After Speedy Subpoena Cases, Trump Tax Disputes Linger
U.S. District Judges Trevor McFadden and Carl Nichols appear to be taking a deliberative approach in their handling of fights over the president's tax returns.
September 05, 2019 at 05:54 PM
7 minute read
A pair of federal judges in Washington, D.C., seem to be in no rush to decide whether House Democrats can get their hands on President Donald Trump's tax returns.
U.S. District Judge Trevor McFadden, who has shown himself to be methodical when it comes to legal cases involving the president, last week rejected House Democrats' request to fast-track their lawsuit seeking Trump's federal tax returns from the Treasury Department.
And U.S. District Judge Carl Nichols will have overseen a lawsuit surrounding Trump's New York tax returns for several weeks by the time he reaches a decision about where the case should even be held. New York state Attorney General Letitia James is trying to get the case dismissed for lack of subject matter jurisdiction.
Those slow timelines by both judges, who are Trump appointees, are a marked difference from the speedy resolutions reached in district court over lawsuits challenging congressional subpoenas for the president's records from private financial institutions.
Federal trial judges in D.C. and the Southern District of New York—both appointees of President Barack Obama—issued rulings in the cases over congressional subpoenas issued to Mazars, Capital One and Deutsche Bank within weeks of the complaints being filed. Circuit courts are now poised to issue their rulings in those cases in the near future.
Legal experts say that the disparate timelines may be the result of varying styles among the different judges presiding over the cases. The federal tax return case before McFadden also involves records possessed by the federal government, rather than private parties, as in the subpoena cases, meaning he will have to tackle different questions about separation of powers.
"Unless there's some extraordinary reason for it to move faster, it's going to be a matter of months," Michael Stern, former senior counsel to the House from 1996 until 2004, said of McFadden's case.
The Democratic-controlled House Ways and Means Committee asked McFadden to speed up their case earlier this month. House lawyers, including general counsel Douglas Letter, argued that they have a limited amount of time to get the tax returns and then draft legislation in response before their terms in Congress expire.
But McFadden didn't buy the argument. In an order last week, he rejected the request to expedite, questioning why the House attorneys waited seven weeks after filing the complaint to ask for an expedited briefing schedule.
And he pointed to decisions due to emerge from circuit court panels on other congressional subpoenas to Mazars, as well as Capital One and Deutsche Bank, as having the potential to guide his decision-making in the tax returns case.
"To be sure, this is no ordinary case, but the weighty constitutional issues and political ramifications it presents militate in favor of caution and deliberation, not haste," McFadden wrote. "And the Committee has not shown otherwise."
This is not the first time McFadden has shown himself to act methodically in a high-profile case. Earlier this year, the judge was wary of House Democrats' argument that they could sue the Trump administration over the diversion of military funds to construct a wall along the southern border with Mexico.
He ultimately ruled the House could not sue the executive branch. The case is currently being appealed to the U.S. Court of Appeals for the D.C. Circuit.
Stern said that, because Trump sued in his private capacity to block the congressional subpoenas in the other cases, judges didn't have to consider whether the committees even had the ability to sue.
But the lawsuit over the federal returns was the first legal challenge proactively filed by House Democrats to get records held by the Trump administration, meaning that Main Justice lawyers can raise standing issues.
"Courts are reluctant to insert themselves in a dispute between the executive and legislative branches," Stern said. "So when Congress asks them to help, they have a lot of concerns about that, and they want to try, if possible, to avoid becoming the arbiters of the dispute."
Legal experts have said that House Ways and Means Committee Chairman Richard Neal, D-Massachusetts, is well within his rights to request Trump's tax returns under a 1924 law that states the Internal Revenue Service "shall" furnish lawmakers with requested tax records.
Neal initially requested the returns from the IRS under the law, but Treasury Secretary Steve Mnuchin said the committee lacked a legitimate legislative purpose for the documents. Mnuchin offered up the same reasoning when he later rejected a congressional subpoena for the returns.
Ilya Somin, a law professor at George Mason University, said judges are generally given broad discretion when it comes to setting the timelines for resolving their cases.
He said that, in the case surrounding Trump's federal returns, there might not be as much urgency as there is in other matters, like getting former White House counsel Don McGahn to testify before Congress as House Democrats weigh possible impeachment proceedings.
"If, ultimately, Trump's tax returns are made public, it will still have a political and legal impact if it happens three months from now or six months from now," Simon said.
There is the potential for lawmakers to get their hands on the documents through other means, particularly if they prevail in their battle to subpoena financial records from Deutsche Bank. The bank told a panel on the U.S. Court of Appeals for the Second Circuit in a publicly redacted letter that it had tax returns of at least one Trump family member in its possession.
That panel heard oral arguments over the Deutsche Bank subpoena in late August, and a decision is expected in the coming weeks.
Several lawsuits also have been filed in the U.S District Court for the Eastern District of California challenging a California law that would require Trump to provide his tax returns in order to appear on the state's ballot. Judge Morrison C. England Jr. will hold a Sept. 19 hearing on the several motions for a preliminary injunction in those related cases.
Experts also said the pace of a case can depend on the judge overseeing the matter.
Charles Tiefer, a professor at the University of Baltimore's School of Law, said he believes McFadden "unfortunately, sees the case the way that the Trump side sees it."
"The tax case comes down to one word in the statute, namely that the IRS 'shall' provide the returns to the Ways and Means Committee," Tiefer said. "He's needlessly dragging out his reading of that one word."
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