Lawsuits over Trump business threaten to tie up presidency

Lawsuits over Trump business threaten to tie up presidency

January 11th, 2017 by Associated Press in National Business

FILE - In this Jan. 9, 2017 file photo, President-elect Donald Trump talks with reporters at Trump Tower in New York. As a businessman, Trump has kept the courts busy. That is not likely to end when he enters the Oval Office, creating an unusual and potentially looming problem for a sitting president. (AP Photo/Evan Vucci, File)

Photo by The Associated Press /Times Free Press.

WASHINGTON (AP) - As a businessman, Donald Trump has kept the courts busy. That's hardly likely to change when he enters the Oval Office, creating an unusual and potentially serious problem for a sitting president.

Only a handful of presidents have undergone legal depositions during their terms, and even fewer have become embroiled in private lawsuits. Trump is poised to join that small club.

Just last week, the president-elect sat for a deposition in a lawsuit involving his Washington hotel , and he is still tied up in legal disputes that are to proceed after Inauguration Day. Trump is also caught up in an investigation by the New York attorney general into whether he used his charity for personal benefit.

While Trump has said he will turn over management of his company to his adult sons, he has left open the possibility he will keep not only an ownership interest but the legal liability that accompanies it. Legal experts worry that would leave him more exposed to lawsuits, including ones financed by deep-pocketed political opponents who could use the courts as one more battleground to fight his administration.

Trump is expected to give more details about stepping away from his business at a news conference on Wednesday.

"He is going to be not just a litigation magnet, but a litigation vortex that sucks in every political and personal adversary he has," said Norman Eisen, the Obama administration chief White House ethics counselor from 2009 through 2011. Eisen has encouraged Trump to sell his assets and put the cash in a blind trust to avoid conflicts of interest and legal pitfalls.

Under constitutional immunity protections, Trump can't be sued over official acts in the Oval Office. But he could be named in lawsuits for personal actions or those involving his businesses. That raises the prospect of a President Trump answering questions under oath in more depositions, as President Bill Clinton did in the Paula Jones case that led to his 1998 impeachment by the House of Representatives.

The danger for Trump is heightened given the sprawling nature of his business, the Trump Organization.

"We've had presidents before who were rich, but we're in some uncharted territory given Trump's wealth and his myriad of business interests," said Saikrishna Prakash, a professor at the University of Virginia School of Law who specializes in constitutional separation of powers.

Prakash said potential plaintiffs may think Trump would be more likely to settle cases.

In the weeks after the election, Trump paid $25 million to settle three lawsuits alleging Trump University misled students into paying as much as $35,000 a year for instruction of little value. Trump said he did nothing wrong and was only settling so he could focus on the presidency.

The Trump Organization's general counsel, Alan Garten, said the company is not more vulnerable to paying judgments to plaintiffs, noting that Trump sat for a deposition last week instead of settling. He said he wasn't worried about future legal attacks funded by political opponents. "People will be wasting their time," Garten said.

Trump has decided to pursue two lawsuits against chefs- Jose Andres and Geoffrey Zakarian- who pulled out of restaurant deals in his new Washington hotel after the candidate made disparaging comments during his campaign about Mexican immigrants in the U.S. illegally.

The hotel may be facing additional legal entanglements. As The Washington Post recently reported, contractors have filed liens against the property in the past month, saying they are still owed money for their work. Garten said that contractors filing liens aren't unexpected given the hotel was such a big project, and that they aren't a big deal.

Allegations of unpaid work are at the center of another pending dispute.

In October, a circuit court awarded more than $310,000 to a Florida paint store for money owed for a renovation of one of Trump's golf resorts, but the case is still pending on appeal.

Trump is also coming into office with a pending state investigation into his charity.

New York Attorney General Eric Schneiderman launched an investigation of The Donald J. Trump Foundation last year after news organizations revealed that Trump used the charity to settle lawsuits, make an illegal $25,000 political contribution to a group supporting Florida Attorney General Pam Bondi and purchased items such as a painting of himself that was displayed at one of his properties.

In December, Trump said he would dissolve the charity to avoid conflicts of interest, but Schneiderman has said the charity cannot close while the investigation is going on. Trump does not face the potential for criminal charges in that investigation, but he or the foundation could face fines and other civil penalties.

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Condon reported from New York. Associated Press writer Julie Bykowicz and AP researcher Randy Herschaft contributed to this report.


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