Imagine you have a small business that is in direct competition with a business owned by the President of the United States. It’s an unprecedented reality for Khalid Pitts and Diane Gross, who own Cork Wine bar in DC and are suing Donald Trump over what they say are unfair business practices.
We already know the Constitution prohibits the president from receiving benefits, be it gifts or money, from foreign governments. We also know that every word the president utters (or tweets) can impact policy in other countries and influence the stock market.
We also know that foreign governments hoping to influence the president stayed at his DC hotel – one reason ethics experts said he should sell the hotel. Instead, Trump announced that his sons would run the hotel. Still, Donald Trump has a controlling interest in the hotel and he has all the influence that comes with being president.
On Wednesday, Cork Wine bar sued Trump and his DC hotel for unfair business practices. When the hotel opened on September 12, it was just another competitor. Following the election that changed because “many organizations and individuals, including citizens of nations other than the United States, substantially increased their use of the Hotel and its various facilities to the detriment of Cork.”
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It’s a fact that diplomats are staying at the hotel to influence Trump, as reflected in a Washington Post article, back in November.
“Why wouldn’t I stay at his hotel blocks from the White House, so I can tell the new president, ‘I love your new hotel!’ Isn’t it rude to come to his city and say, ‘I am staying at your competitor?’ ” said one Asian diplomat.
It stands to reason that others hoping to influence the President and the government are applying the same logic. However, this is not where the allegation of unfair business practices ends. The plaintiffs go on to say,
“The effects of that unfair advantage are magnified greatly by marketing activities of the Hotel’s officers and employees and the similar activities of defendant Trump, his family, and the White House staff and/or advisors,”
The couple says they have lost business to Trump’s DC hotel since the election. That’s what is key. There was no demonstrable loss of income when Trump was a candidate. Only when he started using the presidency to promote the hotel.
That means there is a tangible measurable harm that can be tied to Trump’s use of the presidency to promote his business interests, including Trump International Hotel. Since Trump is the first president to refuse to divest from his business holdings, we are in uncharted legal territory.
We already know that since the election, Trump (and senior staff) used the presidency to promote Trump International Hotel by holding press conference/infomercials there. We know Trump used the presidency to give an unparalleled advantage to daughter Ivanka’s business interests by scolding Nordstom via Twitter. We also know from Melania Trump’s libel suit that the alleged libel prevented her from cashing in on being first lady.
Common sense suggests that Trump has used the presidency to have a competitive edge over business competitors. Common sense suggests that this is an unfair business practice. There is reason to believe the court could see it that way too.
It’s clear from Trump’s previous conduct that he is not above using the presidency to benefit his and his family’s business interests. According to ethics experts, it is unethical. Common sense, combined with the facts suggest it is also an unfair business practice. After all, how does a small business compete with a president and his staff who can get advertising worth millions of dollars for free by holding press conferences at Trump International Hotel?
While this is about business practices, it isn’t about money. The lawyers representing Cork are working on this case pro bono. For their part, the plaintiffs are not seeking a financial remedy. Rather, they want a court order to stop the unfair competition. Their lawyers say this can be accomplished by closing the hotel and its restaurants for the period that Trump is president. Trump and his family can fully divest their interests or Trump could resign.
Naturally, the Trump family is dismissive. According to Eric Trump, “It’s people who have nothing better to do, so they harass and they harass and the [court] will throw it out…It’s ridiculous.”
What is ridiculous and offensive is a first family that believes it is entitled to cash in on the presidency. It’s also ridiculous to suggest there is nothing wrong with using the presidency to promote the Trump family’s businesses. Ultimately, it’s up to the court to decide if doing so amounts to an unfair business practice under the law.
Former contributor.
