Lawsuits by watchdog groups curb Trump’s self-enrichment schemes as judges issue sharp rebukes
In 2026, nonpartisan groups including Democracy Defenders Fund and the Campaign Legal Center sued over Donald Trump’s efforts to cut his tax exposure, give large Truth Social investors early access to his posts, and spend federal money on highly partisan ads promoting his record ahead of midterm elections in which Republicans lost heavily. Federal judges in Florida and New York answered with unusually harsh language. Florida’s Kathleen Williams rejected a Justice Department–backed plan to settle Trump’s $10bn lawsuit against the IRS over an old leak of his tax information to the New York Times by creating a $1.8bn fund for alleged victims of political persecution under Joe Biden—an arrangement that could have aided some January 6 Capitol rioters and would have given him immunity from IRS audits before May 2026. She called the deal “premised on deception” and a “fraud against the court,” saying Trump sat on both sides of the case, the court itself may have been a victim of fraud, and the plaintiffs had collusively filed claims with no viable legal basis to win judicial cover. The Department of Justice dropped the fund after her mid-July ruling and congressional blowback, including from Democratic senator Elizabeth Warren, but immunity from IRS investigations and prosecutions of past tax matters for Trump, his family, and the Trump Organization remains in force. Separately, a New York federal judge rebuked the use of $20m in public funds for ads widely attacked as campaign propaganda. Former DoJ lawyer Stacey Young, who founded Justice Connection, said department leadership treats Trump as its chief client. Retired appeals judge J. Michael Luttig, who joined a July Democracy Defenders Fund suit with 35 former judges against the IRS settlement, described a pattern of self-enrichment and said courts have also struck down major initiatives including tariffs and birthright citizenship.
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