US Appeals Court Keeps Trump IRS Case Sanctions in Place

A US appeals court on Tuesday declined to immediately halt sanctions stemming from President Donald Trump’s $10 billion lawsuit against the Internal Revenue Service, leaving a federal judge’s restrictions in effect while the legal battle continues.

A three-judge panel of the Atlanta-based 11th US Circuit Court of Appeals rejected a request from Trump’s attorneys and the Justice Department to pause the sanctions. No dissents were noted.

US District Judge Kathleen Williams in Miami previously concluded that the lawsuit had been pursued for an improper purpose. Her order targeted an agreement that included protections from certain tax claims and had initially contemplated a nearly $1.8 billion fund for people alleging mistreatment by the federal government. The Justice Department later abandoned plans for the fund following opposition from lawmakers in both parties.

Williams also referred Trump attorney Alejandro Brito to Florida legal disciplinary authorities. The order prohibited the parties, including Trump, his adult sons and the Trump Organization, from presenting the agreement as a court settlement or relying on its provisions in future official proceedings.

Trump’s lawyers and the Justice Department challenged the restrictions, arguing they violated First Amendment free-speech protections. However, the appeals panel determined that Brito’s disciplinary referral was not a final appealable order. It also found that the restrictions on describing or using the agreement were sufficiently narrow and did not improperly infringe free-speech rights.

Trump filed the IRS lawsuit in January, alleging the agency failed to adequately prevent the unauthorized disclosure of his tax records during his first presidential term. The complaint sought at least $10 billion in damages.

A spokesperson for Trump’s legal team maintained that the lawsuit was an appropriate effort to hold accountable those responsible for alleged wrongdoing. The Justice Department did not immediately comment on Tuesday’s appellate decision.

The appeals panel said Trump’s lawyers and the Justice Department had not provided evidence explaining their litigation conduct or demonstrating that the lawsuit and proposed agreement were not collusive.