The House Ways and Means Committee lawsuit, in its quest for President Donald Trump’s tax returns, sets in motion a legal battle that may not be resolved before the 2020 presidential election.
Courts will be asked to decide not just whether the panel’s request for six years of Trump’s personal and business returns is legitimate, but also whether Congress can sue the executive branch. How quickly it all happens will likely depend on the judge assigned to the case, according to tax practitioners and professors. The issue could eventually reach the U.S. Supreme Court.
“To get this all resolved by the end of President Trump’s first term, we’ll need a district judge to put the pedal to the metal,” said Daniel Hemel, an assistant law professor at the University of Chicago Law School.
The committee’s July 2 complaint doubles down on Chairman Richard Neal’s (D-Mass.) reliance on tax code Section 6103. The code section gives the Ways and Means chairman, as well as the heads of the Joint Committee on Taxation and the Senate Finance Committee, the authority to request individual tax returns. Treasury Secretary Steven Mnuchin has previously said Ways and Means lacks a legitimate legislative purpose for its request.
One question courts will have to answer is whether the committee is allowed to sue the Treasury Department. The issue is a broad one: whether one government branch can sue another.
It comes down to whether Congress has something called “standing,” which is necessary under the Constitution in order to bring a federal suit.
“The Supreme Court has never blessed this. Different courts have come out different ways,” said Andy Grewal, a professor at the University of Iowa College of Law.
The standing objection can be overcome if the House authorizes the lawsuit, said George K. Yin, a professor at the University of Virginia School of Law. The complaint seems to anticipate this, he said. The document mentions a new House rule, which gave a House group the ability to authorize a lawsuit on behalf of the House.
“That could go far in protecting this standing issue,” he said.
A second question has to do with the specific request for the tax returns. While Section 6103(f) doesn’t require the committee to explain the reasoning for its request to Treasury, some say a court may still ask for one.
“Supreme Court precedent could be interpreted as requiring Congress to have a satisfactory motivation for the request,” said Harvard Law School professor Thomas J. Brennan. “So there’s debate to be had about what sort of rationale is needed.”
William Pittard, former acting general counsel and deputy general counsel for the House, said the administration is likely to lead with the standing argument rather than an argument focused on whether the tax return request has a legitimate legislative purpose. The latter has been Treasury’s primary argument up to this point, but it is a tougher one to win in court, he said.
That approach, for example, didn’t help in a recent case involving a House Oversight Committee subpoena for the president’s financial records from his accounting firm Mazars USA LLP. A federal judge ruled in favor of the House panel in May—a decision the president’s lawyers are currently appealing.
The courts may also decide that they can’t rule on the dispute because it involves a “political question,” a term that has special legal meaning.
“There are some questions the Supreme Court has said have to be resolved by the political process rather than by the judiciary,” said Howard E. Abrams, who is a visiting law professor at Harvard Law School. The technical term the court would use is that the case is “nonjusticiable.”
While the case works its way through the court system, the clock is ticking. Democrats would prefer to examine the documents before the 2020 elections.
And if Republicans retake the House, they could stop the lawsuit altogether.
“If the Republicans win, they will undoubtedly quash the request,” said Steven Rosenthal, a senior fellow in the Urban-Brookings Tax Policy Center. Rosenthal said that was the president’s “best hope.”
Pittard, a partner at KaiserDillon PLLC, said judge selection will be the biggest determinant for how quickly the tax return case moves through the courts. He pointed to a previous legal battle between the House and the Justice Department over records related to a gun-running investigation, known as “Operation Fast and Furious,” that took seven years to settle as an example of an outcome Ways and Means Democrats will want to avoid.
The recent cases involving clashes between the House and the Trump administration, including the one dealing with the president’s accounting firm, should provide some encouragement, Pittard said. It took only about a month for a judge to make a decision in that case.
Abrams said the Supreme Court may get involved if there is a quick decision and a quick appeal, because the case could answer constitutional-level questions. He pointed to when the Supreme Court took up arguments from former President Richard Nixon about executive privilege.
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