Trump: D.C. Circuit Made ‘Several Errors’ in Tax Return Case

By: Mary Katherine Browne

Former President Trump filed a petition for rehearing, arguing that the court was too deferential to the House Ways and Means Committee in its decision to hold the panel’s request for his tax returns valid.

In an August 18 petition, Trump requested a panel rehearing and a rehearing en banc before the D.C. Circuit, arguing that the court made a number of errors when it affirmed the district court’s decision to dismiss his cross-claims and counterclaims in Committee on Ways and Means v. Treasury.

“The panel affirmed the dismissal of Intervenors’ complaint at the pleading stage. The district court’s decision, which applied a highly deferential standard, predated this Court’s decision in Mazars. But the panel, purporting to apply Mazars’ more robust scrutiny, nonetheless affirmed — meaning that in its view, Intervenors had not even plausibly alleged a violation of this heightened, far-less-deferential standard. In doing so, it made several errors,” the petition says (emphasis in original). 

Trump alleges fault with the D.C. Circuit’s determination in three areas: the court didn’t consider any of the record evidence of the committee’s improper purpose; the panel’s application of Mazars was far too deferential to the committee; and the panel violated precedent in rejecting his facial challenge to section 6103(f)(1).

Trump argues that the evidence the D.C. Circuit refused to consider was the “very evidence” that led Treasury and the Justice Department to reject the committee’s original request, and that the court was rendering its legitimate legislative purpose useless by considering only resolutions by the committee.

“The panel held that it could consider only the purpose the Committee asserted in its request. This reduced the legitimate-legislative-purpose inquiry to a toothless magic-words test . . . and ignored the Supreme Court’s admonition that courts should not ‘blind’ themselves to ‘what all others can see and understand,” the petition says.

Trump argued that the court’s application of Trump v. Mazars USA LLP, 140 S. Ct. 2019 (2020), was “irreconcilable” with its analysis in Trump v. Mazars USA LLP, No. 21-5176 (D.C. Cir. 2022), which limited the scope of the committee’s request for financial information from Trump’s former accounting firm.

“‘[A] more searching inquiry into the burdens imposed by the Committee’s request is warranted given the core constitutional principle at issue.’ In closely analogous circumstances, this Court substantially narrowed a sweeping subpoena for similar records issued by the same House. It should grant rehearing to apply the same scrutiny here,” Trump argued, citing Circuit Judge Karen L. Henderson’s concerns in her concurring opinion.

Trump also revisited his argument that section 6103(f)(1) is unconstitutional because it doesn’t require congressional requests for tax information to have a legitimate legislative purpose.

Exhausting All Options

Trump also filed an opposition to the committee’s request to allow Treasury to immediately hand over his tax returns. The committee asserted that a delay would significantly harm its ability to act on the information.

Trump disagreed, arguing that if the D.C. Circuit denied his request for a rehearing, he would seek certiorari from the Supreme Court, so the stay order should remain until he exhausted all his options.

The former president called the committee’s request to kill the stay order “egregious." 

“At its boldest, it asks a panel of this Court to deliberately moot this dispute, unilaterally deciding that the full Court and the Supreme Court should get no chance to consider further review,” Trump said.

“The Committee has no good reason why this important separation-of-powers dispute should end before the Supreme Court gets the chance to even consider weighing in. The House was similarly confident that no further review was necessary in Mazars, but the Supreme Court disagreed and ruled 9-0 against its position,” he concluded. 

Ongoing Battle

The House battle for Trump’s tax returns has continued for more than three years. Ways and Means Committee Chair Richard E. Neal, D-Mass., requested the returns in April 2019, but then-Treasury Secretary Steven Mnuchin refused to comply with the subpoena, arguing that the request was disingenuous in its purpose.

Trump filed cross-claims in August 2021 against the request, arguing that separation of powers still applied and that Congress sought the returns for political reasons.

D.C. District Court Judge Judge Trevor N. McFadden dismissed the cross-claims and counterclaims in December 2021. Trump appealed, and arguments were heard in March.

The D.C. Circuit unanimously affirmed McFadden’s decision August 9, finding that the committee’s request for Trump’s tax returns was valid. The circuit court said the burden placed on a sitting president wasn’t substantial enough to violate separation of powers.

In Committee on Ways and Means v. Treasury, No. 21-5289 (D.C. Cir. 2022), Trump is represented by attorneys from Consovoy McCarthy PLLC.