Why Trump is Taking His Own Government to the Court

In a dramatic legal move, pro-crypto U.S. President Donald Trump, along with his sons Donald Trump Jr. and Eric Trump and the Trump Organization, filed a $10 billion lawsuit against the Internal Revenue Service (IRS) and the U.S. Treasury Department. 

The lawsuit, filed Thursday in Miami federal court, claims the agencies failed to prevent the leak of Trump’s tax records, exposing private financial information to the media during his first term.

This is not an ordinary lawsuit. It is very unusual for a sitting president to take legal action against his own administration, and the case is already making headlines across the country. It raises serious questions about how the government protects taxpayers’ private information and how politics can mix with the legal system.

The heart of the lawsuit: Reputational and financial damage

Trump’s legal team says the leak caused serious harm, resulting in “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.”

The complaint specifically points to former IRS contractor Charles “Chaz” Littlejohn, who admitted in a 2024 deposition that he provided Trump’s tax records to the investigative news outlet ProPublica, as per CNBC. Littlejohn also provided documents to The New York Times, which reported on Trump’s minimal federal tax payments in certain years, a story that sparked national headlines.

Trump’s legal team claims that ProPublica’s reporting falsely suggested that the returns contained “versions of fraud,” a statement Trump says misrepresented the financial records of him and his businesses.

Charles Littlejohn and Booz Allen Hamilton: A data breach fallout

Littlejohn, 40, pleaded guilty in 2023 to one count of disclosure of tax return information and is now serving a five-year prison sentence. Beyond Trump’s documents, Littlejohn admitted to stealing and leaking records of thousands of other wealthy individuals, including billionaires Jeff Bezos and Elon Musk.

The Treasury Department responded by canceling all contracts with Booz Allen Hamilton, the consulting firm employing Littlejohn. Treasury Secretary Scott Bessent said, “Booz Allen failed to implement adequate safeguards to protect sensitive data, including the confidential taxpayer information it had access to through its contracts with the Internal Revenue Service.”

The IRS, meanwhile, called Littlejohn’s actions “unacceptable” and said it has taken “substantial investments in data security to strengthen its safeguarding of taxpayer information.”

Trump’s pattern of high-value lawsuits

This $10 billion lawsuit is not Trump’s first move of this kind. In October 2025, he sought $230 million from the Department of Justice (DOJ), claiming the agency had improperly investigated him. 

Trump told reporters, “They probably owe me a lot of money, but if I get money from our country, I’ll do something nice with it, like give it to charity or give it to the White House.”

Trump has also filed similar multi-billion-dollar lawsuits against major media outlets, including:

• BBC: $10 billion defamation suit over edits to a January 6, 2021, speech clip.
• The Wall Street Journal (WSJ): $10 billion suit over reporting on an alleged crude drawing sent to Jeffrey Epstein in 2003.

Both media companies vowed to fight the lawsuits.

Historical context: IRS leaks and other victims

Trump is not the first high-profile figure affected by IRS leaks. In 2024, hedge fund billionaire Ken Griffin sued the IRS after Littlejohn leaked his tax records. Griffin later dropped his lawsuit after the IRS strengthened its data security measures.

Legal experts say Trump’s case is unusual and complicated. It raises questions about how much responsibility the government bears when a contractor mishandles sensitive information, the privacy of taxpayers, and the potential conflicts when a sitting president takes legal action against federal agencies.

Crypto angle: Why the lawsuit hits even closer to home

This lawsuit takes on an added layer because of Trump’s growing involvement in the cryptocurrency world.

Trump’s embrace of crypto began with his NFT projects, selling digital trading cards of himself that quickly drew strong interest. At events like the Bitcoin 2024 conference, he spoke about supporting Bitcoin and digital assets, pledging to champion the industry and overhaul federal regulation.

As president, Trump has become a major player in crypto, earning substantial sums through non-fungible tokens (NFTs), memecoins, and his own digital token ventures, including the Trump-branded coin ($TRUMP) and projects under World Liberty Financial. 

According to Bloomberg, digital assets added roughly $1.4 billion to the Trump family’s net worth over the past year, now making up about one-fifth of their estimated $6.8 billion fortune. 

Separately, financial disclosures show that Trump personally earned at least $57.7 million from token sales tied to World Liberty Financial, while additional crypto venture proceeds over recent months brought in hundreds of millions more.

Experts note that if his crypto income were ever examined alongside the leaked tax returns, it could show not only past tax behavior but also the scale of his digital asset earnings and what taxes have been paid. For Trump, the issue is about more than just reputation—it now involves a multi-million-dollar crypto empire.

This leads many observers to ask: Why is Trump pushing so hard against the leaked tax returns when his crypto earnings alone are far larger than the amounts at issue? The likely answer is control—he wants to prevent scrutiny of his entire financial picture, both traditional businesses and newer digital ventures.

Political and legal implications

By filing this lawsuit, Trump is in a rare position. He is challenging agencies that are part of his own administration while asking for one of the largest financial settlements ever. 

Even if the case doesn’t succeed, analysts say it is likely to attract huge public attention and could ignite wider discussions about government data security, oversight of the IRS, and the limits of presidential authority in civil matters.

With the case now filed, all eyes are on the Miami federal court. The White House and the Trump Organization have not commented on the potential use of the $10 billion if awarded. Meanwhile, the case adds yet another chapter to the president’s complex relationship with the federal government.

Also Read: Why Trump Pardoned the Crypto Industry but Left SBF to Rot

Disclaimer: The Crypto Times is not making any claims about President Trump’s financial holdings. References to crypto assets, NFTs, or digital earnings in this article are based solely on publicly available news reports and media coverage, and should be considered context or speculation rather than verified fact.

Disclaimer: The information researched and reported by The Crypto Times is for informational purposes only and is not a substitute for professional financial advice. Investing in crypto assets involves significant risk due to market volatility. Always Do Your Own Research (DYOR) and consult with a qualified Financial Advisor before making any investment decisions.