A Settlement With Himself
You pay the bill.
The President sued his own government. His former personal defense lawyer signed the settlement for the United States. And the rest of us are paying for it.
That is the shortest, honest summary of what the Justice Department announced this week. The longer version is worse.
On Monday, Trump’s lawyers moved to dismiss the President’s $10 billion lawsuit against the IRS. In exchange, the United States agreed to:
A formal apology to the President and his sons.
Withdrawal of two pending Trump tort claims — one tied to the 2022 FBI search of Mar-a-Lago, a lawful search conducted pursuant to a judicial warrant that recovered classified documents the President had refused to return, and one tied to the Russia investigation.
Creation of a $1.776 billion “Anti-Weaponization Fund,” capitalized from the federal Judgment Fund. The fund is administered by a five-member commission. The Attorney General appoints commissioners; the President can fire commissioners at will; the eligibility criteria are not public; the commission’s deliberations are confidential; and its decisions are insulated from judicial review.
And, through an Acting Attorney General’s order issued the next day, a sweeping release of any tax claim, audit, or examination against Trump, his family, his trusts, and his affiliated businesses for any return filed before May 18.
The settlement was signed for the United States by Stanley Woodward, formerly the personal defense lawyer for Walt Nauta — Trump’s co-defendant and personal valet, accused of helping move boxes of classified documents at Mar-a-Lago. The order extending Trump’s permanent tax immunity was signed alone by Acting Attorney General Todd Blanche — Trump’s own former criminal defense lawyer in that same case. The Department of the Treasury, a named defendant, did not sign. Its top lawyer resigned hours after the announcement.
Three constitutional problems sit stacked on top of one another, each independently fatal.
The first is Article III. The Constitution gives federal courts jurisdiction only over genuine cases and controversies — meaning genuinely adverse parties. The Supreme Court has condemned collusive litigation since Lord v. Veazie in 1850. Judge Kathleen Williams had set a May 27 hearing on whether the suit was adverse at all, given that the President as plaintiff was suing agencies the President controls. The parties dismissed the case before she could hold it.
As Trump himself told reporters: “I’m supposed to work out a settlement with myself.” That is not commentary. It is an admission against interest.
No one can be both plaintiff and defendant in the same case. That isn’t a technicality. It is the constitutional baseline. When a sitting president sues an agency he controls, settles with himself, and routes nearly two billion dollars to a fund he staffs, the federal courthouse has been used as a notary, a laundering entity, not a forum of justice.
The second is the Appropriations Clause. Article I, Section 9 says no money shall be drawn from the Treasury but in consequence of appropriations made by law. The Judgment Fund (31 U.S.C. § 1304) is a narrow standing appropriation Congress created so the government can pay real legal claims it loses or settles in good faith. The Office of Legal Counsel has long held that the fund is available only when the underlying cause of action could have resulted in a final money judgment. Otherwise, OLC has said, settlement authority becomes a “dispensing power” — the precise concept the Framers rejected in Article I.
No court tested whether this lawsuit could survive Article III. Instead, the administration converted public money into a fund Congress would never have appropriated.
Precedent?
DOJ’s defense leans on a single precedent: the Obama-era Keepseagle settlement for Native American farmers who had been discriminated against in USDA loan programs over many years. The comparison collapses on contact.
In Keepseagle, Congress had waived the statute of limitations on a bipartisan basis for those specific claims; the legislative branch was a partner. A federal judge oversaw the class action. The disposition of funds was supervised by that same judge. The settlement was affirmed on appeal.
Every check the Anti-Weaponization Fund avoids — congressional authorization, judicial oversight, appellate review — was present in Keepseagle. The administration is not following the precedent. It is stripping out everything that made the precedent legitimate.
The third is the Domestic Emoluments Clause, together with Article II’s Take Care duty. A permanent federal release of all tax liability flowing from the United States to the sitting President personally is, on its face, an emolument received from the United States beyond his salary. And an order that categorically refuses to enforce the tax laws against the President’s own family cannot be reconciled with the duty to take care that the laws be faithfully executed.
These defects are not subtle. They are not contested. They are obvious on the face of the documents. The harder question — and the more consequential one — is whether any court will ever get the chance to say so.
Standing doctrine has been narrowed in recent years; taxpayer standing in particular has become a forbidding doctrine for challenges like this one, and the settlement itself purports to foreclose judicial review. But the audit shield may yet generate plaintiffs the fund alone could not — including IRS officials who refuse to honor an order they consider beyond the Acting Attorney General’s authority to issue.
The structure is portable. Any future president can manufacture a personal-grievance lawsuit, settle with himself, pull money from the Judgment Fund into a personally-directed account, and via a unilateral AG order extinguish his own tax exposure. Whatever you call this, the next president will get to call it precedent.
None of this is normal. It is, in fact, the opposite of normal. And in a constitutional democracy, the words “this is not normal” do not absolve us. They obligate us.
I’m glad you’re here. I’m grateful you’re engaged. Here and everywhere.
— James.