A judge for the US District Court for the Southern District of New York ruled on Monday that President Donald Trump is required to comply with a grand jury subpoena to provide his tax returns to the Manhattan District Attorney. However, within hours the US Court of Appeals for the Second Circuit issued an administrative stay blocking the order.
Trump appealed a grand jury subpoena obtained by Manhattan District Attorney Cyrus Vance in September for eight years of the president’s tax returns. The tax returns are part of an investigation into Trump’s business dealings in the state spurred by testimony of the president’s ex-lawyer Michael Cohen, who alleged that the President’s now defunct charity organization, the Trump Organization, reimbursed him for hush money payments made to cover up the president’s extramarital affairs. The Trump Organization claimed that the payments were merely a retainer fee. Under New York state law, recording hush money payments as legal fees is an illegal falsification of business records. As a result of the disagreement in the character of the payments, Vance requested the president’s tax returns to determine if the organization took part in an illegal scheme. In addition to asserting executive privilege over the tax returns, lawyers for Trump argued that the office of the presidency grants immunity from criminal prosecution by state litigators, making the subpoenas illegal to issue.
In his opinion, District Court Judge Victor Marrero rejected these claims, calling them “extraordinary” and an “overreach of executive power.” The judge stated that adopting Trump’s arguments would grant the president complete immunity from any investigation or prosecution while in office, upsetting the balance of powers upon which the Constitution is based. In Marrero’s view, to allow the president to defy the subpoena would be unconstitutional and the court could not “endorse such a categorical and limitless assertion of presidential immunity from judicial process.” The court dismissed the challenge to the subpoena, mandating that the president release the tax returns.
Trump’s legal team appealed the ruling immediately to the Second Circuit. In an administrative decision, the appeals court stayed the enforcement of the District Court’s order until an expedited appeal can be heard.
On Twitter, the president hailed the stay as a victory, saying that the case was politically motivated and that “a thing like this has never happened to any President before.” The Trump administration has routinely fought to block access to the president’s financial records, including challenging a California law that mandated their disclosure. Though not required under federal law, it has been customary for presidents to publicly release tax returns since at least 1974, with every president since then except Gerald Ford releasing their annual tax returns for every year that they have been in office.