Trump drops $10 billion IRS lawsuit

Donald Trump, Donald Trump Jr., Eric Trump and the Trump Organization moved on May 18 to dismiss their $10 billion lawsuit against the Internal Revenue Service, ending a case over the leak of Trump’s tax returns. Hours later, the Justice Department announced a nearly $1.8 billion “Anti-Weaponization Fund” tied to the settlement, saying it would compensate people who claim they were harmed by government “weaponization and lawfare.” Reuters, NPR and other outlets reported the arrangement on Monday, and a Miami federal judge dismissed the case the same day. The lawsuit had been unusual from the start because Trump, as president, was suing agencies within the government he leads. Judge Kathleen Williams had earlier questioned whether the parties were sufficiently adverse to keep the case alive, according to ABC News and court coverage cited by multiple outlets. The dismissal on May 18 avoided a further fight over that issue. (usnews.com) ### What exactly did Trump drop? The May 18 filing covered the full civil case brought in federal court in Miami by Trump, his two eldest sons and the Trump Organization against the IRS and Treasury Department. The plaintiffs had sought $10 billion, alleging the government failed to properly control a contractor who disclosed Trump’s tax information. (abcnews.com) The underlying dispute traces to the leak of Trump’s tax returns by Charles Littlejohn, a former IRS contractor who was prosecuted for disclosing tax information belonging to Trump and thousands of wealthy Americans. The civil suit argued the government should be held liable for the leak and its handling. (cnbc.com) ### What is the $1.8 billion fund? The Justice Department said on May 18 that it would establish a fund of roughly $1.776 billion, widely rounded to nearly $1.8 billion, as part of the settlement. Instead of Trump and the other plaintiffs receiving direct damages, the government said the money would support claims by people alleging they were targeted through government “weaponization” or “lawfare.” (usnews.com) The administration described the mechanism as a way to resolve the IRS suit while creating a process for compensation or formal apologies in other cases. Axios called it an unprecedented taxpayer-backed mechanism, while Politico reported the fund would be administered through a new claims structure announced by DOJ. ### Why was the case legally awkward? (usnews.com) Judge Kathleen Williams raised the issue on April 24, asking Trump and the government to explain why the case could proceed when the sitting president oversees the agencies he was suing. ABC News reported Williams said the parties might not be “sufficiently adverse,” a basic requirement for a live case in federal court. (axios.com) NPR reported ethics watchdogs and congressional Democrats had sought to intervene as settlement talks accelerated. Their objection was not enough to stop the dismissal once Trump asked to drop the case and the judge granted it. ### Who could seek money from the new program? (abcnews.com) The Justice Department’s public description was broad, saying the fund would be open to people who show they suffered government “weaponization and lawfare.” News reports said that could include Trump allies and other people who claim they were improperly investigated or prosecuted under prior administrations. (ideastream.org) Some outlets reported the scope could become a new political and legal flashpoint. Time said the agreement also included a formal apology to Trump, his sons and the Trump Organization, while AP and NBC reported immediate criticism from Democrats and ethics groups. ### What happens next? Judge Kathleen Williams closed the Miami case on May 18, ending the litigation in court. (whbl.com) The next step is the Justice Department’s rollout of the fund’s claims process, including who qualifies, what evidence claimants must provide and who will administer payments or apologies. (ideastream.org) (time.com)