The attorneys general from Maryland and the District of Columbia had brought the case, arguing that the president violated a constitutional clause that prohibits elected officials from doing business with foreign governments without permission from Congress.
But an appeals court panel ruled the attorneys general lacked standing to bring the lawsuit.
Reacting to the decision, President Trump tweeted, "Word just out that I won a big part of the Deep State and Democrat induced Witch Hunt."
Earlier this year, a federal district court in Maryland had allowed the lawsuit to move forward.
But on Wednesday, a three-judge panel of the 4th Circuit Court of Appeals criticized the Maryland district court judge’s ruling as “so attenuated and abstract that their prosecution of this case readily provokes the question of whether this action against the President is an appropriate use of the courts.”
The appeals court decision marks the first legal victory for President Trump as his legal team fights legal challenges on several fronts.
In a statement on Wednesday, Jay Sekulow, counsel to the president, hailed the appeals court ruling as “a complete victory.”
“The decision states that there was no legal standing to bring this lawsuit in the first place,” Sekulow continued. “This latest effort at Presidential harassment has been dismissed with prejudice.“
The attorneys general from Maryland and District of Columbia issued a statement regarding the court's decision this afternoon.
"We think that this panel of the Fourth Circuit Court of Appeals got it wrong. Although the court described a litany of ways in which this case is unique, it failed to acknowledge the most extraordinary circumstance of all: President Trump is brazenly profiting from the Office of the President in ways that no other President in history ever imagined and that the founders expressly sought—in the Constitution—to prohibit. We have not and will not abandon our efforts to hold President Trump accountable for violating the Nation’s original anti-corruption laws. We believe that the federal trial judge correctly decided that the plaintiffs have standing—and that discovery should go forward on President Trump’s receipt of emoluments. All Americans suffer when our chief executive is vulnerable to corrupt foreign influence. The idea that the District of Columbia and Maryland are not harmed by the President’s violation of the Constitution is plain error. We will continue to pursue our legal options to hold him accountable.”
Earlier this week, in a separate emoluments case, congressional Democrats began issuing subpoenas as part of the discovery process in their case. Justice Department attorneys representing President Trump asked the D.C. Circuit Court of Appeals to intervene and halt the “extraordinary case,” as they called it.