U.S. District Judge Kathleen Williams ruled Monday, July 13, 2026, that President Trump’s $10 billion lawsuit against the IRS was filed for an improper purpose and referred his attorneys for potential disciplinary action, writing that Plaintiffs improperly employed this lawsuit to justify a particular award in this matter, access to taxpayer funds and exemption from audits and other investigations, which was accomplished by leveraging control over Defendants, and finding that Plaintiffs acted in bad faith.
The suit, filed in January 2026 in Miami federal court, alleged the government improperly allowed former IRS contractor Charles Littlejohn, who pleaded guilty in 2023, to leak Trump’s tax returns to the New York Times, ProPublica, and other outlets in 2019 and 2020, but Trump’s legal team moved to dismiss the case on May 17, 2026, the same day acting Attorney General Todd Blanche, Trump’s former personal defense lawyer, announced a settlement creating a $1.776 billion Anti Weaponization Fund and permanently barring the IRS from auditing Trump, his sons, or the Trump Organization over past returns.
Williams’ order directly called out Blanche, stating his May 19, 2026 congressional testimony that there is no judge to review the settlement was at best, misleading and, at worst, disingenuous, and directed the court clerk to mail copies of her order to the state bars of New York and Washington D.C., where disciplinary referrals had already been sent for Blanche and Associate Attorney General Stanley Woodward, while also prohibiting Trump and the federal government from referring to the settlement agreement in any official proceeding.