Trump Responds to Stay Opposition in Tax Returns Subpoena Case

DONALD J. TRUMP,
Plaintiff-Appellant,
v.
CYRUS R. VANCE, JR., in his official capacity as District Attorney of the County of New York;
MAZARS USA, LLP,
Defendants-Appellees.

IN THE UNITED STATES COURT OF APPEALS
FOR THE SECOND CIRCUIT

REPLY IN SUPPORT OF EMERGENCY MOTION FOR ADMINISTRATIVE STAY AND STAY PENDING APPEAL

Marc L. Mukasey
MUKASEY FRENCHMAN & SKLAROFF LLP
Two Grand Central Tower
140 East 45th Street, 17th Floor
New York, New York 10177
(212) 466-6400
marc.mukasey@mukaseylaw.com

Alan S. Futerfas
Law Offices of Alan S. Futerfas
565 Fifth Ave., 7th Floor
New York, NY 10017
(212) 684-8400
asfuterfas@futerfaslaw.com

William S. Consovoy
Cameron T. Norris
Alexa R. Baltes
CONSOVOY MCCARTHY PLLC
1600 Wilson Blvd., Ste. 700
Arlington, VA 22209
(703) 243-9423
will@consovoymccarthy.com
cam@consovoymccarthy.com
lexi@consovoymccarthy.com

Patrick Strawbridge
CONSOVOY MCCARTHY PLLC
Ten Post Office Square
8th Floor South PMB #706
Boston, MA 02109
patrick@consovoymccarthy.com

Counsel for President Donald J. Trump

The President submits this reply in support of his emergency motion for an administrative stay and stay pending appeal (Mot.). The District Attorney's opposition (Opp.) provides no basis for denying a stay. Should the Court disagree, the President respectfully requests an administrative stay to afford the Supreme Court sufficient time to consider the President's stay application.

A. The District Attorney is wrong about which legal standards apply.

1. The District Attorney incorrectly argues that the President receives no special protection in his “efforts to quash a subpoena as overbroad or issued in bad faith.” Opp. 5. When the Supreme Court said “these protections... apply with special force to a President,” it meant protections against “arbitrary fishing expeditions” and “bad faith” subpoenas. Trump v. Vance, 140 S. Ct. 2412, 2428 (2020) (cleaned up). The District Attorney also ignores the Supreme Court's warnings that “in no case would a court be required to proceed against the president as against an ordinary individual,” Cheney v. U.S. Dist. Court for D.C., 542 U.S. 367, 381-82 (2004) (cleaned up), and that the President's status “should inform the conduct of the entire proceeding,” Clinton v. Jones, 520. U.S. 681, 707 (1997). Overbroad and bad-faith subpoenas are no less “hindering,” Opp. 5, than “vexatious civil suits,” Vance, 140 S. Ct. at 2428.

2. The District Attorney argues that the President needs an injunction — not a stay — pending appeal. Opp. 6-7. But the tests are the same in this Court. Compare Mot. 4-5, with Opp. 8-9. The assertion is misplaced anyway. The District Attorney linked the enforceability of the subpoena to the issuance of the judgment. Trump v. Vance, 2020 WL 4914390, at *1 (S.D.N.Y. Aug. 21, 2020). Hence, “temporarily divesting [that] order of enforceability” renders the subpoena unenforceable. Nken v. Holder, 556 U.S. 418, 428 (2009). That is why the District Attorney, in opposing a stay in the prior appeal, never argued that the President was trying to “recast” an injunction request “as a request for a stay” even though the circumstances were the same. Opp. 7.

This is also what happened in the litigation over the congressional subpoenas. As here, the committees deferred enforcement pending judicial review, except they tied enforceability to issuance of the mandate instead of the judgment. Application for Stay, Trump v. Mazars USA, LLP, 19A545 (U.S. Nov. 15, 2019) at 1. The appropriate relief thus was a stay of the mandate — not an injunction pending appeal — and that was the relief the Supreme Court granted. Trump v. Mazars USA, LLP, 140 S. Ct. 581 (2019); Trump v. Deutsche Bank AG, 140 S. Ct. 660 (2019).

