Washington DC wine bar owners sue Donald Trump after new hotel causes them to lose business

Proprietors say President's business enjoys unfair and illegal advantage

Khalid Pitts and Diane Gross, co-owners of Cork Wine Bar, are suing President Trump over his financial interest in the restaurant at Trump International Hotel in Washington DC (Bill O'Leary/Reuters)

At Cork Wine Bar, owners Khalid Pitts and Diane Gross host corporate dinners, political fundraisers, embassy receptions and an array of other events for clients looking for a casually elegant setting offering more than 200 wines from around the world.

But the couple contend their Logan Circle business would be better off if not for a new player in town who they claim is operating with an unfair and illegal advantage: President Donald Trump, owner of the $212 million Trump International Hotel he opened last fall.

With support from a legal team headlined by the co-founder of Ralph Nader’s advocacy group, Gross and Pitts sued Trump and his D.C. hotel company Wednesday in Superior Court, alleging that the president’s continued ownership of the hotel constitutes unfair competition that damages their business.

“We have events we do here for elected officials, non-profits, foreign dignitaries, the World Bank, law firms,” Gross said. “Those folks are now being courted to come and want to go there because they see it as advantageous to them to curry favor with the president.”

The White House declined to comment. President Trump has taken steps to insulate himself from the business, resigning from his positions and putting his adult sons, Donald Trump Jr. and Eric Trump, in charge. He pledged to donate profits from foreign clients to the US Treasury.

Eric Trump called the suit “a publicity stunt” in an interview Thursday afternoon following a promotional event for the Senior PGA Championships, the golf tournament he will host in Loudoun County in May.

“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,” he said.

Donald Trump Jr. said recently that the suggestion his father donated millions of dollars to run for president against a deep Republican field and Hillary Clinton to make money was without any merit. “That doesn’t make any sense whatsoever,” he said.

Gross and Pitts seek no damages but rather an order barring Trump’s D.C. hotel business from operating while President Trump owns it. Attorneys are representing the couple on a pro bono basis and include Alan B. Morrison, dean of public interest law at George Washington University and co-founder, with Ralph Nader, of the Public Citizen Litigation Group in 1972.

The complaint cites Trump’s appearances at the hotel, its hosting of foreign embassies and White House press secretary Sean Spicer’s comments saying, shortly before the inauguration: “It’s an absolutely stunning hotel. I encourage you to go there if you haven’t been by.”

“This is a company town and the business is the government,” Pitts said. “We have people, individuals, companies in the US and around the world who do business with the government. And the business leader of the government is the president of the United States.”

Cork’s co-owners do not name any specific client they have lost to Trump, although they say business around the inauguration fell well short of what they experienced in 2009.

“We do lose bookings sometimes and nobody ever gives you a reason. They don’t say, ‘We’re going to the Trump hotel instead of coming here.’ We do know that business has been a little slower with the inauguration of this president,” Gross said.

The restaurant faces competitive pressures beyond Trump’s hotel and its BLT Prime restaurant 1½ miles away in Northwest Washington. Pitts and Gross were trailblazers when they opened on 14th Street among pawnshops and vacant storefronts in 2008. More than a year later, they opened Cork Market & Tasting Room. Since then, more than two dozen restaurants have opened nearby. And to be sure, their 2,500-square-foot brick establishment north of R Street and the 4,600-square-foot market across the street provide just a fraction of the crowd capacity and service of Trump’s 13,200-square-foot chandelier-adorned ballroom.

“We don’t mind competition. The whole D.C dining scene is exploding and we are friends with half the businesses on this block,” Gross said. “It’s really about the unfairness of it.”

With the suit, Gross and Pitts join a growing list of D.C. restaurateurs confronting a new political climate in the Trump era. Chef José Andrés is battling Trump in court over a failed deal to open a restaurant in the hotel and his establishments joined more than 50 area restaurants that closed for a day in protest of the president’s hard-line immigration policy. A man chasing fake news accounts fired a shotgun in Comet Ping Pong pizzeria a month after the election, while the owners of Maggiano’s Little Italy apologised for inadvertently hosting a white nationalist dinner in November.

Given the unique circumstances of Trump’s business interests, it’s difficult to predict how a judge might consider the suit. Paul F. Rothstein, a professor at Georgetown University Law School, said that when the Supreme Court allowed a sexual harassment suit to proceed against President Clinton in 1997 it opened the door to other litigation against sitting presidents.

“The Supreme Court has made clear numerous times that president is subject to the laws of the country just like any other person,” Rothstein said.

Rothstein said part of a judge’s decision about whether a case should proceed, rather than be delayed, could hinge on whether it could interfere with the president’s work. “His businesses are so widespread that the court might find on the facts that there would be a little more interference in the president’s job,” he said.

Similar to others pushing legal action against Trump or his companies, Gross and Pitts are active in liberal political causes, with Pitts running for D.C. Council in 2014 and having formerly served as national political director of the Sierra Club and as a campaign director for the Service Employees International Union.

Other attorneys for the couple include George Washington University law school professor Steven L. Schooner, Scott H. Rome of the Veritas Law Firm and Mark S. Zaid.

Rome, who represents multiple restaurant owners, said that whatever business Trump reaps at the hotel is business another of the city’s restaurants or hotels would otherwise be getting.

“That business is coming from somewhere. And local D.C. restaurants are bearing the brunt of it,” he said.

The Washington Post