Two Washington, D.C., police officers who defended the U.S. Capitol from a mob of President Trump’s supporters on Jan. 6, 2021, sued the Trump administration Wednesday to block the creation of a new $1.776 billion taxpayer-backed fund, which would pay out money to people — potentially including Jan. 6 defendants — who think they were wronged by the Justice Department under previous administrations.
“In the most brazen act of presidential corruption this century, President Donald J. Trump has created a $1.776 billion taxpayer-funded slush fund to finance the insurrectionists and paramilitary groups that commit violence in his name,” the suit alleges. “No statute authorizes its creation, the settlement on which it is premised is a corrupt sham, and its design violates the Constitution and federal law.”
Former Capitol Police Officer Harry Dunn and Metropolitan Police Department Officer Daniel Hodges argue the fund is illegal because Congress did not authorize it. They also claim the fund creates the risk of “further violence” against them by “encourag[ing] those who enacted violence in the President’s name to continue to do so” — while possibly financing “the violent operations of rioters, paramilitaries, and their supporters who threatened Plaintiffs’ lives that day, and continue to do so.”
The Justice Department announced its new “Anti-Weaponization Fund” earlier this week. Previously, Trump, his two older sons and the Trump family business sued the Internal Revenue Service for at least $10 billion over the leak of their tax returns during the president’s first term. But on Monday morning, Trump moved to withdraw his suit against the government agency amid reports that his administration had effectively decided to settle with itself.
A few hours later, the Justice Department described the fund as “part of [that] settlement agreement.”
The judge overseeing Trump’s lawsuit against the IRS was already considering throwing it out because of the inherent conflicts of interest in a case where the president was suing the government he oversees. But this week’s settlement allows the administration to dodge a potential courtroom loss while also creating a mechanism to distribute billions of dollars to those it believes have “suffered weaponization and lawfare” — possibly including the more than 1,500 people charged in connection with the attack on the U.S. Capitol on Jan. 6, 2021.
Trump defended the fund on Monday when a reporter asked him why taxpayers should “pay for the January 6th-ers?”
“This is reimbursing people that were horribly treated,” the president said, suggesting Jan. 6 defendants were wrongly imprisoned. “They’ve paid legal fees that they didn’t have [sic]. Their lives have been destroyed and they turned out to be right. It was a terrible period of time in the history of our country.”
A group of House Democrats immediately filed a motion challenging the legitimacy of the case and the settlement. “Never in the history of the United States has a sitting president sought a monetary settlement from the government he leads — let alone sought many billions of dollars in taxpayer funds,” lawyers for the Democrats wrote in court papers. They also accused the Justice Department of having “colluded” with Trump.
Here’s what you need to know about the settlement and the fund.
An ‘unprecedented’ lawsuit
When the Trumps sued the IRS in January, they argued that the agency should have done more to prevent a former contractor from disclosing their tax information to the New York Times and ProPublica in 2019.
Federal law allows taxpayers to sue the IRS over leaked information. But legal experts said at the time that there were two problems with the Trumps’ suit.
The first was the amount they were demanding in damages: a minimum of $10 billion, which is far more than the president’s estimated net worth. The second was who they were demanding it from: an agency under Trump’s control.
The judge assigned to the case, Kathleen Williams of the Southern District of Florida, immediately questioned its validity. As the Times explained earlier this month, “it is a basic legal principle that the two sides in a lawsuit must be actually opposed to each other.” Otherwise, there’s no conflict to adjudicate. But in Trump’s suit, his personal lawyers were on one side, bringing the complaint — and lawyers from Trump’s Justice Department were on the other, supposedly responding to it.
“Although President Trump [asserts] that he is bringing this lawsuit in his personal capacity, he is the sitting president and his named adversaries are entities whose decisions are subject to his direction,” Williams wrote last month in an order. “Accordingly, it is unclear to this court whether the parties are sufficiently adverse to each other.”
To sort out whether the suit could proceed, Williams asked six prominent outside lawyers to weigh in.
“This case is unprecedented: A sitting president seeks monetary damages for alleged harm to his personal interests from an executive agency that he controls,” the lawyers wrote. “The Court might ask why DOJ’s approach to litigating this case appears to depart from its approach in similar cases, as well as what steps Defendants are taking to ensure that settlement discussions are conducted at arm’s length and without risk of collusion.”
