House Committee Sues Mnuchin For Trump Tax Returns

As expected, the House Ways & Means Committee is suing Treasury Secretary Mnuchin over his refusal to provide the committee with copies of the President's tax returns.

Continuing the legal battle between the Democratic-controlled House and the White House, the House Ways And Means Committee has filed a lawsuit against Secretary of the Treasury Steve Mnuchin seeking to compel him to provide copies of the President’s tax returns as required by law:

WASHINGTON — The House’s tax-writing committee sued the Treasury Department and Internal Revenue Service on Tuesday demanding access to President Trump’s tax returns, escalating a fight with an administration that has repeatedly dismissed as illegitimate the Democrats’ attempt to obtain Mr. Trump’s financial records.

The lawsuit moves the dispute into federal courts after months of sniping between the Democratic-led House Ways and Means Committee, which requested and then subpoenaed the returns, and the Treasury secretary, Steven Mnuchin. The outcome is likely to determine whether financial information that Mr. Trump — breaking with longstanding tradition — has kept closely guarded as a candidate and as president will be viewed by Congress and, ultimately, by the public.

In Tuesday’s filing, the House argued that the administration’s defiance of its request amounted to “an extraordinary attack on the authority of Congress to obtain information needed to conduct oversight of Treasury, the I.R.S., and the tax laws on behalf of the American people.”

But with the House and the executive branch locked in a broader struggle over access to information from and witnesses in the Trump administration, the stakes in the tax-return lawsuit may be higher than that particular issue. House Democrats are facing resistance on a broad range of investigations that include inquiries into Robert S. Mueller III’s inquiry into Russian election interference, the addition of a citizenship question into the 2020 census, and the profits gleaned from Mr. Trump’s ongoing business ventures.

In almost every instance, the Trump administration has argued that Congress’s power to access those materials is inherently limited to information that would serve “legitimate” legislative purposes — defined by the executive branch as materials primarily needed to help draft new laws.

Congress retorts that its powers to compel information are far more sweeping than that and encompass oversight of important matters in general — and that its decisions about what information it wants to subpoena are not to be second-guessed by the White House.

The background for all of this should be familiar by now. Back in April, Congressman Richard Neal sent a request to Treasury Secretary Steve Mnuchin and I.R.S. Commissioner Charles Rettig requesting those returns. That request was made pursuant to 26 U.S.C. 6103 which, among other things, allows the Ways And Means Committee to request copies of the tax returns of any individual American. Despite that statute, Treasury Secretary Steve Mnuchin has refused to comply with both a written request and a subpoena for these documents. In refusing these requests, Mnuchin argued that the request, and subsequent subpoena, lack a “legitimate legislative purpose,” an argument that the Administration has made in a number of other situations where it is refusing to comply with seemingly legitimate document requests. At this point, that means the committee was left with two options. One option they have would have been to hold Mnuchin in contempt, which seems like a fruitless pursuit since the Justice Department is unlikely to pursue enforcement of any Congressional contempt citation against an Administration official. The other option would be to file a lawsuit seeking a Court order compelling him to turn over the requested documents. Wisely, the committee chose the second option.

Both Secretary Mnuchin and the Justice Department have argued that the Committee is not entitled to copies of the President’s returns due to the fact that it lacks a “legitimate legislative purpose.” While the statute itself does not contain any requirement that the Committee set forth any such purpose, two Supreme Court cases suggest that this limitation on Congressional subpoena power does exist. These cases are  McGrain v. Daugherty, a 1927 case arising out of one of Congress’ investigations into the Teapot Dome scandal, and Watkins v. United States, a 1957 case dealing with a union officials conviction for contempt of Congress. The facts of these cases are not important, but both stand for the proposition that any Congressional investigation into the private affairs of an individual must serve a “legitimate legislative purpose.” In late May, though, Federal District Court Judges in Washington, D.C. and New York City both issued opinions dealing with unrelated Congressional document requests that appear to undercut the Administration’s legal position significantly. While neither case deals with tax return issues, they do deal with the equally sensitive issue of Congressional requests for documents from third-parties dealing with the President’s finances. In both cases, the Judges gave Congress broad deference in determining what a “legitimate legislative purpose” was and essentially stated that as long as Congress can state a plausible reason for requesting the information then it has met the requirements under the law.

With these rulings in mind, and also keeping in mind that the relevant statute clearly gives the Ways & Means Committee broad authority to demand a copy of a tax return, it seems clear that the Administration’s legal argument, which is set forth in a legal memorandum made public in June, is incredibly weak. Even taking into account the argument that the committee must have a “legitimate legislative purpose” for its request, it is clear from the court cases noted above that Congress itself is the sole judge of what a legitimate purpose is and that it is not up to the Administration to refuse to comply with a validly issued subpoena, especially in a case such as this when the subpoena is backed up by the statutory authority that exists in this case.

