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Spotlight on Congressional Investigations: Fall 2021

October 21, 2021 Download PDF

Paul, Weiss’s Congressional Investigations practice group is pleased to publish this inaugural edition of its Spotlight on Congressional Investigations series.  As Congress’s investigative activity aimed at companies is drawing increasing attention, this edition focuses on two issues relating to congressional subpoenas:  Congress’s consideration of enhancements to its ability to enforce subpoenas and the D.C. district court’s application of the Supreme Court’s Mazars test, finding that the subpoena to former President Trump’s accounting firm was partially overbroad. 

Congress Considers Enhancements to Its Power to Enforce Congressional Subpoenas

In June, the House Judiciary Committee’s Subcommittee on Courts, Intellectual Property, and the Internet held a hearing on Civil Enforcement of Congressional Authorities.  The thesis of the hearing was that Congress’s current mechanisms for enforcing subpoenas are inadequate, especially when those subpoenas are directed toward current or former Executive Branch officials.  As described at the hearing, Congress has three main mechanisms to enforce a subpoena: (1) inherent contempt, the ability to hold witnesses in contempt and to impose sanctions; (2) criminal contempt, a statutory penalty making it a misdemeanor to refuse to comply with a congressional subpoena that is precipitated by Congressional referral to the Department of Justice; and (3) initiating a civil suit in the courts to enforce the subpoena.  All three mechanisms are available to Congress no matter the recipient of the subpoena—whether a private actor or executive branch employee. 

At the hearing, witnesses noted that the modern trend is to initiate civil litigation, but opined that civil litigation is a long and time-consuming process, and rapidly evolving political dynamics often overtake the effectiveness of any enforcement action.  As one example: more than two years after first issuing a subpoena, Congress finally resolved a dispute with former White House Counsel Don McGahn in June 2021 to provide closed-door testimony.  Congress reached a deal with McGahn for his testimony only after it first issued the subpoena in 2019 and filed a civil suit in federal district court in the District of Columbia in August 2019 to enforce it.  McGahn’s agreement to provide closed-door testimony resulted in the parties withdrawing the lawsuit that was pending in the D.C. Circuit.  Stemming from this dispute was another ruling by the D.C. Circuit, which initially found that the House Committee on the Judiciary lacked standing to sue to enforce its subpoena power.  That ruling, however, was later reversed en banc

Despite bipartisan interest in strengthening the mechanisms for enforcing congressional subpoenas, there have been only two bills introduced this Congress that address the issue.  Introduced originally in June 2020, and reintroduced this Congress by Rep. Ted Lieu (D-CA), the Congressional Inherent Contempt Power Act would, among other things, vest the subpoenaing Committee with power to report for a full House vote both a resolution of contempt and the imposition of financial penalties up to $100,000 for failure to comply with a subpoena.  The Congressional Inherent Contempt Power Act has 14 cosponsors, all Democrats.  No action has been taken on the bill. 

In September, Rep. Adam Schiff (D-CA) re-introduced the Protecting Our Democracy Act, which includes a provision to bolster Congress’s subpoena enforcement power.  The bill would codify a cause of action for Congress to enforce subpoenas and expedite the judicial process for civil enforcement actions.  It would also, among other things, empower courts to levy fines against government officials for failing to comply with a subpoena issued by Congress.  No action has been taken on the bill, and it has eight cosponsors, all Democrats.

Federal District Court Issues Decision on Subpoenas to Former President Trump’s Accounting Firm, Mazars, Finding the Subpoenas Overbroad in Part

In August 2021, Judge Amit Mehta in the federal district court in the District of Columbia issued a decision in long-running litigation first initiated in April 2019 to enforce a congressional subpoena for then-President Trump’s financial records.[1]  The case had gone to the Supreme Court, which created a test that was then applied by Judge Mehta on remand.  Judge Mehta held that the subpoena was overbroad as it applied to all of the requests but for those seeking information pertaining to then-President Trump’s lease of federal land and any possible violations of the Foreign Emoluments Clause.  Although the test applies to presidents, there are hints in the district court’s decision that may provide insight as to how courts might approach congressional subpoenas issued to private entities in the future. 

In 2019, the House of Representatives Committee on Oversight and Reform (“Oversight Committee”) issued a broad subpoena to President Trump’s accounting firm, Mazars, seeking the President’s personal financial records.  The subpoena was issued for the purpose of verifying allegations made by President Trump’s former longtime attorney Michael Cohen just weeks prior that President Trump had altered the value of his assets and liabilities on financial statements.  Within weeks, Congress filed a civil enforcement action in federal district court.  After the district court and D.C. Circuit upheld the subpoena and its scope as a valid exercise of Congress’s broad investigative authority, the Supreme Court reversed in July 2020 and articulated a new, four-prong analysis regarding the validity of a congressional subpoena directed to the president.  The Supreme Court remanded to the district court to apply its newly announced test. 

