Congress is best chance to stop Trump ‘lawfare’ fund, attorneys say

Those attorneys, both now in private practice, said members of Congress have good legal grounds to challenge the use of taxpayer money for the fund, which purportedly will pay people who were unfairly targeted by the DOJ under the Biden administration.

Two days after Trump and acting Attorney General Todd Blanche announced the fund’s creation, skeptics from across the political spectrum emerged to figure out next steps to challenge its legality. Challenges could wind their way through the court system for the duration of Trump’s presidency or longer and could wind up before the Supreme Court.

Opponents have various avenues for lawsuits that could delay the “Anti-Weaponization Fund” from making payouts to claimants, or even potentially kill off the fund altogether, the lawyers said.

On Wednesday, two police officers who had defended the U.S. Capitol on Jan. 6, 2021, from a mob of Trump supporters, sued Trump in federal court in Washington, seeking to block the fund from going into effect.

It remains to be seen if the officers will be found to have legal standing to challenge the fund or if their theory of why it is illegal will prevail in court.

“This is among the most corrupt acts we’ve seen,” said Chris Mattei, a trial attorney in Connecticut who was previously chief of the financial fraud and public corruption unit of the U.S. Attorney’s Office in the state.

“Essentially, what you have is a president who used a frivolous lawsuit to create pretexts within a thoroughly corrupted Department of Justice to agree to create a fund to pay off the president’s supporters and would immunize the president from any tax consequences,” said Mattei, who practices at Koskoff, Koskoff and Bieder.

He was referring to the settlement barring the IRS from audits or enforcement actions against Trump and his family members for tax filings prior to the settlement.

Trump on Wednesday told reporters he was not involved in the settlement that created the fund, but defended its purpose, saying that “people were destroyed” by the weaponization of law against the Jan. 6 Capitol defendants and other people.

“They went to jail, their families were ruined, they committed suicide,” Trump said. “You know, all the Biden administration and the Obama administration, both of them, I mean, the Obama administration started it.”

“The Biden administration was horrible in terms of what they’ve done to people,” Trump said. “We’re reimbursing those people for their legal fees and for their costs and for anybody involved.”

Another former federal prosecutor, Neama Rahmani, told CNBC, “I still think the best legal argument” against the fund “is Congress saying that it’s a violation of the appropriations section of the Constitution.”

The Constitution’s Appropriations Clause bars the U.S. Treasury from making payments that are not authorized by law as passed by Congress.

The DOJ, in its statement announcing the fund on Monday, implicitly suggested it would not violate the Appropriations Clause because, “The Fund will receive $1.776 billion and [that] will come from the judgment fund, which is a perpetual appropriation allowing DOJ to settle and pay cases.”

The department also said there was a legal precedent for such a fund, pointing to the Obama administration’s creation of a $760 million fund to address claims by Native American farmers who were discriminated against by the Agriculture Department.

Rahmani, who practices law in Los Angeles, dismissed the idea that the Anti-Weaponization Fund can receive money from the DOJ’s judgment fund.

“This isn’t clear delegation by Congress,’ he said. “There’s no statutory, legislative authority for any of this, which means, legally, the courts are going to be very skeptical.”

“This isn’t the 9/11 Fund,” Rahmani said. “This is not something that is being authorized or set up by Congress.”

The Justice Department defended the new fund, with a spokesperson saying by email: “The only thing illegal and corrupt about this situation is the brazen weaponization of federal resources by previous administrations to retaliate against those with opposing political beliefs. This Department will continue to expose this lawfare and ensure those who experienced injustices are made whole.”

A pending legal challenge to the construction of Trump’s $400 million White House ballroom by a private group alleges the project violates the APA.

Mattei also speculated that attorneys general of individual states could sue to block the DOJ’s fund by arguing it is giving purported victims of prosecutorial overreach a monetary recourse not available to individuals with claims related to other types of government wrongdoing.

Mattei and Rahmani both said that in addition to the source of its money, the unusual structure of the fund provides multiple footholds for legal challenges that could delay or kill the fund.

The fund is supposed to have five members, each of whom would be appointed by the U.S. attorney general, with one member chosen in consultation with congressional leadership. The president can remove any member of the panel.

Mattei said he expected there would be a legal challenge filed under the APA related to the structure of the fund’s membership, which was determined by the DOJ and not Congress.

“Then you would have all sorts of litigation around people being denied compensation … and people like the police officers [who sued Wednesday] challenge the awarding of compensation,” Mattei said.

Mattei said he thinks the range of options available for legal challenges to the fund means that it could be prevented from operating for some time.

“I suspect that there will be, at some point, a lawsuit that will be allowed to proceed to the discovery phase, and that fund during the course of that litigation is likely to be stayed during that,” he said.

“I think that a plaintiff challenging the formation of this fund or the governance of this fund or the manner in which it is supervised will have a lot to work with,” Mattei said.

— Justin Papp contributed to this report.