Within hours of reports that the Justice Department is considering settling President Donald Trump’s $10 billion lawsuit against the IRS, Hillary Clinton accused Trump of “shaking down taxpayers” and declared that the “corruption meter is flashing red.”
Clinton did not mention why this lawsuit exists: a former IRS contractor named Charles Littlejohn stole thousands of confidential tax returns, smuggled them out of government systems on personal devices including an iPod, and handed them to news outlets. He pleaded guilty and was sentenced to five years in federal prison. The Department of Justice under Attorney General Merrick Garland described the conduct as a betrayal of public trust.
The lawsuit, filed by President Trump, Donald Trump Jr., Eric Trump, and the Trump Organization in January 2026, seeks at least $10 billion. It alleges that the IRS failed to protect confidential tax information stolen by Littlejohn and leaked to news outlets.
Littlejohn was convicted on September 29, 2023, and sentenced on January 29, 2024, after being found guilty of stealing and disclosing thousands of tax records without authorization. He used broad search parameters in an IRS database to conceal his target, uploaded the records to a private website, saved them on personal devices including an iPod, and provided the material to news organizations between August and October 2019. One outlet published a series of articles based on this information in September 2020.
The Department of Justice has stated that Littlejohn’s actions constitute an abuse of his contractor role and a violation of the duty to protect sensitive taxpayer information.