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$5 Million (Tax-Free) Settlement in January 6 Lawsuit Draws Mixed Reactions

$5 Million (Tax Free) Settlement in January 6 Lawsuit Draws Mixed Reactions
Image Credit: Wikipedia / Tyler Merbler

On May 19, 2025, reports confirmed that the federal government agreed to pay a $5 million settlement to the family of Ashli Babbitt, the Air Force veteran fatally shot inside the U.S. Capitol during the events of January 6, 2021. According to attorney Mark W. Smith, host of Four Boxes Diner, this wrongful death lawsuit was originally filed in California but later transferred to Washington, D.C. The case targeted the federal government and was defended under President Biden’s DOJ before being quietly settled under President Trump’s new administration.

From $30 Million to $5 Million

From $30 Million to $5 Million
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Initially, Ashli Babbitt’s family sought $30 million in damages, according to Guns & Gadgets host Jared Yanis. The final amount settled at $5 million, tax-free, because the settlement involved a physical injury and wrongful death. Mark W. Smith explained that in cases like this, “the family may not owe federal income tax,” effectively raising the financial impact to something closer to $8–9 million in real value. He also noted that attorney fees may apply, depending on the structure of the legal agreement.

DOJ Does a 180

DOJ Does a 180
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What’s drawing additional attention is how sharply the Department of Justice reversed its stance. Under the Biden administration, the DOJ had cleared Capitol Police Lieutenant Michael Byrd of wrongdoing in the 2021 shooting, citing self-defense. But as Jared Yanis reported, “the DOJ did a 180 and decided to settle,” marking a significant shift in tone. Yanis emphasized that Babbitt was unarmed and questioned the necessity of lethal force.

Police Defend Their Own

Police Defend Their Own
Image Credit: CNN

Not everyone is pleased. During a CNN interview, former Capitol Police officer Harry Dunn expressed disappointment. He said the settlement “sends a chilling message to law enforcement,” especially those tasked with protective duties like Capitol Police. “Somebody lost their life, yes,” Dunn said. “But if she had lived, she would have been charged.” He warned the decision could open the door for other January 6 participants to seek damages against police who were attacked that day.

Why $5 Million and Not More?

Why $5 Million and Not More
Image Credit: The Four Boxes Diner

According to Mark W. Smith, the amount reflects more than just financial valuation – it’s a strategic legal decision. A trial in Washington, D.C., he noted, would have likely been decided by a jury unsympathetic to January 6 protestors. Smith pointed out that to date, every protester tried in D.C. courts has been found guilty. “That’s a 100% conviction rate,” he said. Facing a possibly hostile judge, an adverse jury, and a prior DOJ report labeling the shooting “justified,” Babbitt’s legal team likely saw settlement as the safest option.

The Federal Advantage

The Federal Advantage
Image Credit: Survival World

Smith also emphasized how hard it is to beat the federal government in court. “They have unlimited money, endless time, and no consequences for dragging things out,” he said. Government attorneys are salaried, not performance-based. They don’t lose their jobs if they lose a case. “If you can settle now for $5 million rather than gamble and maybe get nothing in five years, that’s a serious consideration,” he added.

The George Floyd Comparison

The George Floyd Comparison
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The $5 million figure has invited comparison to the $27 million settlement awarded to George Floyd’s family in 2021. Smith acknowledged this and suggested that the higher payout might have included elements of political pressure and public relations. “That number does seem a little rich,” he said. Still, it’s important to remember that Floyd’s case was settled by the city of Minneapolis, not the federal government, and under completely different social and political circumstances.

A Win, or Just Closure?

A Win, or Just Closure
Image Credit: Wikipedia / Tyler Merbler

Despite the political firestorm, some view the Babbitt settlement as a chance for closure. “It may not be everything they hoped for, but it brings finality,” Smith explained. Lawsuits against the government often take years, and the emotional toll can be massive. For Babbitt’s family, this agreement may allow them to move forward without risking an outright court defeat or endless delays.

Political Reactions Pour In

Political Reactions Pour In
Image Credit: CNN

As Jared Yanis reported, House Minority Leader Hakeem Jeffries harshly condemned the settlement, calling it “a slap in the face to law enforcement.” Others, including Trump allies, have defended the payout as long overdue. Trump himself has repeatedly described Ashli Babbitt as a victim and questioned why her death wasn’t more thoroughly investigated. The new settlement may be seen by his supporters as a quiet acknowledgment of that grievance.

Officer Dunn Raises Larger Questions

Officer Dunn Raises Larger Questions
Image Credit: CNN

On CNN, Harry Dunn raised a chilling hypothetical: “Do other rioters now get to sue the police if they were pepper-sprayed or struck?” It’s a fair point. The lawsuit, while settled without an admission of wrongdoing, sets a precedent that many are watching closely. If the door opens to more legal claims from January 6 defendants, the federal government may find itself in new legal territory, again caught between law enforcement loyalty and constitutional litigation.

Justice or Politics?

Justice or Politics
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Here’s where I land: whether you see this as a form of justice or political maneuvering likely depends on your view of January 6. But what’s clear is this – the federal government blinked. They didn’t take this case to trial, despite having a strong record of convictions and a supportive D.C. jury pool. That tells me someone at DOJ saw risk. Maybe it was about optics. Maybe it was legal uncertainty. But a $5 million check says they wanted this story closed – and fast.

What Happens Next?

What Happens Next
Image Credit: Wikipedia / Tyler Merbler

It’s hard to say what ripple effects this settlement will have. For now, the case brings a major chapter of the January 6 legal saga to a close. Whether it opens new ones – or reopens old wounds – will depend on how the public and lawmakers respond in the weeks ahead. One thing’s for sure: the conversation about January 6 isn’t going away anytime soon.

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