Donald J. Trump v. Deutsche Bank AG
Citation943 F.3d 627
Date Filed2019-12-03
Docket19-1540-cv
Cited33 times
StatusPublished
Full Opinion (html_with_citations)
19-1540-cv
Donald J. Trump v. Deutsche Bank AG
UNITED STATES COURT OF APPEALS
FOR THE SECOND CIRCUIT
August Term 2019
Argued: August 23, 2019 Decided: December 3, 2019
Docket No. 19â1540âcv
ââââââââââââââââââââââââââââââââââââââââââ
DONALD J. TRUMP, DONALD J. TRUMP, JR., ERIC
TRUMP, IVANKA TRUMP, DONALD J. TRUMP
REVOCABLE TRUST, TRUMP ORGANIZATION, INC.,
TRUMP ORGANIZATION LLC, DJT HOLDINGS LLC,
DJT HOLDINGS MANAGING MEMBER LLC, TRUMP
ACQUISITION LLC, TRUMP ACQUISITION, CORP.,
Plaintiffs â Appellants,
v.
DEUTSCHE BANK AG, CAPITAL ONE FINANCIAL
CORPORATION,
Defendants â Appellees,
COMMITTEE ON FINANCIAL SERVICES OF THE
UNITED STATES HOUSE OF REPRESENTATIVES,
PERMANENT SELECT COMMITTEE ON
INTELLIGENCE OF THE UNITED STATES HOUSE
OF REPRESENTATIVES,
Intervenor Defendants â Appellees.
ââââââââââââââââââââââââââââââââââââââââââ
Before: NEWMAN, HALL, and LIVINGSTON, Circuit Judges.
Expedited interlocutory appeal from the May 22, 2019, order of the District
Court for the Southern District of New York (Edgardo Ramos, District Judge)
denying PlaintiffsâAppellantsâ motion for a preliminary injunction to prevent the
DefendantsâAppelleesâ compliance with subpoenas issued to them by the
Intervenor DefendantsâAppellees and denying PlaintiffsâAppellantsâ motion for a
stay pending appeal.
Affirmed in substantial part and remanded in part. Judge Livingston
concurs in part and dissents in part with a separate opinion.
Patrick Strawbridge, Consovoy McCarthy PLLC,
Boston, MA (William S. Consovoy,
Cameron T. Norris, Consovoy McCarthy
PLLC, Arlington, VA, Marc Lee Mukasey,
Mukasey Frenchman & Sklaroff LLP, New
York, NY, on the brief), for Plaintiffsâ
Appellants Donald J. Trump, Donald J.
Trump, Jr., Eric Trump, Ivanka Trump,
Donald J. Trump Revocable Trust, Trump
Organization, Inc., Trump Organization
LLC, DJT Holdings LLC, DJT Holdings
Managing Member LLC, Trump Acquisition
LLC, Trump Acquisition, Corp.
Douglas N. Letter, General Counsel, U.S. House of
Representatives, Washington, D.C. (Todd B.
Tatelman, Dep. General Counsel, Megan
2
Barbero, Josephine Morse, Assoc. General
Counsel, Office of General Counsel, U.S.
House of Representatives, Washington,
D.C., on the brief), for Intervenor Defendantsâ
Appellees Committee on Financial Services
and Permanent Select Committee on
Intelligence of the United States House of
Representatives.
Parvin D. Moyne, Akin Gump Strauss Hauer &
Feld LLP, New York, NY (Thomas C.
Moyer, Raphael A. Prober, Steven R. Ross,
Akin Gump Strauss Hauer & Feld LLP,
Washington, D.C.), for DefendantâAppellee
Deutsche Bank AG.
James A. Murphy, Murphy & McGonigle, PC,
New York, NY (Steven D. Feldman, Murphy
& McGonigle, PC, New York, NY), for
DefendantâAppellee Capital One Financial
Corporation.
(Dennis Fan, Mark R. Freeman, Scott R. McIntosh,
Appellate Staff Attys., Joseph H. Hunt, Asst.
Atty. General, Hashim M. Mooppan, Dep.
Asst. Atty. General, Civil Division, U.S.
Dept. of Justice, Washington, D.C., for
amicus curiae United States of America.)
(Brianne J. Gorod, Elizabeth B. Wydra, Brian R.
Frazelle, Ashwin P. Phatak, Constitutional
Accountability Center, Washington, D.C.,
for amicus curiae Constitutional Accountability
Center, in support of Intervenor Defendantsâ
Appellees.)
3
JON O. NEWMAN, Circuit Judge:
This appeal raises an important issue concerning the investigative authority
of two committees of the United States House of Representatives and the
protection of privacy due the President of the United States suing in his individual,
not official, capacity with respect to financial records. The specific issue is the
lawfulness of three subpoenas issued by the House Committee on Financial
Services and the House Permanent Select Committee on Intelligence (collectively,
âCommitteesâ or âIntervenorsâ) to two banks, Deutsche Bank AG and Capital One
Financial Corporation (âCapital Oneâ) (collectively, âBanksâ). The subpoenas
issued by each of the Committees to Deutsche Bank (âDeutsche Bank Subpoenasâ)
seek identical records of President Donald J. Trump (âLead Plaintiffâ), members
of his family, The Trump Organization, Inc. (âTrump Organizationâ), and several
affiliated entities (collectively, âPlaintiffsâ or âAppellantsâ). The subpoena issued
by the Committee on Financial Services to Capital One (âCapital One Subpoenaâ)
seeks records of the Trump Organization and several affiliated entities. The
Capital One Subpoena does not list the Lead Plaintiff or members of his family by
name, but might seek their records in the event they are a principal, director,
shareholder, or officer of any of the listed entities.
4
The issue of the lawfulness of the three subpoenas arises on an expedited
interlocutory appeal from the May 22, 2019, Order of the District Court for the
Southern District of New York (Edgardo Ramos, District Judge) (âOrderâ) denying
Plaintiffsâ motion for a preliminary injunction to prevent the Banksâ compliance
with the subpoenas and denying Plaintiffsâ motion for a stay pending appeal.
We affirm the Order in substantial part to the extent that it denied a
preliminary injunction and order prompt compliance with the subpoenas, except
that the case is remanded to a limited extent for implementation of the procedure
set forth in this opinion concerning the nondisclosure of sensitive personal
information and a limited opportunity for Appellants to object to disclosure of
other specific documents within the coverage of those paragraphs of the Deutsche
Bank Subpoenas listed in this opinion. We dismiss as moot the appeal from the
Order to the extent that it denied a stay pending appeal because the Committees
agreed not to require compliance with the subpoenas pending the appeal, once the
appeal was expedited.
In her partial dissent, Judge Livingston prefers a total remand of the case for
âcreation of a record that is sufficient more closely to examine the serious
questions that the Plaintiffs have raised,â Part Diss. Op. at 10â11, and to âafford
5
the parties an opportunity to negotiate,â id. at 11. We discuss at pages 69â72 of this
opinion not only why such a remand is not warranted but why it would also run
counter to the instruction the Supreme Court has given to courts considering
attempts to have the Judicial Branch interfere with a lawful exercise of the
congressional authority of the Legislative Branch.
Background
The subpoenas. The case concerns three subpoenas issued by committees of
the United States House of Representatives. On April 11 of this year, the
Committee on Financial Services and the Permanent Select Committee on
Intelligence each issued identical subpoenas to Deutsche Bank, seeking a broad
range of financial records of Donald J. Trump, members of his family, and
affiliated entities. On the same date, the Committee on Financial Services issued a
subpoena of narrower scope to Capital One Financial Corporation.1 We detail the
scope of the subpoenas in Part II(C).
Litigation procedure. On April 29, Donald J. Trump, his three oldest children,
the Trump Organization, and six entities affiliated with either the Lead Plaintiff or
The subpoenas issued by the Committee on Financial Services are not dated, but we were
1
informed at oral argument that they were issued on April 11.
6
the Trump Organization2 filed a complaint in the District Court seeking a
declaratory judgment that the subpoenas are invalid and an injunction âquashingâ
the subpoenas and enjoining compliance with them.3 On May 3, the Plaintiffs filed
a motion for a preliminary injunction,4 and the District Court granted the
Committeesâ joint motion to intervene.5 The Plaintiffs and the Committees then
agreed to an expedited briefing schedule for the motion for a preliminary
injunction.6 Deutsche Bank notified the District Court that it took no position on
the Plaintiffsâ request for limited expedited discovery,7 and Capital One notified
the District Court that it took no position on the Plaintiffsâ request for an order
requiring the Committees to provide Plaintiffs with copies of the subpoenas.8
On May 22, the District Court held a hearing on the Plaintiffsâ motion for a
preliminary injunction and denied it, reading into the record an extensive
opinion.9 On May 24, the Plaintiffs filed a notice of an interlocutory appeal. On
2 They are Donald J. Trump Revocable Trust, Trump Organization LLC, DJT Holdings
LLC, DJT Holdings Managing Member LLC, Trump Acquisition LLC, and Trump Acquisition,
Corp.
3 Trump v. Deutsche Bank, No. 19âcvâ3826 (S.D.N.Y. 2019), Dkt. No. 1 (Apr. 29, 2019).
4 Id., Dkt. No. 26 (May 3, 2019).
5
Id., Dkt. No. 31 (May 3, 2019).
6
Id., Dkt. No. 21 (May 1, 2019).
7
Id., Dkt. No. 38 (May 7, 2019).
8
Id., Dkt. No. 40 (May 7, 2019).
9 Id., Dkt. No. 59 (May 22, 2019).
7
May 25, the parties submitted a joint motion to stay proceedings in the District
Court pending the appeal,10 which the District Court granted on May 28.11
On May 25, the parties jointly moved in this Court for an expedited appeal,12
which was granted on May 31.13 Thereafter, the Banks informed us that they take
no position with respect to the appeal.14 Nevertheless, we requested counsel for
the Banks to attend the oral argument to be available to respond to any questions
the panel might have.15 We requested the Committees to provide unredacted
copies of the Deutsche Bank subpoenas, which we have received under seal. We
also inquired of the United States Solicitor General whether the United States
would like to submit its view on the issues raised on this appeal.16 On August 19,
the United States submitted a brief as amicus curiae, urging reversal of the District
10 Id., Dkt. No. 61 (May 25, 2019).
11 Id., Dkt. No. 62 (May 28, 2019).
12 Trump v. Deutsche Bank, No. 19â1540 (2d Cir. 2019), Dkt. No. 5 (May 25, 2019).
13 Id., Dkt. No. 8 (May 31, 2019). In the partiesâ joint motion to expedite the appeal, the
Committees agreed that if the appeal were expedited, they would suspend compliance with the
subpoenas during the pendency of the appeal âexcept to the extent the subpoenas call for the
production of documents unrelated to any person or entity affiliated with PlaintiffâAppellants.â
J. Mot. to Expedite at 2, id., Dkt. No. 5 (May 25, 2019). Granting the motion to expedite the appeal
has therefore rendered moot the appeal from the District Courtâs order to the extent that it denied
a stay pending appeal.
14
Id., Dkt. Nos. 66 (July 11, 2019), 71 (July 12, 2019).
15
Id., Dkt. No. 81 (July 17, 2019).
16
Id., Dkt. No. 80 (July 17, 2019).
8
Courtâs order denying a preliminary injunction,17 to which the Committees and
Appellants responded on August 21.18 On August 23, we heard oral argument.
The oral argument precipitated letters from the parties to this Court
concerning tax returns sought pursuant to the subpoenas. These letters and
subsequent procedural developments are discussed in Part II(B).
Discussion
We emphasize at the outset that the issues raised by this litigation do not
concern a dispute between the Legislative and Executive Branches. As to such a
dispute, as occurs where the Justice Department, suing on behalf of the United
States, seeks an injunction to prevent a third party from responding to a
congressional committeeâs subpoena seeking documents of a department or
agency of the Executive Branch, see, e.g., United States v. AT&T, 567 F.2d 121, 122 (D.C. Cir. 1977) (âAT&T IIâ), the Judicial Branch proceeds with caution, see id. at 123 (seeking to âavoid a resolution that might disturb the balance of power between the two branchesâ), sometimes encountering issues of justiciability in advance of the merits, see United States v. AT&T,551 F.2d 384, 390
(D.C. Cir. 1976)
(âAT&T Iâ). Although the challenged subpoenas seek financial records of the
17
Id., Dkt. No. 143 (Aug. 19, 2019).
18
Id., Dkt. Nos. 148, 149 (Aug. 21, 2019).
9
person who is the President, no documents are sought reflecting any actions taken
by Donald J. Trump acting in his official capacity as President. Indeed, the
Complaint explicitly states that âPresident Trump brings this suit solely in his
capacity as a private citizen.â Complaint Âś 13. Appellants underscore this point by
declining in this Court to assert as barriers to compliance with the subpoenas any
privilege that might be available to the President in his official capacity, such as
executive privilege. See Franchise Tax Board v. Hyatt, 139 S. Ct. 1485, 1499(2019) (citing United States v. Nixon,418 U.S. 683
, 705â06 (1974)). The protection sought is the protection from compelled disclosure alleged to be beyond the constitutional authority of the Committees, a protection that, if validly asserted, would be available to any private individual. See Barenblatt v. United States,360 U.S. 109
(1959); Watkins v. United States,354 U.S. 178
(1957). For this reason, in the
remainder of this opinion we will refer to President Trump as the âLead Plaintiffâ;
the formal title âPresident Trumpâ might mislead some to think that his official
records are sought, and the locution âMr. Trump,â sometimes used in this
litigation, might seem to some disrespectful.
Also at the outset, we note that there is no dispute that Plaintiffs had
standing in the District Court to challenge the lawfulness of the Committeesâ
10
subpoenas by seeking injunctive relief against the Banks as custodians of the
documents. See United States Servicemenâs Fund v. Eastland, 488 F.2d 1252, 1260(D.C. Cir. 1973) (â[T]he plaintiffs have no alternative means to vindicate their rights.â) (italics omitted), revâd on other grounds without questioning plaintiffsâ standing,421 U.S. 491
(1975).
We review denial of a preliminary injunction for abuse of discretion, see, e.g.,
Ragbir v. Homan, 923 F.3d 53, 62(2d Cir. 2019), but our review is appropriately more exacting where the action sought to be enjoined concerns the President, even though he is suing in his individual, not official, capacity, in view of ââ[t]he high respect that is owed to the office of the Chief Executiveââ that ââshould inform the conduct of [an] entire proceeding,ââ Cheney v. United States District Court,542 U.S. 367, 385
(2004) (first brackets in original) (quoting Clinton v. Jones,520 U.S. 681, 707
(1997)).
I. Preliminary Injunction Standard
In this Circuit, we have repeatedly said that district courts may grant a
preliminary injunction where a plaintiff demonstrates irreparable harm and meets
either of two standards: â(a) a likelihood of success on the merits, or (b) sufficiently
serious questions going to the merits to make them a fair ground for litigation, and
11
a balance of hardships tipping decidedly in the movantâs favor.â19 Kelly v.
Honeywell International, Inc., 933 F.3d 173, 184 (2d Cir. 2019) (quotation marks
19 The first component of the âseriousâquestionsâ standard has sometimes been phrased
as requiring a party seeking a preliminary injunction to show âsufficiently serious questions
going to the merits of its claims to make them fair ground for litigation.â OtoeâMissouria Tribe of
Indians v. New York State Depât of Financial Services, 769 F.3d 105, 110 (2d Cir. 2014). That
formulation raises the question whether the referent of âthemâ is âclaimsâ or âserious questions.â
Normally, the referent of a pronoun is the word or phrase immediately preceding it. That would
mean that a plaintiffâs âclaimsâ must be sufficiently serious to make them a fair ground for
litigation. But the OtoeâMissouria Tribe formulation could also be read to mean that the âserious
questionsâ must be sufficiently serious to make them a fair ground for litigation.
The origin and evolution of the seriousâquestions standard indicate that what must be
sufficiently serious to be a fair ground of litigation are the questions that the plaintiffâs claims
raise, not the claims themselves (although the distinction probably makes little, if any, difference
in practice). The first version of what has become the first component of the seriousâquestions
standard appears in Hamilton Watch Co. v. Benrus Watch Co., 206 F.2d 738(2d Cir. 1953), where we referred to âquestions going to the merits so serious, substantial, difficult and doubtful, as to make them a fair ground for litigation,âid. at 740
(emphasis added). This formulation was repeated verbatim later the same year in Unicon Management Corp. v. Koppers Co.,366 F.2d 199, 205
(2d Cir. 1966), and Dino DeLaurentis Cinematografica, S.p.A. v. Dâ150, Inc.,366 F.2d 373, 376
(2d Cir. 1966). This formulation was substantially repeated three years later in Checker Motors Corp. v. Chrysler Corp.,405 F.2d 319
(2d Cir. 1969), but with omission of the word âdoubtful,âid. at 323
. Three years later, in Stark v. New York Stock Exchange,466 F.2d 743
(2d Cir. 1972), we shortened the formulation to just âserious questions going to the merits.â Id. at 744. The following year, in Gulf & Western Industries, Inc. v. Great Atlantic & Pacific Tea Co.,476 F.2d 687
(2d Cir. 1973), we expanded that short version to âserious questions going to the merits which warrant further investigation for trial.âId. at 692
. Later that year, in Sonesta International Hotels Corp. v. Wellington Associates,483 F.2d 247
(2d Cir. 1973), there first appeared the current version of the formulation, âsufficiently serious questions going to the merits to make them a fair ground for litigation.âId. at 250
(emphasis added). This formulation was repeated verbatim in a series of cases. See Triebwasser & Katz v. American Telephone & Telegraph Co.,535 F.2d 1356, 1358
(2d Cir. 1976); New York v. Nuclear Regulatory Commission,550 F.2d 745, 750
(2d Cir. 1977); Selchow & Richter Co. v. McGrawâHill Book Co.,580 F.2d 25, 27
(2d Cir. 1978); Caulfield v. Board of Education,583 F.2d 605, 610
(2d Cir. 1978); Jackson Dairy, Inc. v. H.P. Hood & Sons, Inc.,596 F.2d 70, 72
(2d Cir. 1979); see also William H. Mulligan, ForewordâPreliminary Injunction in the Second Circuit,43 Brook. L. Rev. 831
(primarily considering requirement of irreparable injury).
Thereafter, this Court and district courts in this Circuit cited Jackson Dairy and its
formulation of the seriousâquestions standard innumerable times, as the citing references
collected by Westlaw indicate, until in Plaza Health Laboratories, Inc. v. Perales, 878 F.2d 577 (2d
Cir. 1989), the formulation was rephrased to âsufficiently serious questions going to the merits of
12
deleted); Jackson Dairy, Inc. v. H.P. Hood & Sons, Inc., 596 F.2d 70, 72 (2d Cir. 1979).
The Committees contend that the likelihoodâofâsuccess standard applies;
Appellants contend that the seriousâquestions standard applies.20
With respect to irreparable harm, a factor required under either standard,
Appellants contend that compliance with the subpoenas will cause them such
its claims to make them fair ground for litigation.â Id. at 580. Plaza Health Laboratories added the
phrase âof its claims,â thereby creating the grammatical query considered in this footnote. Plaza
Health Laboratories cited only Sperry International Trade, Inc. v. Government of Israel, 670 F.2d 8(2d Cir. 1982), and Jackson Dairy, but both of those opinions had used the traditional formulation without the phrase âof its claims.â See Sperry International Trade,670 F. 2d at 110
; Jackson Dairy,
598 F.2d at 11. A Westlaw search reveals that the Plaza Health Laboratories formulation has been
used by this Court just fifteen times, and the Jackson Dairy formulation has been used 226 times.
In view of the evolution of, and this Courtâs clear preference for, the Jackson Dairy
formulation, we will use it in this opinion, thereby avoiding the grammatical query posed by the
Plaza Health Laboratories formulation. We will also use the article âaâ before âfair ground for
litigation,â which Plaza Health Laboratories and some of the opinions citing it omitted, but which
is always included in the opinions using the Jackson Dairy formulation.
20 In their reply brief, Appellants contend that âthe Committees conceded [in the District
Court] that the seriousâquestions standard applies.â Reply Br. for Appellants at 2. They cite
footnote 28 of the Committeesâ memorandum in opposition to the motion for a preliminary
injunction. We normally do not consider an issue raised for the first time in a reply brief. See
McBride v. BIC Consumer Products Manufacturing Co., 583 F.3d 92, 96 (2d Cir. 2009). In any event,
Appellantsâ claim is without merit.
The Committeesâ footnote states, âTo the extent there is any meaningful distinction
between the Winter [v. Natural Resources Defense Council, Inc., 555 U.S. 7, 20(2008)] standard and the âserious questionsâ formulation, that has also been used by the Second Circuit in postâWinter cases, see Citigroup Global Markets, Inc. v. VCG Special Opportunities Master Fund Ltd.,598 F.3d 30
, 36â38 (2d Cir. 2010), this Court need not consider that nuance here because Mr. Trump has failed to meet the heavy burden required under either standard.â Dist. Ct. Dkt. No. 51, at 10 n.28 (citation omitted) (May 10, 2019). Stating that the Lead Plaintiff had not met either the likelihoodâ ofâsuccess standard or the seriousâquestions standard is not a concession that the lesser standard applies. Moreover, in the sentence of text to which the footnote is appended, the Committees explicitly contend that the higher standard applies, stating that to obtain a preliminary injunction âa plaintiff âmust establish that he is likely to succeed on the merits.ââId.
at 10 (quoting New York Progress & Protection PAC v. Walsh,733 F.3d 483, 486
(2d Cir. 2003)).
13
harm. In the District Court, the Committees took the position that whether
compliance would cause Appellants irreparable harm would depend on whether
the Committees would make public the documents obtained.21 The District Court
ruled that compliance would cause irreparable harm because âplaintiffs have an
interest in keeping their records private from everyone, including
congresspersons,â and âthe committees have not committed one way or the other
to keeping plaintiffsâ records confidential from the public once received.â J. Appâx
122â23. We agree.
The issue therefore becomes whether Appellants seeking a preliminary
injunction had to meet (1) the more rigorous standard of a likelihood of success on
the merits or (2) the less rigorous standard of sufficiently serious questions going
to the merits to make them a fair ground for litigation plus a balance of hardships
tipping decidedly in their favor.22
21 Counsel for the Committees said to the District Court, â[J]ust because documents are
turned over to Congress, that itself is not irreparable injury. The question is if Congress was going
to disclose them. So just turning it over to Congress is not irreparable injury.â J. Appâx 111.
22 One opinion of this Court noted that â[b]ecause the moving party must not only show
that there are âserious questionsâ going to the merits, but must additionally establish that âthe
balance of hardships tips decidedlyâ in its favor, its overall burden is no lighter than the one it bears
under the âlikelihood of successâ standard.â Citigroup Global Markets, Inc. v. VCG Special
Opportunities Master Fund Ltd., 598 F.3d 30, 35(2d Cir. 2010) (citation omitted) (emphasis in original). Although that might have been the situation on the facts of that case, there can be no doubt, as we have repeatedly said, that the likelihoodâofâsuccess standard is more rigorous than the seriousâquestions standard. See, e.g., Central Rabbinical Congress of U.S. & Canada v. New York City Depât of Health & Mental Hygiene,763 F.3d 183, 192
(2d Cir. 2014) (likelihoodâofâsuccess
14
With slightly different formulations, we have repeatedly stated that the
seriousâquestions standard cannot be used to preliminarily enjoin governmental
action. See Plaza Health Laboratories, Inc. v. Perales, 878 F.2d 577, 580(2d Cir. 1989) (applying more rigorous likelihoodâofâsuccess standard in affirming denial of preliminary injunction against âgovernmental action taken in the public interest pursuant to a statutory or regulatory schemeâ); Union Carbide Agricultural Products Co. v. Costle,632 F.2d 1014, 1018
(2d Cir. 1980) (same, with respect to âgovernmental action that is in the public interestâ); Medical Society of State of New York v. Toia,560 F.2d 535, 538
(2d Cir. 1977) (same, where âinterim relief [enjoining governmental action] may adversely affect the public interestâ); see also Able v. United States,44 F.3d 128, 131
(2d Cir. 1995) (âAs long as the action to be enjoined
is taken pursuant to a statutory or regulatory scheme, even government action
with respect to one litigant requires application of the âlikelihood of successâ
standard.â).
Nevertheless, in two decisions, we have affirmed preliminary injunctions
against government action issued using the less rigorous seriousâquestions
standard âmore rigorousâ); Red Earth LLC v. United States, 657 F.3d 138, 143(2d Cir. 2011) (same); Metropolitan Taxicab Board of Trade v. City of New York,615 F.3d 152, 156
(2d Cir. 2010) (same); County of Nassau v. Leavitt,524 F.3d 408, 414
(2d Cir. 2008) (same).
15
standard. See Haitian Centers Council, Inc. v. McNary, 969 F.2d 1326, 1342(2d Cir. 1992) (officials of the Immigration and Naturalization Service enjoined), judgment vacated as moot sub nom. Sale v. Haitian Centers Council, Inc.,509 U.S. 918
(1993); Mitchell v. Cuomo,748 F.2d 804
, 806â08 (2d Cir. 1984) (state prison officials enjoined). We have sometimes affirmed decisions that issued or denied preliminary injunctions against government action using both standards. See Hudson River Sloop Clearwater, Inc. v. Depât of Navy,836 F.2d 760
, 763 (2d Cir. 1988) (preliminary injunction denied under both standards); Patton v. Dole,806 F.2d 24
, 28â30 (2d Cir. 1986) (preliminary injunction granted under both standards); Patchogue Nursing Center v. Bowen,797 F.2d 1137
, 1141â42 (2d Cir. 1986)
(preliminary injunction denied under both standards).
Haitian Centers noted that âthe âlikelihood of successâ prong need not always
be followed merely because a movant seeks to enjoin government action.â 969 F.2d
at 1339(emphasis added). Then, building on the statement in Plaza Health Laboratories that the less rigorous standard may not be used to enjoin âgovernmental action taken in the public interest pursuant to a statutory or regulatory scheme,â878 F.2d at 580
(emphasis added), Haitian Centers noted that âno party has an exclusive claim on the public interest,â969 F.2d at 1339
. That
16
point influenced our later decision in Time Warner Cable of New York City L.P. v.
Bloomberg L.P., 118 F.3d 917(2d Cir. 1997), where, noting that âthere are public interest concerns on both sidesâ of the litigation,id. at 923
, we said that the seriousâ questions standard âwould be applicable,âid. at 924
, even though we ultimately decided the case under the likelihoodâofâsuccess standard, seeid.
In Able, we noted that the government action exception to the use of the
seriousâquestions standard âreflects the idea that governmental policies
implemented through legislation or regulations developed through
presumptively reasoned democratic processes are entitled to a higher degree of
deference and should not be enjoined lightly,â 44 F.3d at 131, and that the likelihoodâofâsuccess standard was appropriate in that case âwhere the full play of the democratic process involving both the legislative and executive branches has produced a policy in the name of the public interest embodied in a statute and implementing regulations,âid.
We also pointed out that Haitian Centers had approved use of the seriousâquestions standard to challenge action taken pursuant to a âpolicy formulated solely by the executive branch.âId.
Based on these
statements, Appellants contend that only the seriousâquestions standard applies
17
to challenge any action âtaken pursuant to a policy formulated by one branch.â
Reply Br. for Appellants at 3 (quotation marks and brackets omitted).
