President Donald Trump speaks before Steve Witkoff is sworn as special envoy during a ceremony in the Oval Office of the White House, Tuesday, May 6, 2025, in Washington, with a portrait of former President Ronald Reagan in the background (AP Photo/Mark Schiefelbein).
A federal judge in Miami issued an order late Friday that could prove ominous for President Donald Trump and his planned $1.776 billion "anti-weaponization fund."
In January, Trump's original lawsuit against the IRS was filed in the Southern District of Florida.
By the middle of May, however, the case was closed – on the plaintiff's own request – with the 45th and 47th president opting instead for a "settlement" that will be used as a vehicle to pay his stalwart allies.
Under the terms of the settlement, eligible claimants are people who were subjected to the "sustained use of the levers of government power by Democrat elected officials, political and career federal employees, contractors, and agents in order to target" them for "improper and unlawful political, personal, and/or ideological reasons."
But, for various reasons, the prospect of the fund was never quite a sure bet for Trump or the would-be payees.
In her order closing the case, U.S. District Judge Kathleen Williams, a Barack Obama appointee, said "there is no settlement of record" because the notice to voluntarily dismiss the case "does not reference any settlement or include a stipulation of settlement."
The judge had other concerns, too.
"Additionally, Defendants—federal agencies represented by the Department of Justice…neither submitted any settlement documents nor filed any documents ensuring that settlement was appropriate where there was an outstanding question as to whether an actual case or controversy existed," the mid-May order reads.
Then quite a few more things happened that put the fund in doubt – including an injunction issued Friday morning by a judge in the Eastern District of Virginia that bars the DOJ "from taking any further action pursuant to the creation or operation of" the fund, including transferring money to the fund, considering any claims submitted to the fund, and disbursing any money from the fund.
Meanwhile, at least four other lawsuits and/or claims were filed that sought to pump the brakes on what Trump's critics call a "slush fund."
One of those claims was filed by nearly three dozen former federal judges who implored Williams to disregard the "fraudulent nature" of Trump's voluntary dismissal, "reopen" the case, and look into "exactly what happened here," as Law&Crime previously reported.
While it was an open question whether Williams would consider reopening a case she dismissed with prejudice – or if the retired judges would be able to maintain their objections to the fund under the auspices of the original lawsuit – those questions were quickly answered.
"Here, the non-party movants advance grievous allegations that Plaintiffs voluntarily dismissed this litigation solely to avoid judicial scrutiny of a lawsuit that 'was collusive from the start' and was only filed to provide the imprimatur of legality for an unlawful settlement," Williams writes in her late Friday order.
The judge rattles off a laundry list of objections, at length:
They point to the fact that the settlement in question includes a "three-paragraph addendum . . . [that] purports to 'forever bar and preclude' the United States from pursuing claims that could have been [otherwise] asserted [against] Plaintiffs," and highlight the fact that Defendants did not "even try to defend against Plaintiffs' claims" despite their active opposition to nearly identical claims in other litigation. Finally, the non-party movants assert that Plaintiffs' claims were "clearly untimely" and therefore untenable.
The order also suggests that Williams views the entire process – that is, the filing of the lawsuit and concomitant quick settlement – as perhaps indicative of a fraud on the court itself.
"A court is empowered to investigate serious misconduct as a collateral issue within the purview of Rule 11 and determine 'whether an attorney has abused the judicial process,'" the judge opines – citing the relevant Federal Rule of Civil Procedure.
"The purpose of Rule 11 is to deter baseless filings," the order goes on, citing precedent. "Specifically, Rule 11 'requires that an attorney or unrepresented party filing a pleading certify that the filing is not presented for any improper purpose.' A party's decision to file a frivolous lawsuit for the sole purpose of forcing a settlement may qualify as such an improper purpose."
Here, Williams suggests those involved may find themselves subject to discipline should the worst conclusions – for Trump and the federal agencies involved – be reached.
"If a party files a lawsuit for an improper purpose, 'the court may impose an appropriate sanction on the responsible party,'" the order continues.
To that end, the judge has directed the plaintiffs to file a response to the former judges that includes responses to: "(1) the charges of collusion and whether the Parties are truly adverse; (2) the assertion that the dismissal in this case was premised on deception by the Parties; and (3) the question of whether the case should be reopened because the Court was the 'victim of a fraud.'"
The government must answer those pointed questions by June 12, the judge said. The retired judges will be able to respond until June 19.