The Supreme Court’s opinion affirmed Congress’s broad subpoena authority, noting that while Congress has no “enumerated constitutional power” to issue subpoenas, the power is inherently necessary in order to legislate.[2]  But the Court found that the Oversight Committee exceeded that authority in its subpoena to Mazars, and relied on separation-of-powers concerns in articulating four factors courts should consider when analyzing a congressional subpoena for personal information of the President: (a) “the asserted legislative purpose” must “warrant[] the significant step of involving the President and his papers”—noting that Congress should look elsewhere if the information sought is available from a source other than the President’s personal papers; (b) the subpoena is to be “no broader than reasonably necessary to support Congress’s legislative objective”—noting the specificity of the request being an important safeguard against unnecessary intrusion on the President; (c) courts are to be “attentive to the nature of the evidence offered by Congress to establish that a subpoena advances a valid legislative purpose”; and (d) the burden imposed on the President by the subpoena insofar as those burdens are imposed by a rival political branch that may be incentivized to use subpoenas for institutional advantage. 

Because President Trump lost the election while briefing was underway in the district court on remand, Judge Mehta modified the Mazars test in two ways.  First, the district court found that the consideration of the burden imposed on Trump as a former president was entitled to less weight, both because the subpoena did not, at that point, burden the Office of the President, and because the concerns regarding separation-of-powers where a subpoena is directed at a sitting president were not as relevant.  Second, the district court applied less weight to the “tradition of negotiation and compromise” between the co-equal branches that would hopefully lead to out-of-court resolutions of future subpoena disputes.  A former president, the district court noted, had little incentive to accommodate Congress in the same way an incumbent president would—either for purposes of seeking goodwill or for fear of retaliation through checks and balances. 

Applying this “Mazars lite” test, the district court narrowed the subpoena to include only those documents that relate to the former President’s lease of the federally owned Old Post Office Building in Washington, D.C., which was sold to Trump International Hotel, and to any foreign payments he may have received while in office in violation of the Foreign Emoluments Clause of the Constitution.  The district court held that the subpoena was overbroad to the extent it sought records related to conflicts of interest and financial disclosures in Trump’s capacity as a president and a candidate.  Specifically, the court found that the Oversight Committee did not show that it could not rely on other sources of information, aside from Trump’s personal records, to obtain the information it needed to pursue its legislative objectives.  Additionally, the court found that the burdens imposed by the subpoena outweighed the Committee’s need for insights into Trump’s finances and possible conflicts of interest, especially considering the “already quite extensive” regime of financial disclosures required for presidents and presidential candidates. 

The Oversight Committee has appealed to the D.C. Circuit, arguing the entire subpoena should be enforced and that the district court erred in relying on separations-of-powers concerns to circumscribe the scope of the subpoena.  Former President Trump has argued that the entire subpoena should be voided for implicating significant separation-of-powers concerns. 

Although the district court’s decision involves highly specific circumstances involving a President-turned-former-President, the district court’s reasoning in narrowing the Mazars subpoena may shed light on how a court would evaluate the reasonableness and scope of a subpoena to private actors.  Though it stands to reason, of course, that any subpoena directed toward a sitting or former president would draw greater scrutiny from the courts than a subpoena directed to a private entity.  The Mazars analysis requires Congress to put forward a record establishing “that a subpoena advances a valid legislative purpose.”  This analysis has been used by courts in assessing the validity of congressional subpoenas to private individuals and entities, too.[3]  The district court closely examined the Oversight Committee’s written record on this score, and in the future, Congress may work harder to develop that record in advance of litigation.  In turn, subpoena recipients should consider bolstering their efforts to develop a record of their own.  Likewise, because the court went to such great lengths to assess whether the material Congress sought could have been discovered via sources other than the target’s personal records, so too in the future might courts be more inclined to ask whether Congress looked for documents from a less intrusive or burdensome source than the subpoena recipient.

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The enforcement of congressional subpoenas will continue to be debated and, in all likelihood, litigated.  And although there appear to be few, if any, imminent legislative enactments for enhancing the power of Congress to enforce subpoenas, the Mazars decision provides a long-sought blueprint for analyzing the permissibility of congressional subpoenas against Executive Branch officials.  Of course, the two non-civil litigation mechanisms for enforcing congressional subpoenas may be tested in the near future.  Just recently, the House Select Committee to Investigate the January 6th Attack on the United States Capitol issued subpoenas to multiple Trump-era Executive Branch officials.  As of October 7, 2021, the deadline to respond to the initial subpoenas, one recipient, former Trump advisor Steve Bannon, has not complied.  Many commentators are urging Congress to utilize, for the first time in decades, its powers of criminal or inherent contempt.  And as of October 19, 2021, the Select Committee voted unanimously to advance for full House consideration a resolution of contempt.  Although it is yet unclear how this dispute will unfold, if brought to court, the Select Committee’s subpoenas will be scrutinized in the shadow of Mazars—one of the most clearly articulated frameworks for assessing Congressional subpoenas ever to be passed down by the Court.

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[1] Trump v. Mazars USA, LLP, No. 19-cv-01136, 2021 WL 3602683 (D.D.C. Aug. 11, 2021). 

[2] Trump v. Mazars USA, LLP, 140 S. Ct. 2019, 2031 (2020) (“The congressional power to obtain information is broad and indispensable.” (internal quotations and citations omitted)). 

[3] E.g., Quinn v. United States, 349 U.S. 155, 161 (1955).

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