Federal Judge Voids Trump's $1.8B IRS Settlement, Finds Bad Faith, Refers Attorney to Bar

U.S. District Judge Kathleen Williams issued a 56-page ruling on July 13, 2026 finding Trump acted in bad faith in an IRS anti-weaponization fund lawsuit and voiding a $1.8 billion settlement the administration had arranged. Williams referred attorney Alejandro Brito to the Florida Bar for disciplinary proceedings and restricted DOJ attorney Daniel Epstein from practicing in the Southern District of Florida. The ruling is the clearest judicial finding to date that the administration used litigation itself as a mechanism to construct what Williams characterized in her own language as a tool for manipulating the judicial process — a potential political slush fund built through settlement rather than appropriation.

This is a distinct accountability moment inside the broader pattern of unlawfully-installed and sanctioned DOJ attorneys already tracked in the timeline — Alina Habba, Lindsey Halligan, and others found by federal courts to have served without lawful authority. Unlike those cases, which turned on appointment procedure, this ruling reaches the substance of what DOJ attorneys were attempting to build: a large, judicially-blessed fund outside normal congressional appropriation control, using the same litigation-as-instrument approach the timeline documents in the DOJ’s broader capture (see 2026-03-09–doj-abuse-power-public-integrity-section-gutted).