In CREW v. Trump, Plaintiffs Change Their Tune

by Theodore Kupfer

Citizens for Responsibility and Washington (CREW) is suing President Trump for violating the foreign-emoluments clause of the Constitution. The viability of their case depends upon the standing claims of the three plaintiffs that have joined CREW in the suit. The additional plaintiffs — Jill Phaneuf, Eric Goode, and Restaurant Opportunities Center United — say they work in the hospitality industry and compete with Trump’s hotels in New York and Washington, D.C. Competition between their businesses and Trump’s, the theory goes, gives these plaintiffs standing to bring the case (which litigates whether Trump is illegally doing business with foreign governments).

But as I reported last month, the plaintiffs appear to be overstating their involvements in the hospitality industry in order to secure standing. Attorney Deepak Gupta said in oral arguments that Phaneuf’s “only job is booking events at hotels in Embassy Row,” but she told National Review she works full-time for a private-equity firm. That could imperil her claim of injury. Goode, meanwhile, was said to “own” the Bowery Hotel in New York in filings by CREW and statements during oral arguments by Gupta. Goode is really a managing partner at the hotel, not the sole owner — an important distinction: Legal experts say that individual members of corporate entities cannot bring suit on behalf of the entity unless they are explicitly authorized to do so.

Now, the plaintiffs are changing their tune. Gupta’s law firm filed a document on December 1 that says Goode “has an ownership interest” in the Bowery and refers to “multiple hotels, restaurants, and event and meeting spaces in which the hospitality plaintiffs have a financial interest.” Before, Goode owned several hotels and Phaneuf’s only job was to book diplomatic events. Now, Goode and Phaneuf have “financial interests” in these ventures. It’s a shift in position, however subtle, that should lead the court to ask questions about the plaintiffs’ standing claims. Has Goode been authorized by his business partners to bring suit? And is Phaneuf’s interest in D.C. event planning (which she now characterizes as a “book of business of events in a longer-term hold of an illiquid asset”) sufficient for standing?

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