Cases and controversies: Congress, the subpoena power and a “legislative purpose”

Editor’s note: This post is part of an occasional series on legal issues presented by current topics in the news.  

When the Supreme Court returns to the bench in the fall, it will hear oral arguments on a variety of high-profile issues, including protection under federal employment laws for LGBT employees and the Trump administration’s decision to terminate the “Deferred Action for Childhood Arrivals” program, known as DACA, which allows undocumented immigrants who came to this country as children to apply for protection from deportation. But other issues are lurking in the wings, including conflicts between Congress and the White House over congressional demands for President Donald Trump’s financial records and tax returns. The Supreme Court has ruled that such requests must serve a “valid legislative purpose” – a requirement that it has interpreted as giving Congress broad, but not unlimited, power to investigate.

One case making its way through the courts is Trump v. Mazars LLP, the battle over the April 2019 subpoena issued by the House Oversight Committee to Mazars USA, Trump’s accounting firm, for financial records – dating back to 2011 – for Trump and his businesses. Before issuing the subpoena, committee chair Elijah Cummings sent a memorandum to other committee members in which he explained that the impetus for the subpoena was testimony by Michael Cohen, the president’s personal attorney, in February 2019, in which Cohen told members of the committee that the president’s financial statements were not accurate. Among other things, Cohen reported, the president sometimes either over- or under-reported the value of his assets, depending on the purpose for which the financial statements were being used.

Cummings wrote that the committee “has full authority to investigate whether the President may have engaged in illegal conduct before and during his time in office, to determine whether he has undisclosed conflicts of interest that may impair his ability to make impartial policy decisions, to assess whether he is complying with the Emoluments Clause of the Constitution, and to review whether he has accurately reported his finances to the Office of Government Ethics and other federal entities. The Committee’s interest in these matters,” Cummings concluded, “informs its review of multiple laws and legislative proposals under our jurisdiction.”

Trump asked a federal judge in Washington, D.C., to block the subpoena to Mazars, arguing that it went beyond Congress’ authority to conduct investigations and lacked a legislative purpose. Instead, Trump and his lawyers countered, the committee’s “true motive” was “to collect personal information about him solely for political advantage.” Moreover, they added, the subpoena was actually “law enforcement” activity directed at “the conduct of a private citizen years before he was even a candidate for public office.”

When U.S. District Judge Amit Mehta rejected Trump’s request in May, Trump took his case to the U.S. Court of Appeals for the District of Columbia Circuit, which heard oral argument in the president’s appeal on July 12. News reports indicate that two of the three judges on the panel hearing the case were skeptical of the president’s argument. If the court rules against the president, it could set up an appeal to the Supreme Court later this year or early next year.

At the same time, Trump is also trying to block subpoenas for banking records from Deutsche Bank – the president’s biggest creditor – and Capital One. In May, a federal judge in New York rejected a request from Trump’s lawyers to block those subpoenas, but U.S. District Judge Edgardo Ramos did agree to put the case on hold while Trump appealed to the U.S. Court of Appeals for the 2nd Circuit. On July 17, the 2nd Circuit asked the Department of Justice for its views on the dispute. Oral argument in that case is scheduled for August 23.

And yesterday Trump filed a lawsuit in federal district court in Washington to bar the House Ways and Means Committee from obtaining his New York tax returns. In another lawsuit, already pending in the same court, the committee is seeking the president’s federal tax returns from the Department of the Treasury, which declined to comply with a subpoena for them.

The Supreme Court first addressed the scope of Congress’ power to investigate in 1880, in a case called Kilbourn v. Thompson. The case arose after a special committee was created to investigate the bankruptcy of an investment firm that held U.S. government funds. Hallett Kilbourn was ordered to appear before the committee to testify and to bring records with him, but Kilbourn was held in contempt after he refused both to answer questions about the people involved and to bring records. The Supreme Court threw out the contempt order, holding that the House of Representatives did not have the power to authorize the investigation and, therefore, to force Kilbourn to testify. The court explained that no one can be punished for contempt “as a witness before either house unless his testimony is required in a matter into which that house has jurisdiction to inquire, and we feel equally sure that neither of these bodies possesses the general power of making inquiry into the private affairs of the citizen.”

The Supreme Court would address this issue again nearly 50 years later, in a case called McGrain v. Daugherty. During an investigation into charges of misconduct at the Department of Justice, a Senate committee issued a subpoena for the brother of the attorney general, but he did not appear or produce the records that the committee had requested. A lower court ruled that efforts to keep him in custody exceeded the Senate’s powers, but the Supreme Court reversed. Although nothing expressly gives Congress the power to investigate as part of its legislative function, the court explained, the power to obtain the information that it needs to legislate “has long been treated as an attribute of the power to legislate.”

The court explained that it had reached a different result in Kilbourn because the issue in that case was not one on which Congress could legislate, when a case was still pending in the bankruptcy court and “the United States and other creditors were free to press their claims in that proceeding.” But the court reiterated that the power to investigate “is an essential and appropriate auxiliary to the legislative function.” In this case, the court continued, although the resolution authorizing the investigation did not specifically say that it “is intended to be in aid of legislation,” it “does show that the subject to be investigated was the administration of the Department of Justice.” “Plainly,” the court emphasized, “the subject was one on which legislation could be had and would be materially aided by the information on which the investigation was calculated to elicit.” Indeed, the court added, the only legitimate reason for which the Senate could have ordered the investigation was to help it in legislating, “and we think the subject matter was such that the presumption should be indulged that this was the real object.” It would have been better, the court acknowledged, for the Senate to have said so explicitly, but it was not required to do so when the investigation related to the administration of the DOJ.

Since then, the court has reiterated that Congress’ power to investigate is broad — “as penetrating and far-reaching as the potential power to enact and appropriate under the Constitution.” That power allows Congress to make, for example, “inquiries concerning the administration of existing laws, as well as proposed or possibly needed statutes. It includes surveys of defects in our social, economic or political system for the purpose of enabling the Congress to remedy them,” as well as “probes into departments of the Federal Government to expose corruption, inefficiency or waste.”

Moreover, the court has added, the inquiry into whether an investigation serves a “legislative purpose” is a relatively narrow one, in which any possible ulterior motives by Congress take a back seat. The court explained that, although “dishonest or vindictive motives are readily attributed to legislative conduct and as readily believed,” the remedy for such motives is “self-discipline and the voters,” rather than the courts. The role of the courts, the Supreme Court stressed, should be limited to determining whether a committee’s investigation goes beyond the legislative function because it takes on powers that are “exclusively vested” in either the judiciary or the executive branch.

At the same time, the Supreme Court has made clear that Congress’ power to investigate is not unlimited. That power cannot, the court has noted, “be used to inquire into private affairs unrelated to a valid legislative purpose,” and it does not apply “to an area in which Congress is forbidden to legislate.” Nor, the court has observed, should the power to investigate “be confused with any of the powers of law enforcement.” Congress’ power to investigate is also limited by the rights guaranteed by the Bill of Rights, including the right not to incriminate oneself.

One of the more recent Supreme Court cases involving the scope of Congress’ investigatory power arose from efforts to obtain bank records. In Eastland v. United States Servicemen’s Fund, a Senate committee was investigating the fund’s efforts to sow opposition to the Vietnam War among members of the armed forces. When the committee issued a subpoena to the bank where the fund had an account, the fund tried to block subpoena on the ground that the resolutions authorizing the subpoena were “an unconstitutional abuse of the legislative power of inquiry,” because the actual purpose of the subpoena was to deter the fund and its members from expressing themselves.

The Supreme Court rejected the fund’s arguments, concluding that the subpoena was valid based on even “the most cursory look at the facts.” “Inquiry into the sources of funds used to carry on activities suspected by a subcommittee of Congress to have a potential for undermining the morale of the Armed Forces,” the court explained, “is within the legitimate legislative sphere.” It doesn’t matter whether the fund’s activities violated the law, the court added; the investigation “was intended to inform Congress in an area where legislation may be had.”

This piece was originally published on Howe at the Court.