| Last week, President Donald Trump, his sons Donald Jr. and Eric, and the Trump Organization filed a lawsuit against the Internal Revenue Service (IRS) and the U.S. Department of the Treasury, alleging that from October 2019 through January 2020, a then-employee of the IRS, Charles “Chaz” Littlejohn, illegally downloaded their tax information and distributed it to various news outlets. |
| Some recent lawsuits that President Trump has filed against news organizations were legally and/or factually frivolous—transparent and, unfortunately, effective means of demanding bribes in exchange for the Trump administration’s forbearance from exacting revenge against perceived enemies through unrelated regulatory measures. By contrast, the suit against the IRS appears to have some legitimate factual and legal basis. Nonetheless, it is highly problematic and should be dismissed. |
| The Facts and the Law |
| As one would expect from the Trumps, the complaint contains some preposterous hyperbole. It boasts that “[t]he Trump Organization is the preeminent developer of some of the most valuable and prized luxury real estate assets in the world.” In describing the recipients of the purloined tax information, it refers to the New YorkTimes and ProPublica as “leftist media outlets.” |
| Nonetheless, the complaint’s recitation of the key facts is basically correct. Littlejohn is currently serving a five-year sentence for the conduct alleged in the Trump complaint. As University of Michigan Law Professor Reuven Avi-Yonah has argued, that is extremely harsh—both in comparison to the recommended ten months under the Sentencing Guidelines and in light of the fact that Littlejohn can be seen as a whistleblower who performed a public service by bringing to light the kind of information that other presidents have routinely disclosed. That said, Littlejohn did commit a crime. |
| However, the Trumps are not suing Littlejohn. They are suing the federal government. Is that permissible? |
| In an ordinary case, the answer would be yes. The complaint correctly states that “26 U.S.C. § 7431 provides taxpayers a private right of action for damages against the United States for the knowing or negligent unauthorized inspection or disclosure of tax return information in violation of 26 U.S.C. § 6103.” The complaint also seeks damages under the Privacy Act. Here too, the claim would be sound in an ordinary case. |
| Fantastical Damages |
| Needless to say, however, this case is anything but ordinary. To begin, the claim that the Trumps and the Trump Organization suffered $10 billion in damages is fantastical. There is no requirement to provide evidence for a damages amount in a complaint, but there is a requirement that the allegation be made in good faith—and it is difficult to see how $10 billion is a good-faith estimate. |
| The net worth of the Trumps and value of the Trump businesses are somewhat opaque, but reasonable estimates can be made from publicly available data. I asked the following question of the thinking versions of three leading chatbots: “What was the collective net worth of Donald Trump, Donald Trump Jr., Eric Trump, and the Trump Organization at the end of 2024?” I chose to run the numbers at the end of 2024 rather than now because Trump has monetized the presidency to such an extraordinary extent that his current wealth would provide a poor measure of any financial impact the Littlejohn revelations had on the trajectory of his family’s and his organization’s wealth. |
| Each chatbot detailed roughly the same sources but used somewhat different methodologies. Gemini gave an estimate between $4 billion and $7.2 billion. Claude suggested between $6.7 billion and $7.4 billion. ChatGPT used some higher assessments and came up with a figure of $10 billion. Even if one accepts the highest estimate, the $10 billion figure in the complaint would mean that the Littlejohn revelation cost the Trumps and their organization half of their net worth, i.e., they would have been twice as rich at the end of 2024 as they were. That is highly implausible, to say the least. |
| Moreover, there is a further question whether the financial harm, if any, that the Trumps and the Trump Organization suffered was attributable to the Littlejohn revelations. The complaint describes eight New York Times stories as containing “false allegations” of legally questionable activities and business failures. It makes similar claims about ProPublica. Presumably, these stories were harmful because they damaged the reputation of the Trumps and the Trump Organization. But if the stories were false, as the Trumps allege, then they were not derived from Littlejohn’s disclosures, which the complaint seemingly acknowledges were true. Perhaps the Trumps would have had a claim against the media outlets for defamation, but if so, the damages would not be attributable to Littlejohn’s actions. |
| Self-Dealing |
