DC Attorney General Alleges Inaugural Committee Misused Nonprofit Funds to Enrich Trump Hotel
The complaint claims a member of the inaugural committee agreed to pay more than $1 million to rent event space at Trump's D.C. hotel for four days ahead of the inauguration.
January 22, 2020 at 10:56 AM
4 minute read
The original version of this story was published on National Law Journal
D.C. attorney general Karl Racine sued President Donald Trump's inaugural committee and several Trump businesses Wednesday, alleging the committee improperly used nonprofit funds to book a ballroom at Trump's D.C. hotel during the 2017 inauguration.
In the lawsuit filed in D.C. Superior Court, Racine alleges the Presidential Inaugural Committee violated district law "when it wasted approximately $1 million of charitable funds in overpayment for the use of event space at the Trump Hotel, owned and controlled by the Trump Entities."
The complaint states that former Trump campaign official Rick Gates, a member of the inaugural committee, agreed to pay more than $1 million to rent event space at Trump's D.C. hotel for four days ahead of the inauguration.
That amount was "unreasonable and improperly served to enrich the Trump Entities and its owners for a number of different reasons," according to the filing.
The complaint also alleges that other staff on the inaugural committee "with experience in managing events raised serious concerns about the price" after the Trump Hotel sent its proposal.
The document includes an email that Gates sent to Ivanka Trump, raising concerns about the price.
"First, the cost itself seems quite high compared to other property. Second, I am a bit worried about the optics of PIC paying Trump Hotel a high fee and the media making a big story out of it," Gates wrote, according to the complaint. "Let me know if you have any thoughts and if we can discuss the best path forward."
The complaint also alleges that "the Trump Entities came into possession or control of nonprofit funds that in equity, and good conscience, it should not have received."
Racine is requesting that a D.C. Superior Court judge order the creation of a trust over the $1 million paid by the inaugural committee to the Trump properties, and "[d]irect those funds be restored to a proper public purpose by directing the funds to another nonprofit entity dedicated to promoting civic engagement of the citizens of the United States of America."
In a statement, a spokesperson for Trump Hotels slammed Racine's allegations as "false, intentionally misleading and riddled with inaccuracies."
"The rates charged by the hotel were completely in line with what anyone else would have been charged for an unprecedented event of this enormous magnitude and were reflective of the fact that hotel had just recently opened, possessed superior facilities and was centrally located on Pennsylvania Avenue," the spokesperson said.
A spokesperson for the inaugural committee also said in a statement that the "facts will show that the PIC operated in compliance with the law and this suit is without merit."
This is not the D.C. attorney general's first lawsuit targeting the president's private business. Racine and Maryland Attorney General Brian Frosh sued Trump in 2017 for allegedly violating the Constitution's emoluments clause by profiting from his D.C. hotel while in office. The U.S. Court of Appeals for the Fourth Circuit heard en banc arguments in the case in December.
Trump's two adult sons, Donald Trump Jr. and Eric Trump, are running the Trump Organization while their father is in office. They announced last year that they are interested in selling the lease to the D.C. hotel, as the company faces several legal challenges over Trump's holding of the property.
Read more:
This content has been archived. It is available through our partners, LexisNexis® and Bloomberg Law.
To view this content, please continue to their sites.
Not a Lexis Subscriber?
Subscribe Now
Not a Bloomberg Law Subscriber?
Subscribe Now
NOT FOR REPRINT
© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
You Might Like
View All'Water Cooler Discussions': US Judge Questions DOJ Request in Google Search Case
3 minute readDemocratic State AGs Revel in Role as Last Line of Defense Against Trump Agenda
7 minute readBig Law Communications, Media Attorneys Brace for Changes Under Trump
4 minute readTrending Stories
- 1Judge Denies Sean Combs Third Bail Bid, Citing Community Safety
- 2Republican FTC Commissioner: 'The Time for Rulemaking by the Biden-Harris FTC Is Over'
- 3NY Appellate Panel Cites Student's Disciplinary History While Sending Negligence Claim Against School District to Trial
- 4A Meta DIG and Its Nvidia Implications
- 5Deception or Coercion? California Supreme Court Grants Review in Jailhouse Confession Case
Who Got The Work
Michael G. Bongiorno, Andrew Scott Dulberg and Elizabeth E. Driscoll from Wilmer Cutler Pickering Hale and Dorr have stepped in to represent Symbotic Inc., an A.I.-enabled technology platform that focuses on increasing supply chain efficiency, and other defendants in a pending shareholder derivative lawsuit. The case, filed Oct. 2 in Massachusetts District Court by the Brown Law Firm on behalf of Stephen Austen, accuses certain officers and directors of misleading investors in regard to Symbotic's potential for margin growth by failing to disclose that the company was not equipped to timely deploy its systems or manage expenses through project delays. The case, assigned to U.S. District Judge Nathaniel M. Gorton, is 1:24-cv-12522, Austen v. Cohen et al.
Who Got The Work
Edmund Polubinski and Marie Killmond of Davis Polk & Wardwell have entered appearances for data platform software development company MongoDB and other defendants in a pending shareholder derivative lawsuit. The action, filed Oct. 7 in New York Southern District Court by the Brown Law Firm, accuses the company's directors and/or officers of falsely expressing confidence in the company’s restructuring of its sales incentive plan and downplaying the severity of decreases in its upfront commitments. The case is 1:24-cv-07594, Roy v. Ittycheria et al.
Who Got The Work
Amy O. Bruchs and Kurt F. Ellison of Michael Best & Friedrich have entered appearances for Epic Systems Corp. in a pending employment discrimination lawsuit. The suit was filed Sept. 7 in Wisconsin Western District Court by Levine Eisberner LLC and Siri & Glimstad on behalf of a project manager who claims that he was wrongfully terminated after applying for a religious exemption to the defendant's COVID-19 vaccine mandate. The case, assigned to U.S. Magistrate Judge Anita Marie Boor, is 3:24-cv-00630, Secker, Nathan v. Epic Systems Corporation.
Who Got The Work
David X. Sullivan, Thomas J. Finn and Gregory A. Hall from McCarter & English have entered appearances for Sunrun Installation Services in a pending civil rights lawsuit. The complaint was filed Sept. 4 in Connecticut District Court by attorney Robert M. Berke on behalf of former employee George Edward Steins, who was arrested and charged with employing an unregistered home improvement salesperson. The complaint alleges that had Sunrun informed the Connecticut Department of Consumer Protection that the plaintiff's employment had ended in 2017 and that he no longer held Sunrun's home improvement contractor license, he would not have been hit with charges, which were dismissed in May 2024. The case, assigned to U.S. District Judge Jeffrey A. Meyer, is 3:24-cv-01423, Steins v. Sunrun, Inc. et al.
Who Got The Work
Greenberg Traurig shareholder Joshua L. Raskin has entered an appearance for boohoo.com UK Ltd. in a pending patent infringement lawsuit. The suit, filed Sept. 3 in Texas Eastern District Court by Rozier Hardt McDonough on behalf of Alto Dynamics, asserts five patents related to an online shopping platform. The case, assigned to U.S. District Judge Rodney Gilstrap, is 2:24-cv-00719, Alto Dynamics, LLC v. boohoo.com UK Limited.
Featured Firms
Law Offices of Gary Martin Hays & Associates, P.C.
(470) 294-1674
Law Offices of Mark E. Salomone
(857) 444-6468
Smith & Hassler
(713) 739-1250