Here’s the Complaint:

Ways and Means Committee v…. by on Scribd

FILED UNDER: Campaign 2020, Donald Trump, Law and the Courts, Politicians, Taxes, US Politics
Doug Mataconis
About Doug Mataconis
Doug holds a B.A. in Political Science from Rutgers University and J.D. from George Mason University School of Law. He joined the staff of OTB in May 2010. Before joining OTB, he wrote at Below The BeltwayThe Liberty Papers, and United Liberty Follow Doug on Twitter | Facebook

Comments

  1. CSK says:

    He’s hiding something. Probably the fact that “he’s a clown living on credit,” as someone once said of him.

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  2. Gustopher says:

    Should have done this months ago…

    As soon as the administration started saying the law didn’t apply to them, there was no point in waiting. Whether the administration has a case or not, it’s not going to be solved by further negotiations and threats.

  3. Paine says:

    @Gustopher: No idea how true this is, but I did read somewhere that making multiple requests and providing ample time for Treasury to comply was part of a deliberate effort by the dems to strengthen the eventual court case.

  4. Daryl and his brother Darryl says:

    The 116th Congress convened on January 3rd.
    That’s 180 days.
    To date, I don’t see anything they have accomplished in the War for the Republic.
    There will be tanks at Individual-1’s 4th of July party, though.

  5. Kathy says:

    @Paine:

    Rings true.

    What the Committee should do is take into account the transactional nature of the Dennison so-called administration. This means they should sue Mnuchin for the tax records, but also for inflicting emotional distress or some other harm he’d be responsible to pay money in restitution for.

  6. Daryl and his brother Darryl says:

    @Kathy:

    he’d be responsible to pay money in restitution for.

    Make sure he is personally responsible for it…and not the taxpayers.

  7. Daryl and his brother Darryl says:

    @Daryl and his brother Darryl:
    Individual-1 will be home in NY before this court case ever get’s settled.
    The Democratic House needs to grow a pair.

  8. DrDaveT says:

    These cases are McGrain v. Daugherty, a 1927 case arising out of one of Congress’ investigations into the Teapot Dome scandal, and Watkins v. United States, a 1957 case dealing with a union officials conviction for contempt of Congress. The facts of these cases are not important, but both stand for the proposition that any Congressional investigation into the private affairs of an individual must serve a “legitimate legislative purpose.”

    If you can copy and paste your previous material, so can I:

    You keep saying this, but it is still not true. Those cases both found that an individual may not be compelled to testify before Congress unless such testimony would serve a legitimate legislative purpose. No one is asking Trump or Mnuchin or anyone else to testify at a Congressional hearing, and Mnuchin is not being treated as a private individual at all. Neither precedent is relevant in any way to a question of whether an Executive agency can decline a statutory request from Congress that is clearly authorized and nondiscretionary under existing law.

    If you still disagree with that, could you please either expand on your argument or point to an outside analysis of why those cases ought to apply here?

  9. Kathy says:

    Somewhat related, good news on the census front.

    Though we should really know this means “good news for now.” It’s very likely El Cheeto will throw a few tantrums, complain how unfair the courts are, suck his thumb, throw another tantrum, etc. before he finally relents and moves on to some other outrageous norm and rule breaking streak.

    You know what would be great? A very explicit SCOTUS opinion that no one is above the law.

  10. wr says:

    @Kathy: “You know what would be great? A very explicit SCOTUS opinion that no one is above the law.”

    Sorry, but this best you’re going to do from this court is that no one who isn’t white and rich and connected to the Republican party is above the law.

  11. An Interested Party says:

    The Democratic House needs to grow a pair.

    What would you suggest that they do…

  12. Teve says:

    @An Interested Party: step 1 is steal underwear. Step 3 is profit. Pelosi has to fill in step 2, geez, do you want me to do all the work?

  13. Tyrell says:

    @Gustopher: It is a bad precedent if the IRS releases any of Trump’s tax returns to members of Congress. Once that door is opened, who would be next – state officials? Anyone they have a beef with? A local mayor? Police officer? School teacher?
    Who would want Congress to have access to their tax records?
    I realize that may sound ridiculous, but if our tax records are not safe, what is?
    We are in an age where there is little, if any, privacy and confidentiality anymore. Weekly we hear of private information being broken into and personal information gathered. Who is going to protect us? Certainly not the Congress or government.

  14. Grumpy realist says:

    @Tyrell: you fail to understand. This has to do with anti-corruption. If Trump wanted to keep his tax records secret, he should have not run for POTUS. That was totally his own decision.

    It’s like someone whining because the FBI does a security check on him before providing clearance.

  15. Daryl and his brother Darryl says:

    @Tyrell:
    I suspect a lot of you Trumpaloons don’t realize there is a law that provides for Congress to see anyone’s returns, and that law came about because of the corruption that led to the Teapot Dome Scandal.
    I wish you sycophants would try to educate yourselves just a little bit before going on your rants.

  16. Tyrell says:

    @Kathy I remember this coming up some time ago and somehow one of the networks got hold of some of his returns. It appeared that his percentage of tax paid was higher than Sanders and Hillary.
    “I guess that’s it”