We think that argument fails by endeavoring to make a requirement out of
the sentences we have quoted from Able. The fact that legislation developed by
both branches of the federal government is entitled to a higher degree of deference
does not mean that only such action is entitled to the deference reflected in the
likelihoodâofâsuccess standard. The Supreme Court has said that a high degree of
deference should be accorded to actions taken solely by Congress, see United States
v. Rumely, 345 U.S. 41, 46(1953) (admonishing courts to âtread warilyâ â[w]henever constitutional limits upon the investigative power of Congress have to be drawnâ), and we have often approved application of the more rigorous likelihoodâofâsuccess standard to enjoin action taken by units of government with far less authority than the combined force of the national Legislative and Executive Branches. For example, we have ruled that the more rigorous likelihoodâofâsuccess standard was applicable when a preliminary injunction was sought to prohibit a municipal agency from enforcing a regulation, see Central Rabbinical Congress of U.S. and Canada v. New York City Depât of Health & Mental Hygiene,763 F.3d 183, 192
(2d Cir. 2014); to prohibit New York Cityâs Taxi & Limousine Commission from
18
enforcing changes to lease rates, Metropolitan Taxicab Board of Trade v. City of New
York, 615 F.3d 152, 156(2d Cir. 2010); to require one branch of a state legislature to undo its expulsion of a state senator, see Monserrate v. New York State Senate,599 F.3d 148, 154
(2d Cir. 2010); to prohibit a town from hiring police officers and firefighters, see NAACP v. Town of East Haven,70 F.3d 219, 223
(2d Cir. 1995); to prohibit the Metropolitan Transit Authority from implementing a staff reduction plan, see Molloy v. Metropolitan Transportation Authority,94 F.3d 808, 811
(2d Cir. 1996); to prohibit the New York City Transit Authority from increasing subway and bus fares, see New York Urban League, Inc. v. State of New York,71 F.3d 1031
, 1036 n.7 (2d Cir. 1995); to prohibit New York Stateâs Department of Social Services from suspending a healthâcare services provider from participating in the Stateâs medical assistance program, see Plaza Health Laboratories,878 F.2d at 580
, and to prohibit two commissioners of New York state agencies from enforcing provisions of state law, see Medical Society,560 F.2d at 538
.
In dissent, Judge Livingston questions the significance of decisions such as
these on two grounds. First, she suggests that some of them lacked sufficient
analysis. See Part. Diss. Op. at 44. However, with exceptions not relevant here,
panels of this Court are bound by the holdings of prior panels, see, e.g., Lotes Co. v.
19
Hon Hal Precision Industry Co., 753 F.3d 395, 405(2d Cir. 2014); Gelman v. Ashcroft,372 F.3d 495, 499
(2d Cir. 2004), and those holdings are not to be disregarded by
any claimed insufficiency of an opinionâs analysis. Second, she suggests that we
might have used the more rigorous likelihoodâofâsuccess standard in these cases
because of federalism concerns. See Part. Diss. Op. at 45, n.28. However, none of
the eight decisions even hints that federalism concerns influenced the use of the
likelihoodâofâsuccess standard.
We have not previously had occasion to consider whether enforcement of a
congressional committeeâs subpoena qualifies as, or is sufficiently analogous to,
âgovernmental action taken in the public interest pursuant to a statutory or
regulatory scheme,â Plaza Health Laboratories, 878 F.2d at 580, so as to preclude
application of the less rigorous seriousâquestions standard. Facing that issue, we
conclude that those seeking to preliminarily enjoin compliance with subpoenas
issued by congressional committees exercising, as we conclude in Part II(C), their
constitutional and duly authorized power to subpoena documents in aid of both
regulatory oversight and consideration of potential legislation must satisfy the
more rigorous likelihoodâofâsuccess standard. Surely such committees should not
be enjoined from accomplishing their tasks under a less rigorous standard than we
20
applied to plaintiffs seeking to preliminarily enjoin state and local units of
government in Central Rabbinical Congress, Metropolitan Taxicab Board of Trade,
Monserrate, Town of East Haven, Molloy, New York Urban League, Plaza Health Medical
Society, discussed above. None of those cases involved implementation of a policy
Ęşdeveloped through presumptively reasoned democratic processesĘş and resulting
from Ęşthe full play of the democratic process involving both the legislative and
executive branches,Ęş which were the elements present in Able, 44 F.3d at 131. Yet
in all eight cases, we applied the likelihoodâofâsuccess standard. Indeed, in
Monserrate we applied the more rigorous standard to a plaintiff seeking to
preliminarily enjoin action taken by just one body of a state legislature. We will
therefore apply the likelihoodâofâsuccess standard to Appellantsâ motion for a
preliminary injunction in this case.
Before leaving the issue of the applicable preliminary injunction standard,
we should reckon with the preliminary injunction standard formulated in 2008 by
the Supreme Court in Winter v. Natural Resources Defense Council, Inc., 555 U.S. 7,
20 (2008): âA plaintiff seeking a preliminary injunction must establish that he is
likely to succeed on the merits, that he is likely to suffer irreparable harm in the
absence of preliminary relief, that the balance of equities tips in his favor, and that
21
an injunction is in the public interest.â Id. at 20. This formulation incorporates both
the irreparable injury requirement and the likelihoodâofâsuccess requirement from
the more rigorous standard we have been using, includes from our less rigorous
seriousâquestions standard a balance of equities (similar to hardships) that tips in
favor of the plaintiff (although not including the requirement of sufficiently
serious questions going to the merits to make them a fair ground for litigation nor
the requirement that the balance of hardships tips decidedly in the plaintiffâs favor),
and adds as a fourth requirement that the injunction is in the public interest.
It is not clear whether the Supreme Court intended courts to require these
four components of the Winter standard in all preliminary injunction cases. Winter
concerned military operations affecting the national security, testing for
submarine detection, and two of the three cases cited to support the Winter
formulation also concerned national security issues, Munaf v. Geren, 553 U.S. 674(2008) (transferring U.S. military prisoners in a foreign country to that countryâs government), and Weinberger v. RomeroâBarcelo,456 U.S. 305
(1982) (training the
Navyâs bomber pilots). The third case, Amoco Production Co. v. Village of Gambell,
22
480 U.S. 531 (1987), concerned a matter unrelated to national securityââdrilling for
oil and natural gas.23
In any event, two years after the Supreme Courtâs decision in Winter, our
Court explained why we did not believe that the Supreme Court had precluded
our use of the two preliminary injunction standards that we had used for five
decades. See Citigroup Global Markets, Inc. v. VCG Special Opportunities Master Fund
Ltd., 598 F.3d 30, 35â38 (2d Cir. 2010). However, Citigroup shed no light on which of those standards was applicable to plaintiffs seeking to preliminarily enjoin governmental action. That case involved a motion by a brokerage firm to preliminarily enjoin a hedge fund from pursuing an arbitration. Seeid. at 32
.
23 Uncertainty as to use of the Winter formulation for all preliminary injunctions remained
after the Supreme Courtâs decision the next year in Nken v. Holder, 556 U.S. 418(2009). In language similar to that used in Winter, the Court identified the four factors applicable to the grant of a stay pending appealâââ(1) whether the stay applicant has made a strong showing that he is likely to succeed on the merits; (2) whether the applicant will be irreparably injured absent a stay; (3) whether issuance of the stay will substantially injure the other parties interested in the proceeding; and (4) where the public interest lies.âId. at 434
(quotation marks omitted). The Court then stated that â[t]here is substantial overlap between these [four factors] and the factors governing preliminary injunctions,â although the two are not âone and the same.âId.
In Winter, the first factor did not include the words âstrong showing,â 555 U.S. at 20; the second factor used the word âlikelyâ to modify âsuffer irreparable harm, id.; the third factor was âthe balance of equities tips in [the plaintiffâs] favor,â id.; and the fourth factor was that an injunction âis in the public interest,âid.
Unlike Winter, which had set out four factors that an applicant for a preliminary injunction âmust establish,âid.,
Nken said that the applicable legal principles âhave been distilled into consideration of four factors.â556 U.S. at 434
(emphasis added).
23
Although we have concluded that the likelihoodâofâsuccess standard
applies in this case and have determined that Appellants have established
irreparable injury, a requirement common to both of our preliminary injunction
standards and the Supreme Courtâs Winter formulation, we will proceed to
consider not only whether Appellants have met the governing likelihoodâofâ
success standard but also whether they have satisfied the other requirements in
one or more of these three standards: sufficiently serious questions going to the
merits of their claims to make them fair ground for litigation, a balance of
hardships tipping decidedly in their favor, and the public interest favoring an
injunction. We turn first to the merits of their statutory and constitutional claims
in order to determine what we regard as the critical issue: likelihood of success.
II. Likelihood of Success
A. Statutory ClaimââRFPA
Appellants contend that the subpoenas are invalid for failure of the
Committees to comply with the Right to Financial Privacy Act (âRFPAâ or âActâ),
12 U.S.C. §§ 3401â3423. RFPA prohibits a financial institutionâs disclosure of a
customerâs financial records to âany Government authorityâ except in accordance
with the Actâs procedural requirements. § 3403(a). The Committees acknowledge
24
noncompliance with those requirements, but contend that RFPA does not apply to
them because they are not a âGovernment authorityâ within the meaning of
section 3403(a). Because the Act defines âGovernment authorityâ to mean âany
agency or department of the United States, or any officer, employee, or agent
thereof,â § 3401(3), the precise statutory issue is whether Congress or one of its
committees is an âagency or department of the United States.â
We begin with the plain meaning of âagency or departmentâ at the time
RFPA was enacted in 1978. Appellants do not argue that âagencyâ could possibly
refer to Congress; the sole dispute is over the word âdepartment.â Appellants
contend that âdepartmentâ is used in RFPA to mean any of the three branches of
government. The Committees, on the other hand, contend that the word is used to
mean some component of the Executive Branch.
Contemporary dictionaries support the Committeesâ interpretation. See
Websterâs Third New International Dictionary (1971) (defining âdepartmentâ as
âan administrative division or branch of a national or municipal governmentâ)
(emphasis added); Blackâs Law Dictionary (5th ed. 1979) (defining âdepartmentâ
as â[o]ne of the major administrative divisions of the executive branch of the
25
government usually headed by an officer of cabinet rank; e.g., Department of
Stateâ) (emphasis added).
Moreover, other contextual clues in RFPA indicate that neither Congress nor
its committees are an âagency or department of the United Statesâ within the
meaning of RFPA, and therefore Congress did not subject itself or its committees
to the Act. Section 3408 permits a âGovernment authorityâ to request financial
records âpursuant to a formal written request only if . . . the request is authorized
by regulations promulgated by the head of the agency or department.â § 3408(2).
Congress does not promulgate regulations, and its leadership and that of its
committees are not considered the âheadâ of an âagency or department.â The
Supreme Court has stated that â[t]he term âhead of a Departmentâ means . . . the
Secretary in charge of a great division of the [E]xecutive [B]ranch of the
government, like the State, Treasury, and War, who is a member of the Cabinet.â
Burnap v. United States, 252 U.S. 512, 515(1920); accord Freytag v. Commissioner of Internal Revenue,501 U.S. 868, 886
(1991).
26
The several mechanisms for obtaining financial records all require that the
records sought are ârelevant to a legitimate law enforcement inquiry,â24 § 3405(1)
(administrative summons or subpoena), § 3407(1) (judicial subpoena), § 3408(3)
(formal written request), but, as Appellants correctly point out and the
Committees agree, Congress cannot exercise âany of the powers of law
enforcementâ because âthose powers are assigned under our Constitution to the
Executive and the Judiciary,â Quinn v. United States, 349 U.S. 155, 161 (1955).
RFPA directs the Office of Personnel Management (âOPMâ) to determine
whether âdisciplinary action is warranted against [an] agent or employeeâ of âany
agency or departmentâ found to have willfully violated the Act. § 3417(b).
However, OPM is âthe lead personnel agency for civilian employees in the
[E]xecutive [B]ranch.â United States Depât of Air Force v. Federal Labor Relations
Authority, 952 F.2d 446, 448 (D.C. Cir. 1991). It is highly unlikely that Congress
would have directed OPM to take disciplinary action against congressional staff.
RFPA provides civil penalties, including punitive damages, for any âagency
or departmentâ that violates the Actâs requirements. § 3417(a). It is also highly
24RFPA defines âlaw enforcement inquiryâ as âa lawful investigation or official
proceeding inquiring into a violation of, or failure to comply with, any criminal or civil statute or
any regulation, rule, or order issued pursuant thereto.â 12 U.S.C. § 3401(8).
27
unlikely that Congress would have subjected itself to such penalties, especially in
the absence of a clear indication of an intent to do so.
Although no one of these provisions alone conclusively establishes that
RFPA does not apply to Congress, in the aggregate they provide persuasive textual
support for that reading of the Act. This conclusion is strongly reinforced by the
Actâs legislative history. A draft bill submitted by the Departments of Justice and
the Treasury would have explicitly covered access to financial records by
Congress, and distinguished Congress from âany agency or department of the
United States.â25
25 Electronic Funds Transfer & Financial Privacy: Hearings on S. 2096, S. 2293, & S. 1460 Before
the Subcomm. on Financial Institutions of the S. Comm. on Banking, Housing, & Urban Affairs, 95th
Cong. 397 (1978) (hereinafter âHearingsâ).
Hearings includes a draft bill, dated May 17, 1978, and referred to as âTitle XIâRight to
Financial Privacy,â which is identified by a note stating, âThis Draft represents the combined
views of the Departments of Justice and the Treasury, subject to further revision.â Hearings at 397
n.*. The definition section of that bill provides:
ââ[G]overnment authorityâ means the Congress of the United States, or any agency or
department of the United States or of a State or political subdivision, or any officer,
employee or agent of any of the foregoing.â
Hearings at 397 (emphasis added) (explaining definitional provision, § 1101(3)). This provision
not only explicitly made the bill applicable to Congress, but it also reflected the view of Justice
and the Treasury that âagency or department of the United Statesâ did not include Congress.
Hearings also contains a sectionâbyâsection analysis of the JusticeâTreasury draft bill
submitted on May 17, 1978. See Hearings at 365 & n.*. That analysis includes the following
explanation of the coverage of the draft bill:
âThe âgovernment authoritiesâ whose actions are restricted by the bill include any
agency or department of the United States or any State or political subdivision, or
any of their officers, employees, or agents. The Congress is also covered, since it may
use financial records in its investigations to which the same privacy rights should
adhere.â
28
The rejection of this provision of the JusticeâTreasury proposal by omitting
Congress from the enacted definition of âgovernment authorityâ is strong
evidence of a deliberate decision by Congress not to apply the Act to itself.
Although the failure of Congress to enact is often an unreliable indication of
congressional intent, see Brecht v. Abrahamson, 507 U.S. 619, 632 (1993) (âAs a
general matter, we are reluctant to draw inferences from Congressâ failure to act.â)
(quotation marks omitted), the omission of pertinent language from a bill being
considered by Congress is far more probative of such intent, especially when the
omission is from a draft bill submitted by the Department of Justice, a principal
source of proposed legislation.
Hearings at 366 (emphasis added) (explaining definitional provision).
As explained by thenâDeputy Attorney General Benjamin R. Civiletti, â[O]ur
proposal would extend these important procedures and privacy rights to cover
investigations by the Legislative as well as the Executive Branch.â Hearings at 189, 194.
Hearings also includes an analysis prepared by the Congressional Research Service
of the Library of Congress, comparing what is called âDraft Proposed by Justice Dept.â
with S. 14 and S. 2096. Hearings at 161. That analysis points out that the scope of the Justice
Department draft protects financial records from unauthorized access âby Congress,
Federal or State agents and agencies,â whereas S. 14 and S. 2096 protect such records from
unauthorized access âby Federal agents or agencies.â Id.
The draft JusticeâTreasury bill, along with its sectionâbyâsection analysis, are also
in the record of a hearing held by a House of Representatives subcommittee the following
week, where Civiletti gave similar testimony. See Right to Privacy Proposals of the Privacy
Protection Study Commission: Hearings on H.R. 10076 Before the Subcomm. on Government
Information & Individual Rights of the H. Comm. on Government Operations, 95th Cong. 256,
274 (1978).
29
Appellants present two arguments that Congress and its committees are
covered by RFPAâs definitional phrase âagency or department.â First, they point
out that in 1955 the Supreme Court ruled a false statement made by a former
member of Congress to the Disbursing Office of the House of Representatives was
a violation of 18 U.S.C. § 1001because âdepartment,â as used in section 1001, âwas meant to describe the executive, legislative and judicial branches of the Government.â United States v. Bramblett,348 U.S. 503, 509
(1955) (emphasis added).
The Committees respond that an interpretation of âdepartmentâ in section
1001 is not an authoritative basis for interpreting âdepartmentâ in RFPA and that
the Supreme Court overruled Bramblett in Hubbard v. United States, 514 U.S. 695,
715(1995), after characterizing its reading of âdepartmentâ as âseriously flawed,âid. at 702
. To this latter point, Appellants point out that courts âassume that Congress is aware of existing law when it passes legislation,â Miles v. Apex Marine Corp.,498 U.S. 19, 32
(1990), and âwas aware of . . . the judicial background against which it was legislating,â DeKalb County Pension Fund v. Transocean Ltd.,817 F.3d 393
, 409â10 (2d Cir. 2016) (âDeKalbâ) (brackets and quotation marks omitted), and
that the Congress that enacted RFPA in 1978 is assumed to be aware of Bramblett
and obviously did not legislate in light of Hubbard, decided in 1995.
30
We acknowledge the assumption that Congress legislates with awareness of
âexisting law,â Miles, 498 U.S. at 32, and the relevant âjudicial background,â DeKalb,817 F.3d at 409
. The validity of that assumption, however, depends in large part on the context in which it is invoked. Miles applied the assumption interpreting the damages provision of the Jones Act, 46 U.S.C. app. § 688. Noting that the Jones Act incorporated the recovery provisions of the older Federal Employersâ Liability Act (âFELAâ), the Supreme Court was willing to assume that Congress likely intended to adopt for the Jones Act the judicial gloss that the Court had placed on the damages provision of FELA, limiting it to pecuniary loss. See Miles,498 U.S. at 32
. âWhen Congress passed the Jones Act, the [Courtâs] gloss on FELA, and the hoary tradition behind it, were well established. Incorporating FELA unaltered into the Jones Act, Congress must have intended to incorporate the pecuniary limitation on damages as well.âId.
DeKalb applied the assumption more elaborately in determining which
statute of repose applied to a suit under section 14(a) of the Securities Exchange
Act of 1934, 15 U.S.C. § 78n(a). We had previously applied a threeâyear limitations
period in Ceres Partners v. GEL Associates, 918 F.2d 349 (2d Cir. 1990). Thereafter,
Congress enacted the SarbanesâOxley Act of 2002, extending to five years the
31
limitations period for some implied private causes of action, but not the sort of
action implied by section 14(a). See DeKalb, 817 F.3d at 398. We concluded:
Congress must have known that, by extending only the statute of
repose applicable to private rights of action that involve a claim of
fraud, deceit, manipulation, or contrivance, the statutes of repose
applicable to Section 14(a) would remain intact. And from this
knowledge, we conclude that Congress affirmatively intended to
preserve them. We therefore hold that the same threeâyear statutes of
repose that we applied to Section 14 in Ceres . . . still apply to Section
14(a) today.
Id. at 409â10 (quotation marks, brackets, and footnotes omitted).
We encounter no circumstances comparable to Miles or DeKalb in the
pending appeal. Whatever force might be given to the assumption that Congress
enacted RFPA with awareness of Bramblett is thoroughly undermined by the clear
indicators to the contrary from the text and legislative history we have recounted.26
The second argument of Appellants reminds us that in an earlier time, the
word âdepartmentâ was famously used to refer to what is now called a âbranchâ
of the federal government. âIt is emphatically the province and duty of the judicial
department to say what the law is.â Marbury v. Madison, 5 U.S. (1 Cranch) 137, 177
26 Even if Congress had Bramblett in mind, that decision based its interpretation of
âdepartmentâ on the âdevelopment, scope and purpose ofâ the statute at issue in that case. 348
U.S. at 509. RFPA does not share any of the same historical development as section 1001, and
because the Courtâs decision was not based on the text of that section, there is no reason to think
that Congress, when enacting RFPA, believed that Bramblettâs interpretation would extend to
other uses of the word âdepartment.â
32
(1803) (Little, Brown & Co. 1855);27 see also James Madison, Speech in the First
Congress (June 17, 1789), in 5 The Writings of James Madison 395, 398(Gaillard Hunt ed., 1904) (referring to the âthree great departments of Governmentâ). Hubbard, although not known to the Congress enacting RFPA, provides important guidance for us when the Supreme Court states that âwhile we have occasionally spoken of the three branches of our Government, including the Judiciary, as âdepartments,ââ Hubbard,514 U.S. at 699
(brackets omitted) (citing Mississippi v. Johnson,71 U.S. (4 Wall.) 475, 500
(1867)), âthat locution is not an ordinary one. Far more common is the use of âdepartmentâ to refer to a component of the Executive Branch,âid.
Considering all of the partiesâ arguments,28 we conclude that RFPA does not
apply to Congress.
27 I include the publisher in citations to decisions in the nominative reports because of
slight variations among the versions of 19th century publishers. See Jon O. Newman, Citators
Beware: Stylistic Variations in Different Publishersâ Versions of Early Supreme Court Opinions, 26 J. Sup.
Ct. Hist. 1 (2001).
28 Each side makes opposing arguments based on section 3412(d) of RFPA, which
provides: âNothing in this chapter shall authorize the withholding of information by any officer
or employee of a supervisory agency [defined at section 3401(7)] from a duly authorized
committee or subcommittee of the Congress.â Appellants contend that â[i]f congressional
subpoenas were never intended to come within the statuteâs scope, there would be no reason to
include this provision.â Br. for Appellants at 42. The Committees respond that this provision
concerns transfers of documents pursuant to section 3412(a), that it makes clear that the
requirements applicable when an agency or department obtains documents from a financial
institution also apply to transfers to another agency or department, and that âCongress
emphasized, however, that these transfer provisionsâlike RFPAâs other requirementsâdid not
apply to Congress.â Br. for Committees at 53.
33
B. Statutory Claimââ26 U.S.C. § 6103
The request for tax returns of named individuals and entities in the
Deutsche Bank Subpoenas encounters a possible statutory claim under 26 U.S.C.
§ 6103. See Deutsche Bank Subpoenas Âś 1(vi)(e)(7), J. Appâx 39. Because of that
request and because the parties had not said anything about tax returns in their
briefs, we asked the Banks at oral argument whether they had in their possession
tax returns within the coverage of the subpoenas. The Banks offered reasons why
they could not then respond to the question.
On August 26, we ordered the Banks to inform the Court whether either one
has in its possession any tax returns of the individuals or entities named in
paragraph 1 of the subpoenas received from the Committees.29 On August 27,
Each side also makes opposing arguments based on section 3413(j) of RFPA, which
provides: âThis chapter shall not apply when financial records are sought by the Government
Accountability Office [âGAOâ] pursuant to an authorized proceeding, investigation, examination
or audit directed at a government authority.â Appellants contend that, because GAO is within
the Legislative Branch, âif . . . RFPA is limited to the [E]xecutive [B]ranch, then there was no need
to provide any exemption for the GAO.â Br. for Appellants at 43. The Committees respond that
this provision âdifferentiates GAO from âa government authorityâ and thus supports the opposite
conclusion: GAO may obtain financial records in its proceedings or investigations that are
âdirected at a government authority.ââ Br. for Committees at 53 n.24 (emphasis in original).
We deem none of these arguments persuasive, especially in light of the textual and
legislative history support for our conclusion, explained above, that RFPA does not apply to
Congress.
29 No. 19â1540, Dkt. No. 156 (Aug. 26, 2019). On August 27, we entered an Order informing
the Banks that if they filed an unredacted letter under seal, a redacted version of the letter served
on the Committees should be served on Appellants and filed on the public docket. Id., Dkt. No.
157 (Aug. 27, 2019).
34
Deutsche Bank submitted a redacted letter stating that it has in its possession some
tax returns responsive to the subpoenas, with the names of the taxpayers
redacted,30 and submitted under seal an unredacted letter identifying the
taxpayers.31 On the same day, Capital One submitted a letter stating that it did not
possess any tax returns responsive to the subpoena it received.32
Deutsche Bankâs filing of an unredacted letter under seal precipitated
motions by various news organizations for leave to intervene and to seek
unsealing of the unredacted letter.33 On Sept. 18, we ordered the parties to respond
to those motions.34 On Sept. 27, the parties filed their responses.35 On Oct. 4, the
Media Coalition filed a reply memorandum.36 On Oct. 10, we granted the motions
to intervene and denied the motions to unseal. See Trump v. Deutsche Bank, No. 19â
1540, 2019 WL 5075948 (2d Cir. Oct. 10, 2019).
Also at oral argument, we asked the Committees whether their subpoenas
were in compliance with 26 U.S.C. § 6103(f), which imposes some limits on
30
Id., Dkt. No. 161 (Aug. 27, 2019).
31 See Letter from Raphael A. Prober, counsel for Deutsche Bank, to Clerk of Court, Second
Circuit Court of Appeals, No. 19â1540, Dkt. No. 160 (Aug. 27, 2019).
32 See Letter from James A. Murphy, counsel for Capital One, to Clerk of Court, Second
Circuit Court of Appeals, No. 19â1540, Dkt. No. 165 (Aug. 27, 2019).
33 No. 19â1540, Dkt. Nos. 168 (Sept. 11, 2019), 181 (Sept. 18, 2019).
34
Id., Dkt. No. 180 (Sept. 18, 2019).
35
Id., Dkt. Nos. 184, 186, 188, 190 (Sept. 27, 2019).
36
Id., Dkt. No. 193 (Oct. 4, 2019).
35
disclosure of tax returns. The Committees partially responded and offered to
submit a fuller explanation by letter. On August 27, the Committees submitted a
letter stating that the application of section 6103 depends on how the Banks
obtained the returns.37 On August 29, Appellants submitted a letter stating, among
other things, that the Committees have no authority to request the tax returns.38
Section 6103(a) of the Internal Revenue Code provides: â(a) General rule.â
Returns and return information shall be confidential . . . .â Sections 6103(c)â(o)
provide several exceptions to the general requirement of confidentiality.
Subsection 6103(f)(3) makes a specific exception for committees of Congress. It
provides:
â(3) Other committees.âPursuant to an action by, and upon
written request by the chairman of, a committee of the Senate or the
House of Representatives (other than a committee specified in
paragraph (1)) specially authorized to inspect any return or return
information by a resolution of the Senate or the House of
Representatives . . . the Secretary shall furnish such committee, or a
duly authorized and designated subcommittee thereof, sitting in
closed executive session, with any return or return information which
such resolution authorizes the committee or subcommittee to inspect.
Any resolution described in this paragraph shall specify the purpose
for which the return or return information is to be furnished and that
37 See Letter from Douglas N. Letter, General Counsel, U.S. House of Representatives, to
Clerk of Court, Second Circuit Court of Appeals, No. 19â1540, Dkt. No. 158 (Aug. 27, 2019).
38 See Letter from Patrick Strawbridge, counsel for President Donald J. Trump, to Clerk of
Court, Second Circuit Court of Appeals, No. 19â1540, Dkt. No. 166 (Aug. 29, 2019).
36
such information cannot reasonably be obtained from any other
source.â
26 U.S.C. § 6103(f)(3).39
Thus, Congress has protected the confidentiality of income tax returns,
subject to several exceptions, and specified how such returns may be obtained by
a committee of Congress.
Appellants contend that disclosure is prohibited (or, as they phrase it, that
the Committees âhave no jurisdiction to request tax returnsâ40) because the
requirements of the subsection have not been met. They point out that the House
has not passed a resolution specifically authorizing the Committees to inspect tax
returns, specifying the purpose for which the returns are sought, or specifying that
the information cannot reasonably be obtained from other sources. They also
suggest that we need not resolve the issue now, but should leave it for resolution
on remand.
Because the Deutsche Bank Subpoenas require production of tax returns
and the motion for a preliminary injunction to prohibit compliance has been
39 The committees specified in paragraph (1) of section 6103(f) are the House Committee
on Ways and Means, the Senate Committee on Finance, and the Joint Committee on Taxation.
§ 6103(f)(1). The Code defines âSecretaryâ as âthe Secretary of the Treasury or his delegate.â
§ 7701(a)(11)(B).
40 See Letter from Patrick Strawbridge, counsel for President Donald J. Trump, to Clerk of
Court, Second Circuit Court of Appeals at 2, No. 19â1540, Dkt. No. 166 (Aug. 29, 2019).
37
denied by the District Court, the absence of a ruling on production of the returns
risks their disclosure to the Committees. We therefore believe that some ruling
must be made.
The Committees do not dispute that they have not met the requirements of
section 6103(f), but they contend that the provision does not apply to any tax
returns in the possession of Deutsche Bank unless the bank obtained them from
the IRS.
The text of section 6103 does not unambiguously resolve the dispute. In
addition to citing the requirements of section 6103(f), Appellants rely on section
6103(a). It states that tax returns âshall be confidential,â and that âexcept as
authorized by [the Internal Revenue Code]â no person within three specified
categories âshall disclose any return . . . obtained by him . . . in connection with his
serviceâ within any of the three categories. These include employees of the United
States, employees of a state or various local agencies, and those who obtained
access to a return pursuant to various subsections of section 6103(a). § 6103(a)(1)â
(3).
If the introductory clause of section 6103(a) is a blanket protection of the
confidentiality of tax returns, then it prohibits disclosure of the returns in the
38
possession of Deutsche Bank. But if that clause is to be read in conjunction with
the rest of section 6103(a), then the clause means only that the returns are protected
from disclosure by anyone within the three categories, and it does not prohibit
disclosure in the pending appeal because Deutsche Bank is not within any of those
categories. Arguably limiting the coverage of section 6103(a) is section 6103(b). It
defines âreturnâ â[f]or purposes of this sectionâ as a return âwhich is filed with
the Secretary.â § 6103(b)(1). That provision could mean either the document or
digital file in the possession of the Secretary (including the IRS), which Deutsche
Bank does not have, or a copy of a paper or digitized return that has been
submitted to the Secretary, which Deutsche Bank does have.
Another provision of section 6103 also creates ambiguity as to its meaning.
Section 6103(f) states that a congressional committee may obtain a tax return âfrom
the Secretaryâ pursuant to a House resolution meeting specified requirements, as
set forth above. This provision could mean either that the only way a committee
may obtain a tax return is to seek it from the Secretary and comply with the
requirements of section 6103(f), or it could mean that those requirements apply
only when a committee seeks a return from the Secretary and do not apply when
a committee seeks a return from anyone else, such as Deutsche Bank.
39
Case law on these possible interpretations has evoked various rulings and
statements. The Seventh Circuit has ruled that the introductory clause of section
6103(a) is not a blanket protection of confidentiality, but protects only against
disclosure by those described in subsections 6103(a)(1)â(3). Hrubec v. National
Railroad Passenger Corp., 49 F.3d 1269(7th Cir. 1995). âThe ban on disclosure appears in the last, dangling, unnumbered portion of § 6103(a), not in the introductory phrase, and the ban is linked to the scope of identified subsections.â Id. at 1270â71. Hrubec found no violation of section 6103 by Amtrak employees who obtained copies of other employeesâ tax returns from the IRS, but not as a result of a request covered by any of the categories identified in section 6103(a).41 The Ninth Circuit has also given a narrow interpretation to section 6103. In Stokwitz v. United States,831 F.2d 893
(9th Cir. 1987), it ruled that âSection 6103 establishes a comprehensive scheme for controlling the release by the IRS of information received from taxpayers to discrete identified parties.âId. at 895
(emphasis in original); accord Lomont v. OâNeill,285 F.3d 9
, 14â15 (D.C. Cir. 2002); Baskin v. United States,135 F.3d 338, 342
(5th Cir. 1998); Ryan v. United States,74 F.3d 1161, 1163
(11th Cir. 1996). Stokwitz found no violation of section 6103 where
41 The returns had been obtained by someoneâs forgery of an application for them. See
Hrubec v. National Railroad Passenger Corp., 778 F. Supp. 1431, 1433 (N.D. Ill. 1991).
40
employees of the United States Navy seized from a taxpayerâs files copies of tax
returns, even though the employees were covered by subsection 6103(a)(1). The
Court relied on the definition of âtax returnâ in section 6103(b), see id.at 895â96 (â[T]he statutory definitions of âreturnâ and âreturn informationâ to which the entire statute relates, confine the statuteâs coverage to information that is passed through the IRS.â), and noted that implementing âTreasury regulations . . . are exclusively concerned with disclosure by the IRS,âid.
at 896 (citing Treas. Regs.
§§ 301.6103(a)â1 to (p)(7)â1 (1986)).
Other courts have expressed different views. In National Treasury Employees
Union v. Federal Labor Relations Authority, 791 F.2d 183(D.C. Cir. 1986), the D.C. Circuit referred to section 6103(a) as a âgeneral rule that âreturns and return information shall be confidential.ââId. at 183
(brackets omitted) (quoting
§ 6103(a)). The Courtâs main point, however, was that the disclosure, which had
been made by IRS employees, had not been made in compliance with subsection
6103(l)(4)(A), and even that point, as well as the âgeneral ruleâ statement, were
dicta because the Courtâs holding was that the employees should not have been
disciplined.
41
A district court in our Circuit has stated that a board licensing plumbers
violated section 6103 by making disclosure of a license applicantâs tax forms a
condition of obtaining a license. See Russell v. Board of Plumbing Examiners, 74 F.
Supp. 2d 339(S.D.N.Y. 1999) (âThe Board being unable to get the copies directly from the Treasury should not be permitted to do so indirectly by coercion . . . .â), affâd,1 F. Appâx 38
(2d Cir. 2001). The District Courtâs view, however, was at most an alternate holding on an issue that the Court acknowledged had not been briefed, see id. at 348, and our affirmance in a nonâprecedential summary order made no reference to the issue, which had not been asserted as a ground for review, see Br. & Reply Br. for Appellants, Russell v. Board of Plumbing Examiners,1 F. Appâx 38
(2d Cir. 2001) (No. 99â9532).
We agree with the Seventh Circuit that section 6103(a) limits its prohibition
against disclosure of tax returns to returns requested from the three categories of
persons identified in subsections 6103(a)(1)â(3). There remains the possibility,
however, that subsection 6103(f)(3), applicable to requests for tax returns by
congressional committees other than those concerned explicitly with taxes,
provides the exclusive means for such committees to obtain returns. The text of
subsection 6103(f)(3) refers to committee requests âto the Secretary.â We agree
42
with the Ninth Circuit that the plain language of the provision reflects Congressâs
purpose in enacting section 6103, which âwas to curtail loose disclosure practices
by the IRS.â Stokwitz, 831 F.2d at 894. Because there is no claim by Appellants that
Deutsche Bank obtained from the IRS any returns requested by the Committees,
neither subsection 6103(f)(3), nor section 6103 as a whole, precludes their
production to the Committees.
Appellants also contend that production of tax returns is prohibited by the
RFPA and the GrammâLeachâBliley Act, Pub. L. No. 106â102, 113 Stat. 1338(1999). As we have ruled, however, RFPA does not apply to Congress. GrammâLeachâ Bliley is also no bar to production of tax returns because it explicitly permits disclosure of personal information âto comply with a . . . subpoena . . . by Federal . . . authorities.â15 U.S.C. § 6802
(e)(8).
With respect to tax returns, the oral argument of this appeal precipitated
further procedural developments, detailed in Trump v. Deutsche Bank, No. 19â1540,
2019 WL 5075948 (2d Cir. Oct. 10, 2019) (order granting news organizationsâ
motions to intervene and denying their motions to unseal). Ultimately, Deutsche
43
Bank informed us in an August 27, 2019, letter42 that it had two tax returns within
the coverage of the Committeesâ subpoenas and submitted the names of the two
taxpayers under seal.
If any tax returns in the possession of Deutsche Bank were those of the Lead
Plaintiff, we would have to consider whether their production to the Committees
might encounter the objection that it would distract the Chief Executive in the
performance of official duties. That issue need not be resolved, however, because
Deutsche Bank informed us, in its response to the motions of news organizations
to unseal Deutsche Bankâs letter of August 27, that the only tax returns in its
possession within the coverage of the subpoenas are not those of the Lead Plaintiff.
Disclosure of tax returns in the possession of Deutsche Bank in response to
the Committeesâ subpoenas will not violate section 6103, and the fact that, when
requested by news organizations, we did not unseal the names of the taxpayers
whose returns are in the possession of Deutsche Bank is not a reason to exclude
those returns from Deutsche Bankâs compliance with the subpoenas.
42See Letter from Letter from Raphael A. Prober to Clerk of Court, Second Circuit Court
of Appeals, No. 19â1540, Dkt. No. 161 (redacted version) (Aug. 27, 2019); id., Dkt. No. 165
(unredacted version filed under seal) (Aug. 27, 2019).
44
C. Constitutional Claim
Appellantsâ constitutional claim does not assert any constitutionally based
privilege that might protect their financial records from production by the Banks
to the Committees, such as the privileges secured in the Bill of Rights. See Watkins,
354 U.S. at 198 (recognizing âthe restraints of the Bill of Rights upon congressional
investigationsâ). Instead, Appellants contend that the Constitution places limits
on the power of Congress to investigate, that the Committeesâ subpoenas to the
Banks exceed those limits, and that they have a right to prevent disclosure of
documents in response to subpoenas beyond Congressâs power of investigation.
The subpoenas are surely broad in scope. Illustrating the scope, Appellants
specifically call our attention to the following requests in the Committeesâ
subpoenas to Deutsche Bank for the following:
âany document related to account applications, opening
documents, KYC [know your customer], due diligence, and closing
documentsâ;
âany monthly or other periodic account statementâ;
âany document related to any domestic or international
transfer of funds in the amount of $10,000 or moreâ;
âany summary or analysis of domestic or international account
deposits, withdrawals, and transfersâ;
âany document related to monitoring for, identifying, or
evaluating possible suspicious activityâ;
45
âany document related to any investment, bond offering, line
of credit, loan, mortgage, syndication, credit or loan restructuring, or
any other credit arrangement.â
Deutsche Bank Subpoenas œœ 1(i)â(vi), J. Appâx 37â38.
The documents sought are those of the Lead Plaintiff and his three oldest
children, and âmembers of their immediate family,â defined to include child,
daughterâinâlaw, and sonâinâlaw, among others, and a number of entities affiliated
with the Lead Plaintiff and the Trump Organization. Id. at 37 Âś 1, 47 Âś 5. The
documents concern financial transactions of the named individuals and their
affiliated entities. The time frame for which most of the documents are sought is
July 19, 2016, to the present for the Capital One subpoena and January 1, 2010, to
the present for the Deutsche Bank subpoenas, but there is no time limit for two
categories of documents sought by all three subpoenas. See id. at 37, intro., 52,
intro. These categories include documents related to account openings, the names
of those with interests in identified accounts, and financial ties between the named
individuals and entities and any foreign individual, entity, or government. See id.
at 37 Âś 1(i), 41â42 Âś 6(i), 52 œœ 1(i), (ii).
Constitutional investigative authority of Congress. An important line of
Supreme Court decisions, usually tracing back to McGrain v. Daugherty, 273 U.S.
46135 (1927), has recognized a broad power of Congress and its committees to obtain information in aid of its legislative authority under Article I of the Constitution. See Eastland v. United States Servicemenâs Fund,421 U.S. 491, 504
(1975); Barenblatt,360 U.S. at 111
; Watkins,354 U.S. at 187
; Quinn,349 U.S. at 160
; Sinclair v. United States,279 U.S. 263, 297
(1929), overruled on other grounds by United States v. Gaudin,515 U.S. 506, 519
(1995). â[T]he power of inquiryâwith process to enforce itâis an essential and appropriate auxiliary to the legislative function.â McGrain, 273 U.S. at 174. âThe scope of the power of inquiry, in short, is as penetrating and farâ reaching as the potential power to enact and appropriate under the Constitution.â Barenblatt,360 U.S. at 111
. â[T]he power to investigate is inherent in the power to make laws because âa legislative body cannot legislate wisely or effectively in the absence of information respecting the conditions which the legislation is intended to affect or change.ââ Eastland,421 U.S. at 504
(brackets omitted) (quoting McGrain, 273 U.S. at 175). âThe power of the Congress to conduct investigations . . . encompasses inquiries concerning the administration of existing laws as well as proposed or possibly needed statutes.â Watkins,354 U.S. at 187
.43
43Courts have recognized an additional, though less clearly delineated, source of
Congressâs investigative authority, namely, Congressâs âinforming function.â The Supreme
Court has explained that although Congress cannot âexpose for the sake of exposure,â it has the
power âto inquire into and publicize corruption, maladministration or inefficiency in agencies of
47
As the Committees recognize, however, Congressâs constitutional power to
investigate is not unlimited. The Supreme Court has identified several limitations.
One concerns intrusion into the authority of the other branches of the government.
In Kilbourn v. Thompson, 103 U.S. 168(1880), which the Supreme Court has identified as the first case in which the Court considered a challenge to âthe use of compulsory process as a legislative device,â Watkins,354 U.S. at 193
, the Court ruled that Congressâs power to compel testimony was unconstitutionally used because the House of Representatives had âassumed a power which could only be properly exercised by another branch of the government,â in that case, the Judicial Branch, Kilbourn,103 U.S. at 192
.44
In Quinn, the Supreme Court identified other limits. The power to
investigate âmust not be confused with any of the powers of law enforcement.â
the Governmentâ in order to inform the public âconcerning the workings of its government.â
Watkins, 354 U.S. at 200& n.33; see Rumely,345 U.S. at 43
(ââIt is the proper duty of a representative
body to look diligently into every affair of government and to talk much about what it sees. . . .
The informing function of Congress should be preferred even to its legislative function.ââ)
(quoting Woodrow Wilson, Congressional Government: A Study in American Politics 303 (1913)). We
need not consider this potential source of investigative authority because we conclude that the
Committees issued the subpoenas to advance valid legislative purposes.
44 Kilbourn had been imprisoned by the sergeantâatâarms of the House of Representatives
for contempt by refusing to respond to a House committeeâs inquiries concerning matters that
were then pending in a federal bankruptcy court. As the Supreme Court later explained in
McGrain, the bankruptcy was a matter âin respect to which no valid legislation could be hadâ
because the case was âstill pending in the bankruptcy courtâ and âthe United States and other
creditors were free to press their claims in that proceeding.â 273 U.S. at 171.
48
349 U.S. at 161. âNor does it extend to an area in which Congress is forbidden to legislate.âId.
âStill further limitations on the power to investigate are found in the specific individual guarantees of the Bill of Rights . . . .âId.
And, most pertinent to the pending appeal, the power to investigate âcannot be used to inquire into private affairs unrelated to a valid legislative purpose.âId.
The principal argument of Appellants is that compliance with the
Committeesâ subpoenas should be preliminarily enjoined because the subpoenas
seek information concerning their private affairs. Unquestionably, disclosure of
the financial records sought by the Committees will subject Appellantsâ private
business affairs to the Committeesâ scrutiny. However, inquiry into private affairs
is not always beyond the investigative power of Congress. In Quinn, the Court was
careful to state that the power to investigate âcannot be used to inquire into private
affairs unrelated to a valid legislative purpose.â Id.(emphasis added). In Barenblatt, the Court stated a similar qualification: âCongress may not constitutionally require an individual to disclose . . . private affairs except in relation to [a valid legislative] purpose.â360 U.S. at 127
.
So, although the Court had made clear before Barenblatt that there is âno
congressional power to expose for the sake of exposure,â Watkins, 354 U.S. at 200,
49
it has also stated that inquiry into private affairs is permitted as long as the inquiry
is related âto a valid legislative purpose,â Quinn, 349 U.S. at 161; see Barenblatt,360 U.S. at 127
. This potential tension between a permissible legislative purpose and
an impermissible inquiry for the sake of exposure requires consideration of the
role of motive and purpose in assessing the validity of a congressional inquiry.
The Supreme Court has spoken clearly as to motive with respect to a
congressional inquiry. Referring to congressional committee members
questioning a witness, the Court said, â[T]heir motives alone would not vitiate an
investigation which had been instituted by a House of Congress if that assemblyâs
legislative purpose is being served.â Watkins, 354 U.S. at 200 (emphasis added).45
45 Watkins cites, 354 U.S. at 200n.34, among other cases, Eisler v. United States,170 F.2d 273
(D.C. Cir. 1948), in which the D.C. Circuit stated, â[D]efense counsel sought to introduce evidence to show that the Committeeâs real purpose in summoning appellant was to harass and punish him for his political beliefs and that the Committee acted for ulterior motives not within the scope of its or Congressâ powers. The lower court properly refused to admit such evidence, on the ground that the court had no authority to scrutinize the motives of Congress or one of its committees.âId.
at 278â79 (quotation marks and ellipsis omitted).
In Tenney v. Brandhove, 341 U.S. 367(1951), the Supreme Court provided this caution to courts asked to consider legislatorsâ motives: âIn times of political passion, dishonest or vindictive motives are readily attributed to legislative conduct and as readily believed. Courts are not the place for such controversies. Selfâdiscipline and the voters must be the ultimate reliance for discouraging or correcting such abuses. The courts should not go beyond the narrow confines of determining that a committeeâs inquiry may fairly be deemed within its province.âId. at 378
(footnote omitted).
50
More than 50 years ago, the Supreme Court candidly recognized the
difficulty a court faces in considering how a legislative purpose is to be assessed
when a privacy interest is asserted to prevent a legislative inquiry:
âAccommodation of the congressional need for particular
information with the individual and personal interest in privacy is an
arduous and delicate task for any court. We do not underestimate the
difficulties that would attend such an undertaking.â
Id. at 198.
Requirement of identifying legislative purpose. The first task for courts
undertaking this âaccommodationâ is identification of the legislative purpose to
which a congressional investigation is asserted to be related.
âIt is manifest that despite the adverse effects which follow upon
compelled disclosure of private matters, not all such inquiries are
barred. Kilbourn v. Thompson teaches that such an investigation into
individual affairs is invalid if unrelated to any legislative purpose.â
Id. Watkins provided further guidance as to how that inquiry as to legislative
purpose should at least begin:
âAn essential premise in this situation is that the House or
Senate shall have instructed the committee members on what they are
to do with the power delegated to them. It is the responsibility of the
Congress, in the first instance, to insure that compulsory process is
used only in furtherance of a legislative purpose. That requires that
the instructions to an investigating committee spell out that groupâs
jurisdiction and purpose with sufficient particularity. Those
51
instructions are embodied in the authorizing resolution. That
document is the committeeâs charter.â
Id. at 201.
It is not clear whether this passage can be satisfied only by the instruction
that the House gives to a committee pursuant to a House rule defining a standing
committeeâs continuing jurisdiction, or whether a specific âauthorizing
resolutionâ is required for a committee to undertake an investigation on a
particular subject within its jurisdiction. During an argument on July 12 of this
year in the Court of Appeals for the District of Columbia Circuit in Trump v. Mazars
USA, LLP, 940 F.3d 710(D.C. Cir.), rehâg en banc denied,941 F.3d 1180
(D.C. Cir.), mandate stayed, No. 19A545,2019 WL 6328115
(U.S. Nov. 25, 2019) (âTrump v.
Mazarsâ), a challenge to a subpoena issued by the House Committee on Oversight
and Reform,46 the Mazars appellants, many of whom are Appellants here,
contended that a clear statement from the House authorizing a standing
46 The subpoena challenged in Mazars seeks four categories of documents somewhat
different from those sought by the subpoenas challenged on this appeal, and seeks the documents
for purposes significantly different from the Committeesâ purposes, as we point out infra. The
categories are: various financial statements and reports compiled by Mazars USA, LLP,
engagement agreements for preparation of such statements and reports, supporting documents
used in the preparation of such statements and reports, and memoranda, notes, and
communication related to the compilation and auditing of such statements and reports. See Decl.
of William S. Consovoy, Ex. A at 3, Trump v. Committee on Oversight and Reform of the United States
House of Representatives, 380 F. Supp. 3d 76(D.D.C. 2019) (No. 19âcvâ01136 (APM)), ECF No. 9â2, affâd, Trump v. Mazars USA, LLP,940 F.3d 710
(D.C. Cir. 2019).
52
committee to investigate not just a particular subject but the particular subpoena
being challenged was required, at least where the subpoena seeks papers of the
President. See Oral Arg. at 8:35, 1:32:15, 2:03:15, Trump v. Mazars USA, LLP, No. 19â
5142 (D.C. Cir. July 12, 2019).47
Apparently responding to that contention, the House of Representatives on
July 24 adopted a resolution that includes the following language:
âResolved, That the House of Representatives ratifies and
affirms all current and future investigations, as well as all subpoenas
previously issued or to be issued in the future, by any standing or
permanent select committee of the House, pursuant to its jurisdiction
as established by the Constitution of the United States and rules X and
XI of the Rules of the House of Representatives, concerning or issued
directly or indirectly toâ
(1) the President in his personal or official capacity;
(2) his immediate family, business entities, or
organizations;
...
(9) any third party seeking information involving,
referring, or related to any individual or entity described in
paragraphs (1) through (7).â
H.R. Res. 507, 116th Cong. (2019); see H.R. Res. 509, 116th Cong. § 3 (2019) (âHouse
Resolution 507 is hereby adopted.â).48 On July 26, the Committees informed us of
47 Appellants have not made that âclear statementâ argument in their briefs in this case.
48 H.R. Res. 507 disclaims the need for its adoption, stating:
âWhereas the validity of some of [the pending] investigations and subpoenas
[relating to the President] has been incorrectly challenged in Federal court
on the grounds that the investigations and subpoenas were not authorized
53
this resolution.49
On July 31, counsel for the Mazars appellants made two related arguments
to the D.C. Circuit rejecting the significance of Resolution 507.50 First, he read the
passage from Watkins, quoted above, to mean that only the House Rules initially
outlining a committeeâs jurisdiction can provide a valid source of authority for a
legislative investigation. Second, he contended that two decisions, United States v.
Rumely, 345 U.S. 41(1953), and Shelton v. United States,327 F.2d 601
(D.C. Cir. 1963),
establish that Resolution 507 came âtoo late.â On August 1, counsel for Appellants
in our appeal made the same arguments to our Court.51
by the full House and lacked a âclear statementâ of intent to include the
President, which the Presidentâs personal attorneys have argued in Federal
court is necessary before the committees may seek information related to the
President; and
âWhereas while these arguments are plainly incorrect as a matter of law, it is
nevertheless in the interest of the institution of the House of Representatives
to avoid any doubt on this matter and to unequivocally reject these
challenges presented in ongoing or future litigation.â
H.R. Res. 507.
49 See Letter from Douglas N. Letter, General Counsel, U.S. House of Representatives, to
Clerk of Court, Second Circuit Court of Appeals, No. 19â1540, Dkt. No. 106 (July 26, 2019).
50 See Letter from William S. Consovoy, counsel for President Donald J. Trump, to Mark
Langer, Clerk of Court, D.C. Circuit Court of Appeals, Trump v. Mazars USA, LLP, No. 19â5142,
Doc. No. 1799866 (D.C. Cir. July 31, 2019).
51 See Letter from Patrick Strawbridge, counsel for President Donald J. Trump, to Clerk of
Court, Second Circuit Court of Appeals, No. 19â1540, Dkt. No. 112 (Aug. 1, 2019).
On August 6, the United States filed in the Mazars appeal an amicus curiae brief, making
additional arguments concerning the alleged deficiency of Resolution 507. We need not set forth
those arguments because on August 19 the United States filed an amicus curiae brief in the
54
Although we agree that there must be sufficient evidence of legislative
authorization and purposes to enable meaningful judicial review, Appellantsâ
arguments that seek to limit evidence we may consider are not persuasive.
Although Watkins examined the authorizing resolutions of the committee whose
authority to compel answers to its inquiry was being challenged, see 354 U.S. at
201â02 & nn. 35â36, the Supreme Courtâs opinion reveals that these resolutions are
not the only sources to be considered in determining whether a committeeâs
investigation has been validly authorized. As the Court noted, âThere are several
sources that can outline the âquestion under inquiry.ââ Id. at 209. Among these, the
Court mentioned âthe remarks of the [committee] chairman or members of the
committee, or even the nature of the proceedings themselves.â Id. Indeed, the
Court considered the opening statement of the chairman of the committee before
whom the defendant in a criminal contempt proceeding had refused to answer, see
id. at 209â10, although finding the statement impermissibly vague, see id. at 210;
see also Shelton v. United States, 404 F.2d 1292, 1297 (D.C. Cir. 1968) (statements of
committee members relevant to identification of purposes of congressional
investigations).
pending appeal, making additional arguments concerning Resolution 507 as it relates to the
subpoenas in the pending litigation. We consider those arguments infra.
55
Rumely does not confine the search for authorization of a valid legislative
purpose to a committeeâs jurisdictional resolution. The Court concluded that the
witnessâs âduty to answer must be judged as of the time of his refusal.â Rumely,
345 U.S. at 48. Because we regard the time of the Banksâ compliance with the
subpoenas challenged in this case as the equivalent of the time of the witnessâs
refusal in Rumely, that decision is no bar to examining legislative materials existing
before such compliance.
Furthermore, the Courtâs point in Rumely was that the scope of the
resolution authorizing the committeeâs investigation could not âbe enlarged by
subsequent action of Congress.â 345 U.S. at 48. In the pending case, the issue with respect to House Resolution 507 is whether this Court, in ascertaining House authorization of the Committeesâ investigations, can consider evidence that comes after the issuance of the subpoenas. Including House Resolution 507 in our consideration results in no unfairness to the Banks, which have not refused to produce the information requested. Moreover, House Resolution 507 does not suffer from the same âinfirmity of post litem motam, selfâserving declarationsâ that tainted the post hoc debate in Rumely,345 U.S. at 48
, because the resolution does
not purport to alter either the interpretation of the Committeesâ jurisdiction or the
56
stated purposes of the Committeesâ investigations that existed at the time the
subpoenas were issued. Rather, the resolution was passed to eliminate any doubt
regarding the support of the House for the Committeesâ investigations.
The D.C. Circuitâs decision in Shelton states that the time a contempt witness
is entitled to know the purpose of a challenged legislative inquiry is âbefore the
subpoena issued.â 327 F.2d at 607. Preliminarily, we note that this assertion is dictum; the holding is that the committeeâs subpoena was invalid because of procedural irregularity in its issuance.52 Seeid.
More important, that dictum
conflicts with what the Supreme Court said in Watkins. The Court there made clear
that to satisfy the due process objection arising from a contempt imposed for
refusing to answer a committeeâs question insufficiently shown to be related to a
valid legislative purpose, the purpose could be identified as late as immediately
before the witness was required to answer. âUnless the subject matter has been
made to appear with undisputable clarity, it is the duty of the investigative body,
upon objection of the witness on grounds of pertinency, to state for the record the
52 The D.C. Circuit explained that the relevant Senate resolution âimposes on the
Subcommittee itselfâ the âfunction of calling witnesses,â and that âthe whole function of
determining who the witnesses would be was de facto delegated to the Subcommittee counsel.â
Shelton, 327 F.2d at 606.
57
subject under inquiry at that time and the manner in which the propounded
questions are pertinent thereto.â Watkins, 354 U.S. at 214â15.
We therefore do not confine our search for the Committeesâ purposes to the
House Rules alone, nor do we exclude Resolution 507 from our inquiry.
Identifying the Committeesâ legislative purpose. We next consider the
âlegislative purposeâ to which the Committees assert their investigations are
ârelatedâ and âthe weight to be ascribed to[] the interest of the Congress in
demanding disclosuresâ in order to determine whether âa public needâ for such
investigation âoverbalances any private rights affected.â Id. at 198.
Our consideration begins with the Constitution, which assigns to each house
of Congress authority to âdetermine the Rules of its Proceedings.â U.S. Const. art.
I, § 5, cl. 2. In 2019, Congress adopted the Rules of the House of Representatives.
See H.R. Res. 6, 116th Cong. (2019); Rules of the House of Representatives, 116th
Cong. (prepared by Karen L. Haas, Clerk of the House of Representatives, Jan. 11,
2019) (hereinafter âH. Rulesâ). House Rule X establishes the standing committees
of the House, including the Financial Services Committee and the Permanent
Select Committee on Intelligence. See H. Rules X(2)(h), X(11). Rule X assigns to the
Financial Services Committee jurisdiction over bills concerning, among other
58
things, banks and banking, international finance, and money and credit, see H.
Rule X (1)(h)(1), (h)(5), (h)(7), and assigns to the Intelligence Committee
jurisdiction over bills concerning, among other things, the Nationâs intelligence
agencies and their intelligence and intelligenceârelated activities, see H. Rule
X(11)(b)(1)(A), (B).
Rule X also assigns to all of the standing committees âgeneral oversight
responsibilities . . . to assist the House in its analysis, appraisal, and evaluation of
(A) the application, administration, execution, and effectiveness of Federal laws;
and (B) conditions and circumstances that may indicate the necessity or
desirability of enacting new or additional legislation.â H. Rule X(2)(a)(1). In
addition, Rule X assigns to the Intelligence Committee â[s]pecial oversight
functionsâ to âreview and study on a continuing basis laws, programs, and
activities of the intelligence community.â H. Rule X(3)(m).
