Appeals Court Judges Send Emoluments Suit Against Trump Back to a Lower Court

WASHINGTON — A federal appeals court delivered a setback on Friday to a lawsuit by congressional Democrats accusing President Trump of illegally benefiting from his business interests while in office, saying a lower court judge hearing the suit had not adequately considered questions about the separation of powers between the president and Congress.

The order by a three-judge panel of the United States Court of Appeals for the District of Columbia Circuit is a new sign that Mr. Trump will not be forced to produce evidence in lawsuits claiming that he has violated the anticorruption clauses of the Constitution until the novel legal questions raised in those cases are resolved.

The question of what violates the clauses has never been tested in court. Three lawsuits raising the issue have been bouncing back and forth between district courts and appeals courts, and one of the cases may eventually reach the Supreme Court. The clauses restrict the ability of federal official to accept benefits, or “emoluments,” from foreign or state governments.

The Appeals Court judges rejected a request by the government to intervene in the case on an emergency basis. Instead, they said Judge Emmet G. Sullivan of the United States District Court for the District of Columbia had erred by not allowing the Justice Department to appeal his rulings at an early stage, before evidence had been gathered.

“The District Court did not adequately address whether — given the separation of powers issues present in a lawsuit brought by members of the legislative branch against the president of the United States — resolving the legal questions and/or postponing discovery would be preferable, or whether discovery is even necessary” to establish whether the plaintiffs were entitled to judicial intervention, the judges stated.

They sent the case back to Judge Sullivan, essentially telling him to give the Justice Department permission to appeal his rulings because they raise “open threshold cases of pure law.” In response, Judge Sullivan halted discovery in the case while he considers whether to issue new orders.

In a related case, a judicial panel of the United States Court of Appeals for the Fourth Circuit found this month that the State of Maryland and the District of Columbia had no legal standing to sue Mr. Trump for violations of the emoluments clauses. That ruling may also be appealed.

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