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The Latest Legal News & Industry Information
Trump Organization Seals a Deal
To Sell Trump International Hotel
Donald Trump’s business empire plans to sell its lease to its Washington, D.C. hotel for $375 million to a Miami-based investment firm.
In addition to ending financial problems for the hotel, the deal also is likely to halt political controversy that ensnared Trump International Hotel since its opening in 2016.
The purchaser, CGI Merchant Group, plans to rebrand the hotel as a Waldorf Astoria, according to a story first reported by The Wall Street Journal. CGI is partnering with hotelier Hilton Worldwide Holdings to buy the hotel a short walk from the White House.
The deal still requires approval from the U.S. General Service Administration, which leased the building to the Trump Organization in 2012 on a condition that the soon-to-be president renovate it for his planned hotel. The building was formerly used as a post office but remains government property.
The Trump Organization agreed to invest $200 million to convert the building into a 261-room luxury hotel. The organization also agreed to pay the General Services Administration $3 million a year in rent.
Trump officially resigned from the Trump Organization when he became president but turned over the operations to his sons. As a result, he maintained a financial interest in the hotel and other family real estate holdings.
Before it opened, it was mired in protests and lawsuits that accused Trump of using the presidency to benefit his businesses.
Protesters commonly were seen outside the hotel protesting some of his administration’s policies, such as on immigration, gun control and foreign relations. Three major lawsuits were filed against Trump alleging conflicts-of-interest.
One was filed by the advocacy group Citizens for Responsibility and Ethics in Washington; a second by the attorneys general of Maryland and the District of Columbia and a third by Democrats in Congress. All of them accused the former president of violating the Constitution’s Foreign Emoluments Clause.
The Emoluments Clause restricts members of the federal government from receiving gifts, payments or employment from foreign governments without the consent of Congress. It was designed to prevent "corrupting foreign influences" over U.S. government officials.
Nevertheless, a former Mexican ambassador and other foreign representatives claimed they were encouraged by the Trump administration to stay at the president’s hotels when they visited the United States. A congressional report last month revealed Trump International Hotel earned about $3.7 million from foreign governments.
The first two lawsuits were dismissed as moot when Trump left the presidency. The lawsuit by Democrats was dismissed when a federal judge ruled they lacked authority, or standing, to sue.
In addition to political troubles, the hotel never appeared to be a financial success.
Last month, a House Oversight Committee report showed Trump International Hotel lost more than $70 million over the past four years despite publicly claiming it made tens of millions of dollars.
Its dilemma worsened as the COVID-19 pandemic shut down much of the hospitality industry. The company has been trying to sell the hotel since 2019.
The deal so far is a purchase and sale agreement, which means it might not close for months. If it is completed at the $375 million price, it would turn what had been a loss for the Trump Organization into a profit for its overall investment.
For more information, contact The Legal Forum (www.legal-forum.net) at email: tramstack@gmail.com or phone: 202-479-7240.
Gay Activists Ask Congress
For Law to Ensure Inclusion
A Washington, D.C.-based advocate for gay rights testified to Congress last week about the gay community’s dilemma in trying to be included as normal parts of society but facing an uphill struggle against discrimination.
Witnesses at the hearing said gay people endure fewer job offerings, more homelessness and reduced financial opportunities.
About 18 million American adults identify as gay but 27 states have no laws to protect them based on their sexual orientation in housing and employment.
One of the states is Texas, where a federal judge in Fort Worth ruled this month that business owners with religious beliefs are protected from discrimination claims by gay employees.
The court’s decision came in a lawsuit by Christian health care company Braidwood Management Inc. as it sought a ruling to support its ban on hiring homosexuals. The company owner refuses to allow employees to engage in “homosexual behavior or gender non-conforming conduct of any sort,” according to its court filings.
Although the company is located in Texas, the ruling on issues of federal law are likely to influence similar cases nationwide.
Discrimination based on race, religion and sex generally are banned under Title VII of the 1964 Civil Rights Act. The Supreme Court extended the ban to sexual orientation in 2020.
However, the Texas ruling last week carved out an exception by saying First Amendment rights to freedom of religion mean employers can claim exemption from Title VII when they are a “religious corporation, association, educational institution, or society.”
The kind of sentiment expressed in the court ruling drew some the harshest outrage during the congressional hearing last week.
David Johns, executive director of the Washington-based National Black Justice Coalition, suggested that the federal government intervene with legislation such as the Equality Act, which is pending in Congress.
The Equality Act would amend the Civil Rights Act of 1964 to prohibit discrimination based on sex, sexual orientation and gender identity in employment, housing, public accommodations and education.
“It is imperative that we close this legal loophole,” Johns said.
For more information, contact The Legal Forum (www.legal-forum.net) at email: tramstack@gmail.com or phone: 202-479-7240.
Political Action Committee Operators
Charged with Fraud from Trump Election
The Justice Department plans to prosecute three men for allegedly running scam political action committees that raised $3.5 million for 2016 presidential campaigns but donated only $19 to help former President Donald Trump get elected.
Instead, they used the money for lavish lifestyles, according to a Justice Department announcement.