House Rule XI provides: âEach committee may conduct at any time such
investigations and studies as it considers necessary or appropriate in the exercise
of its responsibilities under [R]ule X.â H. Rule XI(1)(b)(1). Rule XI also provides:
âFor the purpose of carrying out any of its functions and duties under
this rule and [R]ule X . . . a committee or subcommittee is authorized
. . . to require, by subpoena . . . the production of such . . . records . . .
as it considers necessary.â
59
H. Rule XI(2)(m)(1)(B).
On March 13, 2019, the House of Representatives adopted a resolution
stating, among other things, that the House âsupports efforts to close loopholes
that allow corruption, terrorism, and money laundering to infiltrate our countryâs
financial system.â H.R. Res. 206, 116th Cong. (Mar. 13, 2019).
On April 12, 2019, the House Committee on Oversight and Reform issued a
report summarizing the subjects that several committees planned to investigate
during the 116th Congress. See H.R. Rep. No. 116â40 (2019). Because the date of
this report is one day after issuance of the subpoenas challenged in this case, we
note that the text of the report makes clear that the plans submitted by the
committees had been received prior to the date the report was issued.53
The plan submitted by the Financial Services Committee includes as its
purposes: âexamining financial regulatorsâ supervision of the banking, thrift and
credit union industries for safety and soundness and compliance with laws and
53The report explains that under House Rule X, the Oversight Committee âis to review
the various plans and, in consultation with the Speaker, the Majority Leader, and the Minority
Leader, report to the House the oversight plans along with any recommendations that the House
leadership and the Committee may have to ensure effective coordination. Pursuant to this rule,
the Committee on Oversight and Reform has reviewed and consulted with House leadership
about the oversight plans of the standing House committees for the 116th Congress.â H.R. Rep.
No. 116â40 at 2.
60
regulations,â id. at 78; âthe implementation, effectiveness, and enforcement of antiâ
money laundering/counterâfinancing of terrorism laws and regulations,â id. at 84
(abbreviation omitted); and âthe risks of money laundering and terrorist financing
in the real estate market,â id. at 85.
The Chair of the Financial Services Committee, Representative Maxine
Waters, has identified a principal purpose of that committeeâs investigation. âThe
movement of illicit funds throughout the global financial system raises numerous
questions regarding the actors who are involved in these money laundering
schemes and where the money is going.â 165 Cong. Rec. H2697, H2698 (daily ed.
Mar. 13, 2019) (statement of Rep. Waters in support of H.R. Res. 206). Linking the
Committeeâs inquiries to Appellants, she explained that her concerns are
âprecisely why the Financial Services Committee is investigating the questionable
financing provided to President Trump and [t]he Trump Organization by banks
like Deutsche Bank to finance its real estate properties.â Id. In her statement, Rep.
Waters noted that Deutsche Bank was fined for its role in a $10 billion moneyâ
laundering scheme, 165 Cong. Rec. at H2698, and the Committees note in their
brief, Br. for Intervenors at 11, that Capital One agreed to pay a fine of $100 million
for failing to correct deficiencies in its Bank Secrecy Act and antiâmoneyâ
61
laundering programs, see Capital One, N.A., Enforcement Action No. 2018â080, 2018
WL 5384428, at *1â2 (O.C.C. Oct. 23, 2018).
The Financial Services Committee has held hearings on these matters,54 and
considered bills to combat financial crimes, such as money laundering.55
The Chair of the Intelligence Committee has identified several purposes of
that committeeâs investigation. The committee is investigating â[t]he scope and
scale of the Russian governmentâs operations to influence the U.S. political
processâ; â[t]he extent of any links and/or coordination between the Russian
government, or related foreign actors, and individuals associated with Donald
Trumpâs campaign, transition, administration, or business interests, in furtherance
of the Russian governmentâs interestsâ; â[w]hether any foreign actor has sought to
compromise or holds leverage, financial or otherwise, over Donald Trump, his
family, his business, or his associatesâ; and â[w]hether President Trump, his
54 Implementation of FinCENâs Customer Due Diligence RuleâRegulator Perspective: Hearing
Before the Subcomm. on Terrorism & Illicit Finance of the H. Comm. on Financial Services, 115th Cong.
(2018); Examining the BSA/AML Regulatory Compliance Regime: Hearing Before the Subcomm. on
Financial Institutions & Consumer Credit of the H. Comm. on Financial Services, 115th Cong. (2017).
55 See Corporate Transparency Act of 2019, H.R. 2513, 116th Cong. (bill to reform corporate
beneficial ownership disclosures and increase transparency); COUNTER Act of 2019, H.R. 2514,
116th Cong. (bill to strengthen the Bank Secrecy Act and antiâmoneyâlaundering laws); Vladimir
Putin Transparency Act, H.R. 1404, 116th Cong. (as passed by House, Mar. 12, 2019) (bill to
require Executive Branch agencies to submit assessment to Congress regarding financial holdings
of Russian President Vladimir Putin and top Kremlinâconnected oligarchs).
62
family, or his associates are or were at any time at heightened risk of, or vulnerable
to, foreign exploitation, inducement, manipulation, pressure, or coercion.â Press
Release, House Permanent Select Committee on Intelligence, Chairman Schiff
Statement on House Intelligence Committee Investigation (Feb. 6, 2019).56
Linking these investigations to Appellants, the Committees cite public
reports indicating that Deutsche Bank has extended loans to the Lead Plaintiff
totaling more than $2 billion57 and that his 2017 financial disclosure report showed
a liability of at least $130 million to Deutsche Bank.58 At oral argument, counsel for
the Committees represented, without contradiction by Appellants, that Deutsche
Bank is the only bank willing to lend to the Lead Plaintiff. See Oral Arg. Tr. at p.
36, ll. 5â18.
On this appeal, the Committees contend that the Intelligence Committeeâs
investigations âwill inform numerous legislative proposals to protect the U.S.
56 https://intelligence.house.gov/news/documentsingle.aspx?DocumentID=447.
57 David Enrich, Deutsche Bank and Trump: $2 Billion in Loans and a Wary Board, N.Y. Times,
Mar. 18, 2019, https://www.nytimes.com/2019/03/18/business/deutscheâbankâdonaldâ
trump/html.
58 Donald J. Trump, President, Executive Branch Personnel Public Financial Disclosure
Report for 2017 (Office of Government Ethics Form 278e) at 45 (May 15, 2018).
63
political process from the threat of foreign influence and strengthen national
security.â Br. for Committees at 18.59
All of the foregoing fully identifies âthe interest[s] of the Congress in
demanding disclosures,â as Watkins requires. 354 U.S. at 198. The Committeesâ interests concern national security and the integrity of elections, and, more specifically, enforcement of antiâmoneyâlaundering/counterâfinancing of terrorism laws, terrorist financing, the movement of illicit funds through the global financial system including the real estate market, the scope of the Russian governmentâs operations to influence the U.S. political process, and whether the Lead Plaintiff was vulnerable to foreign exploitation. Watkins also requires that a legislative inquiry must in fact be related to a legislative purpose.60 Seeid.
The
Committees have fully satisfied the requirements of Watkins.
59 The Committees cite as examples the following bills: Duty to Report Act, H.R. 2424,
116th Cong. (2019) (bill to require campaign officials to notify law enforcement if offered
assistance by foreign nationals and to report all meetings with foreign agents); KREMLIN Act,
H.R. 1617, 116th Cong. (as passed by House, Mar. 12, 2019) (bill to require Director of National
Intelligence to submit to Congress intelligence assessments of Russian intentions relating to
North Atlantic Treaty Organization and Western allies); Strengthening Elections Through
Intelligence Act, H.R. 1474, 116th Cong. (2019) (bill to require an intelligence threat assessment
prior to every federal general election); For the People Act of 2019, H.R. 1, 116th Cong. (as passed
by House, Mar. 8, 2019) (bill to improve election security and oversight and provide for national
strategy and enforcement to combat foreign interference).
60 The Court had previously said in Quinn that the power to investigate âcannot be used
to inquire into private affairs unrelated to a valid legislative purpose.â 349 U.S. at 161 (emphasis
added).
64
We conclude our consideration of the Committeesâ identification of valid
legislative purposes by noting the significantly different purposes that were
identified by the House Committee on Oversight and Reform in the Trump v.
Mazars case in the District of Columbia,61 to which we previously alluded.62 The
four subject matters being investigated by that committee, set out in the margin,63
all explicitly concerned whether the President was in compliance with legal
61
After the D.C. Circuitâs decision in Mazars, Appellants and the Committees sent letters
to this Court, reporting and commenting on that decision. See Letter from Patrick Strawbridge,
counsel for President Donald J. Trump, to Clerk of Court, Second Circuit Court of Appeals, No.
19â1540, Dkt. No. 202 (Oct. 14, 2019); Letter from Douglas N. Letter, General Counsel, U.S. House
of Representatives, to Clerk of Court, Second Circuit Court of Appeals, No. 19â1540, Dkt. No. 201
(Oct. 11, 2019). In view of the D.C. Circuitâs ruling affirming the denial of an injunction to prohibit
compliance with the subpoena there challenged, Appellantsâ letter stating that âthe Mazars
majority agreed that the subpoenas here are unconstitutionalâ presses the limits of advocacy. The
Committeesâ letter states, âThis Court should join the D.C. Circuit in upholding the validity of
the subpoenas at issue here.â
62 See footnote 46, p. 52.
63 As stated by Chairman Cummings:
âThe Committee has full authority to investigate [1] whether the President
may have engaged in illegal conduct before and during his tenure in office,
[2] to determine whether he has undisclosed conflicts of interest that may
impair his ability to make impartial policy decisions, [3] to assess whether
he is complying with the Emoluments Clauses of the Constitution, and [4]
to review whether he has accurately reported his finances to the Office of
Government Ethics and other federal entities. The Committeeâs interest in
these matters informs its review of multiple laws and legislative proposals
under our jurisdiction, and to suggest otherwise is both inaccurate and
contrary to the core mission of the Committee to serve as an independent
check on the Executive Branch.â
Memorandum from Elijah E. Cummings, Chairman, House Comm. on Oversight & Reform, to
Members of the Comm. on Oversight & Reform 4 (Apr. 12, 2019).
65
requirements. Nevertheless, Judge Tatelâs opinion for the Mazars majority
concluded that the Oversight Committee, in issuing the challenged subpoena,
âwas engaged in a âlegitimate legislative investigation,â rather than an
impermissible lawâenforcement inquiry.â Mazars, 940 F.3d at 732 (quoting
Hutcheson v. United States, 369 U.S. 599, 618 (1962)) (citation omitted). On the other
hand, Judge Raoâs dissent contended that because the Oversight Committee was
investigating whether the President violated various laws, its âinvestigations may
be pursued exclusively through impeachment.â64 Id. at 751.
In the pending appeal, the Committees are not investigating whether the
Lead Plaintiff has violated any law. To the extent that the Committees are looking
into unlawful activity such as money laundering, their focus is not on any alleged
misconduct of the Lead Plaintiff (they have made no allegation of his misconduct);
instead, it is on the existence of such activity in the banking industry, the adequacy
of regulation by relevant agencies, and the need for legislation.
Whether legislative purpose âoverbalancesâ private rights. The Supreme Court
can be understood in Watkins to have set out a second requirement for courts
considering challenges to legislative inquiries.
We note that neither the principal nor the reply brief of Appellants mentions the word
64
âimpeachment.â
66
âThe critical element is the existence of, and the weight to be ascribed
to, the interest of the Congress in demanding disclosures from an
unwilling witness. We cannot simply assume, however, that every
congressional investigation is justified by a public need that overbalances
any private rights affected. To do so would be to abdicate the
responsibility placed by the Constitution upon the judiciary to insure
that the Congress does not unjustifiably encroach upon an
individualâs right to privacy . . . .â
354 U.S. at 198â99 (emphasis added).
When the Court said that it âcannot simply assume, however, that every
congressional investigation is justified by a public need that overbalances any
private rights affected,â id. at 198, the inference is available that courts are to
determine whether the importance of the legislative interest outweighs an
individualâs privacy interests.
Three considerations diminish the force of this possible inference. First, we
should be hesitant to conclude that the Supreme Court, always sensitive to
separationâofâpowers concerns, would want courts to make this sort of balancing
determination, the outcome of which might impede the Legislative Branch in
pursuing its valid legislative purposes. Second, the Court might simply have
meant that courts should not âassumeâ the existence of a legislative purpose, but
that the judicial task is at an end once courts find in congressional materials
sufficient identification of the valid legislative purposes that Congress or a
67
committee is pursuing. Third, the Court later cautioned that âcourts should not go
beyond the narrow confines of determining that a committeeâs inquiry may fairly
be deemed within its province.â Eastland, 421 U.S. at 506(quotation marks omitted). On the other hand, it is not likely that the Court would have described such a minimalist approach as âan arduous and delicate task.â Watkins,354 U.S. at 198
.
Encountering this uncertainty as to the task that Watkins has required courts
to undertake, we will assume, for the argument, that we should make at least some
inquiry as to whether the âpublic needâ to investigate for the valid legislative
purposes we have identified âoverbalances any private rights affected.â That
balancing is similar to the comparison of hardships we make in Part IV, one of the
factors relevant to two of the preliminary injunction standards.
We conclude that, even if Watkins requires balancing after valid legislative
purposes have been identified, the interests of Congress in pursuing the
investigations for which the challenged subpoenas were issued substantially
âoverbalanceâ the privacy interests invaded by disclosure of financial documents,
including the nonâofficial documents of the Lead Plaintiff. â[T]he weight to be
ascribed toâ the public need for the investigations the Committees are pursuing is
68
of the highest order. The legislative purposes of the investigations concern
national security and the integrity of elections, as detailed above. By contrast, the
privacy interests concern private financial documents related to businesses,
possibly enhanced by the risk that disclosure might distract the President in the
performance of his official duties.
Whether the subpoenas seek information related to legislative purposes. The
remaining issue is whether the information sought by the subpoenas is sufficiently
related to the identified legislative purposes supporting the Committeesâ
investigations, or whether the subpoenas are overbroad, as Appellants contend.
Their challenge proceeds along three lines: (1) a procedural objection concerning
the District Court, (2) several general substantive objections to the entire scope of
the subpoenas, and (3) a more focused substantive objection to several specific
categories of information sought by the subpoenas.
Procedural objectionââDistrict Courtâs not requiring negotiation. Appellants
contend that the District Court erred procedurally by not âsend[ing] the parties
back to the negotiating tableâ to attempt to narrow the scope of the subpoenas. Br.
for Appellants at 29. Judge Livingston favors that disposition. Part. Diss. Op. at 11,
56. Indeed, that is an additional point of her partial dissent, which takes no
69
position on the merits of any of Appellantsâ claims, deferring decision until such
negotiation occurs. Judge Livingston also favors a total remand for further
development of the record.
Appellants cite two instances where courts have had at least partial success
in encouraging such negotiation. See AT&T II, 567 F.2d at 124â25; Bean LLC v. John
Doe Bank, 291 F. Supp. 3d 34, 39â40 (D.D.C. 2018). Both cases arose in significantly different circumstances, and neither one requires a total remand here. The AT&T litigation involved what the D.C. Circuit characterized as âa portentous clash between the [E]xecutive and [L]egislative [B]ranches,â AT&T I,551 F.2d at 385
. In the pending appeal, as we have noted, the Lead Plaintiff is suing only in his individual capacity, not as President, and no official documents are sought. The only Executive Branch interest implicated is the possible distraction of the President in the performance of his duties, which we consider at pages 90â91. Furthermore, AT&T I concerned national security wiretaps, Executive Branch official documents of obvious sensitivity. Finally, the D.C. Circuitâs advice in AT&T I was offered after the parties had already ânegotiated extensively and came close to agreement.âId. at 394
. The Court simply urged the parties to continue the
process they had successfully begun and ârequestedâ the parties âto attempt to
70
negotiate a settlement,â id. at 395, because the âprecise details of the [earlier] negotiations . . . demonstrate[d] the proximity of the parties to a workable compromise,âid. at 386
. The Bean litigation concerned a subpoena challenged as violative of the First Amendment. See291 F. Supp. 3d at 37
.
To the extent that the request for judicial assistance in narrowing the scope
of the subpoenas is analogous to the role of district court judges managing pretrial
discovery, they have broad discretion to determine the extent to which they should
intervene, see, e.g., In re Fitch, Inc., 330 F.3d 104, 108 (2d Cir. 2003), and Judge Ramos
did not exceed such discretion in this case by leaving any negotiation in the hands
of experienced counsel prior to his ruling. In favoring a total remand, Judge
Livingston does not consider our limited standard of review of the District Courtâs
decision not to require the parties to negotiate, nor does she suggest that the
District Courtâs discretion was exceeded. Moreover, Appellants have not
identified a single category of documents sought or even a single document within
a category that they might be willing to have the Banks produce if a negotiation
had been required. Finally, we note the likely futility of ordering a total remand
for negotiation, as Judge Livingston prefers,65 in view of the fact that the White
65Judge Livingston reports that at oral argument the Committees âaffirmed a willingness
to negotiate on an expedited basis, if requested by this Court.â Part. Diss. Op. at 11. The colloquy
71
House has prohibited members of the Administration from even appearing in
response to congressional subpoenas and has informed Congress that âPresident
Trump and his Administration cannot participateâ in congressional inquiries.66
Judge Livingston suggests that a total remand would be useful to afford the
parties an opportunity for further development of the record. However,
Appellants have given no indication of what additional materials they would seek
to add to the record, and the existing record fully suffices for disposition of this
appeal.
to which Judge Livingston refers arose in response to a hypothetical inquiry from the Court as to
whether certain sensitive documents such as a check for medical services should be excluded
from disclosure. Counsel for the Committees responded that as to any documents âthat have
nothing to do with Mr. Trump and his family and these other businesses, his various businesses,
have nothing to do with their real financial activities, we will direct Deutsche Bank not to produce
those.â Oral Arg. Tr. at p. 41, ll. 11â15. When the Court inquired further about the Committeesâ
position if the Court were to insist on exclusion of such documents, counsel for the Committees
responded, â[I]f this Court orders âthese subpoenas are enforceable butâ ââ and drew this
exception, consistent with the hypothetical your Honor has raised, we would have no problem
with that.â Id. at p. 41, ll. 22â25. Obviously, the Committeesâ willingness to comply with an order
from this Court concerning exclusion of sensitive documents like a check for payment of medical
expenses does not affirm the Committeesâ willingness to engage in negotiation. Later, the
Committees said that â[i]f this court thinks there should be negotiation, . . . make it really, really
fast,â id at p. 46, ll. 8â10, and added, âMr. Trump and the various other people have given no
indication whatsoever that they actually would be willing to negotiate over â in any way that is
serious.â Id. at p. 46, ll. 17â19. Again, there is no expression of a willingness to negotiate.
In any event, the limited remand we order provides an opportunity for exemption from
disclosure of more documents than even those we have labeled âsensitive.â
66 See Letter from Pat A. Cippolone, Counsel to the President, the Speaker of the House of
Representatives, and three House committee chairmen (Oct. 8, 2019),
https://www.nytimes.com/interactive/2019/10/08/us/politics/whiteâhouseâletterâimpeachment.
html. One recipient of this letter, Congressman Adam Schiff, is the chairman of one of the
committees that issued subpoenas in this litigation.
72
A total remand would simply further delay production of documents in
response to subpoenas that were issued seven months ago and would run directly
counter to the Supreme Courtâs instruction that motions to enjoin a congressional
subpoena should âbe given the most expeditious treatment by district courts
because one branch of Government is being asked to halt the functions of a
coordinate branch.â Eastland, 421 U.S. at 511 n.17.
General substantive objections to scope of subpoenas. One broad substantive
challenge to the scope of the subpoenas is that they focus on the Lead Plaintiff.67
This point is made in support of the broader argument that the subpoenas were
issued with the expectation that some of the documents sought would embarrass
67 In the District Court, the Committees stated, âBecause of his prominence, much is
already known about Mr. Trump, his family, and his business, and this public record establishes
that they serve as a useful case study for the broader problems being examined by the
Committee.â Opposition of Intervenors to Plaintiffsâ Motion for a Preliminary Injunction at 16,
Dist. Ct. Dkt. No. 51 (May 10, 2019). Appellants repeatedly point to the phrase âcase studyâ to
argue that the Committees are not only focusing on the Lead Plaintiff but also doing so for law
enforcement purposes. Br. for Appellants at 5, 11, 15, 31, 33, 50. However, as long as valid
legislative purposes are duly authorized and being pursued by use of the challenged subpoenas,
the fact that relevant information obtained also serves as a useful âcase studyâ does not detract
from the lawfulness of the subpoenas. Furthermore, congressional examination of whether
regulatory agencies are properly monitoring a bankâs practices does not convert an inquiry into
impermissible law enforcement, and neither committee has made any allegation that the Lead
Plaintiff or any of the Appellants has violated the law.
Moreover, when a borrower can obtain loans from only one bank, that bank has already
lent the borrower $130 million, and that bank has been fined in connection with a $10 billion
money laundering scheme, that situation is appropriate for a case study of such circumstances by
a congressional committee authorized to monitor how well banking regulators are discharging
their responsibilities and whether new legislation is needed.
73
the President, rather than advance a legitimate legislative purpose. One answer to
the complaint about targeting the Lead Plaintiff and his family is that the
Committees have represented that the three subpoenas at issue in this litigation
are among a group of subpoenas âto seven other financial institutions, the majority
of which do not request documents specific toâ the Lead Plaintiff. Br. for
Committees at 9.68 In fact, the Deutsche Bank Subpoenas themselves seek
documents from entities not related to Appellants. See Deutsche Bank Subpoenas
œœ 2â6, J. Appâx 40â42. Another answer to the targeting objection is the significant
relationship between Deutsche Bank and the Lead Plaintiff. The Committees have
relied on information (not disputed by Appellants) indicating that when no other
bank would extend credit to the Lead Plaintiff, Deutsche Bank loaned him or his
affiliated entities at least $130 million dollars. That unusual circumstance
adequately supports requests for information to determine whether proper
banking procedures have been followed.
68
Replying to this assertion by the Committees, the amicus brief of the United States says,
âThe bare fact that a âmajorityâ of other subpoenas may not be confined to the Presidentâs
information hardly suggests that the present subpoenas are part of a general inquiry into reforms
of the financial system, in which the President and his family have been caught up merely by
chance . . . .â Br. for Amicus United States at 21 (emphases in original). The Committees make no
claim that the subpoenas seek financial records of the Lead Plaintiff, his family, and his business
entities âby chance.â As we have recounted, the Committees have explicitly set out the
circumstances that make the financial records of the Lead Plaintiff and affiliated persons and
business entities appropriate subjects for legislative inquiry.
74
To whatever extent the targeting objection is really a claim that part of the
motive of some members of the Committees for issuing the three subpoenas was
to embarrass the Lead Plaintiff, the Supreme Court has made it clear that in
determining the lawfulness of a congressional inquiry, courts âdo not look to the
motives alleged to have prompted it.â Eastland, 421 U.S. at 508. The Court had earlier said, âSo long as Congress acts in pursuance of its constitutional power, the Judiciary lacks authority to intervene on the basis of the motives which spurred the exercise of that power.â Barenblatt,360 U.S. at 132
(citations omitted).
In this respect, the guiding principle is the same as that applicable when an
arrest supported by probable cause is ruled valid despite the arresting officerâs
motive to retaliate against a suspect for exercising a First Amendment right. See
Nieves v. Bartlett, 139 S. Ct. 1715, 1725(2019); see also Hartman v. Moore,547 U.S. 250
,
265â66 (2006) (absence of probable cause required for valid claim of initiating
prosecution to retaliate against a defendant for exercising a First Amendment
right).
But Appellants disclaim any objection based on inquiry into motive. âNo
aspect of this inquiry involves a search for Congressâs hidden âmotives.ââ Br. for
Appellants at 26. Their point is that various statements of some members of
75
Congress reveal that the purpose of the investigations is to embarrass the President,
not merely that such embarrassment was the motive for the investigations. In this
context (as in some others69), the distinction between motive, i.e., the reason for
acting, and purpose, i.e., the result sought, becomes somewhat blurred. We do not
doubt that some members of the Committees, even as they pursued investigations
for valid legislative purposes, hoped that the results of their inquiries would
embarrass the President.70 But as long as the valid legislative purposes that the
Committees have identified are being pursued and are not artificial pretexts for
illâmotivated maneuvers, the Committees have not exceeded their constitutional
authority. The Supreme Court has stated that there is a âpresumptionâ that the
stated legislative purposes are the âreal objectâ of the Committeesâ investigation.
McGrain, 273 U.S. at 178. We need not rely on that presumption where we have
69 See, e.g., Mobile v. Bolden, 446 U.S. 55, 62(1980) (âOur decisions, moreover, have made clear that action by a State that is racially neutral on its face violates the Fifteenth Amendment only if motivated by a discriminatory purpose.â); see generally Andrew Verstein, The Jurisprudence of Mixed Motives,127 Yale L.J. 1106
(2018).
70 The Complaint in this case alleges the following remarks of some members of Congress.
Rep. Waters, Chair of the Financial Services Committee, said, âI have the gavelâand subpoena
powerâand I am not afraid to use it.â Complaint Âś 37. Another member of Congress âstated that
the new House majority would be âbrutalâ for President Trumpâ and that â[w]eâre going to have
to build an air traffic control tower to keep track of all the subpoenas flying from here to the White
House.â Id.Others âwere busy preparing a âsubpoena cannonâ to fire at President Trump.âId.
Others, âaccording to news outlets that interviewed party leaders,â issued statements that âmeant
that they were going to spend the next two years launching a âfusilladeâ of subpoenas in order to
âdrown Trump with investigations,â âturn Trumpâs life upside down,â and âmake Trumpâs life a
living hell.ââ Id. Âś 36.
76
evidence that valid legislative purposes are being pursued and âthe purpose[s]
asserted [are] supported by references to specific problems which in the past have
been or which in the future could be the subjects of appropriate legislation.â
Shelton, 404 F.2d at 1297.
Appellants object to the extensive time frame covered by the subpoenas,
especially the absence of any time limitations on requests relating to account
applications and the identity of those holding interests in accounts. Appellants
also object to disclosure of financial records in the names of family members,
including the Lead Plaintiffâs grandchildren. However, such information,
including documents dating back to when accounts were opened, is reasonably
related to an investigation about money laundering.
Appellants contend that the subpoenas exceed any valid legislative purpose
because, in their view, the subpoenas are intended to discover evidence of crimes,
thereby indicating that the Committees are pursuing a law enforcement objective,
which is beyond the power of Congress. See Quinn, 349 U.S. at 161. But, as
Appellants themselves recognize, âa permissible legislative investigation does not
become impermissible because it might reveal evidence of a crime.â Br. for
Appellants at 22. Any investigation into the effectiveness of the relevant agenciesâ
77
existing efforts to combat money laundering or the need for new legislation to
render such efforts more effective can be expected to discover evidence of crimes,
and such discovery would not detract from the legitimacy of the legislative
purpose in undertaking the investigation. The Supreme Court long ago rejected
Appellantsâ argument: âNor do we think it a valid objection to the investigation
that it might possibly disclose crime or wrongdoing on [an executive branch
officialâs] part.â McGrain, 273 U.S. at 179â80. See Sinclair, 279 U.S. at 295 (â[T]he
authority of [Congress], directly or through its committees, to require pertinent
disclosures in aid of its own constitutional power is not abridged because the
information sought to be elicited may also be of use in [criminal prosecutions].â).
Appellants fault Judge Ramos, who, they contend, âasserted that Congress
has an independent âinforming functionâ that allows it to . . . âpublicize corruption
. . . in agencies of the Government,â even absent a connection to âcontemplated
legislation in the form of a bill or statute.ââ Br. for Appellants at 23 (quoting District
Court opinion, J. Appâx 127). Although the phrases quoted from the Courtâs
opinion are accurate, the briefâs addition of the words âindependentâ and âabsent
a connectionâ is a mischaracterization of what Judge Ramos said. He was not
asserting an independent informing function or investigative power absent a
78
connection to a legislative purpose. He was careful to state that Congressâs
legislative authority âincludes a more general informing function.â J. Appâx 127
(emphasis added). This reflected the Supreme Courtâs statement in Hutchinson v.
Proxmire, 443 U.S. 111, 132â33 (1979), that âcongressional efforts to inform itself
through committee hearings are part of the legislative function.â71
However, some of the Courtâs statements in Watkins create uncertainty as to
whether, and in what circumstances, an informing function permits public
disclosure of information obtained as part of a valid legislative inquiry. On the one
hand, the Court said, âWe have no doubt that there is no congressional power to
expose for the sake of exposure.â 354 U.S. at 200. On the other hand, the Court also said, âThe public is, of course, entitled to be informed concerning the workings of its government.â72Id.
