A federal appeals panel that includes one of President Donald Trump's own judicial picks refused to lift penalties imposed over the president's anti-weaponization fund.
A three-judge panel of the 11th U.S. Circuit Court of Appeals denied the request for a stay Tuesday in an order issued "by the court," with no judge dissenting. Judge Kevin Newsom, a Trump appointee, sat on the panel alongside Judges Adalberto Jordan and Robin Rosenbaum, both appointed by former President Barack Obama.
The ruling leaves in place sanctions U.S. District Judge Kathleen Williams imposed in July after finding that Trump's lawsuit against the IRS and the Treasury Department was collusive. Williams concluded the suit was filed to legitimize "a 'settlement' that had no viable basis in law or fact," according to the order.
Trump, his sons Donald Trump Jr. and Eric Trump, and the Trump Organization sued in January, alleging a former IRS employee illegally leaked their tax returns and seeking "at least $10,000,000,000.00" in damages, according to the appeals court order. They dropped the case four days after court-appointed lawyers filed a brief questioning whether the court had jurisdiction.
The Justice Department then announced a settlement creating a $1.776 billion fund, which critics worry included Trump's allies. The Trump administration pitched the fund as compensation for people who claim past administrations wrongfully targeted them. The deal also provided a release of "any and all claims" the government may have against Trump, his family and businesses, which shielded them from tax probes into past conduct.
Thirty-five former federal judges asked Williams to reopen the case, calling the deal "a product of collusion," according to the appeals court order. Williams then referred Trump's attorney, Alejandro Brito, to the Florida Bar. She also ordered that attorney Daniel Epstein be denied permission to appear in the Southern District of Florida for a year, and she barred the parties from citing the agreement as evidence of a settlement in any official proceeding.
The appeals panel declined to pause the sanctions against the two lawyers, citing "significant doubts about appellate jurisdiction" because the lower court has not finished its work. Fee proceedings are ongoing, and Williams has yet to rule on whether to reopen the case.
On the ban on citing the settlement, the panel found Trump's side "did not submit or offer any evidence to explain their litigation conduct or demonstrate that the lawsuit and the settlement were not collusive."
Norm Eisen, whose group Democracy Defenders Action helped represent the former judges, celebrated the ruling on X, writing that "the court wasn't buying it!"