The prosecutions represent a rare occurrence for the Justice Department. Scam PACs have been a problem for a long time but tracing the money in a way that would allow the operators to face criminal charges has been elusive.
“Matthew Nelson Tunstall, 34, of Los Angeles, California; Robert Reyes, Jr., 38, of Hollister, California; and Kyle George Davies, 29, of Austin, Texas, solicited contributions to Liberty Action Group PAC and Progressive Priorities PAC under the guise that the PACs were affiliated with or meaningfully supporting specified candidates for public office,” the Justice Department last week statement says.
The candidates mentioned in the indictment are Trump and his Democratic opponent, Hillary Rodham Clinton.
The three defendants are charged with either wire fraud and conspiracy to commit wire fraud, money laundering or conspiracy to make a false statement to the Federal Election Commission.
The Trump political action committee was called Liberty Action Group. Its robocall solicitations warned that Clinton would “release violent criminals from jail.”
The three defendants operated a separate pro-Clinton political action committee at the same time called Progressive Priorities. It ran anti-Trump solicitations that asked for donations to Clinton’s campaign to “fight back against those who would drive us apart.”
Political action committees are tax-exempt organizations registered with the Federal Election Commission that pool campaign contributions before turning them over to candidates or using them to promote ballot initiatives or legislation.
They frequently are steeped in controversy about whether the funds are misappropriated but the allegations infrequently lead to prosecution.
In one case, the political action committee of former U.S. Rep. John Doolittle, R-Calif., paid 15 percent of its donations to a firm that employed only his wife. The firm received $68,630 in 2003 and 2004, and $224,000 in 2005 and 2006. The FBI investigated but Doolittle never was prosecuted.
In the case the Justice Department announced this week, the defendants are accused of misdirecting money from the political action committees to their bank accounts.
They would launder the money by reporting it as “consulting media and fundraising” expenses paid to media companies, according to prosecutors.
For more information, contact The Legal Forum (www.legal-forum.net) at email: tramstack@gmail.com or phone: 202-479-7240.
Homeland Security Department Warns
Of Terrorist Threat During Holidays
Washington’s legal and political communities are top targets identified by the U.S. Department of Homeland Security in an advisory last week about terrorism risks.
The United States faces a “heightened threat environment” from domestic extremists and foreign terrorist groups through the Thanksgiving and Christmas holiday season, the agency warned.
The advisory resulted partly from Homeland Security monitoring of extremists’ social media messages, some of which express outrage over COVID-19 vaccine mandates and restrictions. They also suggest violent revenge against politicians, police and others who support or carry out the mandates.
“The ongoing global pandemic continues to exacerbate these threats, in part due to perceived government overreach in implementation of public health safety measures,” the National Threat Advisory System Bulletin says.
One set of intercepted extremist messages advocated an attack on an Amazon Web Service warehouse in Virginia.
“The plot highlights a departure from traditional targets and signifies potential willingness to attack private entities believed to be supporting or enabling the government’s perceived abuse of power,” according to an FBI Joint Intelligence Bulletin.
The bulletin did not warn of a specific U.S. target but did say explosives carried by drones or deadly chlorine gas could be used for the attacks.
Another social media message monitored by law enforcement asked, “How long before a politician is killed for mandating vaccines?”
At the same time, Islamic extremists are reportedly regrouping after the U.S. military exit from Afghanistan allowed them to regain control over the country. Military analysts testified to Congress after the withdrawal in August that terrorists could be ready to strike U.S. targets within six months.
The Homeland Security Department bulletin said the “foreign terrorist organizations” seek to “inspire potential followers to conduct attacks in the United States.”
For more information, contact The Legal Forum (www.legal-forum.net) at email: tramstack@gmail.com or phone: 202-479-7240.
Maryland’s New Anti-Hate Program
Seeks to Protect Asian Americans
Maryland Gov. Larry Hogan announced details last week for his plan to confront hate crimes and bias against Asian Americans.
The plan is based largely on creating greater awareness among law enforcement officers, educators and civic leaders.
Hogan said that in Maryland “hate crimes targeting Asian Americans have doubled since 2018.” Nationally they increased 150 percent in 2020.
“We’re going to update hate and bias training for law enforcement agencies,” Hogan said. Part of the update would include hiring officers who speak “multiple languages.”
The state is increasing hate crime prevention funding from $3 million to $5 million. Some of the money would go to the Maryland Coordination and Analysis Center to share data about Asian American hate crimes with the Governor’s Office of Community Initiatives.
A primary method of reporting hate crimes is by calling Maryland’s 2-1-1 phone number. Under Hogan’s initiative, a secondary network for reporting incidents is being coordinated among churches, community centers and nonprofit organizations.
“Because too many incidents continue to go unreported, and unpunished, we’re publishing a ‘how to report hate crimes and incidents’ document which will be available in Asian languages,” Hogan said. It would be posted online.
The educational component of his plan would include Asian American history courses in public schools and scholarships at the Philip Merrill College of Journalism at the University of Maryland for Asian American students.
Hogan made the announcement while accompanied by his wife, who is Korean American, and members of the state’s Asian American Hate Crimes Workgroup.