And, in cautioning that the publicâs right to be informed about its government âcannot be inflated into a general power to expose,âid.,
the
Court added in the same sentence, âwhere the predominant result can only be an
71 To whatever extent Judge Ramos might be understood as treating the informing
function as an additional source of Congressâs power, he did not rely on that source of authority,
mentioning it only as part of a general overview of Congressâs powers.
72 In Hutchinson, the Supreme Court arguably contradicted this statement when it said,
â[T]he transmittal of . . . information by individual Members in order to inform the public [about
their activities in Congress] is not a part of the legislative function or the deliberations that make
up the legislative process.â 443 U.S. at 133. However, the Courtâs next sentence makes the limited context clear: âAs a result, transmittal of such information by press releases and newsletters is not protected by the Speech or Debate Clause.âId.
79
invasion of the private rights of individuals,â id.(emphases added). The Court also noted that it was ânot concerned with the power of the Congress to inquire into and publicize corruption, maladministration or inefficiency in agencies of the Government.âId.
at 200 n.33. These latter statements make clear that Congress can
obtain information in an investigation as long as the information is collected in
furtherance of valid legislative purposes. In the pending appeal, the high
significance of the valid legislative purposes demonstrates that the âpredominant
purposeâ of the Committeesâ inquiries cannot be said to be âonlyâ to invade
private rights.
Specific substantive objections to scope of subpoenas. We next consider
Appellantsâ specific challenges to the scope of the subpoenas. Of the three
subpoenas, the two identical subpoenas to Deutsche Bank have the broadest scope.
These subpoenas fill six singleâspaced pages describing eight categories of
documents, subdivided into 52 paragraphs, many of which request several types
of items. If such extensive document requests were made during discovery in
ordinary civil litigation, an initial response would likely be that the requests are
too burdensome. In this case, however, the Banks have made no claim that
compiling the requested documents imposes an excessive burden on them. It is
80
Appellants whose privacy is claimed to be unlawfully impaired by the Banksâ
compliance with the subpoenas who challenge the breadth of the requests. To
consider that challenge we examine the subpoenas in detail.
We note that of the eight categories of documents sought by the two
Deutsche Bank Subpoenas, only categories 1, 7, and 8 request documents
belonging to, or likely to reveal information concerning, Appellants or entities they
control or in which they are alleged to have interests. The Committees confirmed
this fact during oral argument, without dispute from Appellants. The first
category of documents includes, with respect to the individuals (including
members of their immediate families) and entities named: documents reflecting
applications to open accounts, due diligence, and related items, Âś 1(i); account
statements, Âś 1(ii); transfers of amounts in excess of $10,000, Âś 1(iii); summaries or
analyses of account activity including the destination of checks (without limitation
as to amount), Âś 1(iv); suspicious activity, Âś 1(v); investment, mortgage, and credit
arrangements and related items, Âś 1(vi), including appraisals of assets, Âś 1(vi)(d),
and financial information provided by borrowers, Âś 1(vi)(e), such as tax returns, Âś
1(vi)(e)(7), and bankruptcy records, Âś 1(vi)(e)(8); information supplied pursuant
to §§ 314(a) or 314(b) of the PATRIOT Act, Pub. L. No. 107â56, Âś 1(vii); records
81
generated by named bank employees, Âś 1(viii); documents not kept in customary
recordâkeeping systems related to the named individuals and entities, Âś 1(ix); and
matters discussed with Deutsche Bankâs boards, Âś 1(x).
The seventh category covers documents reflecting periodic reviews of the
identified individuals and entities. Âś 7. The eighth category covers any
communications by named employees of the Banks concerning the identified
individuals and entities. Âś 8. Many of the paragraphs in categories 1, 7, and 8 seek
documents âincluding, but not limited to, those involving any foreign individual,
entity, or governmentâ or similar language. E.g., Âś 1(vi), Âś 1(vi)(k).
The subpoena from the Financial Services Committee to Capital One is less
extensive, filling one and oneâhalf singleâspaced pages describing one category of
documents, subdivided into fifteen paragraphs, two of which request several
items. This category includes, with respect to accounts held by the entities named
and their principals, directors, etc.: documents related to applications to open
accounts and due diligence, Âś 1(i); documents identifying those with interests in
the accounts, Âś 1(ii); documents identifying any account manager, Âś 1(iii); monthly
statements and cancelled checks in excess of $5,000, Âś 1(iv); summaries or analyses
of account activity including the destination of checks (without limitation as to
82
amount), Âś 1(v); transfers in excess of $10,000, Âś 1(vi); documents concerning
suspicious activity, Âś 1(vii); reviews of accounts pursuant to Capital Oneâs
procedures related to Bank Secrecy Act, antiâmoneyâlaundering, and compliance
with guidance on âPolitically Exposed Persons,â Âś 1(viii); documents not kept in
customary recordâkeeping systems related to any loan provided to the named
entities, Âś 1(ix); documents related to real estate transactions, Âś 1(x); documents
provided in response to any subpoena or request from any U.S. Federal or state
agency, Âś 1(xi)(a); notices of administrative, civil, or criminal actions, Âś 1(xi)(b);
requests pursuant to §§ 314(a) or 314(b) of the PATRIOT Act, œ 1(xi)(c); and
requests for information to or from a third party, Âś 1(xi)(d).
Sensitive personal information. A specific item in the subpoenas that raises
serious concerns as to whether even valid legislative purposes permit exposure of
matters entitled to privacy protection is the request for âanalyses of . . . transfers,
including . . . the destination of the transfers . . ., including any . . . check . . . .â
Deutsche Bank Subpoenas, Âś 1(iv); Capital One Subpoena, Âś 1(v) (emphasis
added). These items have no dollar limitations, even though other provisions limit
transfer information to checks above specified amounts. Deutsche Bank
Subpoenas, Âś 1(iii) ($10,000); Capital One Subpoena, Âś 1(iv) ($5,000). In addition
83
to âanalysesâ of all checks, the Deutsche Bank Subpoenas seek âmonthly or other
periodic account statementsâ including âoutgoing funds transfers,â Âś 1(ii), which
might reveal the recipients of at least some checks.
These provisions create a risk that some of the checks sought might reveal
sensitive personal details having no relationship to the Committeesâ legislative
purposes. For example, if one of the entities decided to pay for medical services
rendered to an employee, the check, and any similar document disclosing sensitive
personal information unrelated to business transactions, should not be disclosed.
The same would be true of any check reflecting payment for anyoneâs medical
services. The Committees have advanced no reason why the legislative purposes
they are pursuing require disclosure of such sensitive personal information.
Indeed, counsel for the Committees at oral argument appeared to recognize that
such sensitive personal information need not be disclosed. Oral Arg. Tr. at p. 41,
ll. 8â18. We have not located any decision that has considered whether Congress
is entitled to require disclosure of sensitive personal information that might be
swept up in a collection of businessârelated financial documents legitimately
sought in aid of legislative purposes. At least in the absence of a compelling reason
for such disclosure, we decline to permit it in this case.
84
Other possibly excludable documents. In addition to what we have described as
âsensitive documents,â we recognize that there might be a few documents within
the coverage of the subpoenas that have such an attenuated relationship to the
Committeesâ legislative purposes that they need not be disclosed.
We have concluded that the coverage of the following paragraphs of the
Deutsche Bank Subpoenas might include some documents warranting exclusion:
paragraphs 1(ii), 1(iv), 1(vi)(e), 1(viii), and 8. We reach the same conclusion as to
the following paragraphs of the Capital One subpoena: paragraphs 1(iv), 1(v), 1(x),
and 1(xi)(d). We have no such concerns with the coverage of any of the other
paragraphs of the subpoenas. All the documents within the coverage of these other
paragraphs are sufficiently likely to be relevant to legislative purposes.73 Even if
within the coverage of these other paragraphs are some documents that turn out
not to advance the Committeesâ investigations, that would not be a valid reason
for excluding such documents from production. As the Supreme Court has
observed with reference to another challenge to a congressional subpoena seeking
73
For example, paragraph 1(v) of the Deutsche Bank subpoenas calls for production of
âany document related to monitoring for . . . possible suspicious activity,â and paragraph 1(vii)
calls for production of âany document related to any request for information issued or received
by Deutsche Bank AG pursuant to Sections 314(a) or 314(b) of the USA PATRIOT Act,â provisions
that concern money laundering.
85
private banking records, âThe very nature of the investigative functionââlike any
researchââis that it takes the searchers up some âblind alleysâ and into
nonproductive enterprises. To be a valid legislative inquiry there need be no
predictable end result.â Eastland, 421 U.S. at 509.
Any attempt to identify for exclusion from disclosure documents within the
listed paragraphs must be done with awareness that a principal legislative
purpose of the Committees is to seek information about the adequacy of banking
regulatorsâ steps to prevent money laundering, a practice that typically disguises
illegal transactions to appear lawful. Many documents facially appearing to reflect
normal business dealings will therefore warrant disclosure for examination and
analysis by skilled investigators assisting the Committees to determine the
effectiveness of current regulation and the possible need for improved legislation.
Procedure for exclusion of specific documents. To facilitate exclusion of sensitive
documents and those few documents that should be excluded from the coverage
of the listed paragraphs, we instruct the District Court on remand to implement
the following procedure:74 (1) after each of the Banks has promptly, and in no event
beyond 30 days, assembled all documents within the coverage of paragraphs 1(ii),
See 28 U.S.C. § 2106 (appellate court âmay remand the cause and . . . require such further
74
proceedings to be had as may be just under the circumstances.â).
86
1(iv), 1(vi)(e), 1(viii), and 8 of the Deutsche Bank Subpoenas and paragraphs 1(iv),
1(v), 1(x), and 1(xi)(d) of the Capital One Subpoena, counsel for Appellants shall
have 14 days to identify to the District Court all sensitive documents and any
documents (or portions of documents) within the coverage of the listed
paragraphs that they contend should be withheld from disclosure, under the
limited standard discussed above; (2) counsel for the Committees shall have seven
days to object to the nondisclosure of such documents; (3) the District Court shall
rule promptly on the Committeesâ objections; (4) Appellants and the Committees
shall have seven days to seek review in this Court of the District Courtâs ruling
with respect to disclosure or nondisclosure of documents pursuant to this
procedure.75 Any appeal of such a ruling will be referred to this panel.
The abbreviated timetable of this procedure is set in recognition of the
Supreme Courtâs instruction that motions to enjoin a congressional subpoena
should âbe given the most expeditious treatment by district courts because one
branch of Government is being asked to halt the functions of a coordinate branch.â
Eastland, 421 U.S. at 511 n.17.
75Review may be initiated by a letter to the Clerk of this Court, referencing the existing
docket number, without the need to file a notice of appeal.
87
All other documents. All documents within the coverage of the paragraphs
not listed and those documents not excluded pursuant to the procedure outlined
above shall be promptly transmitted to the Committees in daily batches as they
are assembled, beginning seven days from the date of this opinion.
Except as provided above, all three subpoenas seek documents that the
Committees are entitled to believe will disclose information pertinent to legitimate
topics within the Committeesâ authorized investigative authority, especially
money laundering, inappropriate foreign financial relationships with the named
individuals and entities, and Russian operations to influence the U.S. political
process. As the Supreme Court has observed, documents subpoenaed by a
congressional committee need only be ânot plainly incompetent or irrelevant to
any lawful purpose [of a committee] in the discharge of its duties.â McPhaul v.
United States, 364 U.S. 372, 381 (1960) (quotation marks and brackets omitted). The
documents sought by the three subpoenas easily pass that test. The subpoenas are
reasonably framed to aid the Committees in fulfilling their responsibilities to
conduct oversight as to the effectiveness of agencies administering statutes within
the Committeesâ jurisdiction and to obtain information appropriate for
consideration of the need for new legislation.
88
Objections of the United States as amicus curiae. The United States makes
several additional arguments in its amicus curiae brief. The amicus brief contends
that âthe possibility that a subpoena might transgress separationâofâpowers
limits . . . mandates that the House clearly authorize a subpoena directed at [the
Presidentâs] records.â Br. for Amicus United States at 10 (citing Franklin v.
Massachusetts, 505 U.S. 788, 800â01 (1992), and Armstrong v. Bush,924 F.2d 282, 289
(D.C. Cir. 1991)). First, this case does not concern separation of powers. The Lead
Plaintiff is not suing in his official capacity, no action is sought against him in his
official capacity, no official documents of the Executive Branch are at issue,
Congress has not arrogated to itself any authority of the Executive Branch, and
Congress has not sought to limit any authority of the Executive Branch.
Second, the cited cases, Franklin and Armstrong, do not concern
congressional requests for information. Both require a clear statement from
Congress when a statute is claimed to limit presidential power. In all of the
numerous decisions concerning congressional subpoenas for information from
Executive Branch officials, including the President, there is not even a hint, much
less a ruling, that the House (or Senate) is required to authorize a specific subpoena
issued by one of its committees. In any event, the materials cited above provide
89
sufficient clarity, in light of Supreme Court decisions concerning congressional
investigations, to authorize subpoenas for the Lead Plaintiffâs unofficial business
records in aid of valid legislative purposes.
The amicus brief argues that a President is âentitled to special solicitude in
discovery,â Br. for Amicus United States at 6 (citing Cheney, 542 U.S. at 385, and In re Trump,928 F.3d 360
, 371â72 (4th Cir. 2019)), âeven in suits solely related to his private conduct,âid.
(citing Jones,520 U.S. at 707
). As a general proposition, we agree and have endeavored to recognize that point in the special procedure we have directed the District Court to follow on a limited remand. We note, however, that in Cheney the Supreme Court was careful to point out that âspecial considerations control when the Executive Branchâs interests in maintaining the autonomy of its office and safeguarding the confidentiality of its communications are implicated.â Cheney,542 U.S. at 385
. In the pending appeal, the Lead Plaintiff
is suing in his individual capacity, no confidentiality of any official documents is
asserted, and any concern arising from the risk of distraction in the performance
of the Lead Plaintiffâs official duties is minimal in light of the Supreme Courtâs
decision in Clinton v. Jones, and, in any event, far less substantial than the
importance of achieving the legislative purposes identified by Congress. In Jones,
90
the claimed distraction was that attending a deposition and being subjected to a
civil trial would divert some of the Presidentâs time from performance of his
official duties; in the pending case, there is no claim of any diversion of any time
from official duties. Jones, although expressing concern with âthe high respect that
is owed to the office of the Chief Executive,â not only permitted discovery directed
to the President but also obliged him to be subjected to a civil trial. 520 U.S. at 707.76
In re Trump, 928 F.3d at 379â80, concerned a petition for mandamus directing a
District Court to dismiss for lack of standing a complaint alleging violation of the
Foreign and Domestic Emoluments Clauses, U.S. Const. art I, § 9, cl. 8, art II, § 1,
cl. 7.
76Judge Livingston seeks to minimize the significance of Clinton v. Jones on several
grounds. First, she attempts to refute our point that this case does not involve separationâofâ
powers concerns, Part. Diss. Op. at 15â16, but in doing so, she accords little significance to the
major reason for that point: the Lead Plaintiff is suing in his individual, not his official, capacity.
She then seeks to relegate Jones to near insignificance by referring to âlongstanding interbranch
practice,â id. at 17, again ignoring the fact that this litigation is not a conflict between branches of
the Government. The fact that the United States filed only an amicus curiae brief, rather than
intervene to assert the interests of the United States or those of the office of the President,
underscores the absence of a true interbranch conflict. The point that compliance with the
subpoenas will not have an impact on the Lead Plaintiffâs time sufficient to bar compliance arises
from a comparison with Clinton v. Jones, in which the Supreme Court required a President to be
available for a deposition and be subject to a civil trial. The soâcalled distraction of the Lead
Plaintiff is of far less significance than what the Supreme Court permitted with respect to
President Clinton. In sum, Judge Livingston offers no reason to think that compliance with the
subpoenas will distract the Lead Plaintiff from the performance of official duties to a greater
extent than the Supreme Court permitted in Clinton v. Jones.
91
The amicus brief not only repeats Appellantsâ argument that the House
must identify a legitimate legislative purpose for seeking the Presidentâs
information, but adds that it must do so âwith sufficient particularity that courts
can concretely review the validity of any potential legislation and determine
whether the information requested is pertinent and necessary to Congressâs
consideration of such legislation.â Br. for Amicus United States at 11. The meaning
of this sentence is not clear. If it means that legislative purpose must be sufficiently
identified to enable a court now to consider the validity of any legislation that
might be enacted in the future, it would encounter the prohibition on advisory
opinions. See Flast v. Cohen, 392 U.S. 83, 96 (1968) (â[T]he rule against advisory
opinions implements the separation of powers prescribed by the Constitution and
confines federal courts to the role assigned them by Article III.â). On the other
hand, if the sentence means that legislative purpose must be sufficiently identified
so that it will serve as an aid in interpreting legislation that might be enacted in
the future, there is no requirement that legislative purpose sufficient to support a
congressional subpoena must also suffice to aid a court in interpreting some
statute yet to be enacted. In any event, the legislative purposes of the Committeesâ
subpoenas have been sufficiently identified.
92
Refining Appellantsâ argument that the Committeesâ valid legislative
purposes have not been adequately identified, the amicus brief argues that âcourts
must assess âthe connective reasoning whereby the precise questions asked relate
toâ the legitimate legislative purpose.â Br. for Amicus United States at 14 (quoting
Watkins, 354 U.S. at 215). This quotation from Watkins is difficult to square with the Supreme Courtâs later statement in McPhaul that subpoenaed documents need only be ânot plainly incompetent or irrelevant to any lawful purpose [of a committee] in the discharge of its duties.â McPhaul,364 U.S. at 381
(quotation
marks and brackets omitted). It would appear that the âconnective reasoningâ
phrase of Watkins, if still valid at all, is limited to the context in which it was saidâ
a committee witnessâs objection to a specific questionâand not to a subpoena for
adequately described categories of documents that are relevant to adequately
identified valid legislative purposes of investigation.
The amicus brief argues that subpoenaed information ânot âdemonstrably
criticalâ should be deemed insufficiently pertinent when directed at the Presidentâs
records.â Br. for Amicus United States at 15 (quoting Senate Select Committee on
Presidential Campaign Activities v. Nixon, 498 F.2d 725, 731 (D.C. Cir. 1974) (in
banc)). The D.C. Circuit used the phrase âdemonstrably criticalâ as a standard for
93
overcoming a claim of executive privilege. See Nixon, 498 F.2d at 727. President Nixon had asserted that tape recordings of his conversations with senior staff âcannot be made public consistent with the confidentiality essential to the functioning of the Office of the President.âId.
(internal quotation marks omitted). In the pending appeal, no claim of executive privilege has been made, much less a claim that withholding the subpoenaed documents is âessential to the functioning of the Office of the President.âId.
The amicus brief asserts that â[c]ourts may require the Committees first âto
narrow the scope of the subpoenasâ to first seek critical information in light of the
Presidentâs constitutional interests,â Br. for Amicus United States at 17 (ellipsis
omitted) (quoting Cheney, 542 U.S. at 390), and that â[c]ourts may require Congress first to determine whether records relevant to a legitimate legislative purpose are not, in fact, available from other sources that would not impinge on constitutional interests,âid.
(citing Watkins,354 U.S. at 206
). That argument has no application to
the many documents that were generated by the Banks. Moreover, the District
Court was not required to do what it âmayâ do,77 and the Presidentâs
77 The amicus brief asserts that the District Court âassumed that it had no authority to deal
with the overbroad character of the congressional subpoenas here.â Br. for Amicus United States
at 25 (citing J. Appâx 138). We see no indication that the District Court made such an assumption,
either at the cited reference to the District Courtâs opinion or elsewhere in that opinion.
94
âconstitutional interestsâ are implicated when official documents are sought, as in
Cheney, precipitating âa conflict between the [L]egislative and [E]xecutive
[B]ranches,â AT&T I, 551 F.2d at 390.
The amicus brief contends that H.R. 507 is insufficient authorization for the
subpoenas to the extent that it authorizes not only current subpoenas to the named
persons and entities but also future subpoenas to them. Br. for Amicus United
States at 18. Because the pending appeal concerns denial of a preliminary
injunction to prevent compliance with issued subpoenas, we make no
determination with respect to future subpoenas.
In an overarching argument endeavoring to strengthen and make decisive
many of the arguments just considered, the amicus brief urges the principle of
constitutional avoidance. Confronting a constitutional challenge to a statute of
uncertain meaning, courts sometimes interpret the statute so that it clearly
comports with the Constitution. See, e.g., Crowell v. Benson, 285 U.S. 22, 62(1932). Enlisting the principle of constitutional avoidance in the pending appeal, the amicus brief contends that the principle should persuade this Court to require the Committees to ââexplore other avenuesââ for obtaining the information, Br. for Amicus United States at 3 (quoting Cheney,542 U.S. at 390
); to require the District
95
Court âto proceed in a more tailored manner,â id. at 5; to approach âwith the
utmost cautionâ the task of âbalanc[ing] Congressâs interest in the information
against any constitutional interests of the party withholding it,â id. at 16; and to
require the District Court âto attempt to avoid a conflict between constitutional
interests before it can âintervene responsibly,ââ id. at 17â18 (quoting AT&T II, 567
F.2d at 131). The amicus brief also reminds us of the Supreme Courtâs statement in
Rumely suggesting âabstention from adjudication unless no choice is left.â 345 U.S.
at 46.
In the circumstances of this case, we do not believe that constitutional
avoidance adds persuasive force to the arguments in the amicus brief. First, we
question whether constitutional avoidance applies beyond the context of
interpreting ambiguous statutes that are challenged as unconstitutional. The
Supreme Court considered that question in an analogous situation in FCC v. Fox
Television Stations, Inc., 556 U.S. 502(2009). Broadcasters urged the Court to apply to the FCC a more stringent arbitraryâandâcapricious standard of review of agency actions that implicate constitutional liberties. Seeid. at 516
. In declining to do so, the Court said, âWe know of no precedent for applying [the principle of constitutional avoidance] to limit the scope of authorized executive action.âId.
at
96
516. Similarly, it is at least doubtful whether the principle should be enlisted to
limit the scope of authorized congressional action.
Second, to the extent that decisions like Cheney and Rumely advised courts
to proceed with caution, they did so in contexts quite different from the pending
appeal. Cheney involved a real confrontation between the Legislative and
Executive Branches; Rumely involved a âlimitation imposed by the First
Amendment,â 345 U.S. at 44. By contrast, the pending appeal involves solely
private financial documents, and the Lead Plaintiff sues only in his individual
capacity. The only defense even implicating the office of the presidency is the
possibility that document disclosure might distract the Lead Plaintiff in the
performance of his official duties, a risk we have concluded, in light of Supreme
Court precedent, Clinton v. Jones, is minimal at best. Appellants make no claim that
Congress or its committees are purporting to curb in any way the powers of the
Executive Branch.
For all of these reasons, we see no reason to permit constitutional avoidance
to provide added strength to the arguments of the amicus or Appellants
themselves.
97
Having considered Appellantsâ statutory and constitutional claims, we
conclude that they have not shown a likelihood of success on any of them. In
reaching this conclusion, we recognize that we are essentially ruling on the
ultimate merits of Appellantsâ claims. But, as the Supreme Court has pointed out,
âAdjudication of the merits is most appropriate if the injunction rests on a question
of law and it is plain that the plaintiff cannot prevail.â MuFnaf v. Geren, 553 U.S.
674, 691 (2008). That is the situation here.
III. Sufficiently Serious Questions to Make Them a Fair Ground for Litigation
In considering the less rigorous seriousâquestions standard for a
preliminary injunction, it is important to recognize that the first component of this
standard, in addition to a balance of hardships tipping decidedly in favor of the
moving party, is âsufficiently serious questions going to the merits to make them a
fair ground for litigation.â Kelly, 933 F.3d at 184(emphasis added); Jackson Dairy,596 F.2d at 72
. The meaning of this emphasized phrase rarely receives explicit
consideration. Two interpretations are possible.
The phrase could mean that the questions raised have sufficiently serious
legal merit to be open to reasonable debate. That view of the phrase would be
especially appropriate in those cases where the need for preliminary relief
98
precipitously arose just prior to some impending event and the party seeking
temporary relief has not had an adequate opportunity to fully develop its legal
arguments. Alternatively, or in addition, the phrase could mean that the questions
raised have sufficiently serious factual merit to warrant further investigation in
discovery and, if summary judgment is not warranted, at trial.
In the pending appeal, the District Court stated, âThe word âseriousâ relates
to a question that is both serious and open to reasonable debate.â J. Appâx 150. But
Judge Ramos declined to accept Appellantsâ claim that just raising a constitutional
objection to the subpoenas sufficed to render the claim serious. As he observed, if
that sufficed, âevery complaint challenging the power of one of the three
coordinate branches of government would result in preliminary relief, regardless
of whether established law renders the complaint unmeritorious.â Id.
Our case law indicates that the phrase âmake them fair ground for
litigationâ often refers to those factual disputes that can be resolved at trial only
after investigation of the facts. We have stated that the questions raised by a
plaintiffâs claims must be âso serious, substantial, difficult and doubtful as to make
them a fair ground for litigation and thus for more deliberate investigation.â Hamilton
Watch Co. v. Benrus Watch Co., 206 F.2d 738, 740 (2d Cir. 1953) (emphasis added).
99
The emphasized words appear to have originated in Hamilton Watch, but have
been frequently repeated by this Court. See Gulf & Western Industries, Inc. v. Great
Atlantic & Pacific Tea Co., 476 F.2d 687, 692, 93(2d Cir. 1973); Checker Motors Corp. v. Chrysler Corp.,405 F.2d 319, 323
(2d Cir. 1969); Unicon Management Corp. v. Koppers Co.,366 F.2d 199, 205
(2d Cir. 1966). More recently, we pointed out in Citigroup Global Markets that a virtue of the seriousâquestions standard is âthat it permits the entry of an injunction in cases where a factual dispute renders a fully reliable assessment of the merits impossible.â598 F.3d at 36
(emphasis added). For example, in Jacobson & Co. v. Armstrong Cork Co.,548 F.2d 438
(2d Cir. 1977), we affirmed a preliminary injunction under the seriousâquestions standard because the plaintiff had presented affidavits, depositions, and exhibits sufficient to contest the factual issue of the reason for an employeeâs termination, seeid. at 444
.
We need not choose between these meanings of âfair ground for litigation.â
Appellants are not entitled to a preliminary injunction under the seriousâquestions
standard because (1) that standard, as we have discussed, see Part I, does not apply
to preliminary injunctive relief sought to prevent governmental action, and (2)
even if applicable, the standard requires a balance of hardships that tips decidedly
to the plaintiff, a requirement not met in this case, see Point IV. We also point out
100
that, to the extent that the seriousâquestions standard furnishes an opportunity to
develop legal arguments concerning a reasonably debatable question, Appellants
have fully developed their positions in the 95 pages of briefs they have submitted.
To the extent that the seriousâquestions standard is available for factual
development of an issue, Appellants have not identified a single factual issue that
might warrant a trial or a single witness or document that might add substance to
their claims at a trial.
Furthermore, both their statutory and constitutional claims, though serious
in at least some sense, lack merit, and, because they both involve solely issues of
law, are properly rejected at this stage of the litigation, see Munaf, 553 U.S. at 691â
92, except for the limited remand we have ordered.
IV. Balance of Hardships/Equities
The hardship for Appellants if a preliminary injunction is denied would
result from the loss of privacy for their financial documents. We have recognized
that this loss of privacy is irreparable. In assessing the seriousness of that loss for
purposes of determining the balance of hardships, we note that the loss will be
somewhat mitigated to the extent that sensitive personal information and some
documents will not be disclosed pursuant to the procedure we have ordered upon
101
remand. The seriousness of the hardship arising from disclosure of the
information called for by the subpoenas should be assessed in light of the fact that
the Lead Plaintiff is already required to expose for public scrutiny a considerable
amount of personal financial information pursuant to the financial disclosure
requirement of the Ethics in Government Act, 5 U.S.C. app. §§ 101â111, although
considerably more financial information is required to be disclosed by the
subpoenas.
The hardship for the Committees if a preliminary injunction is granted
would result from the loss of time to consider and act upon the material disclosed
pursuant to their subpoenas, which will expire at the end of the 116th Congress.
This loss is also irreparable. In assessing the seriousness of that loss for purposes
of determining the balance of hardships, we note that the Committees have
already been delayed in the receipt of the subpoenaed material since April 11
when the subpoenas were issued. They need the remaining time to analyze the
material, hold hearings, and draft bills for possible enactment.
Even if the balance of these hardships/equities tips in favor of Appellants,
which is debatable, it does not do so âdecidedly,â Kelly, 933 F.3d at 184; Jackson
Dairy, 956 F.2d at 72, as our seriousâquestions standard requires.
102
V. Public Interest
The public interest in vindicating the Committeesâ constitutional authority
is clear and substantial. It is the interest of two congressional committees,
functioning under the authority of a resolution of the House of Representatives
authorizing the subpoenas at issue, to obtain information on enforcement of antiâ
moneyâlaundering/counterâfinancing of terrorism laws, terrorist financing, the
movement of illicit funds through the global financial system including the real
estate market, the scope of the Russian governmentâs operations to influence the
U.S. political process, and whether the Lead Plaintiff was vulnerable to foreign
exploitation. The opposing interests of Appellants, suing only in their private
capacity, are primarily their private interests in nondisclosure of financial
documents concerning their businesses, rather than intimate details of someoneâs
personal life or information the disclosure of which might, as in Watkins, 354 U.S.
at 197â99, chill someoneâs freedom of expression.
We recognize, however, that the privacy interests supporting nondisclosure
of documents reflecting financial transactions of the Lead Plaintiff should be
accorded more significance than those of an ordinary citizen because the Lead
Plaintiff is the President. Although the documents are not official records of the
103
Executive Branch, the Lead Plaintiff is not suing in his official capacity, and no
executive privilege has been asserted, disclosure of the subpoenaed documents
can be expected to risk at least some distraction of the Nationâs Chief Executive in
the performance of his official duties. See Nixon v. Fitzgerald, 457 U.S. 731, 753(1982) (noting risk of distraction as one reason for establishing immunity of President from civil liability for official actions). That concern, we note, did not dissuade the Supreme Court from requiring President Nixon to comply with a district courtâs subpoena to produce tape recordings of conversations with senior staff, see United States v. Nixon,418 U.S. 683
(1974), or requiring President Clinton to submit to discovery, including a deposition, in civil litigation involving preâ presidential conduct, see Jones, 520 U.S. at 697â706.78 See also Trump v. Vance,941 F.3d 631
, 641 n. 12 (2d Cir. 2019) (concluding that âthe disclosure of personal
financial information, standing alone, is unlikely to impair the President in
78 In Jones, the Supreme Court stated, âThe fact that a federal courtâs exercise of its
traditional Article III jurisdiction may significantly burden the time and attention of the Chief
Executive is not sufficient to establish a violation of the Constitution.â 520 U.S. at 703. The same can be said as to Congressâs exercise of its traditional Article I jurisdiction. One court has discounted concern that compliance with document requests might distract the President in the performance of official duties by noting that âthe President himself appears to have had little reluctance to pursue personal litigation despite the supposed distractions it imposes upon his office.â District of Columbia v. Trump,344 F. Supp. 3d 828, 843
(D. Md. 2018) (collecting examples), revâd on other grounds (lack of standing), In re Trump,928 F.3d 360
(4th Cir. 2019).
104
performing the duties of his officeâ), petition for cert. filed, No. 19â635 (U.S. Nov. 14,
2019).
The Committeesâ interests in pursuing their constitutional legislative
function is a far more significant public interest than whatever public interest
inheres in avoiding the risk of a Chief Executiveâs distraction arising from
disclosure of documents reflecting his private financial transactions.
Conclusion
For all of these reasons, we conclude that under the applicable likelihoodâ
ofâsuccess standard, Appellantsâ motion for a preliminary injunction was properly
denied, except as to disclosure of any documents that might be determined to be
appropriate for withholding from disclosure pursuant to our limited remand. The
seriousâquestions standard is inapplicable, the balance of hardships does not tip
decidedly in favor of Appellants, and the public interest favors denial of a
preliminary injunction.
We affirm the District Courtâs order in substantial part to the extent that it
denied a preliminary injunction and order prompt compliance with the
subpoenas, except that the case is remanded to a limited extent for implementation
of the procedure set forth in this opinion concerning the nondisclosure of sensitive
105
personal information and a limited opportunity for Appellants to object to
disclosure of other specific documents within the coverage of those paragraphs of
the subpoenas listed in this opinion. The mandate shall issue forthwith, but
compliance with the three subpoenas and the procedure to be implemented on
remand is stayed for seven days to afford Appellants an opportunity to apply to
the Supreme Court or a Justice thereof for an extension of the stay.
106
DEBRA ANN LIVINGSTON, Circuit Judge, concurring in part and dissenting in part:
Although not expressly provided for in the Constitution, Congressâs power
to conduct investigations for the purpose of legislating is substantial, âas
penetrating and farâreaching as the potential power to enact and appropriate
under the Constitution.â Eastland v. U.S. Servicemenâs Fund, 421 U.S. 491, 504 n.15 (1975) (quoting Barenblatt v. United States,360 U.S. 109, 111
(1959)). Yet this power is not unlimited. When Congress conducts investigations in aid of legislation, its authority derives from its responsibility to legislateâto consider the enactment of new laws or the improvement of existing ones for the public good.1 Congress has no power to expose personal information for the sake of exposure, see Watkins v. United States,354 U.S. 178, 200
(1957) (expressing âno doubt that there is no
congressional power to expose for the sake of exposureâ (emphasis added)), nor
1 None of these subpoenas issued in connection with an impeachment proceeding,
in which Congressâs investigatory powers are at their peak, but rather, as stated, âin aid
of legislation.â See Kilbourn v. Thompson, 103 U.S. 168, 190(1880) (noting that â[w]here the question of . . . impeachment is before [the House or the Senate] acting in its appropriate sphere on that subject, we see no reason to doubt the right to compel the attendance of witnesses, and their answer to proper questions, in the same manner and by the use of the same means that courts of justice can in like casesâ); Senate Select Comm. on Presidential Campaign Activities v. Nixon,498 F.2d 725, 732
(D.C. Cir. 1974) (citing to
Article I, Section 2 of the Constitution when noting that impeachment investigations in
the House have âan express constitutional sourceâ which differentiates them from
Congressâs general oversight or legislative power).
1
may it seek information to enforce laws or punish for their infractionâ
responsibilities which belong to the executive and judicial branches respectively,
and not to it. Id. at 187 (noting that Congress is neither âa law enforcement [n]or
trial agency,â as â[t]hese are functions of the executive and judicial departments
of governmentâ). As the Supreme Court has put it: âNo inquiry is an end in
itself; it must be related to, and in furtherance of, a legitimate task of the Congress.
Investigations conducted solely for the personal aggrandizement of the
investigators or to âpunishâ those investigated are indefensible.â Id.
The legislative subpoenas here are deeply troubling. Targeted at the
President of the United States but issued to third parties, they seek voluminous
financial information not only about the President personally, but his wife, his
children, his grandchildren, his business organizations, and his business
associates. 2 Collectively, the subpoenas seek personal and business banking
records stretching back nearly a decade (and with regard to several categories of
2 The Plaintiff entities here are defined to include not only parents, subsidiaries,
related joint ventures and the like, but any âcurrent or former employee, officer, director,
shareholder, partner, member, consultant, senior manager, manager, senior associate,
staff employee, independent contractor, agent, attorney or other representative of any of
those entities,â so that the banking records of numerous individuals beyond the
Presidentâs immediate family are potentially included in this dragnet. J.A. at 47, 58.
2
information, with no time limitation whatsoever) and they make no distinction
between business and personal affairs, nor consistently between large and small
receipts and expenditures. To be sure, breadth may be necessary in legislative
subpoenas so that Congress can learn about a proposed subject of legislation
sufficiently to enact new laws or improve the old ones: such learning is âan
indispensable ingredient of lawmaking.â 3 Eastland, 421 U.S. at 505. Still, the
district court was of the view that in a routine civil case, it would have sent the
parties into a room with the instruction that âyou donât come out until you come
back with a reasonable subpoena.â J.A. at 94. The majority doesnât disagree.
It, too, characterizes the subpoenas as âsurely broad in scope.â Maj. Op. at 45.
It acknowledges that compliance will âsubject [the Presidentâs] private business
affairs to the Committeesâ scrutiny,â id. at 48, and impose irreparable harm, id. at
13. It could have added that personal banking records of the President and his
family are not excluded, and that neither House committee seeking this
3 That said, âlegislative judgments normally depend more on the predicted
consequences of proposed legislative actions and their political acceptability, than on
precise reconstruction of past events,â which appears to be the focus of the present
subpoenas. Nixon, 498 F.2d at 732.
3
information will commit to treating any portion of it as confidential, irrespective
of any public interest in disclosure. J.A. at 122â23.
The majority and I are in agreement on several points. First, we agree that
the Right to Financial Privacy Act (âRFPAâ), 12 U.S.C. §§ 3401â3423, does not
apply to Congress because, as the majority correctly concludes, Congress is not a
âGovernment authorityâ within the meaning of that statute. Maj. Op. at 24â33.
We likewise agree that 26 U.S.C. § 6103of the Internal Revenue Code does not pose an obstacle to Deutsche Bank AGâs disclosure of tax returns in its possession in response to the Committeesâ subpoenas.Id.
at 34â44. Accordingly, I concur
that, as to the statutory arguments presented by the Plaintiffs, they have raised no
serious question suggesting that the House subpoenas may not be enforced.
The statutory arguments, however, are not the only arguments presented.
The majority and I agree that this appeal raises an important issue regarding the
investigative authority of two committees of the United States House of
Representativesâthe House Committee on Financial Services and the House
Permanent Select Committee on Intelligence (collectively, âCommitteesâ)âin the
context of their efforts to obtain voluminous personal and business banking
records of the President of the United States, members of his immediate family,
4
his primary business organization and affiliated entities, and his business
associates. Maj. Op. at 4. In fact, the question before us appears not only
important (as the majority acknowledges) but of first impression: the parties are
unaware of any Congress before this one in which a standing or permanent select
committee of the House has issued a thirdâparty subpoena for documents
targeting a Presidentâs personal information solely on the rationale that this
information is âin aid of legislation.â Trump Br. at 14; Tr. of Oral Arg. at 34:24â
35:3â4. But this House has now authorized all such House committees to issue
legislative subpoenas of this sort, so long as directed at information involving this
President, his immediate family, business entities, or organizations. H.R. Res.
507, 116th Cong. (2019); see also H.R. Res. 509, 116th Cong. § 3 (2019) (âHouse
Resolution 507 is hereby adopted.â).
In such a context, âexperience admonishes us to tread warily.â United
States v. Rumely, 345 U.S. 41, 46(1953). I agree with the majority that our review of the denial of a preliminary injunction is âappropriately more exacting where the action sought to be enjoined concerns the President . . . in view of â[t]he high respect that is owed to the office of the Chief Executive,ââ Maj. Op. at 11 (quoting Cheney v. U.S. Dist. Court,542 U.S. 367, 385
(2004)). We disagree, however, as to
5
the preliminary injunction standard to be applied. In my view, a preliminary
injunction may issue in a case of this sort when a movant has demonstrated
sufficiently serious questions going to the merits to make them a fair ground for
litigation, plus a balance of hardships tipping decidedly in that partyâs favor, that
the public interest favors an injunction, and that the movant, as here, will
otherwise suffer irreparable harm. See Citigroup Glob. Markets, Inc. v. VCG Special
Opportunities Master Fund Ltd., 598 F.3d 30, 35, 38 (2d Cir. 2010).
And as to the merits showing, I respectfully disagree with the majorityâs
determination that the Plaintiffsâ constitutional arguments and those raised by the
United States as amicus curiae are insubstantialânot sufficiently serious for closer
review.4 Maj. Op. at 89â98. I cannot accept the majorityâs conclusions that âthis
case does not concern separation of powers,â id. at 89, and that there is âminimal at bestâ risk of distraction to this and future Presidents from legislative subpoenas of this sort,id. at 97
. Instead, I conclude that the Plaintiffs have raised serious
4 Given my determination herein that the Plaintiffs have made a showing of
âserious questionsâ as to the merits and that this case must be remanded, I need not now
address whether the Plaintiffs have also satisfied the âlikelihood of successâ standardâ
and I do not do so, given the obligation in this context to avoid unnecessary judicial
determinations on constitutional questions implicating Congressâs investigative powers.
See Rumely, 345 U.S. at 46. I note, however, that I do not concur in the majorityâs
determination that as to the present reach of these subpoenas, the Plaintiffs have shown
no likelihood of success.
6
questions on the merits, implicating not only Congressâs lawmaking powers, but
also the ability of this and future Presidents to discharge the duties of the Office of
the President free of myriad inquiries instigated âmore casually and less
responsiblyâ than contemplated in our constitutional framework. Rumely, 345
U.S. at 46.
Nor do I agree with the majorityâs determination substantially to affirm the
judgment and order compliance with these subpoenas. The majority itself
recognizes that these broad subpoenas cannot be enforced precisely as drafted
because they call for the production of material that may either bear âan
attenuated relationshipâ to any legislative purpose or that âmight [even] reveal
sensitive personal details having no relationship to the Committeesâ legislative
purposes.â Maj. Op. at 84 (emphasis added). The majority remands for a
culling process pursuant to which information disclosing, for instance, the
payment of medical expenses would be exempt from disclosure. Id.The majorityâs limited culling, however, is tightly restricted to specified categories of information, leaving out almost all âbusinessârelated financial documentsâ from any review by the district court,id.,
irrespective of any threatened harm from
disclosure, and potentially leaving out substantial personal information as well.
7
Indeed, given the tight limitations imposed by the majority on the district courtâs
review, even sensitive records reflecting personal matters unrelated to any
conceivable legislative purpose could potentially be disclosed.
I agree with the majority that remand is necessary. But we disagree as to
the reasons why. I conclude that the present record is insufficient to support the
majorityâs determination that the voluminous records of Plaintiffs sought from
Deutsche Bank AG (âDeutsche Bankâ) and Capital One Financial Corporation
(âCapital Oneâ) should at this time be produced. 5 The majority concludes in
advanceâbefore these records have been assembledâthat only a select âfew
documentsâ will implicate privacy concerns or bear âsuch an attenuated
relationshipâ to any legislative purpose that âthey need not be disclosed.â Maj.
Op. at 85 (emphasis added). I disagree that the present record is sufficient to
make that determination or to conclude, more fundamentally, where the balance
of hardships lies with regard to the preliminary relief that the Plaintiffs seek. In
this sensitive separationâofâpowers context, serious questions have been raised as
5 The Plaintiffs challenge the subpoenas as they relate to the banking records of
President Donald J. Trump, his family, and his businessesâthe Plaintiffs here. Trump
Br. at 1. To the extent the subpoenas seek other information related to parties who are
not Plaintiffs, the subpoenas have not been challenged and are not part of this appeal.
8
to the historical precedent for these subpoenas; whether Congress has employed
procedures sufficient to âprevent the separation of power from responsibility,â
Watkins, 354 U.S. at 215, in seeking this Presidentâs personal information; and whether the subpoenas are supported by valid legislative purposes and seek information reasonably pertinent to those purposes, see Quinn v. United States,349 U.S. 155, 161
(1955) (noting that Congressâs power to investigate âcannot be used
to inquire into private affairs unrelated to a valid legislative purposeâ). These
questions, like the balance of hardship question, also require further review.
As set forth herein, I would remand, directing the district court promptly to
implement a procedure by which the Plaintiffs may lodge their objections to
disclosure with regard to specific portions of the assembled material and so that
the Committees can clearly articulate, also with regard to specific categories of
information, the legislative purpose that supports disclosure and the pertinence of
such information to that purpose. The objective of this remand is the creation of
a record that is sufficient more closely to examine the serious questions that the
Plaintiffs have raised and to determine where the balance of hardships lies with
regard to an injunction in this case, and concerning particular categories of
information. The district court acknowledged that in a routine civil case, it would
9
not have ordered the disclosures here. The majority errs in implicitly concluding
that a President has less protection from the unreasonable disclosure of his
personal and business affairs than would be afforded any litigant in a civil case.
Only on the basis of this fuller record would I determine the question
whether a preliminary injunction should have issued, and with regard to what
portions of the records sought. In reaching this conclusion, I am guided by the
Supreme Courtâs counsel in Rumely that in the context of delicate constitutional
issues involving limits on the investigative power of Congress, our duty is to avoid
pronouncement âunless no choice is left.â Rumely, 345 U.S. at 46; cf. Cheney, 542 U.S. at 389â90 (suggesting that courts should âexplore other avenuesâ to avoid adjudicating âoverly broad discovery requestsâ and âunnecessarily broad subpoenasâ that present âcollision courseâ conflicts between coequal branches). Indeed, Rumely affirms that the duty of constitutional avoidance is âeven more applicableâ in the context of congressional investigations âthan to formal legislation.â Rumely,345 U.S. at 46
; see also Tobin v. United States,306 F.2d 270, 275
(D.C. Cir. 1962) (recognizing duty of courts in appropriate circumstances to avoid
âpassing on serious constitutional questionsâ presented by Congressâs exercise of
10
its investigative power). Decision here may be required, but is premature on the
present record.
Remand will also afford the parties an opportunity to negotiate. This is not
the essential point of the remand I propose, but efforts at negotiation in this context
are to be encouraged, since they may narrow the scope of these subpoenas, and
thus avoid judicial pronouncement on the âbroad confrontation now tendered.â
United States v. Am. Tel. & Tel. Co (AT&T I), 551 F.2d 384, 395 (D.C. Cir. 1976). The
Plaintiffs have repeatedly sought the opportunity to negotiate. Reply Br. at 6â7;
Tr. of Oral Arg. at 17:18â19, 18:3â20, 66:7â67:2. And the Committees, while
preferring the more immediate disposition that the majority affords them, have
expressed a willingness to attempt negotiation on an expedited basis if requested
by this Court.6 Tr. of Oral Arg. at 46:8â19.
6 Before this Court, counsel for the Committees stated that â[i]f this court thinks
there should be negotiation . . . [p]lease make it really, really fast, because we think that
Mr. Trumpâs statements make clear this is absolutely insincere . . . [b]ut fine, give us a
day.â Tr. of Oral Arg. at 46:8â15. Counsel for the Plaintiffs specifically affirmed in
response that âI donât think there is any basis to determine that we are being insincere,
and I certainly welcome, I think that we have made clear, sending this case back down
for judicially refereed negotiations on whatever timeline the court thinks is appropriate
is absolutely something we are willing to participate in in good faith.â Tr. of Oral Arg.
at 66:21â67:2.
Referencing an October 8, 2019 letter from Pat A. Cippolone, Counsel to the
President, to the Speaker of the House of Representatives and three House committee
chairs (a letter that is not part of the record before us), the majority concludes that a
11
To be clear, and as set forth herein, the Plaintiffs have raised serious
questions on the merits as to these subpoenas, which implicate profound
separationâofâpowers concerns. 7 But pending the full remand that I outline
remand for negotiation is futile because the President has prohibited certain members of
the Administration from appearing in connection with the ongoing impeachment
inquiry. Maj. Op. at 71â72, 72 n.66. With respect, however, this letter references only
the âimpeachment inquiryâ and not the legislative investigations at issue here. This
letter thus provides no basis for this Court to disregard the express representations of the
Plaintiffsâ attorney that the Plaintiffs, including the President, seek to negotiate in good
faith.
7 The majority suggests that these subpoenas do not implicate separation of
powers because, inter alia, President Trump is not suing in his official capacity. Maj. Op.
at 70. I disagree. As in Rumely, âwe would have to be that âblindâ Court . . . that does
not see what â(a)ll others can see and understand,ââ not to recognize that these subpoenas
target the President in seeking personal and business financial records of not only the
President himself, but his three oldest children and members of their immediate family,
plus the records of the Trump Organization and a litany of organizations with which the
President is affiliated. Rumely, 345 U.S. at 44(quoting Bailey v. Drexel Furniture Co.,259 U.S. 20, 37
(1922)); see alsoid.
(acknowledging âwide concern, both in and out of Congress, over some aspects of the exercise of the congressional power of investigationâ); cf. Depât of Commerce v. New York,139 S. Ct. 2551, 2575
(2019) (noting that courts are âânot required to exhibit a naivetĂŠ from which ordinary citizens are freeâââ(quoting United States v. Stanchich,550 F.2d 1294, 1300
(2d Cir. 1977) (Friendly, J.))). Indeed, the Committees
themselves acknowledge that âPresident Trump and the Trump Organizationâ are the
focus of their investigations, see 165 Cong. Rec. H2698 (daily ed. Mar. 13, 2019) (statement
of Rep. Waters), and that âgiven the closely held nature of the Trump Organization,â
investigation must âinclude [the Presidentâs] close family members,â District Court Doc.
No. 51 at 25â26. To be sure, Presidents are not immune from legislative subpoenas.
But as I explain below, this dragnet around the President implicates separationâofâpowers
concerns for this and future Presidents, supporting a remand as to all the Plaintiffs here.
To the extent that certain of the requested records may ultimately be found not to
implicate separationâofâpowers concerns, such a determination can only properly be
made following a remand for development of the record.
12
herein, I defer for now the question whether they have also shown a balance of
hardships tipping decidedly in their favor. The remainder of this opinion sets
out the reasons for my conclusions: (1) that the Plaintiffs have raised serious
constitutional questions as to these legislative subpoenas; and (2) that the serious
question formulation of the preliminary injunction standard is applicable,
contrary to the majorityâs position.
I
A
To reiterate, the subpoenas here are very troubling. Congress âcannot
legislate wisely or effectively in the absence of information respecting the
conditions which the legislation is intended to affect or change.â Eastland, 421
U.S. at 504. At the same time, illâconceived inquiries by congressional committees âcan lead to ruthless exposure of private lives in order to gather dataâ that is unrelated and unhelpful to the performance of legislative tasks. Watkins,354 U.S. at 205
. And the âarduous and delicate taskâ of courts seeking to accommodate âthe congressional need for particular informationâ with the individualâs âpersonal interest in privacy,âid. at 198
, does not grow easier when
Congress seeks a Presidentâs personal information. Indeed, given the âunique
13
constitutional position of the Presidentâ in our scheme of government, see Franklin
v. Massachusetts, 505 U.S. 788, 800(1992), and the grave importance of diligent and fearless discharge of the Presidentâs public duties, our task grows more difficult. See Nixon v. Fitzgerald,457 U.S. 731, 753
(1982) (recognizing that distraction from
public duties is âto the detriment of not only the President and his office but also
the Nation that the Presidency was designed to serveâ).
The majority disagrees. It concludes that this case âdoes not concern
separation of powersâ because the soughtâafter records are personal, not official,
and because Congress âhas not arrogated to itself any authority of the Executive
Branch,â nor âsought to limit any authority of the Executive Branch.â Maj. Op.
at 89. With respect, however, this conclusion gives too short shrift to the
Supreme Courtâs analysis in Clinton v. Jones, 520 U.S. 681(1997), on which the majority principally relies. There, the Supreme Court concluded that permitting a civil case to go forward ârelat[ing] entirely to the unofficial conduct of the individual who happens to be the Presidentâ did not represent a per se impermissible intrusion by the federal judiciary on executive power and that the doctrine of separation of powers did not impose a categorical rule that all such private actions must be stayed against the President while in office.Id. at 701
,
14
705â06. At the same time, however, the Court recognized that it is insufficient
that a branch ânot arrogate power to itselfâ: âthe separationâofâpowers doctrine
[also] requires that a branch not impair another in the performance of its constitutional
duties.â Id. at 701(emphasis added) (quoting Loving v. United States,517 U.S. 748, 757
(1996)); see also Nixon v. Adminâr of Gen. Servs.,433 U.S. 425
, 443â45 (1977).
And as for the judiciary in the context of private litigation against a sitting
President, â[t]he high respect that is owed to the office of the Chief Executive,â the
Court recognized, âthough not justifying a rule of categorical immunity, is a
matter that should inform the conduct of the entire proceeding, including the
timing and scope of discovery.â Id. at 707; see also Fitzgerald, 457 U.S. at 751â56
(noting that the âspecial nature of the Presidentâs constitutional office and
functions,â id. at 756, and the âsingular importance,â id. at 751, of her duties
require particular âdeference and restraint,â id. at 753, in the conduct of litigation
involving the President).
The majority concludes that legislative subpoenas to third parties targeting
a Presidentâs personal or financial information, however broad and tangentially
connected to any legislative purpose, do not seriously implicate separation of
powers on the theory that âany concern arising from the risk of distraction in the
15
performance of the [Presidentâs] official duties is minimal,â Maj. Op. at 90, perhaps
less than that, id. at 103â05, at least as compared to the potential burden of standing
trial in a civil case while President, which Jones held is not categorically prohibited
by separationâofâpowers concerns. 8 But this analysis is flawed in two key
respects.
First, the Jones Court concluded that the burden in that caseânamely, a civil
suit against the President while in officeâdid not categorically constitute a
âconstitutionally forbidden impairment of the Executiveâs ability to perform its
constitutionally mandated functionsâ in light of the long history of judicial review
of executive action and of presidential amenability to judicial process. 520 U.S.
at 702; see alsoid.
at 701â06. In assessing the separationâofâpowers issue, the Court
8 The majority also relies on the fact that President Trump seeks a preliminary
injunction in his individual capacity, not his official capacity, and that the United States
has filed an amicus curiae brief rather than a motion to intervene in asserting its view that
this case presents âthorny constitutional questions involving separation of powersâ and
that the district courtâs order should be reversed. Brief of United States as Amicus
Curiae at 27; see Maj. Op. at 91 n.76. In Jones itself, however, President Clinton
proceeded in his individual capacity and the United States filed an amicus brief
addressing its separationâofâpowers concerns. The Court nonetheless noted that â[t]he
representations made on behalf of the Executive Branch as to the potential impactâ of a
rule permitting private litigation to proceed against a sitting President âmerit . . .
respectful and deliberate consideration,â 520 U.S. at 689â90, and concluded, as already
observed, that as to any civil action regarding personal conduct permitted to proceed,
âthe conduct of the entire proceeding, including the timing and scope of discovery,â
should be informed by respect for the Office of Chief Executive, id. at 707.
16
heavily weighed the pragmatic accommodation between the judiciary and the
executive demonstrated by longstanding interbranch practice. See id.at 704â05 (discussing historical practice and the manner in which the judiciary has permissibly burdened the Executive Branch). It directed inferior courts that even as it rejected a rule of categorical immunity, the Presidentâs unique role in the constitutional framework should inform the entire conduct of any civil action,id. at 707
, and that âthe availability of sanctionsâ would âprovide[] a significant deterrent to litigation directed at the President in his unofficial capacity for purposes of political gain or harassment,âid.
at 708â09. The Jones Court was thus solicitous of separationâofâpowers concerns in the context of litigation over a Presidentâs personal conduct; moreover, it continued a long tradition of placing âgreat weightâ on historical practice in addressing questions âconcern[ing] the allocation of power between two . . . branches of Government,â NLRB v. Noel Canning,573 U.S. 513
, 524 (2014) (quoting The Pocket Veto Case,279 U.S. 655, 689
(1929)).9
9 The high value placed on historical practice âis neither new nor controversial.â
Noel Canning, 573 U.S. at 525. James Madison observed that a âregular course of
practiceâ could âliquidate & settleâ constitutional meaning in the face of âdifficulties and
differences of opinionâ involved in the practice of government under the Constitution.
James Madison, Letter to Spencer Roane (Sept. 2, 1819), in 8 Writings of James Madison 450
(Gaillard Hunt ed., 1908)); see also Noel Canning, 573 U.S. at 525 (collecting cases stating
17
Here, the parties have not identified, and my own search has failed to
unearth, any previous example, in any previous Congress, of a standing or
permanent select committee of the House of Representatives or the Senate using
compulsory process to obtain documents containing a Presidentâs personal
information from a third party in aid of legislation. Trump Br. at 14; Tr. of Oral
Arg. at 34:24â35:4. Historical practice instead suggests that, on the few past
occasions on which a Presidentâs personal documents have been subpoenaed from
third parties, such requests have emanated either from a special committee
established and authorized to pursue a specific, limited investigation or from a
committee proceeding under the impeachment power. 10 It is possible that a
the relevance of past practice to separationâofâpowers issues).
