Daily Tax Report: State

California Justices Find Cracks in Presidential Tax Returns Law

Nov. 6, 2019, 7:10 PM

Justices on California’s highest court appeared skeptical that the legislature can require presidential candidates to release five years of tax returns if they want to appear on the state primary ballot.

During oral arguments Nov. 6, justices pushed attorneys for California Secretary of State Alex Padilla (D) to defend the law, enacted in July and spawned by President Donald Trump’s refusal to release his tax returns.

“We searched the record to find legislative history of any consideration of the state Constitution,” Chief Justice Tani Gorre Cantil-Sakauye said to Supervising Deputy Attorney General Jay C. Russell. “We didn’t find any. Did you?”

Russell said lawmakers discussed the the legislature’s plenary power over state primary ballots while debating the measure, but acknowledged the record was scant.

The battle is one of several related to Trump’s tax returns at the state and federal level. The U.S. Supreme Court will likely have to eventually weigh in, although that may not happen before the 2020 presidential election. Earlier this week, Trump’s attorney said he would appeal a Second Circuit loss to the Supreme Court in a case in which Trump is trying to block a subpoena into his accounting firm.

If the state’s high court strikes down the ballot-access requirement for violating the California Constitution, no other court could review its interpretation of the state law involved. Although California officials are appealing their loss in related cases in federal court that put the law on hold, the outcome of those cases might not matter.

The Battle

Democratic leaders are defending a legal challenge from the state Republican Party that argues the law tramples Padilla’s state constitutional duty to place on the ballot the names of candidates who are recognized across the state or nation, or who have become ballot-eligible through petition.

“If you are a recognized candidate, no action of the legislature can keep you off the ballot,” said Thomas W. Hiltachk, attorney with Bell, McAndrews & Hiltachk LLP in Sacramento, representing the California Republican Party.

Justices focused on voter-approved provisions of the state Constitution from 1972 that require an open presidential primary.

“Why isn’t the notion of an open primary a limitation of what the legislature can do,” Justice Goodwin H. Liu asked Russell.

The state’s argument is the opposite: that the open primary rules allow for legislative requirements, he said.

Justices also asked whether lawmakers could go further to require birth certificates, or medical, school, divorce, mental health, or other records before candidates could appear on the primary ballot.

“Where does it end?” Justice Ming W. Chin asked. “Do we get all high school report cards?”

Russell said the legislature could require other information from candidates, but the information must have a link to providing honest, fair, and open elections.

The justices didn’t grant the Republican request to block the law immediately in light of the Nov. 26 deadline for Trump to provide his tax returns to be eligible for the March 3 primary ballot. The court has 90 days to issue a written ruling, but the justices have accelerated the case and could rule before Nov. 26.

The case is Patterson v. Padilla, Cal., No. S257302, oral arguments 11/6/19.

To contact the reporter on this story: Laura Mahoney in Sacramento, Calif. at lmahoney@bloomberglaw.com

To contact the editors responsible for this story: Jeff Harrington at jharrington@bloombergtax.com; Colleen Murphy at cmurphy@bloombergtax.com

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