Lawsuit challenging President Trump updated to highlight “gratuitous Chinese trademarks” 19 Apr 17
The landmark emoluments lawsuit initiated by Citizens for Responsibility and Ethics in Washington (CREW) – seeking to find the president in violation of the emoluments clauses of the Constitution – has been updated to include the receipt of “gratuitous Chinese trademarks”. Specifically, the suit aims to link the granting of registrations to President Trump’s affirmation of the ‘One China’ policy.
The emoluments clause of the US Constitution states that “no person holding any office of profit or trust under them, shall, without the Consent of the Congress, accept of any present, emolument, office, or title, of any kind whatever, from any King, Prince, or foreign state”. In February, we reported on the fallout that resulted from a TRUMP mark in class 37 progressing to registration in China. Speculation centred on whether the move represents an inexpensive way for China to curry favour with the president, and whether this violates the emoluments clause. We argued that the registration was not a surprise, and other legal commentators have stated that the approvals and timing were the result of due process. However, as we noted last week, the media focus has intensified after another 38 marks were granted preliminary approval in the country, with reports also highlighting recent Mexico trademarks. Yesterday came another media frenzy as reports emerged that - on the same day the president’s daughter Ivanka Trump met Chinese president Xi Jinping – China’s granted preliminary approval for three trademarks filed by Ivanka Trump Marks LLC.
Trademarks, then, are clearly taking centre stage in reporting about alleged conflicts of interest in the Trump Administration. Speaking to CNN, Ivanka Trump’s lawyer states that Ivanka has had no involvement with trademark applications submitted by the business since she resigned her post to take a role in her father’s administration. However, more curious is the amended CREW complaint. Earlier this week, it was revealed that an association of more than 200 restaurants and thousands of restaurant workers (Restaurant Opportunities Centers (ROC)) was joining the CREW lawsuit, along with a luxury hotel event booker. The amended complaint, filed yesterday morning, added new alleged violations that have occurred in the last three months including the federal government’s decision to permit President Trump to continue leasing his Washington DC hotel in violation of the lease. More interesting for trademark observers is the inclusion of the Chinese government’s granting of “gratuitous Chinese trademarks” soon after the president confirmed support of a ‘one China policy’.
While Barack Obama’s former ethics lawyer, Norman Eisen, has been quoted as saying “each of these [granted] trademarks is a potential emolument”, others argue that – as Trump signed over his business interests to his sons – he has divested his conflicting assets. This particular question seemed like it would go unanswered as it had not been included in the original CREW lawsuit but that has changed this week as the organisation sought to bolster the standing of its legal challenge. The Hollywood Reporter notes that the addition of ROC as a party is designed to evidence injury more explicitly than the original filing. The addition to the trademarks is likewise seen as a counter to an expected Justice Department argument that – with the emoluments clause – “the framers of the Constitution only meant to bar foreign bribery, not ordinary arm's-length transactions like paying for a hotel room”.
In the filing, then, CREW seeks to draw a link between Trump’s stance on the ‘One China’ policy and the granting of trademarks which “have considerable value by giving the Trump Organization the sole right to profit from the Trump brand in China”. It notes that, after a call with Taiwan President Tsai Ing-wen, Trump suggested that his administration “might end the One China policy unless some benefit were received in exchange”. He subsequently spoke to Chinese President Xi Jinping and pledged to honour the One China policy, and five days later China “reversed its prior course and gave defendant trademark protection”, having for years declined to do so. In short: “China only gave the trademark protection to defendant after he had been elected President, questioned the One China policy, was sworn in, and re-affirmed the One China policy.” The lawsuit adds: “When asked why defendant changed his position on the One China policy, and whether he had gotten something in exchange from China, White House Press Secretary Sean Spicer answered: “The President always gets something,” but did not specify what concession was obtained from China.” The intimation is clear – that the Chinese trademarks were Trump’s price for clarifying his policy stance.
As we argued, the timing of the TRUMP mark registrations appear to follow the normal timings and process for trademark registrations in China, and ironically his heightened fame as president may have itself elevated his fame to such a degree he can now protect his name in this way in China (where previously he couldn’t). Additionally, while the lawsuit notes that Chinese law prohibits awarding trademarks that are “the same as or similar to the name of leaders of national, regional, or international political organizations”, the specific question of whether public figures can themselves obtain trademark registrations for their names was not addressed by the Supreme People’s Court (SPC) guidance in the high profile Qiaodan case. Therefore, perhaps Trumps success serves as clarification that public figures can register their own marks.
For now, though, the answer to the question of whether receipt of trademark registrations does violate the emoluments clauses of the Constitution is a step closer.
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