10 President Andrew Johnson had his personal bank records examined as part of
his impeachment, but those records appear to have been relevant because of personal
loans made to him by the Treasury Department. See Stephen W. Stathis, Executive
Cooperation: Presidential Recognition of the Investigative Authority of Congress and the Courts,
3 J.L. & Pol. 183, 219 (1986); see also Michael Les Benedict, The Impeachment of President
Andrew Johnson, 1867â68, in 1 Congress Investigates: A Critical and Documentary History 254,
264â68 (Roger A. Bruns et al. eds., rev. ed. 2011). President Clinton may have had some
financial information, or at the very least some financial information of thenâFirst Lady
Hillary Clinton, examined by the Whitewater Special Committee, though it appears to
have been turned over voluntarily. See S. Rep. No. 104â280, at 155â61 (1996). The
House and Senate Banking Committees also appear to have subpoenaed witnesses to
testify regarding Whitewater and the death of Vince Foster; however, they do not appear
to have subpoenaed the Presidentâs personal financial information. See Stephen
Labaton, The Whitewater Affair: The Hearing; House Committee Told of Contacts Over
Whitewater, N.Y. Times, July 27, 1994, at A1 (describing testimony); Raymond W. Smock,
18
contrary example exists. But the historical precedent for the congressional
subpoenas here, in contrast to the judicial processes assessed in Jones, is sparse at
best, and perhaps nonexistent.11 And this paucity of historical practice alone is
The Whitewater Investigation and Impeachment of President Bill Clinton, 1992â98, in 2 Congress
Investigates: A Critical and Documentary History, supra, at 1041, 1044â45. President Nixon
voluntarily disclosed several years of tax returns to a House Committee; that same
Committee used statutory authority not at issue here to procure additional information
from the IRS. See S. Rep. No. 93â768, at 1â3 (1974); Memorandum from Richard E. Neal,
Chairman, to the Members of the H. Comm. on Ways and Means 3 (July 25, 2019),
https://perma.cc/UYZ2âQTCU. Other investigations do not appear to have involved
either subpoenas of the Presidentâs personal financial information or subpoenas to third
parties to obtain documents concerning the President in a personal capacity. See
generally Stathis, supra.
11 Notably, the dearth of historical practice here may be partially attributable to
the fact that â[t]he authority to issue a subpoena was once delegated from the full House
to its committees very sparingly because the power appears long to have been deemed
too serious a matter for general delegation.â Todd David Peterson, Contempt of Congress
v. Executive Privilege, 14 U. Pa. J. Const. L. 77, 106 (2011) (internal quotation marks and citation omitted). It appears that the House did not authorize standing committees to issue subpoenas until 1975. Id. at 107. Moreover (and more generally), it should also be noted that disputes between the two elected branches over congressional subpoenas have historically been resolved through a process of direct negotiation and accommodation between these two branches, undertaken outside the supervision of the federal courts. See, e.g., Comm. on Judiciary, U.S. House of Representatives v. Miers,558 F. Supp. 2d 53
, 56â57 (D.D.C. 2008) (noting that ânegotiation and accommodation . . . most
often leads to resolution of disputes between the political branchesâ and âstrongly
encourag[ing] the political branches to resume their discourse and negotiations in an
effort to resolve their differences constructivelyâ). The majority rejects this approach
due to its view that this case does not involve separation of powers, Maj. Op at 69â73;
however, given the expressed willingness of the parties to negotiate and my view that
separationâofâpowers concerns are present here, the traditional practice of further
negotiation is a viable resolution.
19
reason for courts to pause in assessing this dispute between a President and two
House committees.12
The second flaw in the majorityâs analysis lies in its assumption that thirdâ
party subpoenas of this sort pose, at best, âminimalâ risk of distraction to this and
future Presidents. Maj. Op. at 90. Contrary to the majorityâs suggestion, it is not
at all difficult to conceive how standing committees exercising the authority to
issue thirdâparty subpoenas in aid of legislation might significantly burden
presidents with myriad inquiries into their business, personal, and family affairs.
See Watkins, 354 U.S. at 205(recognizing potential for âruthless exposure of private livesâ by committees seeking information âneither desired by the Congress nor useful to itâ); cf. Jones, 520 U.S. at 701â02 (considering the likelihood that frivolous civil litigation against the President could overly burden the Executive Branch). Jones relied on the relative rarity of civil litigation against past presidents to discount concerns of distraction, see520 U.S. at 702
, but the subjects on which
12This Courtâs recent decision in Trump v. Vance, 941 F.3d 631 (2d. Cir. 2019), is not
to the contrary. The Vance panel explicitly relied on the âlongâsettledâ amenability of
presidents to judicial process, and in particular to subpoenas issued as part of a criminal
prosecution, to inform its holding that the state grand jury subpoena to a thirdâparty
custodian of the Presidentâs tax returns at issue in that case was lawful. See id. at 640
(discussing the historical practice of ordering presidents to comply with grand jury
subpoenas). Here, there is no such longstanding practice, and the subpoenas in
question were not issued by a grand jury as part of a criminal investigation.
20
legislation might be had are vast.13 And the risk of undue distraction from illâ
conceived inquiries might be particularly acute today, in an era in which (as the
Supreme Court and individual Justices have repeatedly acknowledged) digital
technologies have lodged an increasingly large fraction of even our most intimate
information in thirdâparty hands. See, e.g., Riley v. California, 573 U.S. 373, 395 (2014) (discussing how âInternet search and browsing historyâ can âreveal an individualâs private interests or concernsâ); Carpenter v. United States,138 S. Ct. 2206, 2261
(2018) (acknowledging âpowerful private companiesâ collecting âvast quantities of data about the lives of ordinary Americansâ) (Alito, J., dissenting); United States v. Jones,565 U.S. 400, 417
(2012) (noting that in the digital age, âpeople
13
To be clear, while civil litigation against sitting presidents is unusual, presidents
are routinely the subjects of congressional investigation while in officeâas they must be,
and for appropriate reasons. But there is no substantial historical precedent for the use
of subpoena power to obtain a Presidentâs personal information from a third party in aid
of legislation. And as to such subpoenas, there is no analogue for the possibility of
sanctions in the civil litigation context, which the Jones Court relied on as âprovid[ing] a
significant deterrent to litigation directed at the President in his unofficial capacity for
purposes of political gain or harassment.â 520 U.S. at 708â09. Nor do established rules
of procedure provide a mechanism for narrowing congressional subpoenas so as to avoid
âembarrassment, oppression, or undue burden.â Fed. R. Civ. P. 26(c)(1). Historically,
in those few instances in which investigators have sought a Presidentâs personal
documents, Congress has instead typically proceeded pursuant to the political checks
inherent in the invocation of impeachment authority or the narrow authorization
afforded to a special committee.
21
reveal a great deal of information about themselves to third parties in the course
of carrying out mundane tasksâ) (Sotomayor, J., concurring).
To be clear, this is not to suggest that a President is immune from legislative
subpoenas into personal mattersânot at all. But as the D.C. Circuit recognized
in Trump v. Mazars (while concluding that the House Committee on Oversight and
Reform possessed authority to issue a legislative subpoena to President Trumpâs
accounting firm), âseparationâofâpowers concerns still linger in the airâ with
regard to such subpoenas. Trump v. Mazars USA, LLP, 940 F.3d 710, 726 (D.C. Cir. 2019). And in such a circumstance, there is reason to conclude that courts must not only undertake the âarduous and delicate taskâ of â[a]ccommodat[ing] . . . the congressional need for particular information with the individual and personal interest in privacy,â Maj. Op. at 51 (quoting Watkins,354 U.S. at 198
). They must also take on the equally sensitive task of ensuring that Congress, in seeking the Presidentâs personal information in aid of legislation, has employed âprocedures which prevent the separation of power from responsibility,â Watkins,354 U.S. at 215
(discussing such procedures in the context of a threat to individual rights from
congressional investigations), and which ensure due consideration to the
separationâofâpowers concerns that the Supreme Court identified and deemed
22
essential for judicial respect in Jones. See Jones, 520 U.S. at 707(noting that âhigh respect that is owed to the office of the Chief Executive,â while not mandating categorical immunity from suit for private conduct while in office, should âinform the conduct of the entire proceeding, including the timing and scope of discoveryâ); Cheney,542 U.S. at 385
(noting that Presidentâs âconstitutional responsibilities and status [are] factors counseling judicial deference and restraintâ in conduct of litigation) (quoting Fitzgerald,457 U.S. at 753
(alteration in Cheney)).
B
These subpoenas are deeply problematic when considered against the
backdrop of these separationâofâpowers concerns. In fact, this much is evident
from even cursory consideration of the differences between the present case and
Mazars, the only other precedent directly addressing a legislative subpoena served
on a third party and seeking a Presidentâs personal financial information.14 In
Mazars, the D.C. Circuit recently upheld a legislative subpoena directed at the
14 As noted at the outset, see supra page 5, the parties are unable to cite any
Congress before this one in which a standing committee of the House of Representatives
has issued a thirdâparty subpoena for documents targeting a Presidentâs personal
information solely in aid of legislation. The practice appears to have begun with the
committees of this House of Representatives, which has issued such subpoenas
repeatedly, thus raising the separationâofâpowers concerns discussed herein.
23
Presidentâs accounting firm, concluding that it had properly issued in connection
with the consideration of changes to laws relating to financial disclosures required
of Presidents.15 Mazars, 940 F.3d at 748. At the same time, the Mazars Court
pointedly suggested that the articulation of just any rationale for concluding that
a sitting Presidentâs personal information might inform a committee in
considering potential legislation is not enough to state a valid legislative purpose:
Just as a congressional committee could not subpoena
the Presidentâs high school transcripts in service of an
investigation into Kâ12 education, nor subpoena his
medical records as part of an investigation into public
health, it may not subpoena his financial information
except to facilitate an investigation into presidential
finances.
15 Judge Rao dissented, concluding that even assuming the Committee on
Oversight and Reform had a legislative purpose, it had also asserted an intent to
determine âwhether the President broke the law,â an inquiry that âmust be pursued
through impeachment,â and not via Congressâs authority to investigate for legislative
purposes. Mazars, 940 F.3d at 748 (Rao, J., dissenting). In the instant case, given the
need for remand here, I need not now determine whether the House Committees have
avowed such an intent, so I have no occasion to consider the arguments raised in Judge
Raoâs thorough analysis. However, it is worth noting that nowhere in the Mazars
majority or Judge Raoâs extensive discussion of historical practice, id. at 718â24 (majority
opinion), 757â67 (Rao, J., dissenting), is there any hint of a prior occasion on which a
standing or permanent select committee has used compulsory process to obtain
documents targeting a Presidentâs personal information from a third party justified solely
on the basis of future legislation.
24
Id. at 733. Key to the result in Mazars, then (and assuming, arguendo, that it was
correctly decided) was the majorityâs conclusion that there was âno inherent
constitutional flaw in laws requiring Presidents to publicly disclose financial
informationâ and that the subpoena on its face thus properly sought relevant
information âabout a subject on which legislation may be had.â Id. at 737
(quoting Eastland, 421 U.S. at 508).
This case is significantly different, at least as to the subpoenas issued by the
Committee on Financial Services. This Committee seeks a universe of financial
records sufficient to reconstruct over a decade of the Presidentâs business and
personal affairs, not in connection with the consideration of legislation involving
the Chief Executive, but because the President, his family, and his businesses
present a âuseful case study,â according to the Committee, for an inquiry into the
lending practices of institutions such as Deutsche Bank and Capital One.16 District
Court Doc. No. 51 at 25. More specifically, the Committee is investigating
16 The Capital One subpoena, moreover, seeks the Presidentâs personal and
business financial records starting from the exact date on which he became the
Republican nominee for Presidentâan unusual date, to be sure, for specifying the precise
moment at which his banking records became a useful point of inquiry into the possibility
of tightening up the regulation of lending practices with potentially âbroad effects on the
national economy.â District Court Doc. No. 51 at 25.
25
âwhether existing policies and programs at financial institutions are adequate to
ensure the safety and soundness of lending practices and the prevention of loan
fraud,â id. at 12, as well as âindustryâwide compliance with banking statutes and
regulations, particularly antiâmoney laundering policies,â id. at 13. The
Committee urges that â[b]ecause of his prominence, much is already known about
Mr. Trump, his family, and his business, and this public record establishes that
they serve as a useful case study for the broader problemsâ under its
consideration. 17 Id. at 25. The majority endorses this statement of legislative
purpose and intimates (albeit with no evidence in the record before us) that past
transactions between Deutsche Bank and the President in his preâpresidential
business life may have violated banking regulations and that âno other bank
would extend creditâ to President Trump. Maj. Op. at 73 n.67, 74.
To be sure, legislative subpoenas issue not when all is known, but on the
reasonable theory that â[a] legislative body cannot legislate wisely or effectivelyâ
17 The House Financial Services Committee asserts that the subpoenasâ objective
can be derived in part from House Resolution 206, which affirms that the House
âsupports efforts to close loopholes that allow corruption, terrorism, and money
laundering to infiltrate our countryâs financial system.â H.R. Res. 206, 116th Cong.
(2019). House Resolution 206, however, does not materially aid in defining more clearly
the reasons for the Committeeâs âcase studyâ approach, as it does not call for a
congressional investigation, much less one by a designated committee, nor does it
reference the President and his family.
26
without obtaining âinformation respecting the conditions which the legislation is
intended to affect or change.â Eastland, 421 U.S. at 504(quoting McGrain v. Daugherty,273 U.S. 135, 175
(1927) (alteration in Eastland)). But the rationale proffered for these subpoenas of the House Financial Services Committee falls far short of demonstrating a clear reason why a congressional investigation aimed generally at closing regulatory loopholes in the banking system need focus on over a decade of financial information regarding this President, his family, and his business affairs. 18 Nor does the proffered rationale reveal how the broad purposes pursued by the Committee are consistent with the granular detail that these subpoenas seek. See Watkins,354 U.S. at 204
(noting the troubling tendency
of some legislative investigations to âprobe for a depth of detail . . . removed from
any basis of legislative actionâ and to âturn their attention to the past to collect
minutiae on remote topicsâ).
18 Thus, the majority references the fact that Deutsche Bank âhas been fined in
connection with a $10 billion money laundering scheme.â Maj. Op. at 73 n.67. But the
record is devoid of any claim, much less any evidence, that this fine had anything at all to
do with the President, his children, his business organizations, or his business associates,
all of whom will be irreparably harmed by the majorityâs endorsement of the âcase studyâ
approach of the House Financial Services Committee.
27
This is a reason for pause. As suggested by Judge Katsas in his dissent
from the denial of rehearing in banc in Mazars, the âuncompromising extension of
McGrain v. Daughertyâ to this new context raises the serious question whether
future Presidents will be routinely subject to the distraction of thirdâparty
subpoenas emanating from standing committees in aid of legislationâa practice
for which there is scant historical precedent, as already discussed. Trump v.
Mazars USA, LLP, No. 19â5142, 2019 WL 5991603, at *1 (D.C. Cir. Nov. 13, 2019)
(Katsas, J., dissenting from the denial of rehearing en banc). Some case study
rationale (in this instance, to learn whether regulators were adequately equipped
to scrutinize Deutsche Bankâs and Capital Oneâs lending practices in relation to the
President before he obtained the Office of Chief Executive) will always be present.
But the regular issuance of thirdâparty legislative subpoenas by single committees
of one House of Congress targeting a Presidentâs personal information would be
something new, potentially impairing public perceptions of the legislative branch
by fueling perceptions that standing committees are engaged, not in legislating,
but in opposition research.19 More relevant here, such investigative practices by
19 Such subpoenas, moreover, will inevitably result, as here, in recourse to the
courts, potentially embroiling them, as well, in political battles between committees of
Congress and the President.
28
Congress, undertaken âmore casually and less responsiblyâ than is the
constitutional ideal, see Rumely, 345 U.S. at 46, pose a serious threat to âpresidential autonomy and independence,â Mazars,2019 WL 5991603
, at *1 (Katsas, J., dissenting from the denial of rehearing en banc). And this is a substantial concern in our constitutional scheme, which relies on the proposition that the occupant of the Office of Chief Executive is positioned to ââdeal fearlessly and impartially withâ [its] duties,â even as Presidents may be âeasily identifiable target[s]â of legal process, personally vulnerable by virtue of the âvisibility of [the] office and the effect of [their] actions on countless people.â Fitzgerald, 457 U.S. at 752â53 (quoting Ferri v. Ackerman,444 U.S. 193, 203
(1979)).
To be sure, the third subpoena to Deutsche Bank, which is identical to the
Deutsche Bank subpoena issued by the Committee on Financial Services, emanates
from the Permanent Select Committee on Intelligence and is more closely linked
to the consideration of legislation related to the Office of the Chief Executive and
to this Presidentâs affairs, as a recent candidate. 20 The majority is correct,
20As the majority states, the Chair of the Intelligence Committee has publicly
affirmed that the Committee is investigating matters related to interference by the
Russian government in the U.S. political process and that the information sought from
Deutsche Bank will inform legislative proposals to protect this process from foreign
influence. Maj. Op at 62â64. The House Intelligence Committee, moreover, has an
oversight function to which its subpoena could conceivably relate. At the same time,
29
moreover, that once presented with adequate evidence of legislative authorization
and purposes, it is not the province of courts to inquire into legislatorsâ motives,
see Maj. Op. at 50â51, and that âmotives alone would not vitiate an investigation
which had been instituted by a House of Congress if that assemblyâs legislative
purpose is being served.â Watkins, 354 U.S. at 200.
At the same time, as the majority also affirms, the record must provide
âsufficient evidence of legislative authorization and purposes to enable
meaningful judicial review.â Maj. Op. at 55. And this is particularly the case
when a congressional investigation even potentially trenches upon constitutional
however, no House resolution appears specifically to reference this investigation, at least
as it relates to efforts to seek the Presidentâs financial information, nor is such a legislative
purpose easy to square with the extraordinary breadth of the Deutsche Bank subpoenas.
The Chair, moreover, has also affirmed that the Committeeâs investigation is in
furtherance of Congressâs duty to âensure that U.S. officialsâincluding the Presidentâ
are serving the national interest and, if not, are held accountable.â Press Release,
Permanent Select Comm. on Intelligence, Chairman Schiff Statement on House
Intelligence Committee Investigation (Feb. 6, 2019), bit.ly/2UMzwTE. The Plaintiffs
argue that the subpoena is thus not in furtherance of legislative purposes, but represents
an effort by the Committee to itself conduct intelligence and law enforcement activities.
Trump Br. at 35â36. Indeed, at oral argument, the Committeesâ lawyer appeared
explicitly to equate these subpoenas to those issued in connection with federal criminal
investigations. Tr. of Oral Arg. at 59:14â60:2. While I do not decide whether the
Intelligence Committee has affirmatively avowed an improper purpose, the amorphous
nature of the Committeeâs legislative purpose would be clarified by my proposed
remand, as would the connection between this purpose and the particular disclosures
that are sought.
30
limits on Congressâs investigative power. See Rumely, 345 U.S. at 46(noting that such limits should be identified by courts only after âCongress has . . . unequivocally authoriz[ed] an inquiry of dubious limitsâ). Indeed, in such circumstances, the Supreme Court has made clear that courts are to look to the âinstructions to an investigating committee,â as âembodied in the authorizing resolution,â to ascertain whether the legislative assembly has âassay[ed] the relative necessity of specific disclosures.â Watkins,354 U.S. at 201, 206
.
Considered in light of the separationâofâpowers concerns that persist with regard
to these subpoenas, the Plaintiffs have raised a serious question on this front as
well.
As to both the House Financial Services and Intelligence Committee
subpoenas, there is an open question as to whether these subpoenas have been
authorized by the House of Representatives in a manner permitting this Court to
determine whether they are âin furtherance of . . . a legitimate task of the
Congress.â Watkins, 354 U.S. at 187. As the Watkins Court explained, â[t]he
theory of a committee inquiry is that the committee members are serving as the
representatives of the parent assembly in collecting information for a legislative
purposeâ and that âthe House or Senate shall have instructed the committee
31
members on what they are to do with the power delegated to them.â Id.at 200â 01. The majority acknowledges Watkinsâs requirement that an authorizing resolution âspell out [an investigating committeeâs] jurisdiction and purpose with sufficient particularityâ as to ensure that âcompulsory process is used only in furtherance of a legislative purpose.âId. at 201
; see Maj. Op. at 51, 79â80.
Critically, moreover, the majority itself recognizes that â[i]t is not clear whether
this passage can be satisfiedâ with regard to these subpoenas by the principal
instruction in place here, at the time the subpoenas issued: namely, the
instruction âthat the House gives to a committee pursuant to a House rule defining
a standing committeeâs continuing jurisdiction.â Maj. Op. at 52â53.
The majority treats House Resolution 507 as the cureâall solution to this key
uncertainty, rejecting the Plaintiffsâ argument that it is not properly considered on
the subject of legislative authorization and purposes because it issued after the
subpoenas themselves.21 But House Resolution 507 falls far short of a specific
21 The majorityâs support for this conclusion derives solely from cases discussing,
in the contempt prosecution context, what evidence may be considered in evaluating
whether a question posed to a witness before a congressional committee was pertinent to
an investigationâs inquiry. See Watkins, 354 U.S. at 201â02; Rumely, 345 U.S. at 48; Shelton v. United States,327 F.2d 601, 607
(D.C. Cir. 1963); see also Maj. Op. at 54â58. This issue
is distinct from the threshold question of whether a committee is adequately authorized,
so that the majority must necessarily reason by analogy, and its conclusion is far from
inevitable, particularly in the context of thirdâparty subpoenas aimed at a Presidentâs
32
âauthorizing resolutionâ issued to make clear that a designated committee is to
undertake an investigation on a particular subject within its domain. To be sure,
McGrain found sufficient a resolution that did not âin terms avow that it [was]
intended to be in aid of legislation,â on the theory that âthe subjectâmatter was
such that [a] presumption should be indulgedâ that legislating âwas the real
object.â 273 U.S. at 177â78. But in a context like this, presenting serious
constitutional concerns, courts âhave adopted the policy of construing . . .
resolutions . . . narrowly, in order to obviate the necessity of passing on serious
constitutional questions.â Tobin, 306 F.2d at 274â75. And this resolution on its
face discusses none of the subpoenas here, nor even the work of the committees
from which they issued. Instead, House Resolution 507 authorizes any subpoena,
by any standing or permanent select committee, already issued or in the future to
be issued, so long as it concerns the President, his family, or his business entities
and organizations:
personal information, where the President must be able efficiently (and without undue
distraction) to determine what, if any, steps she should take, either to assist the inquiry
or, as here, to litigate. I need not address this question, however, because, even
assuming that Resolution 507 is properly considered, a serious question remains as to
whether it constitutes what the majority acknowledges is required: âsufficient evidence
of legislative authorization and purposes to enable meaningful judicial review.â Maj.
Op. at 55.
33
Resolved, That the House of Representatives ratifies and
affirms all current and future investigations, as well as all subpoenas
previously issued or to be issued in the future, by any standing or
permanent select committee of the House, pursuant to its jurisdiction
as established by the Constitution of the United States and rules X and
XI of the Rules of the House of Representatives, concerning or issued
directly or indirectly to â
(1) the President in his personal or official capacity;
(2) his immediate family, business entities, or
organizations;
...
(9) any third party seeking information involving,
referring, or related to any individual or entity described in
paragraphs (1) through (7).
H.R. Res. 507, 116th Cong. (2019); see also H.R. Res. 509, 116th Cong. § 3 (2019)
(âHouse Resolution 507 is hereby adoptedâ).
By purporting to authorize thirdâparty subpoenas for any and all past and
future investigations into the Presidentâs personal and official business, Resolution
507 would appear to run directly into the primary concern in Watkins that
â[b]roadly drafted and loosely wordedâ resolutions can âleave tremendous
latitude to the discretion of investigators,â 354 U.S. at 201, and thus permit committees âin essence, to define [their] own authority,âid. at 205
. As Watkins
emphasized, â[a]n essential premiseâ underlying the investigatory powers of a
congressional committee to compel the production of documents or attendance by
an individual âis that the House or Senate shall have instructed the committee
34
members on what they are to do with the power delegated to them.â Id. at 201. Absent that instruction, such subpoenas defy judicial review, the Watkins Court understood, because âit is impossible . . . to declare that [a committee] has ranged beyond the area committed to it by its parent assembly.âId. at 205
.
To be clear, Watkins addressed this problem in the context of a House
proceeding implicating a private citizenâs constitutional liberties, and not
separation of powers. But its caution is still relevant: that âexcessively broad
charter[s]â to investigating committees make it difficult, if not impossible, for
courts âto ascertain whether any legislative purpose justifies the disclosures
sought and, if so, the importance of that information to the Congress in furtherance
of its legislative function.â Id.at 205â06. With respect, the majority thus errs in dismissing the Department of Justiceâs concern that the blankâcheck approach adopted here to authorizing thirdâparty subpoenas seeking personal information about the President and his family represents âa failure of the House to exercise âpreliminary control of the Committee[s],ââ see Brief of United States as Amicus Curiae at 19 (quoting Watkins,354 U.S. at 203
)âa failure which not only throws
into question the adequacy of authorization in this case, but which also raises
significant issues for the future regarding interbranch balance and the ability of
35
this and future Presidents to perform their duties without undue distraction, id.at 5â7; see Jones,520 U.S. at 690
(noting that ârepresentations made on behalf of the
Executive Branch as to the potential impactâ of inquiries on the Office of the
President âmerit our respectful and deliberate considerationâ). 22 In short,
Resolution 507 itself, given its retrospective and prospective nature, and its
purported authorization of any and all thirdâparty committee subpoenas seeking
not only official, but personal information about the President, his family, and his
businesses, presents a serious question as to whether the House has discharged its
22 The Department of Justice argues that a clear statement rule should apply to the
authorization of legislative subpoenas seeking a Presidentâs personal information. Brief
of United States as Amicus Curiae at 10. The majority dismisses this argument, noting
that neither Franklin v. Massachusetts, 505 U.S. 788, nor Armstrong v. Bush,924 F.2d 282
(D.C. Cir. 1991), on which the Department relies, concern congressional subpoenas, but statutes âclaimed to limit presidential power.â Maj. Op. at 89. But Rumely makes clear that the duty of constitutional avoidance (implemented, in part, through mechanisms such as clear statement rules) âis even more applicableâ in the context of congressional investigations than in the interpretation of statutes.345 U.S. at 46
. It also affirms that â[w]henever constitutional limits upon the investigative power of Congress have to be drawn . . . , it ought only to be done after Congress has demonstrated its full awareness of what is at stake by unequivocally authorizing an inquiry of dubious limits.âId.
In short, while I need not at this time reach the question, the Departmentâs clear statement argument merits serious consideration, as does its assertion that the Houseâs âblankâ checkâ approach to use of compulsory process directed at the President, his family, and his businesses runs afoul of Watkinsâs caution that â[a] measure of added care on the part of the House and the Senate in authorizing the use of compulsory processâ would help âprevent the separation of power from responsibility.â354 U.S. at 215
.
36
âresponsibility . . . in the first instance, to insure that compulsory process is used
only in furtherance of a legislative purpose.â Watkins, 354 U.S. at 201.
II
These thirdâparty legislative subpoenas thus raise serious questions on the
merits, implicating substantial separationâofâpowers concerns. In such a context,
Rumelyâs caution kicks in, which âcounsel[s] abstention from adjudication unless
no choice is left.â 345 U.S. at 46. The majority disagrees, asserting that even
assuming serious questions regarding the separation of powers have been raised,
affirmance here is still required because our âserious questionsâ approach to
whether a preliminary injunction should issue is unavailable in the context of these
thirdâparty legislative subpoenas. 23 I have already outlined my disagreement
23 The majority also argues that any serious questions presented here âare
properly rejected at this stage of the litigationâ because they âinvolve solely issues of
law.â Maj. Op. at 101. I disagree. As an initial matter, our case law has recognized
that, in appropriate circumstances, purely legal issues can present sufficiently serious
questions to warrant a preliminary injunction. See, e.g., Haitian Centers Council, Inc. v.
