DC Judge Puts Cork in Wine Bar's Suit Against Trump

President Donald Trump listens during a meeting with members of Congress in the Cabinet Room of the White House in Washington, D.C., on July 17, 2018. (Photo: Yuri Gripas/Bloomberg)

A federal judge in Washington, D.C., on Monday tossed a local restaurant’s “unfair competition” lawsuit against President Donald Trump and his Pennsylvania Avenue hotel, finding the D.C. business owner’s complaint had failed to state a claim against the president.

U.S. District Judge Richard Leon’s ruling comes more than a year after the owners of Cork Wine Bar, the upscale D.C. restaurant, sued Trump and Trump Old Post Office LLC, the business entity that operates Trump International Hotel. The restaurant’s owners initially sued in D.C.'s Superior Court—alleging Trump’s promotion of his hotel and its restaurants diverted customers away from their business—but the lawsuit was moved to the U.S. District Court for the District of Columbia.

Judge Richard Leon, U.S. District Court for the District of Columbia. (Photo: Diego M. Radzinschi/ALM)

Leon’s ruling on Monday hands a win to Morgan Lewis attorneys who were representing Trump, as well as Seyfarth Shaw, who represented the Trump Old Post Office LLC. The defendants had sought to dismiss the case by arguing in part that Trump was entitled to presidential immunity.

In his 12-page opinion, Leon avoided the constitutional question on immunity, instead taking up the defendants' argument that the Cork Wine Bar owners had failed to state a claim.

“While appearing at first blush to be just another unfair competition action, there are constitutional questions of profound weight and import lurking within the contours of this case. Fortunately, however, the pending motions can be resolved without opening the Pandora’s box of novel issues,” he wrote.

Leon said Cork’s lawsuit did not accuse Trump or his Old Post Office entity of directly interfering with Cork’s business or dissuading possible customers from patronizing their restaurant.

“Instead, Cork’s complaint, at its core, is that defendants are acting to realize and maximize the competitive advantage and financial benefits available to them as a result of President Trump’s heightened notoriety since taking office,” Leon wrote. “To Cork, these efforts are distasteful and unseemly, if not unethical.”

“But even if Cork’s offense is well taken, its objection is not to a legally redressable wrong. Its objection is to the ‘process known as competition, which though painful, fierce, frequently ruthless,sometimes Darwinian in its pitilessness, is the cornerstone of our highly successful economic system,’” he wrote, quoting a 1999 Seventh Circuit opinion.

In a statement, lawyers representing Cork Wine Bar said they were “disappointed” by Monday’s opinion. One of the attorneys, Mark Zaid, said they planned to appeal the ruling.

"Judge Leon correctly noted the ‘constitutional questions of profound weight and import lurking within the contours of this case’ but we disagree with the decision that ‘Unfair Competition’ is not the proper vehicle to address those questions,” the statement said.

“We are encouraged that the standing of Cork was never challenged, and that we are in a Country that supports the rule of law, and allows a local small business to challenge the President of the United States, where necessary... It is important to continue challenging the business activities and other non-presidential actions that allow the President, his company and his family to unfairly profit from the office of President of the United States."

The restaurant's owners are also represented by Alan Morrison and Steven Schooner of George Washington University’s law school and Scott Rome of the Veritas Law Firm.

You can read Leon’s ruling here.