3. The District Attorney argues that this §1983 action is “procedurally misplaced” because the President must instead file a motion to quash. Opp. 7. But not only did the District Attorney fail to make this argument in his motion to dismiss, he claimed that the proper way for the President “to raise any additional claims in the wake of the Supreme Court's decision” was to “file an amended pleading that can survive a motion to dismiss.” D.Ct. Doc. 52 at 7-8. The District Attorney's impulse to look for new arguments on appeal is understandable given the vulnerability of the decision below. But any procedural challenge has been waived.

The argument is also wrong. This Court held that the President may challenge the Mazars subpoena in federal court, Trump v. Vance, 941 F.3d 631, 637-39 (2d Cir. 2019), and the Supreme Court didn't disturb that holding. To the contrary, the Supreme Court held that that, even aside from immunity, “a President would be entitled to the protection of federal courts.” Vance, 140 S. Ct. at 2428; accord id. at 2433 (Kavanaugh, J., concurring in the judgment). The District Attorney ignores that the President needed to file a civil action — not a criminal motion — to challenge a state grand-jury subpoena in federal court. This Court and the Supreme Court correctly accepted §1983 as the right cause of action.

B. The President's challenge to the district court's decision is meritorious.

1. The District Attorney repeats the district court's reasons for finding the overbreadth and bad-faith claims implausible. Opp. 9-17. But he is unable to grapple with the cases holding that the district court erred in drawing every inference against the President. Mot. 11-12, 16. Thus, while he derides the SAC's allegations as “speculative,” Opp. 9, the District Attorney cannot explain why these inferences are unreasonable based on the facts as pled in the complaint. That's because it is obviously plausible that a congressional subpoena allegedly issued in aid of federal legislation is overbroad when issued in a local criminal investigation, and that the decision to copy that subpoena was plausibly made in bad faith. Mot. 9-11, 13-16; Vance, 140 S. Ct. at 2449 (Alito, J., dissenting). That the District Attorney believes contrary inferences are more likely is no basis for dismissal.

The District Attorney's reliance on extrinsic evidence proves the point. Opp. 11-12, 14, 17 & n.7. If the factual inferences drawn by the President were truly implausible, the District Attorney would not feel the need to rely on material outside the four corners of the complaint. His decision to do so is a tacit admission that the parties have a factual dispute. “When presented with material outside of the pleadings pursuant to a Rule 12(b)(6) motion to dismiss,” however, “the district court must either disregard such material or give the parties notice that the motion is being converted to one for summary judgment and permit the parties to submit evidence accordingly.” Kopec v. Coughlin, 922 F.2d 152, 155-56 (2d Cir. 1991). The District Attorney assures the Court that he doesn't need this evidence, just as the district court promised it was only being “mindful” of it. Ex. A. 73. But this Court “'deals with substance, not shadows.'” Trump v. Mazars USA, LLP, 140 S. Ct. 2019, 2035 (2020). The proceedings below make clear that the President was subjected to a pseudo “summary-judgment proceeding — one featuring a bespoke factual record, tailor-made to suit the needs of defendants.” Goel v. Bunge, Ltd., 820 F.3d 554, 560 (2d Cir. 2016).

Finally, the District Attorney retreats to the presumption of validity. Opp. 9-10. But the presumption, at most, bears on the evidentiary burden the President must meet in establishing “ultimate entitlement to relief.” Ex. A. 33; Virag v. Hynes, 54 N.Y.2d 437, 444. (1981). In all events, the President's overbreadth and bad-faith claims are plausible with or without any presumption of validity. Mot. 7-16.

2. The deck was clearly stacked against the President in other ways too. Even though the Supreme Court identified overbreadth and bad faith as appropriate grounds for challenging the subpoena, the district court characterized those arguments as having “the tenor and practical effect of which could be to engender a form of presidential immunity by default.” Ex. A. 8. It expressed dissatisfaction with having to “devote considerable judicial resources to consider again a fact pattern it believes the parties had thoroughly argued and the Court had substantially addressed.” Id. 9. It described the claims “absolute immunity through a back door,” it called the SAC a “roundabout route” to presidential immunity, and it said “granting the relief the President requests would effectively constitute an undue expansion of presidential immunity doctrine potentially implicating adverse public concerns.” Id. 12-13.

