President Donald Trump is dropping his $10 billion lawsuit against the Internal Revenue Service, according to court documents, a signal that the administration is preparing to go forward with a plan to set up a $1.8 billion fund that would compensate those who believe they were subject to unfair investigations under previous administrations.
Monday morning’s court filing did not provide any details of a settlement. Rather, it noted that the case was still in a very preliminary phase. Trump’s lawyers said that meant that he did not need to ask for permission to dismiss the case nor did the IRS need to consent to the dismissal. The filing said he was dismissing with prejudice, which would foreclose his ability to try to bring the case again.
In January, Trump, along with his sons Donald Trump Jr. and Eric Trump, sued the IRS and Treasury Department for at least $10 billion. The lawsuit accuses the IRS of an unauthorized leak of Trump’s tax returns from his first presidency.
Trump’s lawsuit alleges that the IRS failed to protect confidential tax information and the tax information of the Trump Organization. Charles Littlejohn, a former IRS contractor, was sentenced to five years in prison for leaking Trump’s tax records, along with the records of thousands of others.
Trump sued the IRS in his capacity as a citizen, not as the president.
Soon after Trump brought the lawsuit, the federal judge presiding over the case in Florida, district Judge Kathleen Williams, expressed skepticism that it was the kind of legitimate legal dispute that belonged in her courthouse.
She asked a group of outside lawyers to brief her on the question. They too raised concerns about the propriety of a president seeking monetary damages for personal reasons against a government agency within his executive branch.
The deal follows several others reached in lawsuits filed by allies of Trump.
In March, the department settled a lawsuit with Michael Flynn. Flynn sued the government for $50 million, accusing the FBI of trying to entrap him in the first few days of the Trump administration. Flynn was awarded over $1 million in the settlement.
Carter Page, a former Trump campaign adviser, also settled a lawsuit with the Trump administration in April. Page was suing the Justice Department and FBI over flawed government surveillance he faced due to Russian contacts in 2016.
Minutes after Trump’s legal team notified the court he’s dropping the case on Monday, nearly 100 House Democrats submitted a “friend-of-the-court” brief accusing Trump of “blatant self-dealing.”
They wrote that, if Trump sought to voluntarily submit the case to facilitate such a settlement, the court should scrutinize that maneuver under a legal rule that would allow the court to sanction the lawyers involved.
This story is breaking and will be updated.