McNary, 969 F.2d 1326, 1339â40 (2d Cir. 1993) (finding sufficiently serious questions going to the merits based on the novel questions of law presented by plaintiffsâ claims), judgment vacated as moot by Sale v. Haitian Ctrs. Council, Inc.,509 U.S. 918
(1993); see also,
e.g., 11A Charles Alan Wright, Arthur R. Miller & Mary Kay Kane, Federal Practice and
Procedure § 2948.3 (3d ed.) (Westlaw) (database updated August 2019) (referring to âthe
existence of a factual conflict, or of difficult questions of law,â as components of the merits
showing in the preliminary injunction context (emphasis added)). Moreover, the
majority itself is remanding for some development of the factual record. As set forth
herein, I conclude that the majorityâs limited remand is inadequate, and that the record
37
with the majorityâs determination that âthis case does not concern separation of
powers,â Maj. Op. at 89, and that the questions raised, even if âserious in at least
some sense, lack merit,â id. at 101. I also disagree as to the supposed
unavailability of our traditional preliminary injunction approach. Indeed, I
conclude, with respect, that the majority badly errs in deciding that this approach
is unavailable in the sensitive context of challenges to congressional subpoenas.
As the Supreme Court made clear in Winter v. Natural Resources Defense
Council, Inc., â[a] plaintiff seeking a preliminary injunction must establish that he
is likely to succeed on the merits, that he is likely to suffer irreparable harm in the
absence of preliminary relief, that the balance of equities tips in his favor, and that
an injunction is in the public interest.â 555 U.S. 7, 20(2008). The majority acknowledges that, as to the required merits showing, we have repeatedly said in this Circuit that âdistrict courts may grant a preliminary injunction where a plaintiff . . . meets either of two standards: â(a) a likelihood of success on the merits, or (b) sufficiently serious questions going to the merits to make them a fair ground for litigation.ââ Maj. Op. at 11â12 (quoting Kelly v. Honeywell Intâl, Inc.,933 F.3d 173, 184
(2d Cir. 2019)). When a plaintiff has demonstrated only âserious
needs further factual development before the legal issues here can be adequately assessed.
38
questionsâ as to the merits, however, the plaintiff has a higher burden as to the
third element: he must show that the balance of hardships tips decidedly in his
favor. See Kelly, 933 F.3d at 184; Maj. Op. at 11â12. The majority also acknowledges that we have reaffirmed our traditional approach in the wake of the Supreme Courtâs decision in Winter. See Citigroup,598 F.3d at 38
(âhold[ing] that
our venerable standard for assessing a movantâs probability of success on the
merits remains validâ). 24 Irreparable harm is not in question in this case,
moreover, because, inter alia, the Plaintiffs have an interest in keeping their
banking records private from Congress and neither House committee will commit
to treating any portion of the voluminous personal and business records that they
seek as confidential. J.A. at 122â23. In such circumstances, the majority and I
are in agreement that compliance with these subpoenas will cause irreparable
Citigroup carefully assessed Winterâs import and concluded that our traditional
24
approach is wholly consistent with that precedent and is properly retained, given â[t]he
value of this circuitâs approach to assessing the merits of a claim at the preliminary
injunction stage,â which âlies in its flexibility in the face of varying factual scenarios and
the greater uncertainties inherent at the outset of particularly complex litigation.â
Citigroup, 598 F.3d at 35. Moreover, Citigroup made clear that, under either the âserious questionsâ or the âlikelihood of successâ formulation, courts in this Circuit consider all four elements articulated by the Supreme Court in Winter. Seeid. at 34
, 38 (citing Winter,555 U.S. at 20
).
39
harm to the President, his family, his businesses, and his business associates.
Maj. Op. at 13â14.
The majority asserts that a preliminary injunction is nonetheless unavailable
based on our âserious questionsâ formulation of the merits inquiry because of the
soâcalled âgovernment action exceptionâ to this formulation, as expressed by this
Courtâs decision in Plaza Health Laboratories, Inc. v. Perales, 878 F.2d 577, 580(2d Cir. 1989). I disagree. To be sure, our case law has recognized three narrowly defined situations in which a movant cannot obtain a preliminary injunction under the âserious questionsâ formulation. See id.; Tom Doherty Assocs., Inc. v. Saban Entmât, Inc.,60 F.3d 27
, 33â34 (2d Cir. 1995); Abdul Wali v. Coughlin,754 F.2d 1015, 1025
(2d Cir. 1985). But Plaza Health, on which the majority relies, is not
applicable.
To explain my conclusion requires a step back from our traditional
formulation, to set forth why this Circuit was correct to reaffirm our serious
question approachâand, indeed, why we err today in expanding a formulaic
exception to it. While sometimes styled in our case law as its own âstandard,â
see, e.g., OtoeâMissouria Tribe of Indians v. N.Y. State Depât of Fin. Servs., 769 F.3d 105,
110 (2d Cir. 2014), the âsufficiently serious questions, plus a balance of hardships
40
tipping decidedly in favor of the moving partyâ approach is not actually a separate
test at all, but rather a way of articulating one point on a single sliding scale that
balances likelihood of success against hardship in determining whether a
preliminary injunction should issue. See 11A Charles Alan Wright, Arthur R.
Miller & Mary Kay Kane, Federal Practice and Procedure § 2948.3 (3d ed.) (Westlaw)
(database updated August 2019) (hereinafter âWright & Millerâ) (referring to the
Second Circuitâs âserious questionsâ formulation as â[p]robably the most oftenâ
quoted statementâ of the sliding scale principle). Likelihood of success, while of
âparticular importanceâ in this inquiry, is not determinative, but must be
considered and balanced with the relative hardship each side is likely to face from
the determination whether an injunction issues, with the soâcalled âserious
questionsâ standard emerging as simply one point on the sliding scale at which an
injunction may be warranted.25 Id. This flexible approach is particularly wellâ
suited to the preliminary injunction context, where courts act pursuant to
25 As Judge Frank articulated decades ago, when âthe balance of hardships tips
decidedly toward plaintiff,â it should âordinarily be enough that the plaintiff has raised
questions going to the merits so serious, substantial, difficult and doubtful, as to make
them a fair ground for litigation and thus for more deliberate investigation.â Hamilton
Watch Co. v. Benrus Watch Co., 206 F.2d 738, 740 (2d Cir. 1953).
41
equitable principles.26 See, e.g., Holland v. Florida, 560 U.S. 631, 649â50 (2010) (âIn
emphasizing the need for flexibility . . . we have followed a tradition in which
courts of equity have sought to relieve hardships which, from time to time, arise
from a hard and fast adherence to more absolute legal rules, which, if strictly
applied, threaten the evils of archaic rigidity.â (internal quotation marks,
alterations, and citations omitted)).
Against this backdrop, our soâcalled âexceptionsâ to the serious questions
formulation are best understood not in prescriptive terms, but as the articulation
of principles guiding the application of the sliding scale calculus in particular
scenarios. As relevant here, the Plaza Health âexceptionâ thus reflects a
considered judgment, drawing on equitable ideas, that â[w]here the moving party
seeks to stay government action taken in the public interest pursuant to a statutory
or regulatory scheme,â the serious questions formulation should be generally
unavailable precisely because the balance of hardships is so unlikely to tip
26 Indeed, confining preliminary injunctions to circumstances in which a plaintiff
has shown there is no difficult question of law that could ultimately go against him would
âdeprive the remedy of much of its utility.â Wright & Miller § 2948.3; see also Citigroup,
598 F.3d at 35 (noting that â[p]reliminary injunctions should not be mechanically
confined to cases that are simple or easy,â as happens when the likelihoodâofâsuccess
standard is formulaically employed).
42
decidedly in that partyâs favor. Able v. United States, 44 F.3d 128, 131(2d Cir. 1995) (quoting Plaza Health,878 F.2d at 580
). In issuing a preliminary injunction based
on the conclusion that it does, a court impermissibly âsubstitute[s] its own
determination of the public interestâ for the one reflected in the statutory or
regulatory scheme. Id. at 132.
Accordingly, where government action has been fairly characterized as
taken pursuant to a statutory or regulatory scheme, we have generally applied the
likelihoodâofâsuccess standard. See Citigroup, 598 F.3d at 35n.4 (articulating the exception as limited to situations in which âa moving party seeks to stay government action taken in the public interest pursuant to a statutory or regulatory schemeâ). And where movants have sought preliminarily to enjoin government action pursuant to a federal statutory or regulatory scheme, we have explained that in the context of such action, âdeveloped through presumptively reasoned democratic processesâ and resulting from âthe full play of the democratic process involving both the legislative and executive branches,â it is difficult to envision any circumstance in which a movant could demonstrate that the balance of hardships tips decidedly in his favor. Able,44 F.3d at 131
.
43
The majority argues that the Plaza Health exception sweeps more broadly,
relying for this proposition on cases involving action taken by state and local
governments. 27 See Maj. Op. at 15â16. While certain of these cases did not
analyze why the Plaza Health exception was applicable, and appear simply to have
assumed that the government action in question was taken pursuant to a statutory
or regulatory scheme, see, e.g., Cent. Rabbinical Cong., 763 F.3d at 192; Monserrate,599 F.3d at 154
, those that did engage with this analysis explicitly identified a
statutory or regulatory scheme and accordingly concluded that the presumptive
27 See, e.g., Cent. Rabbinical Cong. of U.S. & Canada v. N.Y.C. Depât of Health & Mental
Hygiene, 763 F.3d 183, 192(2d Cir. 2014) (likelihoodâofâsuccess standard applied to preliminary injunction sought by religious organizations against a city ordinance based on the courtâs conclusion, without further analysis, that the ordinance constituted âgovernment action taken in the public interest pursuant to a statutory or regulatory schemeâ (citation omitted)); Monserrate v. N.Y. State Senate,599 F.3d 148, 154
(2d Cir. 2010) (same, as to a preliminary injunction seeking to unwind the expulsion of a state senator); NAACP v. Town of East Haven,70 F.3d 219, 223
(2d Cir. 1995) (likelihoodâofâsuccess standard applied to a preliminary injunction seeking to enjoin a town from hiring police officers or firefighters, based on the courtâs conclusion that the town acted âin the public interestâ and âpursuant to established municipal regulations and state civil service lawsâ); N.Y. Urban League, Inc. v. State of New York,71 F.3d 1031
, 1036 n.7 (2d Cir. 1995) (applying likelihoodâofâsuccess standard to a preliminary injunction seeking to bar transit authority from implementing a proposed fare increase on the basis that the action in question âwas to be implemented in accordance with the special powersâ of the transit authority board as set forth in a state statute); see also Molloy v. Metro. Transp. Auth.,94 F.3d 808, 811
(2d Cir. 1996) (relying on New York Urban League in applying the likelihoodâ
ofâsuccess standard to a preliminary injunction sought against transit authorityâs
implementation of a staff reduction plan).
44
public interest weighed against the movant, see, e.g., NAACP, 70 F.3d at 223; see also, e.g., OtoeâMissouria Tribe of Indians,769 F.3d at 110
(determining that New
Yorkâs ban on certain loans was âa paradigmatic example of governmental action
taken in the public interest, one that vindicated proven policies implemented
through legislation or regulationsâ and therefore applying the likelihoodâofâ
success standard (internal quotation marks and citations omitted)).28
Where, by contrast, government action has not been taken pursuant to a
specific statutory or regulatory scheme, the narrow Plaza Health exception has not
been applied, precisely because the public interest has not been presumed to rest
with a single party. This explains why this Court recently upheld the denial of a
preliminary injunction sought by President Trump to restrain the enforcement of
a grand jury subpoena issued by the New York County District Attorney without
applying the Plaza Health exception in determining the applicable preliminary
injunction standard. See Trump v. Vance, 941 F.3d 631, 639â40 (2d Cir. 2019). It explains our decision in Haitian Centers Council, Inc. v. McNary,969 F.2d 1326
(2d Cir. 1993), judgment vacated as moot by Sale v. Haitian Ctrs. Council, Inc.,509 U.S. 918
28 Such cases may also exhibit an especial hesitancy on the part of federal courts
to substitute their own view of the public interest for that reached by local and state
governments in light of principles of comity and federalism.
45
(1993), in which we applied the serious questions standard to an injunction sought
against the actions of the Immigration and Naturalization Service only after
rejecting the governmentâs argument that the action was taken âpursuant to
Congressâ[s] broad grant of authority in the [Immigration and Nationality Act],â
and reasoning that âin litigation such as is presented herein, no party has an
exclusive claim on the public interest,â id; see also, e.g., Patton v. Dole, 806 F.2d 24, 29â30 (2d Cir. 1986); Hudson River Sloop Clearwater, Inc. v. Depât of Navy,836 F.2d 760
, 763 (2d Cir. 1988); Mitchell v. Cuomo,748 F.2d 804
, 806â07 (2d Cir. 1984); cf. Carey v. Klutznick,637 F.2d 834, 839
(2d Cir. 1980) (rejecting the Census Bureauâs
argument that âthe public interest [rests] solely with itâ).
The government action at issue in the instant case plainly falls outside the
current confines of the narrow Plaza Health exception. Here, far from a situation
in which a movant seeks to enjoin action that is the product of âthe full play of the
democratic process,â Able, 44 F.3d at 131, these legislative subpoenas, with due
respect, do not constitute governmental action pursuant to a statutory or
regulatory scheme and do not reflect the presumptively publicâinterested actions
of both the legislative and executive branches. Rather, each subpoena is the
46
product of a subâcomponent of a single chamber of one branch of the federal
government and, critically, implicates the interests of another branch.29
The majorityâs approach, which concludes that, because the Committees act
pursuant to powers under the Constitution, such action should â[s]urely . . . notâ
be evaluated under a âless rigorous standardâ than that âapplied to plaintiffs
seeking to preliminary enjoin state and local units of governmentâ in cases such as
Central Rabbinical Congress and Monserrate, Maj. Op. at 20â21, is misguided for two
reasons. First, by deeming the âserious questionsâ standard to be less rigorous,
the majority ignores the fact that the ultimate burden is equivalent under both
standards.30 More fundamentally, the majority errs by categorically extending
29 Indeed, precisely because subpoenas of this sort implicate separation of powers
so that neither Congress nor the Plaintiffs can be taken to represent the public interest
with regard to their enforcement, the D.C. Circuit in Mazars declined to determine, in an
analogous context, what deference it owed to the congressional subpoena reviewed in
that case. Mazars, 940 F.3d at 726.
30 As is the nature of a sliding scale, the variables move in tandem and the
Plaintiffsâ ultimate burden is equivalent either way. The majority perceives tension
between this Courtâs observation in Citigroup that the âoverall burdenâ of the serious
questions standard is âno lighter than the one it bears under the âlikelihood of successâ
standard,â Citigroup, 598 F.3d at 35, and language in our other opinions that refers to the likelihoodâofâsuccess standard as âmore rigorous,â see, e.g., Cent. Rabbinical Cong.,763 F.3d at 192
. See Maj. Op. at 14 n.22. I disagree. Because one standard requires a more
demanding showing as to the merits and a correspondingly less demanding showing as
to hardship, while the other standard requires the reverse, the overall burdens are clearly
equivalent. Deeming the likelihoodâofâsuccess standard to be âmore rigorousâ refers
only to its increased rigor as to the required merits showing. It was for this reason,
47
the Plaza Health exception to a situation in which âno party has an exclusive claim
on the public interest,â Time Warner Cable of N.Y.C. v. Bloomberg L.P., 118 F.3d 917,
923(2d Cir. 1997) (quoting Haitian Centers,969 F.2d at 1339
), when the soâcalled
âgovernment action exceptionâ is premised entirely on the assumption that the
public interest weighs decidedly against the movant.
To be clear, preliminary injunctions constitute an extraordinary form of
relief and should not issue lightly. See, e.g., Mazurek v. Armstrong, 520 U.S. 968,
972(1997) (quoting Wright & Miller § 2948). The majorityâs expansion of our soâ called âgovernment action exceptionâ into the delicate arena of congressional investigations, however, is unwise, precisely because this is a context in which flexible application of equitable principles is vital. Historically, federal courts have undertaken some of their most difficult assignments in the context of reviewing the actions of congressional committees. The Supreme Court has thus been required to take on the âarduous and delicate taskâ of â[a]ccommodat[ing] . . . the congressional need for particular information with the among others, that we concluded in Citigroup that the Supreme Courtâs decision in Winter revealed âno command . . . that would foreclose the application of our established âserious questionsâ standard as a means of assessing a movantâs likelihood of success on the meritsâ against the other components required to obtain preliminary relief.598 F.3d at 38
.
48
individual and personal interest in privacy.â Watkins, 354 U.S. at 198. It has been called upon to address the â[g]rave constitutional questionsâ presented when âthe power of Congress to investigateâ appears to encroach on the limits on that power imposed by the Bill of Rights and, in particular, the First Amendment. Rumely,345 U.S. at 44, 48
. Disputes between congressional committees and Presidents arising from subpoenas, as here, also not uncommonly require courts to âsearch for accommodation between the two branchesââa task for which this Circuitâs flexible approach to making the difficult judgment whether a preliminary injunction should issue is particularly wellâsuited. United States v. Am. Tel. & Tel. Co (âAT&T IIâ),567 F.2d 121
, 131 (D.C. Cir. 1977).
In short, we should not deprive ourselves of our traditional approach in
such a sensitive context. As we affirmed in Citigroup, â[r]equiring in every case
a showing that ultimate success on the merits is more likely than not is
âunacceptable as a general rule,ââ and also âdeprive[s] the remedy of much of its
utility.â 598 F.3d at 35â36 (quoting Wright & Miller § 2948.3). Because this case
is not squarely covered by Plaza Health or any other previouslyâarticulated
âexception,â I conclude we are bound to (and should) undertake our usual
approach: namely, to consider the Plaintiffsâ showing as to the merits, balance of
49
hardships (merged here with the public interest inquiry, see Nken v. Holder, 556
U.S. 418, 435 (2009)), and irreparable harm and determine whether an injunction
is warranted under either the likelihood of success or serious questions standard.
As set forth already, moreover, these subpoenas do, in fact, present serious
questions implicating not only the investigative authority of these two House
committees, but the separation of powers between Congress and the Presidency.
* * *
Having determined that Plaintiffs have raised serious questions as to the
merits, in the usual case, the next step would be to assess the balance of hardships.
But this leads to my final point of departure from the majority. The majority
orders immediate compliance with these subpoenas save for a âfew documents
that should be excludedâ pursuant to its call for a restricted culling of certain
records assembled under specific subpoena categories. Maj. Op. at 86. In
contrast, I would not remand for the limited culling ordered by the majority, but
would instead remand in full, directing that the district court assist in the
development of the record regarding the legislative purposes, pertinence, privacy,
and separationâofâpowers issues at stake in this case.
50
I would request the district court on remand promptly to implement a
procedure by which the Plaintiffs identify on privacy or pertinency grounds
specific portions of the material assembled in response to these subpoenas for
nondisclosure. Like the majority, I would then provide counsel for the
Committees with an opportunity to object, but I would also require counsel,
provided with a general description of such material, to articulate clearly the
legislative purpose that disclosure serves and to specify how the material sought
is pertinent to that purpose. Even assuming, arguendo, that the Committees act
pursuant to adequate authorization from the House as a whole, serious questions
persist as to the ends the Committees are pursuing and whether these ends are
adequate to justify the soughtâafter disclosures.31 A fuller record would permit a
more informed calculus regarding balance of hardships and would further clarify
the stakes as to the serious questions that the Plaintiffs have already raised. This
full remand is superior to the majorityâs approach for at least three reasons.
31As to the âcase studyâ rationale proffered by the House Financial Services
Committee, for instance, if that Committee is unable more clearly to articulate the
pertinence of its subpoenas to the legislative purposes it pursues, see Watkins, 354 U.S. at
214â15, the balance of hardships may well lie with the Plaintiffs, who will suffer
irreparable harm from the disclosure of their private and business affairs.
51
First and most fundamentally, remand is necessary here because the present
record does not permit a full assessment of either the serious questions raised by
these novel subpoenas or the balance of hardships with regard to specific
disclosures. The present record is wholly insufficient to support the conclusion
that the voluminous material sought pursuant to these subpoenas should at this
time be produced. Serious questions arising from the lack of historical precedent
for these subpoenas, their questionable authorization, their legislative purposes,
and the pertinence of particular disclosures remain. The record as to hardship,
moreover, is sparse, and does not reflect either partiesâ concerns as to the disclosure
or nondisclosure of particular categories of information sought by these
extraordinarily broad subpoenas. The majority disagrees on both counts,
concluding that while the questions here may be âserious,â they are without merit,
Maj. Op. at 100â01, and that even if the balance of hardships tips in Plaintiffsâ favor,
it does not do so âdecidedly,â Maj. Op. at 102. For the reasons already expressed,
however, I cannot join in this assessment.
Next (and notably), a broader remand is necessary here, even taking the
majority on its own termsâeven assuming (incorrectly) that the district courtâs
judgment could be substantially affirmed on the present record. This is because
52
the majorityâs remand is inadequate to address the privacy and pertinency
concerns that the majority itself identifies and deems important. As to sensitive
personal information and an unspecified category of ânonpertinentâ material, the
majority concludes that the Plaintiffs should be afforded an opportunity to object
to disclosure on privacy and pertinency grounds. It notes that â[t]he Committees
have advanced no reason why the legislative purposes they are pursuing require
disclosureâ of âpayment for anyoneâs medical expenses,â for instance, and the
majority thus forbids it. Maj. Op. at 84. But by providing the Plaintiffs with an
opportunity to object only as to limited, specific categories of information sought
pursuant to these subpoenas, the majority creates the very potential for
unwarranted disclosure of sensitive information that it purports to disallow. The
majority thus orders compliance with, for instance, the Deutsche Bank subpoenaâs
demand for âany document related to any domestic or international transfer of
funds in the amount of $10,000 or more,â including any âcheck,â J.A. at 38,
providing no opportunity for Plaintiffs to object that the soughtâafter material is
sensitive and related to no legislative purpose at all.
Perhaps there is no material responsive to this category that would trigger
Rule 26(c)(1)âs protections against âembarrassment, oppression, or undue burdenâ
53
in a routine civil case. Fed. R. Civ. P. 26(c)(1). Perhaps such material does exist.
We cannot know until the documents are assembled and objections are made.
The privacy and pertinency concerns that the majority purports to address simply
cannot be addressed in the abstract. And by declining a full remand to permit a
record to be made, the majority affords less protection against the unwarranted
disclosure of personal information regarding a sitting President and his family
than would be afforded to any litigant in a civil case.
Finally, I also disagree with the majorityâs implicit assessment that the
Plaintiffs have demonstrated no stake in the privacy of their businessârelated
information that merits further review. Indeed, to the extent that the majority
does show a reasonable concern for the needless disclosure of Plaintiffsâ private
and nonpertinent information, this concern does not generally extend to private
business information at all, even though such information may implicate the same
issues of privacy and (non)pertinence. To be sure, the majority is correct that
Congress must have the ability to investigate businesses (even closelyâheld ones)
in aid of legislation. And such investigations, serving a public good, will
sometimes cause competitive harm.32 But particularly in light of the very broad
32 Federal Rule of Civil Procedure 26(c)(1)(G) permits a district court to issue
54
disclosure sought by these subpoenas (which, with regard to many transactions,
could require the production of information from both this year and from decades
ago), the majority has proffered no clear reason for denying the Plaintiffs an
opportunity to object more generally to the disclosure of such material.
The majority argues that any hardship from business disclosures is offset in
this case by the fact that Presidents already âexpose for public scrutiny a
considerable amount of personal financial information pursuant to the financial
disclosure requirement of the Ethics in Government Act, 5 U.S.C. app. §§ 101â111.â
Maj. Op. at 102. But this is beside the pointâor perhaps makes the point that the
majorityâs approach is problematic.
Public disclosures made pursuant to the Ethics in Government Act are
required by law, pursuant to a statute that has run the gantlet of bicameralism and
presentment. In making disclosures pursuant to this Act, a President complies
with a statute that presumptively reflects a democratically enacted consensus
protective orders to prevent public disclosure of âconfidential . . . commercial
information,â a protection not afforded or offered to the Plaintiffs by the Committees
here. The majority does not include these competitive harms as âirreparable injuriesâ
in its analysis, restricting its focus only to âloss of privacy.â See Maj. Op. at 101â02. The
irreversible nature of the competitive harm risked by immediate and unconditional
disclosure, and the lack of safeguards common to typical discovery procedures in civil
litigation, further buttress my view that these subpoenas, as drafted, raise serious
questions which a remand would aid in resolving.
55
regarding the financial disclosures that a Chief Executive should be required to
make. These House subpoenas, by contrast, require âconsiderably more financial
information,â as the majority concedes, but themselves raise substantial questions
as to whether they are supported by âsufficient evidence of legislative
authorization and purposes to enable meaningful judicial review.â Maj. Op. at
55, 102. And as Judge Katsas suggested in dissent from the denial of rehearing
in banc in Mazars, the scope of required disclosure âis determined . . . by the whim
of Congressâthe Presidentâs constitutional rival for political powerâor even, as
in this case, by one committee of one House of Congress.â Mazars, 2019 WL
5991603, at *1 (Katsas, J., dissenting from the denial of rehearing en banc). In such
circumstances, and taking the majorityâs analysis on its own terms, it is not clear
why the majority limits its remand to the particular categories of information that
it has selected, as opposed to permitting a more general opportunity to object
regarding nonpertinent business information and the irreparable injury that will
attend its disclosure.
For all the reasons that I have laid out here, this matter should be returned
to the district court. The remand that I have outlined would clarify the issues at
stake so that a reasoned determination could be made as to whether serious
56
questions persist, and where the balance of hardships lies. Indeed, given the lack
of historical precedent for these subpoenas; their extraordinary breadth; and the
persistent questions here regarding authorization, legislative purposes, and
pertinence, a remand for development of the record with regard to specific
categories of information is far preferable to the majorityâs approach.
Such a procedure would also encourage negotiation between the parties and
potentially narrow the scope of this dispute. Because I conclude, contrary to the
majority, that this case implicates the Supreme Courtâs caution to âtread warilyâ
in matters pitting the power of Congress to investigate against other substantial
constitutional concerns, Rumely, 345 U.S. at 46, and because the âserious questionsâ delineated above sound in separation of powers, see Pub. Citizen v. Depât of Justice,491 U.S. 440, 466
(1989) (noting that the Supreme Courtâs âreluctance to
decide constitutional issues is especially great where . . . they concern the relative
powers of coordinate branches of governmentâ), this matter falls within a range of
cases in which we should attempt, if possible, to âavoid a resolution that might
disturb the balance of power between the two branches,â AT&T II, 567 F.2d at 123.
Perhaps that is not possible here. But as the D.C. Circuit has recognized in the
past, congressional committees and the Chief Executive âhave a long history of
57
settlement of disputes that seemed irreconcilableâ and such resolutions, where
possible, are to be preferred, since â[a] court decision selects a victor, and tends
thereafter to tilt the scales.â AT&T I, 551 F.2d at 394; see alsoid. at 391
(noting
possibility of âbetter balance . . . in the constitutional senseâ from âpolitical
struggle and compromise,â rather than court decision); Rumely, 345 U.S. at 45â46
(noting that a â[c]ourtâs duty to avoid a constitutional issue, if possible, applies not
merely to legislation . . . but also to congressional action by way of resolutionââ
indeed, most especially in this context).
Accordingly, I would withhold decision as to balance of hardships and
remand to permit the district court and the parties the opportunity to provide this
Court with an adequate record regarding the legislative purpose, pertinence,
privacy and separation of powers issues in this case. Such a procedure, as in
AT&T I, 551 F.2d at 394â95, and AT&T II, 567 F.2d at 128â32, could narrow the
scope of the present dispute. But it is required in any event, because the record
simply does not support the majorityâs decision to order immediate compliance
with these subpoenas, but for a âfew documents,â Maj. Op. at 85, falling within its
preselected categories. To be clear, I reach this resolution guided by the Supreme
Courtâs admonition in Rumely that the outer reaches of Congressâs investigative
58
power are to be identified reluctantly, and only after Congress âhas demonstrated
its full awareness of what is at stake by unequivocally authorizing an inquiry of
dubious limits.â 345 U.S. at 46. Serious questions persist with regard to these subpoenasâquestions demanding close review lest such novel subpoenas prove a threat to presidential autonomy not only now but in the future, and âto the detriment of not only the President and his office but also the Nation that the Presidency was designed to serve.â Fitzgerald,457 U.S. at 753
. Once the parties
have provided this Court with the information that I would seek on remand, we
would at that point have a sufficient record on which to make a prompt and
reasoned determination as to where the balance of hardships lies and whether the
Plaintiffs, having raised serious questions on the merits, are entitled to preliminary
relief.
59