Judge Reopens Trump IRS Case, Examines Settlement Allegations

A significant legal development unfolded in Miami as federal judge Kathleen M. Williams reopened President Trump’s $10 billion lawsuit against the IRS, citing serious allegations of deception in settling the case. This decision marks a setback for both Mr. Trump, who dismissed the suit voluntarily, and the Justice Department, which had used the suit to create a compensation fund.

The fund, valued at $1.8 billion, was designed to recompense individuals claiming they experienced government weaponization by Democrats. Additionally, the settlement provided substantial tax advantages for Mr. Trump, his family, and his businesses. The reopening of the case came after a bipartisan group of 35 former federal judges submitted court documents urging Judge Williams to reinvestigate the case details.

Judge Williams had previously closed the case, raising concerns about whether Mr. Trump was in a position of conflict by suing a federal agency he controlled. When she closed it, she noted there was no formal settlement on record. However, the Justice Department subsequently published an agreement that effectively ended the action.

In a concise but rigorous order, Judge Williams communicated her intent to scrutinize Mr. Trump’s attempts to settle the lawsuit in a manner that benefitted him and his associates. She declared her authority to investigate serious misconduct in her courtroom and directed Mr. Trump’s attorneys to respond by June 12, addressing whether the case should be reopened due to fraud allegations against the court or possible collusion by Mr. Trump to elude judicial examination.

Judge Williams referenced analysis by The New York Times, which disclosed the IRS had crafted a detailed memorandum containing defenses against the lawsuit, which the Justice Department chose not to pursue in court. Legal representatives for the former judges commended Judge Williams’s decision.

“The judges and their counsel greatly appreciate the seriousness with which the court is addressing these grievous allegations,” said Norman Eisen, representing the former judges. “We stand ready to work with the court as it investigates this matter.”

Alan Feuer, a journalist for The Times, focuses on extremism and political violence, covering criminal cases tied to the January 6 Capitol attack and former President Trump. Andrew Duehren reports on tax policy from Washington for The Times.