| There is another, even more fundamental problem with the lawsuit. Trump was president when Littlejohn unlawfully released his tax data. |
| During his current term, President Trump has invoked the so-called unitary executive theory to justify his asserted power to fire directors of independent agencies for any reason he sees fit, notwithstanding statutes forbidding him from doing so absent good cause. In December, the Supreme Court heard oral argument in Trump v. Slaughter, a case involving the Federal Trade Commission that will resolve whether he is correct about that. Based on the Justices’ questions, it appears that Trump will prevail. |
| But even if Trump loses in the Slaughter case, that will not affect the IRS. At every point during his first administration and now, Trump has had the power to remove the head of the IRS. A federal statutory provision, 26 U.S.C. § 7803(a)(1)(D), says now, as it did throughout Trump’s first term, that the IRS “Commissioner may be removed at the will of the President.” The Trumps’ complaint alleges that Littlejohn was able to access and reveal their data because the IRS failed to adopt and deploy “appropriate technical, employee screening, security, and monitoring systems to prevent Littlejohn’s unlawful conduct.” But given that that conduct did not occur until more than two and a half years after Trump took office in January 2017, it would appear that the person most responsible for the IRS’s failings was the person ultimately responsible for the IRS: President Trump himself. |
| Does that mean that presidents may never sue the government for harm done to them in their private capacity? Suppose that, while vacationing in Yosemite, the president is injured by a negligently driven National Park Service vehicle. An ordinary citizen would be entitled in such circumstances to sue the United States government under the Federal Tort Claims Act (FTCA). Should the president be barred from suing because the National Parks are within the Department of the Interior, whose head can be fired by the president for any reason? That might seem unfair. |
| In the foregoing hypothetical example, however, one cannot reasonably attribute the injury to the president’s own failings. No matter how well run an agency is, accidents will happen. Furthermore, a suit under the FTCA could not possibly garner a president billions of dollars. There is thus little risk that a lawsuit by a president in such circumstances would create perverse incentives to manage an agency poorly and then sue that very agency for damages allegedly arising out of its mismanagement. |
| Uncharted Waters |
| Whether there is or should be a bar on damages suits against the U.S. government by the president is a novel question because no prior president has been so crass as to sue the very government he heads for damages. Yes, then-former President Richard Nixon unsuccessfully sued the government to retain control of his presidential papers, but that was a claim for declaratory and equitable relief, not money. Only our wealthiest president has had the audacity to seek to enrich himself even further by demanding billions of dollars from the taxpaying public. |
| Fortunately, there is an easy way for the court to dismiss the Trumps’ lawsuit. Part (d) of the key statutory provision the complaint cites as authorizing suit establishes a two-year statute of limitations. The statute is tolled on “the date of discovery by the plaintiff of the unauthorized inspection or disclosure,” which would have been no later than 2022. Part (g)(5) of the Privacy Act likewise has a two-year statute of limitations. The Trumps can be expected to argue that they did not discover the extent of the wrongdoing by Littlejohn until 2024, but that argument should fail, because they knew about the disclosures themselves when they occurred. |
| Unfortunately, the lawyers in the Department of Justice who are tasked with answering the Trumps’ complaint work under Attorney General Pam Bondi, who serves at the pleasure of President Trump. If they want to keep their jobs, they will be inclined to put up a weak defense. They might even try to waive their best defenses, including the statute of limitations. |
| Should that happen, a key question will be whether the statutes of limitations at issue are “jurisdictional” and thus cannot be waived. Federal courts have an obligation to consider jurisdictional issues even if they are not raised by either party. At least initially, the case has been assigned to Judge Kathleen M. Williams. As an Obama appointee, she is not likely to construe the law creatively simply to curry favor with the Trumps, although one would hope that any federal judge would have sufficient integrity to reject this latest attempt by Donald Trump to treat the presidency the same way that history’s most notoriously greedy tyrants have treated their countries’ resources. |
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