The court shouldn't have approached the remand in this way. The President isn't seeking to resurrect the categorical-immunity claim. He is challenging the subpoena on grounds that federal and state law afford to him, and that the Supreme Court identified as appropriate avenues for relief. The district court might have disagreed with the “unanimous[ ]” decision to allow the President to press additional claims on remand. Vance, 140 S. Ct. at 2431 (Kavanaugh, J., concurring in judgment); id. at 2431 n.6 (majority op.). But it was tasked with implementing the Supreme Court's decision — not questioning it. In re Sanford Fork & Tool Co., 160 U.S. 247, 255 (1895).

Perhaps the district court was only offering “general observations about claims of absolute presidential immunity from judicial process” and not conflating categorical immunity with the claims the President raises on remand. Ex. A 3 n.1. But that seems unlikely. The court recognized that categorical immunity wasn't “directly before [it] at this stage,” but concluded that it is “still implicated by the President's arguments,” id. 13 n.9, and, in denying a stay, it held that the President isn't entitled to appellate review because his categorical immunity claim had already been rejected “at every turn,” D.Ct. Doc. 75 at 6. There is no avoiding that the district court was influenced by its view that “the executive branch's invocations of absolute immunity in various forms and guises to justify exempting the presidency from judicial process, including withholding information demanded by Congress, the courts, or the public, have yielded disquieting constitutional effects eroding the rule of law and the doctrines of separation and balance of powers.” Ex. A 13 n.9. The court was entitled to register its dissatisfaction with prevailing law. But it shouldn't have allowed those views to infect its resolution of the President's claims.

Sometimes a “tangent makes a point.” Id. 3 n.1. This is one of those times. In evaluating whether the President stated claims for overbreadth and bad faith, the district court imposed a withering standard of review that wouldn't have been used against any “other citizen.” Vance, 140 S. Ct. at 2430. The court should have at least afforded the President the benefit of the “established legal and constitutional principles” governing resolution of Rule 12(b)(6) motions. Id. at 2431.

3. Stacking the deck against the President at the pleadings stage was not only legal error. It deprived the President of any chance to test the validity of the subpoena, i.e., on cross-motions for summary judgment after limited discovery. D.Ct. Doc. 67. It is unfair to expect that “a challenging party who does not know the general subject matter of the grand jury's investigation, no matter how valid that party's claim, will be able to make the necessary showing” to defeat enforcement. United States v. R. Enterprises, Inc., 498 U.S. 292, 301 (1991). “After all, a subpoena recipient 'cannot put his whole life before the court in order to show that there is no crime to be investigated.'” Id. It is thus “reasonable that the Government be required to make some preliminary showing by affidavit that each item is at least relevant to an investigation being conducted by the grand jury and properly within its jurisdiction, and is not sought primarily for another purpose.” In re Grand Jury Proceedings, 486 F.2d 85, 93 (3d Cir. 1973). That should be true here too.

If anything, the President should be given even broader rights. Vance, 140 S. Ct. at 2428. Consequently, “lower courts in cases of this sort involving a President will almost invariably have to begin by delving into why the State wants the information; why and how much the State needs the information, including whether the State could obtain the information elsewhere; and whether compliance with the subpoena would unduly burden or interfere with a President's official duties.” Vance, 140 S. Ct. at 2433 (Kavanaugh, J., concurring in the judgment); Trump v. Deutsche Bank AG, 943 F.3d 627, 682 (2d Cir. 2019) (Livingston, J., concurring in part and dissenting in part). As part of that process, furthermore, any supporting declaration the District Attorney submits should be disclosed to the President absent extraordinary circumstances. In re Grand Jury Proceedings, 486 F.2d at 93.

None of this happened below. As the district court explained, the President hasn't even been informed of “the general subject matter of the investigation.” Ex. A 90. So the President plausibly alleged that the investigation concerns the only subject the District Attorney has publicly acknowledged. But the district court then rejected that allegation as speculative, pointing to a redacted declaration the District Attorney's Office submitted and other extrinsic evidence that cannot be deployed at the pleading stage. Id. 73.

