Trump lawsuit settlement creates $1.776 billion fund for victims of government ‘lawfare’

The Department of Justice (DOJ) announced a $1.776 billion “Anti-Weaponization Fund” as part of a settlement resolving President Donald Trump’s $10 billion lawsuit against the IRS over the unauthorized leak of his tax returns, establishing a compensation process for people with claims of being targeted by politically motivated government actions.

Trump, along with his sons Donald Trump Jr. and Eric Trump and the Trump Organization, sued the IRS and Treasury Department after former IRS contractor Charles Littlejohn stole and leaked the President’s and other wealthy Americans’ tax records to news organizations. The complainants sought $10 billion in damages based on statutory penalties for each unauthorized disclosure. 

Under the settlement, Trump and his co-plaintiffs dropped the lawsuit with prejudice — permanently ending it — and withdrew related claims tied to the Russiagate investigation and the 2022 FBI search of Mar-a-Lago. 

In exchange, the Justice Department agreed to issue a formal apology to Trump and his family. But the Trumps will receive no direct financial compensation. Instead, the DOJ agreed to establish the new fund using $1.776 billion from the Treasury Department’s Judgment Fund. The $1.776 billion figure is a reference to the American founding year. 

The fund establishes a process for people claiming they were victims of government “weaponization” or “lawfare” — largely referring to controversial actions taken by government entities against conservative Americans during the Biden administration — to seek formal apologies and compensation. 

The DOJ has said the fund is a lawful way to provide redress for victims. A five-member commission will review voluntary claims, with operations scheduled to continue through December 2028. 

The Department said the fund is modeled on past large-scale settlements, including the Obama-era Keepseagle settlement, which created a roughly $760 million fund to resolve longstanding discrimination claims by Native American farmers against the federal government.

Ninety-three House Democrats filed court papers May 18 urging a judge to block Trump’s proposed settlement, calling it an unconstitutional act of self-dealing that would compensate Jan. 6 rioters and Trump allies.

The Democrats, in an amicus brief and accompanying statements, argued the deal improperly diverted taxpayer money from the Treasury’s Judgment Fund.