"I'm supposed to work out a settlement with myself," President Donald Trump told reporters a few days after he sued the IRS. He wasn't kidding: His January 29 lawsuit , which alleged damages from an IRS contractor's illegal leaking of his tax returns, pitted Trump against an agency he oversees, represented by Justice Department lawyers who also answer to him.
The "settlement" that the president reached with himself, which Acting Attorney General Todd Blanche announced on May 18, included $1.8 billion in taxpayer money for purported victims of the Biden administration's "lawfare and weaponization." It also included protection from liability for tax violations and any other federal offenses that Trump or his family might have committed. That sweet deal was business as usual at the Justice Department, Trump's personal lawyers improbably claim in a brief they filed on Monday in the Southern District of Florida.
There is "no evidence" of "collusion or fraud" in Trump v. IRS , Alejandro Brito and two other lawyers told U.S. District Judge Kathleen Williams, who last month ordered briefing on that issue. Any suggestion that Trump used a phony lawsuit as a pretext to obtain huge favors for himself, his relatives, and his supporters is based on "nothing but speculation," Trump's attorneys say.
Brito et al. glide over the glaring conflicts of interest created by a case in which both sides were represented by lawyers who worked for Trump. Further compromising the Justice Department's ability to defend the IRS, an executive order that Trump issued in February 2025 bars the government's lawyers from taking legal positions at odds with the president's.
That bizarre situation prompted Williams to question whether the case involved a genuine controversy between adverse parties, as required for the lawsuit to proceed. After Williams ordered briefing on that crucial issue by May 20, Trump avoided the need to address it by dropping his lawsuit two days before the deadline. But in response to a May 27 motion by 35 former federal judges, Williams is now mulling "whether the case should be reopened because the Court was the 'victim of a fraud.'"
Those former judges did not have standing to file their motion, Brito et al. argue, and Williams has no authority to reopen the case. Even if she did, they say, the most she could do after determining that there was no true "case or controversy" would be to dismiss the lawsuit again. Under no circumstances, they argue, would Williams have the power to review the "settlement," which the Justice Department "had independent statutory authority to enter regardless of whether this case was ever filed."
The Justice Department reached "a fully proper government settlement" after weighing the merits of Trump's claims and assessing the cost of defending against them, Brito et al. claim. "Because the government can and routinely settles claims with or without a lawsuit, it is irrelevant whether Movants believe that this case presented a robust case or controversy," they write. "The Government's decision to settle rather than litigate does not by itself render the underlying claims fraudulent or the litigation collusive." They add that "the validity of the settlement does not depend on this Court's jurisdiction over the dismissed action, and the dismissal did not result from collusion with anyone."
Whether or not Trump's lawyers are right about Williams' authority to intervene at this point, their argument that there is nothing to see here relies entirely on blithe assurances and comical misdirection. They emphasize, for example, that "three of the four Plaintiffs"—Donald Trump Jr., Eric Trump, and the Trump Organization—were not the president of the United States or even "employees of the federal government." When "private plaintiffs sue the United States for statutory violations," they say, the case is "inherently adversarial."
Trump, his sons, and his business claimed IRS contractor Charles Littlejohn's unauthorized disclosure of their tax returns had caused them "at least" $10 billion in damages. In addition to offering a preposterous estimate of the injury they had suffered, they missed the statutory deadline for filing such claims, meaning the lawsuit was doomed from the outset.
Although Brito et al. do not mention that fatal flaw, they do note another obstacle to the lawsuit. Trump's main claim was based on 26 USC 7431 , which authorizes taxpayers to sue for damages when an "officer or employee of the United States" illegally discloses their tax information. "The question of whether Mr. Littlejohn qualified as an 'officer or employee' of the United States, as opposed to merely a contractor, was a contested issue that required application of a joint-employer analysis under federal common law," Trump's lawyers acknowledge.
That issue figured in a lawsuit that Citadel CEO Kenneth Griffin, another billionaire whose tax returns Littlejohn had leaked, filed in December 2022, also in t…
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