This is not the kind of process the Supreme Court envisioned when it remanded this case. The President's plausible allegations should have been accepted as true. His case should not have been dismissed at the pleadings stage based on extrinsic evidence. And he should have been given a chance to test the subpoena's validity. Put simply, the District Attorney should not have been allowed to “'run roughshod'” over the President in his pursuit of claims that the Supreme Court held he could raise on remand. Vance, 140. S. Ct. at 2428.

C. The equities weigh strongly in favor of a stay.

1. The District Attorney's arguments for why the President won't be irreparably harmed are misplaced. He argues that the President's claim for injunctive relief wouldn't be mooted. Opp. 18-19. While destruction or return of documents can provide a “partial remedy” for the “invasion of privacy,” Church of Scientology of California v. United States, 506 U.S. 9, 13 (1992), the harm the President seeks to prevent is use of these records to engage in a bad-faith fishing expedition. The Court “cannot unring that bell” even if the subpoena is eventually invalidated. United States v. Under Seal, 853 F.3d 706, 724 (4th Cir. 2017); e.g., Office of Thrift Supervision Dept. of Treasury v. Dobbs, 931 F.2d 956, 959 (D.C. Cir. 1991).

Moreover, the Court cannot provide any relief if the District Attorney discloses the records while this appeal is ongoing. Contra the District Attorney's suggestion, Opp. 18, N.Y. Crim. Proc. Law §190.25(4) doesn't strictly forbid the disclosure of records produced to the grand jury. N.Y. Penal Law §215.70 (“public prosecutor” may disclose “in the proper discharge of his official duties”). This could include disclosure as part of an indictment or a grand-jury report, N.Y. Crim Proc. Law §190.85, as well as to third-parties. For the District Attorney's argument to even get out of the starting gate, then, he would need to commit to keep these records confidential during the appeal — irrespective of what New York law might permit. He has made no such commitment.

Mootness aside, there is no doubt that the President will suffer irreparable harm. The Court cannot later “return the parties to the status quo ante — there is nothing a court can do to withdraw all knowledge or information” from the District Attorney or the grand jury. Church of Scientology, 506 U.S. at 12. Thus, contrary to the District Attorney's argument, Opp. 18, maintaining confidentiality does not prevent irreparable harm, Mot. 6-7. It is disclosure of these records to the government — not just to the public — that causes injury.

2. The District Attorney offers boilerplate reasons why the grand jury's needs outweigh the President's harms. Generically claiming that “grand jury's investigation has been substantially hampered” isn't nearly sufficient. Opp. 19. That is especially true since the District Attorney voluntarily delayed enforcement for nearly a year. The District Attorney responds that, in his view, the case “no longer contains difficult questions of constitutional law.” Id. But that just rehashes the merits. The argument is nonresponsive as to why delaying enforcement for nearly a year did not unduly interfere with the grand jury's work but further delaying it for the short period of time needed to afford the President an appeal somehow would.

CONCLUSION

For these reasons, the Court should grant a stay pending appeal. The President respectfully requests that the stay remain in effect until the appeal is resolved, and for one week afterward. If the Court denies a stay pending appeal, the President respectfully requests an administrative stay to afford the Supreme Court sufficient time to consider the President's stay application.

Dated: August 31, 2020

Respectfully submitted,

Marc L. Mukasey
MUKASEY FRENCHMAN & SKLAROFF LLP
Two Grand Central Tower
140 East 45th Street, 17th Floor
New York, New York 10177
(212) 466-6400
marc.mukasey@mukaseylaw.com

Alan S. Futerfas
Law Offices of Alan S. Futerfas
565 Fifth Ave., 7th Floor
New York, NY 10017
(212) 684-8400
asfuterfas@futerfaslaw.com

William S. Consovoy
Cameron T. Norris
Alexa R. Baltes
CONSOVOY MCCARTHY PLLC
1600 Wilson Blvd., Ste. 700
Arlington, VA 22209
(703) 243-9423
will@consovoymccarthy.com
cam@consovoymccarthy.com
lexi@consovoymccarthy.com

Patrick Strawbridge
CONSOVOY MCCARTHY PLLC
Ten Post Office Square
8th Floor South PMB #706
Boston, MA 02109
patrick@consovoymccarthy.com

Counsel for President Donald J. Trump