Judges Express Skepticism Over Trump’s Bid to Block Tax Return Subpoena

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Judges Express Skepticism Over Trump’s Bid to Block Tax Return Subpoena

Judges on a federal appeals panel expressed skepticism at a hearing on Friday about President Trump’s arguments that a subpoena from the Manhattan district attorney seeking eight years of the president’s tax returns was overbroad and issued in bad faith.

The three judges challenged a central argument from Mr. Trump, who has been fighting the subpoena for more than a year. Lawyers for the president have argued that the demand was a politically motivated “fishing expedition,” looking to vacuum up documents related to business dealings far beyond the authority of the Manhattan prosecutor, Cyrus R. Vance Jr.

Pointedly questioning a lawyer for the president, the judges suggested that the subpoena could be justified because — even though the president has extensive financial dealings and real estate projects around the world — his company is based in New York and his tax returns have been filed there.

The subpoena was issued as part of a criminal investigation that Mr. Vance is conducting into Mr. Trump and his business practices.

“How is it a fishing expedition if a taxpayer’s tax returns cover operations nationwide, worldwide, outside of Manhattan island?” one of the judges, Pierre N. Leval, asked William S. Consovoy, a lawyer for the president.

Another judge, Raymond J. Lohier Jr., raised the possibility that the appeals panel could narrow the scope of the subpoena. He asked Mr. Consovoy whether there was any request for the president’s financial records that he would not consider overbroad.

“I think the answer is probably no, your honor,” Mr. Consovoy replied.

“That’s a problem,” the judge said.

The third judge, Robert A. Katzmann, noted in an exchange with Mr. Consovoy that grand juries were given broad investigative authority.

“Are you asking us to change the way grand juries have done their work for time immemorial just because we’re dealing with somebody who’s president of the United States?” the judge asked.

Mr. Consovoy responded that he was not. He said he was asking that the ordinary rules of challenging a subpoena “at least be extended to the president, and that he not be deprived of the basic protections that all other citizens receive.”

All three members of the appeals panel were appointed by Democrats. Judge Leval and Judge Katzmann were appointed to the court by President Bill Clinton, and Judge Lohier by President Barack Obama.

The oral arguments before the U.S. Court of Appeals for the Second Circuit came more than a year after Mr. Trump first sued Mr. Vance, a Democrat, in September 2019, seeking to block the subpoena, which was issued to the president’s accounting firm, Mazars USA.

Mr. Vance’s office was known to be investigating hush-money payments made before the 2016 election to two women who had said they had affairs with the president. The office has since suggested in court filings that the inquiry is much broader and could focus on financial crimes like tax and insurance fraud.

But Mr. Trump’s lawyers have continually claimed in court papers that the investigation was focused only on the 2016 payments, and so the subpoena for the tax returns and other financial records was excessive, they argued.

“If you were to look up the definition of a fishing expedition, this is it,” Mr. Consovoy told the appeals panel.

The president’s bitter legal battle with Mr. Vance’s office already has reached the Supreme Court, which in July rejected his initial argument: that as a sitting president, Mr. Trump had immunity from criminal investigation. But the justices said Mr. Trump could return to the lower court to argue that the subpoena was overbroad and or issued in bad faith, which he did.

In August, a federal judge, Victor Marrero, dismissed the president’s new objections.

“This is a continuation of the witch hunt, the greatest witch hunt in history,” Mr. Trump said after Judge Marrero’s ruling, adding that his case probably would end up back in the Supreme Court.

It was Mr. Trump’s appeal of Judge Marrero’s ruling that was argued on Friday.

Some of the discussion centered on the authority of grand juries and how such investigations proceed, as well as the rights of people who are under investigation — even a president.

“The recipient of a subpoena just doesn’t have a right to go to court and demand to be told what an investigation is all about,” Carey R. Dunne, a senior lawyer in Mr. Vance’s office, told the judges, adding: “It’s just not part of the process.”

In questioning lawyers for both sides, Judge Lohier and Judge Leval appeared to be drawing on personal experience: Each served as a federal prosecutor before joining the bench.

In one of his exchanges with Mr. Consovoy, Judge Lohier noted that grand jury investigations evolve over time.

“Every grand jury investigation, particularly of this importance,” the judge said, “will start to grow both in terms of the nature of the possible charges that the grand jury is investigating and in terms of the documents and witnesses” that may be of interest.

The appellate panel did not say when it would issue a ruling on the president’s appeal.

Even if Mr. Vance succeeds in eventually obtaining the president’s tax returns, grand jury secrecy rules make it unlikely they will become public anytime soon. They would surface only if criminal charges are brought and the documents are introduced at trial.

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