himself, only financial records from his accountants. And nothing in the subpoena touched on the president's official conduct in office. "There is no real public interest at stake here at all," Vance maintained.

Trump's lawyers said the subpoena nonetheless targeted the president by naming him personally and seeking his private records, which would require him to consult with his lawyers and consider possible court fights, distracting him from his official duties.

Although the Supreme Court had not confronted the exact issues in this case before — involving a subpoena from a state prosecutor directed to a president's accountants — it previously had ruled presidents are not beyond the reach of the courts while in office.

In two unanimous decisions, the court said President Richard Nixon had to respond to a subpoena for White House tapes in a criminal case stemming from the Watergate scandal, and President Bill Clinton was not immune from a civil lawsuit while in office, despite the potential distraction the litigation might cause.

In 2000, the Justice Department's Office of Legal Counsel researched the issue and concluded, as previous opinions did, that a sitting president cannot be indicted. But it said a grand jury "could continue to gather evidence throughout the period of immunity, even passing this task down to subsequently empaneled grand juries if necessary."

Robert Mueller's team took a similar view during the special counsel investigation. Mueller's final report said while a sitting president cannot be prosecuted, "a criminal investigation during the president's term is permissible."

In the congressional case, Roberts wrote that the lower courts "did not take adequate account of the significant separation of powers concerns implicated by congressional subpoenas for the president's information."

"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," Roberts said.

But, Roberts added, "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," he went on, "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."

The Democratic majorities of three House committees had demanded several years' worth of financial records from Mazars, the Trump Organization's accounting firm, and two banks that loaned money to Trump businesses — Capital One and Deutsche Bank.

House Speaker Nancy Pelosi, D-Calif., said Thursday: "A careful reading Supreme Court ruling related to the president's financial records is not good news for President Trump. The court has reaffirmed the Congress's authority to conduct oversight on behalf of the American people."

House Judiciary Committee Chairman Jerrold Nadler, D-N.Y., tweeted, "No one is above the law" and Senate Minority Leader Chuck Schumer, D-N.Y., said, "No matter how much he wishes it to be true, President Trump is not king."

The House Oversight Committee acted last year after former Trump lawyer Michael Cohen testified that "Mr. Trump inflated his total assets when it served his purposes and deflated his assets to reduce his real estate taxes." The Financial Services and Intelligence Committees said they were looking into money laundering and lending practices.

House Democrats said they believed Trump's tax returns might provide insights into a question Mueller never answered: Did Trump borrow money from Russian entitles or otherwise do business with them before he became president? He has consistently denied any such relationship.

The president's lawyers argued that Congress has the power to issue subpoenas only for the purpose of writing laws.

The demands for Trump's documents, they said, were instead an effort to conduct investigations, not to legislate. Simply claiming that the information might lead to changing existing laws could not transform a law enforcement effort into a law-making one, they said.

While Trump said Congress has never before subpoenaed the private records of a sitting president, lawyers for the House said Congress has been seeking information about the public and private conduct of presidents for nearly 200 years. House Democrats said the president could not block the subpoenas because they had nothing to do with his official duties, were directed at his banks and accountants — not him — and didn't require him to do anything in response.

They said Congress has the power to issue subpoenas when it needs to know how current federal laws are working.

"It is scarcely surprising that investigators need to conduct a thorough investigation when seeking to determine whether money laundering, election and national security, disclosure, and conflict of interest laws are sufficient," the House general counsel told the court.