An Obama-appointed federal judge sharply criticized President Donald Trump’s IRS settlement Monday, reviving controversy over the administration’s abandoned $1.776 billion anti-weaponization fund and referring several Trump-aligned attorneys for possible discipline.
In a 56-page order, U.S. District Judge Kathleen Williams sanctioned lawyers involved in the case and barred both sides from citing the agreement as a judicially recognized settlement in future proceedings.
“The nature of the suit itself and the conduct of the Parties and counsel from its filing make plain that this was an attempt to use the Court to provide some legitimacy to an agreement to confer immunity to people and entities affiliated with the President and to earmark billions of dollars from American taxpayers to redress grievances not defined in the law,” Williams wrote.
The ruling also revives scrutiny surrounding the now-abandoned $1.776 billion “anti-weaponization” fund, which the Justice Department withdrew after bipartisan criticism. Williams repeatedly cited the provision as evidence that the settlement was driven by political branding rather than a legitimate calculation of damages.
The decision also comes two days before Acting Attorney General Todd Blanche’s Senate confirmation hearing, where Democrats are expected to grill him about the settlement and its remaining provisions.
Williams concluded the lawsuit never presented a genuine legal dispute because Trump ultimately controlled the agencies defending the case.
“In sum, the facts before this Court demonstrate there was never adverseness between the Parties; there was never a case or controversy; and there was never a question as to who would prevail,” she wrote.
Williams referred Blanche and Associate Attorney General Stanley Woodward to their respective bar associations, where disciplinary proceedings are already pending. She also referred Trump attorney Alejandro Brito to the Florida Bar and barred America First Legal Vice President Daniel Epstein from appearing before her court for one year.
A spokesman for Trump’s legal team defended the lawsuit, arguing the IRS failed to protect the president’s confidential tax information after a government contractor leaked tax returns to several news organizations.
“The IRS wrongly allowed a rogue, politically-motivated employee to leak private and confidential information about President Trump, his family, and the Trump Organization,” the spokesman said. “President Trump continues to hold those who wrong America and Americans accountable.”