Williams also ordered lawyers from Trump’s personal team and his Justice Department to brief her by this Wednesday and explain whether they were actually opposed.
But the Justice Department lawyers tasked with defending the IRS never made an appearance or filing. Then came Monday’s settlement announcement.
Usually, Williams would have to approve a formal settlement agreement in a case like this. But by withdrawing the suit before Williams was able to resolve her questions about it, Trump’s lawyers freed the president to strike a $1.776 billion deal with his own administration — without any judicial oversight.
A group of 93 House Democrats filed a motion attempting to block the settlement on Monday, arguing that there are “glaring constitutional defects” to the agreement.
How the fund would work
According to the DOJ’s announcement, the Department of the Treasury has 60 days to deposit the $1.776 billion into a specialized account set up for the Anti-Weaponization Fund. The money will come from a general account that the DOJ uses to settle cases and pay out damages.
As part of the settlement, Trump and his sons will receive a formal apology from the government, but “no monetary payment or damages of any kind.”
Many of the specific details of how the fund will work are still unclear. The DOJ hasn’t outlined how someone can file a claim alleging they were a victim of weaponization. It also hasn’t provided a specific definition of weaponization or what criteria claimants will need to satisfy to receive a payout.
The fund will be operated by six people, who will be empowered to decide which claims of weaponization to accept and how the money is distributed. Trump and his administration will have substantial influence over who those six members are. Five of them will be chosen by the attorney general. The sixth will be chosen “in consultation with congressional leadership.” The president can remove any of the six members at his discretion.
Officially, there are “no partisan requirements” for filing a claim, meaning that anyone with any political viewpoint can request to be compensated by the fund. Whether the group running the fund will accept claims made by people who don’t share the MAGA worldview remains to be seen.
“Anybody in this country can apply,” acting Attorney General Todd Blanche said during a congressional hearing on Tuesday, after he was asked about whether the funds might go to people involved in the Jan. 6 assault on the U.S. Capitol.
Under the terms of the settlement, the government has no liability for “the protection or safeguarding” of the funds once they have been placed into the account. That includes any issues related to bank errors or crimes, like fraud, that may be committed with the money.
The fund is obligated to send a report to the attorney general outlining who it sent money to and how much they received four times per year. The terms of the settlement state that those reports will be confidential, but Blanche told lawmakers Tuesday that there will be a legal “process” that means the details of where the fund’s money is going “will for sure be made public along the way.”
The fund will continue to operate until Dec. 1, 2028. Any money left over at that time will be given back to the federal government.
What people are saying
“The machinery of government should never be weaponized against any American, and it is this department’s intention to make right the wrongs that were previously done while ensuring this never happens again. As part of this settlement, we are setting up a lawful process for victims of lawfare and weaponization to be heard and seek redress.” — Blanche
“No one can be both plaintiff and defendant in the same case. And no president can concoct a fake case for $10 billion in damages against the government so he can be plaintiff and defendant and then ‘settle’ his bogus case against himself as a judge. This is simply not a genuine case or controversy as required by the Constitution. But Trump’s DOJ is not arguing any of this because it is in on the scam. This case is nothing but a racket designed to take $1.7 billion of taxpayer dollars out of the Treasury and pour it into a huge slush fund for Trump at DOJ.” — Democratic Rep. Jamie Raskin of Maryland
“The point of this isn’t to make every January 6-er a millionaire. The point is to compensate and to give entitled people back some of their dignity and some of what they lost, including money, whether it’s for legal fees or other costs associated with what they went through. … If Hunter Biden believes that the Department of Justice was used as a weapon against him, he’s allowed to apply.” — A Trump administration official who spoke to the New York Post
“Trump is shaking hands with himself in order to fund his insurrectionist army to the tune of billions. Of all the corrupt things he has done, this is one of the most depraved.” — Senate Minority Leader Chuck Schumer, Democrat from New York
“Not a big fan. I’m not exactly sure how they would use it. … But yeah, I don’t see a purpose for that.” — Senate Majority Leader John Thune, Republican from South Dakota
“It is as if somebody sued themselves and agreed upon a settlement with themselves that’s going to be funded by the rest of us. … People are concerned about making their own ends meet, not about putting a slush fund together without a legal precedent. We’re a nation of laws. If there needs to be a settlement, let’s consider it and Congress should come together and decide on that.” — Republican Sen. Bill Cassidy of Louisiana
