Over a year ago, we discussed the challenges brought against President Donald Trump for alleged emoluments and unfair competition connected to his properties. One of those cases was brought by my colleague, Alan Morrison who argued the case on appeal. Despite my respect for Professor Morrison, I have been critical of the theories advanced in the case, Cork v. Trump Post Office. The D.C. Circuit has now unanimously rejected the claims. Even accepting all of the facts alleged by the Plaintiffs, the court ruled that they failed to state a legal claim. In fairness to Professor Morrison and his team, this was a very difficult case with little case law to argue on the merits.
Cork Wine Bar is a restaurant in the U Street corridor and alleged unfair competition from the Trump Hotel under the District’s common law of unfair competition. The panel affirmed the district courts dismissal for failure to state a claim.
After a long analysis for the removal to federal court, the panel reached the merits and stated:
Cork makes no meaningful attempt to square its unfair competition claim with District law. The gravamen of Cork’s complaint is that so long as the President retains a stake in the Hotel, Cork cannot fairly compete, because of the “perception” that Hotel patrons will receive favorable treatment from the Trump Administration. Although Cork suggests in passing that President Trump and the Hotel are “impair[ing]” competition and “interfer[ing] with access” to its business, Cork Br. 44-45, its claim bears little resemblance to the examples listed in Ray and B & W Management, and Cork cites no case showing that the allegations here fall into those categories of unfair competition.
Such claims of perceptions could not overcome the lack of precedents. The court noted that the existing case law militates against this claim. One such case is Ray v. Proxmire, where a tour operator alleged that Senator William Proxmire’s wife had leveraged “the prestige and contacts
enjoyed by a senator’s wife” to promote her rival tour
company. The plaintiff cited special access to the White House and other advantages, but the D.C. Circuit ruled that “financial success does not become unlawful simply because it is aided by prominence.”
The court hit Cork hard and noted that “[d]uring oral argument, we asked Cork to cite any case—from any jurisdiction—in which a plaintiff successfully advanced a similar theory. Cork conceded that no such case exists. Cork’s case cannot survive that concession.”
The case may have greater importance on the issue of removal. Cork argued that, had the case remained in the district’s court system, the reviewing courts would have had greater latitude in the interpretation of the common law. The panel acknowledges this point by saying that “[i]n fairness, Cork did not plan on having its common-law claim adjudicated in a court incapable of adapting the common law to fit these allegations.” However, the panel finds that the case was properly removed and denied a motion to certify the common law question to the District of Columbia Court of Appeals.
Here is the opinion: Cork v. Trump Post Office