Key facts
- A US appeals court declined to immediately block sanctions against lawyers for President Donald Trump.
- The sanctions stem from the misuse of the court system in settling a lawsuit Trump filed against the IRS.
- US District Judge Kathleen Williams found the penalties were an appropriate response to the plaintiffs’ abuse of the legal system.
- The lawsuit was deemed a bad faith use of the legal system intended to gain judicial legitimacy for a settlement with no legal basis.
- The audit immunity order granted to Trump, his sons, and the Trump Organization remains in effect.
- Trump's attorneys had argued that allowing the order to remain in effect would leave an unconstitutional speech restraint and career-altering professional sanctions in force.
A US appeals court on Tuesday declined to immediately block sanctions against lawyers for President Donald Trump, whom a judge accused of misusing the court system in settling a lawsuit the president filed against the Internal Revenue Service. The court left penalties in place, ruling that the president’s legal team failed to show they are likely to get the sanctions overturned on appeal.
US District Judge Kathleen Williams found that the penalties were an appropriate response to the plaintiffs’ abuse of the legal system and serve the public interest. This ruling reinforces her July 13, 2026, decision that the Trumps’ lawsuit against the IRS was a bad faith use of the legal system intended “to gain the imprimatur of judicial legitimacy for a ‘settlement’ that had no viable basis in law or fact.”
Trump had sued the IRS earlier in the year, seeking to hold the agency liable for a leak of his tax information. In May, the Justice Department announced it had reached a settlement with Trump to end the case that included the creation of a nearly $1.8 billion fund for victims of alleged government “weaponization.” Separate from the formal settlement, Attorney General Todd Blanche also signed an order granting Trump, his oldest sons Donald Jr. and Eric, and the Trump Organization immunity from audits or other investigations or claims by the IRS or the Treasury Department related to their past tax-related filings. The audit immunity order remains in effect.
In their request for an immediate pause, Trump argued that allowing the order to remain in effect would wrongly leave an unconstitutional speech restraint and career-altering professional sanctions in force while the court considers an appeal that is overwhelmingly likely to succeed.