Trump withdraws – President Donald Trump moved to withdraw his $10 billion lawsuit against the IRS over the leak of his tax returns, after filings signaled a resolution was close. The Justice Department simultaneously announced a $1.7 billion “Anti-Weaponization Fund” tied to a
President Donald Trump moved Monday to withdraw his $10 billion lawsuit against the Internal Revenue Service over the leak of his tax returns, a step made in a federal court filing in Florida where the case was brought.
The withdrawal came as financial markets tightened and oil prices rose after Trump warned Tehran that the “clock is ticking,” with U.S.-Iran negotiations over a permanent end to the war stalling. U.S. futures fell, and markets in Japan and South Korea pulled back from recent records.
In Washington, the legal shift immediately raised stakes because it lines up with a separate government action: the Justice Department announced a $1.7 billion fund to compensate prosecuted allies of the Republican president as part of a resolution of Trump’s case over the leak of his tax returns.
The Justice Department called the account the “Anti-Weaponization Fund.” It was described as part of a deal intended to close out the IRS matter, with the administration framing the fund around Trump’s long-running argument that the Justice Department was “weaponized” against him.
Democrats and government watchdogs pledged to contest what they called a “corrupt” and unprecedented resolution. Rep. Jamie Raskin, the top Democrat on the House Judiciary Committee, called the concept “unconstitutional.”
“This, of course, is a political grievance fund that Donald Trump can use to pay off his friends,” Raskin said in an interview Sunday on ABC’s “This Week.”
“If these people have a valid cause of action. they should bring it to the court like every other American does. and use the system of due process. and proving things by clear and convincing evidence. or a preponderance of evidence. go and prove it.. But the idea that Donald Trump can just pass it out like a pardon is absurd,” he added.
Trump’s lawsuit was filed earlier in the year in a Florida federal court. where he alleged a previous leak of his and the Trump Organization’s confidential tax records caused “reputational and financial harm. public embarrassment. unfairly tarnished their business reputations. portrayed them in a false light. and negatively affected President Trump. and the other Plaintiffs’ public standing.”
Donald Trump Jr. and Eric Trump were also named plaintiffs.
That lawsuit points back to a case that already landed a conviction.. In 2024. former IRS contractor Charles Edward Littlejohn. who worked for Booz Allen Hamilton. a defense and national security tech firm. was sentenced to five years in prison after pleading guilty to leaking tax information about Trump and others to two news outlets between 2018 and 2020.
While the Justice Department moved to create the $1.7 billion fund, it was not immediately clear who precisely would benefit from it.
The administration’s position rests on Trump’s accusations that decisions during the prior administration targeted him and his allies for political reasons.. The piece of evidence he has cited includes dismissed criminal charges he faced between his first and second terms. alleging conspiracy to overturn the 2020 presidential election results he lost. and allegations involving classified documents at his Mar-a-Lago estate in Florida.. It also includes prosecutions of several aides and hundreds of Trump supporters who stormed the U.S.. Capitol on Jan.. 6, 2021.
Merrick Garland. who served as attorney general during former President Joe Biden’s administration. has repeatedly denied allegations of politicization and said decisions followed facts. evidence and the law.. His Justice Department also investigated Biden’s handling of classified information and brought separate tax and gun prosecutions involving Hunter.
The sequence around the IRS case has tightened into a single thread: Trump moved to withdraw the $10 billion lawsuit after a filing in Florida indicated a resolution was close, and the same day the Justice Department announced the $1.7 billion “Anti-Weaponization Fund” tied to that resolution.
Separate developments added to the pressure across the country on Monday. In New York, commuters tried to navigate disrupted routes after a strike on the Long Island Rail Road shut down the nation’s busiest commuter rail system entered its third day.
Gov. Kathy Hochul, a Democrat, blamed the Trump administration for cutting mediation short in September and pushing unions toward a strike. Trump, a Republican, denied involvement, saying on Truth Social that he had nothing to do with it.
“No, Kathy, it’s your fault, and now looking over the facts, you should not have allowed this to happen,” Trump wrote.
Hochul urged companies and agencies that employ workers from Long Island to let them work from home whenever possible.
In Washington’s political calendar. redistricting debates in South Carolina shifted to the state House as lawmakers began a lengthy discussion on whether to follow Trump’s desires for a U.S.. House map that could yield a clean sweep for Republicans.. Similar tensions had already surfaced in Tennessee, Alabama and Louisiana after Republicans leveraged a recent U.S.. Supreme Court ruling that weakened Voting Rights Act protections for minority districts.
In South Carolina, targeting a seat long held by U.S. Rep. Jim Clyburn—identified as the only Democrat among the state’s seven House representatives—became part of the immediate political math.
Early voting in South Carolina is scheduled to begin May 26 for statewide primaries on June 9. Legislation pending in the state House would move U.S. House primaries to August; if it clears the House, it would then go to the Senate.
Elsewhere, China agreed to increase purchases of U.S. agricultural products after a Trump-Xi summit, according to the White House. The agreements include an annualized rate of $17 billion per year for 2026, 2027 and 2028.
China would restore market access for U.S. beef and resume imports of poultry from U.S. states identified by the U.S. Department of Agriculture as free of bird flu, the White House said. The deals were described as separate from last year’s soybean purchase commitments.
For American farmers. the agreements were pitched as offering some hope after trade-war damage dried up major export markets for soybeans and other products.. Farmers were also described as facing additional pressure from policies tied to the war the U.S.. and Israel launched against Iran. with shipping through the Strait of Hormuz curtailed and global fertilizer supplies tightened. sending fertilizer prices soaring.
International tensions were also on display. A drone strike sparked a fire at the edge of the UAE’s sole nuclear power plant on Sunday, which UAE authorities called an “unprovoked terrorist attack.” No one was blamed, and authorities reported no injuries or radiological release.
The UAE, which has hosted air defenses and personnel from Israel, recently accused Iran of launching drone and missile attacks. The report placed those concerns within a broader standoff: tensions have risen over the Strait of Hormuz, described as gripped by Iran under a U.S. naval blockade.
The ceasefire remains fragile, and fighting between Israel and the Iran-backed Hezbollah militant group in Lebanon has heated despite a nominal ceasefire there.
Markets also reflected the wider uncertainty tied to the U.S.-Iran warning. In early European trading, Britain’s FTSE 100 edged up 0.1% to 10,205.31, France’s CAC 40 fell 0.9% to 7,883.42, and Germany’s DAX declined 0.1% to 23,925.82.
During Asian trading, Tokyo’s Nikkei 225 dropped 1% to 60,815.95, with the decline led by technology-related stocks. The index hit intraday all-time highs above 63,000 last week.
The yield on the 10-year Japanese government bond surged to as high as 2.8%, the highest since the late 1990s. One week earlier, it was around 2.55%.
The day’s developments left two competing tensions in view: a U.S.. government deal intended to end a high-profile lawsuit over leaked tax records. and an expanding set of pressures—from labor disruptions to international conflict—that pushed uncertainty into everyday life and global markets at the same time.
Trump IRS lawsuit leaked tax returns Anti-Weaponization Fund Justice Department Merrick Garland Jamie Raskin Long Island Rail Road strike redistricting South Carolina China agricultural trade U.S.-Iran negotiations