Federal judge voids $1.776 billion Trump IRS settlement, calls case a 'bad faith' attempt to abuse the courts

A federal judge in Florida has thrown out a proposed $1.776 billion settlement between President Donald Trump and the IRS, ruling that the president's original lawsuit was brought in "bad faith" and for an "improper purpose," according to NBC News and accountingtoday.com. U.S. District Judge Kathleen Williams voided the agreement, which had been reached between Trump and his own administration, after finding no valid legal controversy existed.

2 sources

NBC NewsJudge says Trump admin attempted to ‘manipulate the judicial process’ with its IRS settlementaccountingtoday.comJudge rules Trump IRS immunity deal has no 'basis in law'

"The president's lawsuit against the IRS was not brought to vindicate rights; it was brought to manipulate the judicial process to pursue benefits unavailable in litigation because the parties were not adverse."

cpapracticeadvisor.comJudge Rules Trump IRS Immunity Deal Has No ‘Basis in Law’

The judge's order referred a Trump attorney for potential discipline, MEAWW reported, and the Washington Post noted that Williams suggested Trump may have sued the IRS specifically to obtain tax immunity for himself and his family. Under the settlement, the IRS had agreed not to audit Trump or his family for past returns and also created a nearly $1.8 billion fund for alleged victims of politicized prosecutions, which attracted interest from Capitol rioters, according to the Post.

MEAWWJudge accuses Trump of weaponizing courts, says he tried to 'manipulate judicial process'

"[The lawsuit] was not brought to vindicate rights; it was brought to manipulate the judicial process."

The ruling confirms what Talking Points Memo described as many observers' conclusion about Trump's attempt to leverage the courts for personal financial benefit. Williams found that the parties were not truly adverse because the Trump administration's IRS was effectively settling with the president himself, making the entire proceeding a vehicle to secure benefits unavailable through legitimate litigation. The $1.776 billion fund, now voided, would have drawn from taxpayer dollars to compensate individuals who claimed they were targeted by politically motivated prosecutions, including those involved in the January 6 Capitol riot.

Talking Points MemoAhead of Blanche Hearing, Judge Says Trump Tried to ‘Manipulate the Judicial Process’ With IRS Settlement