A federal appeals court on Monday declined to block a subpoena for President Trump’s financial records issued by state grand jury in Manhattan. A three-judge panel on the 2nd U.S. Circuit Court of Appeals rejected the President’s argument that he enjoys absolute immunity from a state grand jury subpoena.

“[A]fter reviewing historical and legal precedent, we conclude only that presidential immunity does not bar the enforcement of a state grand jury subpoena directing a third party to produce non‐privileged material, even when the subject matter under investigation pertains to the President,” the appeals court said.

President Trump brought the lawsuit after financial records held by accounting firm Mazars were subpoenaed in August, as part of an investigation being pursued by Manhattan District Attorney Cy Vance that appears to be focused on hush-money payments made to women claiming sexual encounters with Trump.

While the pre-indictment investigation can move forward, the court said, it stopped short of deciding whether presidential immunity limited other prosecutorial acts by state or local prosecutors. Trump in the case had argued that while he was president, state and local prosecutors could not even move forward with subpoenas that pertain to him — including subpoenas of third parties for his records.

“Even assuming, without deciding, that a formal criminal charge against the President carries a stigma too great for the Constitution to tolerate, we cannot conclude that mere investigation is so debilitating,” the court said, adding that such a decision would be hard to square with legal precedents from investigations into President Richard Nixon.

The subpoenas sought Mazars’ financial records going back to 2011, covering Trump’s businesses and Trump himself. Trump’s tax returns are included in the request.

Thursday’s decision is the latest court loss Trump has suffered in his efforts to shield his tax returns from scrutiny. During the 2016 campaign, he broke longstanding tradition by not releasing them voluntarily.

In a separate case, an appeals court panel in D.C. upheld a congressional subpoena seeking Trump financial records from Mazars. Trump’s personal attorneys are asking the full DC appeals court to reconsider that decision. They have also signaled they plan to go to the Supreme Court if necessary to block that subpoena.

After the New York case decision, Trump personal attorney Jay Sekulow told reporters that Trump plans to take that case to the Supreme Court as well.

Trump’s personal legal team has taken an aggressive stance in this and other cases in seeking to stonewall investigations into Trump. They’ve claimed that any criminal investigation —state, local, or federal — touching Trump while he is in office is unconstitutional. In oral arguments in the New York case last month, his lawyer Will Consovoy told the judges that if Trump shot someone on 5th Avenue, local investigators would even be hamstrung in what they could investigate while Trump was in office.

Monday’s decision roundly rejected that argument, even while staying narrowly focused on the third party subpoena the court was considering.

“Although the subpoena is directed to the President’s custodian, no court has ordered the President to do or produce anything,” the court said. “Nor has the President explained why any burden or distraction the third‐party subpoena causes would rise to the level of interfering with his duty to ‘faithfully execute[]” the laws.”

The court noted that “the grand jury in this case is investigating not only the President, but also other persons and entities.”

“Assuming, again without deciding, that the President cannot be prosecuted while he remains in office, it would nonetheless exact a heavy toll on our criminal justice system to prohibit a state from even investigating potential crimes committed by him for potential later prosecution, or by other persons, not protected by any immunity, simply because the proof of those alleged crimes involves the President,” the court said.

Monday’s decision, while a major defeat for the President, only partially agreed with the district court judge’s previous decision in the case siding with Vance. That judge said that the federal judiciary should abstain from the case, since it had to do with a state rather than federal investigation.

Read the opinion below: