Judge shuts down Michael Cohen’s free speech lawsuit against Trump Foundation
By Brian Bennett, News4 Media
Wednesday, June 2, 2018
After a six-week trial, a federal judge in New York City Wednesday ruled that Donald Trump’s $130,000-a-year charity “is not a charitable organization” and may not use it to pay his personal lawyer Michael Cohen for his work in settling civil claims that his client allegedly encouraged illegal campaign contributions.
Prosecutors argued in a lengthy pre-trial briefing that Trump was not, in fact, a charity and could thus be held financially responsible for all money that Michael Cohen earned from his work representing Trump. The U.S. Attorney described it as “an illegal financial transaction,” arguing that the organization should not be able to deduct the money from its taxes.
“I’ve seen this on a lot of levels,” U.S. Attorney Preet Bharara said at the outset of Wednesday’s pre-trial hearing.
“It’s not a charitable organization. It’s not a tax-exempt organization. It’s a for-profit organization,” Bharara said. “I saw the tax return and it showed the president is a taxpayer.”
Bharara, joined by U.S. Magistrate Judge James Orenstein, also described the Trump Foundation as “a for-profit organization” when outlining how he saw it as an “illegal financial transaction.”
“An organization, by its very nature, is more like a commercial venture than it is an organization that’s charitable,” Orenstein said. “They have to pay their taxes, they have to comply with the laws that govern private enterprises.”
When asked by Cohen’s attorney for the first time why he used the Trump Foundation as a “smoke-screen to avoid the tax requirement,” Orenstein responded by saying he did not want to talk about the case.