Another day, another courtroom smackdown for the Trump administration. Today’s hiding comes courtesy of Judge John McConnell in Rhode Island, who is not impressed with the government’s claim to have violated his prior TRO by accident.
The case is part of the struggle to wrest power over federal spending from Congress, allowing the president to nix or redirect it at will. It’s a pillar of Project 2025, which hopes to leverage tax dollars — paid by individual citizens of the states! — against the states to enact conservative priorities without the need to pass legislation. So, not only will they kill federal fuel efficiency standards, but, if California wants to see any of its federal tax dollars returned to it, they’ll have to agree to not have state-level fuel efficiency standards either. Federalism, schmederalism!
On his first day in office, President Trump signed a slew of executive orders aimed at ensuring federal spending aligned with his “priorities.” So, for instance, in his Unleashing American Energy order, he purported to “immediately pause the disbursement of funds appropriated through the Inflation Reduction Act of 2022 (Public Law 117-169) or the Infrastructure Investment and Jobs Act (Public Law 117-58).” That is of course wildly illegal — Congress allocated the funds pursuant to its Article I duties, and the president cannot cancel laws by executive fiat. Nevertheless, the following day, Matthew Vaeth, then the acting director of the Office of Management and Budget (OMB), put out an implementing memo, M-25-11, ordering all federal agencies to pause disbursement of congressionally allocated funds pursuant to the executive order.
A week later, the Trump administration went even further, ordering a pause to all non-defense spending under a second OMB Memo, M-25-13. That memo was challenged and enjoined in multiple courts: first by Judge Loren Alikhan in DC, in response to a complaint brought by non-profit agencies cut off from promised funding; and second in Rhode Island, where Judge McConnell issued a TRO.
Both judges were incredulous at the executive branch’s naked power grab.
“The Executive’s statement that the Executive Branch has a duty ‘to align Federal spending and action with the will of the American people as expressed through Presidential priorities,’ is a constitutionally flawed statement,” Judge McConnell wrote in the January 31 TRO. “The Executive Branch has a duty to align federal spending and action with the will of the people as expressed through congressional appropriations, not through ‘Presidential priorities.’”
“During the pendency of the Temporary Restraining Order, Defendants shall not pause, freeze, impede, block, cancel, or terminate Defendants’ compliance with awards and obligations to provide federal financial assistance to the States, and
Defendants shall not impede the States’ access to such awards and obligations, except on the basis of the applicable authorizing statutes, regulations, and terms,” he ordered.
Note that this prohibition was not tied to the OMB memo, which had by then been rescinded in a ham-handed effort to moot the litigation.
At a hearing last Wednesday, counsel for New York suggested that the government was still insisting on its right to withhold funds under the Unleashing American Energy order. And in an emergency motion to enforce the TRO and a motion for preliminary injunction, both filed Friday, she attached correspondence from Daniel Schwei, the DOJ lawyer arguing the case, explaining the government’s reasoning.
Basically, Schwei says that the funds are being impounded pursuant to the earlier OMB memo, M-25-11, not the now-rescinded M-25-13. And even though the memos instruct federal agencies to do the same (wildly illegal) thing, it’s fine if the money is impounded for some other reason than the second OMB directive.
“Given that Plaintiffs here do not challenge OMB Memo M-25-11, Defendants have reasonably interpreted the temporary restraining order not to extend to that Memorandum, and the Court should not enjoin something that is not properly
challenged in the Complaint,” he argued last night in an opposition to the emergency motion.
But perhaps hedging his bets, Schwei requested the court “clarify” its order, rather than grant the plaintiffs’ motion: “Even if the Court disagrees, however, Defendants’ interpretation certainly did not run afoul of a ‘clear and unambiguous command’ in the Order.”
That … did not go over.
Judge McConnell began his order with a quote from Maness v. Meyers, 419 U.S. 449 (1975), reminding all parties that “Persons who make private determinations of the law and refuse to obey an order generally risk criminal contempt even if the order is ultimately ruled incorrect.”
“The plain language of the TRO entered in this case prohibits all categorical pauses or freezes in obligations or disbursements based on the OMB Directive or based on the President’s 2025 Executive Orders,” he continued, noting that, as proof of compliance with the TRO, the government docketed the Notice of Court Order sent to the agencies which says twice that “Federal agencies cannot pause, freeze, impede, block, cancel, or terminate any awards or obligations on the basis of the OMB Memo, or on the basis of the President’s recently issued Executive Orders.”
The judge instructed the government to unfreeze all funds immediately, and, for clarity, added that “The TRO requirements include any pause or freeze included in the Unleashing Guidance. … The directives in OMB M-25-11 are included in the TRO.”
Well, surely that will teach them a lesson. The Trump administration will go forth and sin no m—
Ooops! There’s another motion to show cause in the parallel USAID case alleging that the government is violating Judge Carl Nichols’ TRO barring them from effectively firing employees. Apparently they remain locked out of their computers and their offices have been taken over by immigration officials.
LOL.
National Council of Nonprofits v. Office of Management and Budget [Docket via Court Listener]
Liz Dye lives in Baltimore where she produces the Law and Chaos substack and podcast.