Left: President Donald Trump speaks at the Future Investment Initiative (FII) Institute summit in Miami Beach, Fla., Wednesday, Feb. 19, 2025 (AP Photo/Rebecca Blackwell). Right: Loren AliKhan, then-Deputy Solicitor General for the District of Columbia, speaks during a Senate Judiciary Committee hearing on ‘Universal Injunction Challenges’ in Washington on Tuesday, Feb. 25, 2020 (Photo by Caroline Brehman/CQ Roll Call via AP Images).
A federal judge in Washington, D.C., maintained a court-ordered pause on the government spending freeze on Thursday despite insistent claims from the Trump administration that the controversial defunding program had been rendered dead letter.
“In a sense, it doesn’t really matter,” an attorney for the Office of Management and Budget (OMB) told U.S. District Judge Loren L. AliKhan during a hearing on a motion for a preliminary injunction.
The court was not convinced by the government’s arguments in favor of staying the temporary restraining order previously issued in the case. At the same time, the judge did not give much indication as to which way she was leaning in terms of the further relief requested by the plaintiff National Council of Nonprofits (NCN).
Arguments between the parties were variations on a familiar theme.
An attorney for the plaintiffs insisted the government was still intent on pursuing a “freeze first, ask questions later policy” and only releasing payments on an individualized basis.
“There is a real concern that despite the rescission, there is a continued interest in continuing the same policy in that or a different name,” the nonprofit group’s attorney said.
The spending freeze followed an OMB memo issued in late January — an attempt to make good on several executive orders issued by President Donald Trump, which outlined decreased spending priorities. Within hours, the federal government lurched into chaos. In response to the specter of frozen entitlement systems, downed websites, and a general state of panic across administrative agencies, the administration quickly performed a volte-face and rescinded the OMB memo with a terse second memo that directed employees to follow up with agency lawyers if they had any questions.
A series of lawsuits, however, ensued, and multiple courts barred the policy from taking effect — to various degrees.
On Thursday, attention focused on a Q&A released by the government which, to hear OMB tell it, added to and clarified the freeze policy.
The plaintiffs, for their part, argued the Q&A for government employees was effectively meaningless. The nonprofit group’s attorney said the government has not provided examples of the Q&A having any impact on limiting the freeze order and that the purported guidance “looks very much like an effort to change appearances to evade accountability” without changing the underlying facts.
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“The interpretation is just flatly inconsistent with the order,” the group’s attorney went on. “You can’t sort of purport to interpret unambiguous language and give it an entirely different meaning.”
The judge summed up the dispute as the defendants preferring to read the Q&A and the memo in tandem while the plaintiffs saying that such a reading is simply not possible.
The court clearly sided with the plaintiffs on this discrete point.
“As a student of English, I found it hard to find your reading,” AliKhan said, of the executive order and the memo aiming to give the order practical effect.
The government’s lawyer acknowledged but tried to wave off the court’s interpretive concerns as somewhat academic.
“I appreciate that we are parsing language and punctuation in a two-page memo,” the OMB attorney said — but maintained that the guidance was null and void.
The government lawyer tidily staked out his argument as simple and logical: the memo has been rescinded, the plaintiffs have their funding stream, they are now arguing about potential future freezes that might potentially impact them, so there is no need for continued relief much less a preliminary injunction that goes even further.
“This case is about prospective relief,” the OMB attorney summed up, arguing there was no need to go back in time to the harms that may or may not have been experienced by the plaintiffs — or other groups subject to the spending freeze.
As for those other groups, the government explained, they are not plaintiffs in the present case and the relevant agencies are not defendants.
“There is nothing to be done about that at this stage,” the OMB attorney said.
The OMB attorney also accused the plaintiffs of complaining about funding streams they “read about in the news” and said their request for new relief “has nothing to do with” the OMB memo.
“That’s all this case is about,” the government lawyer insisted.
The government conceded there are separate funding freezes happening elsewhere but said they are not an issue here — while defending as the general idea of a new administration pausing certain funding while assessing priorities as “rational.”
The OMB attorney offered the example of the Biden administration pausing construction of the border wall.
The judge was skeptical of this comparison.
Eventually, discussion moved to the government’s request for a bond from the plaintiffs in the event that the court decides to issue a preliminary injunction.
“I would call it a disturbing new development,” the nonprofit group’s attorney said.
The plaintiffs said the government was unable to identify any potential harm that would necessitate such a move.
“I also found their bond request curious,” the judge assured the plaintiff.
“I spent most of my career in the executive branch and I have never seen an executive branch request for a bond before,” the judge incredulously added later on — when the defendant took to the dais.
Pressed to account for the paucity of precedent in terms of the government requesting a bond, the OMB attorney said the idea had been tried at least once before — but was admittedly rejected.
“The court’s relief, if it continues forward, has a chilling effect on agencies,” the government’s lawyer argued.
The OMB attorney described this chill as affecting the ability to pause funding in instances where “money is required to go to an entity” but OMB would rather pause and redirect those funds.
“We think it is appropriate for there to be a bond” the government lawyer said. “If the court’s relief is expansive, there should be a dollar figure.”
The judge appeared unmoved but listened politely.
The nonprofit group’s attorney continued to press for a preliminary injunction — and an expansive one at that.
“Relief should not be limited to the plaintiffs but should apply more broadly,” the plaintiff’s lawyer said.
On rebuttal, he said it was “completely contrary to the record” that the harms from the freeze are speculative. The attorney argued there is a massive record of the administration advertising their intent to “freeze first and ask questions later,” repeating one of his earlier lines.
The hearing ended without a decision.
“The TRO will remain in place and I will issue my preliminary injunction ruling in due course,” AliKhan said.
