WASHINGTON (AP) — In a significant legal development, a federal judge has agreed to continue blocking the Trump administration's efforts to freeze grants and loans, potentially totaling trillions of dollars. This move comes as a relief to thousands of nonprofits and small businesses across the United States.
U.S. District Judge Loren AliKhan in Washington, D.C., issued the preliminary injunction following a request from groups representing numerous nonprofits and small businesses. This marks the first order of its kind since the Trump administration announced a sweeping pause on federal aid, which had caused significant confusion and anxiety nationwide.
Judge AliKhan emphasized that the administration "cannot pretend that the nationwide chaos and paralysis from two weeks ago is some distant memory with no bearing on this case." She further stated, "The relief Plaintiffs now seek is a more durable version of the relief they sought then, when their members were on the brink of extinction."
Judge AliKhan highlighted the potential economic devastation the funding freeze could cause, noting that "Plaintiffs have marshalled significant evidence indicating that the funding freeze would be economically catastrophic — and in some circumstances, fatal — to their members."
The Trump administration had previously rescinded a memo outlining its planned funding freeze after Judge AliKhan temporarily blocked it earlier this month. In a related case, a second judge in Rhode Island also issued a temporary restraining order against any pause in federal spending, following a lawsuit filed by nearly two dozen states.
Last month, the White House announced a temporary halt on federal funding to ensure compliance with Trump's agenda. Government lawyers argued that the court lacks the constitutional authority to block such a funding pause. However, organizations represented by the advocacy group Democracy Forward argued that the funding freeze violates their First Amendment rights.
Some groups initially reported being unable to access promised federal funding even after the memo's rescission. However, during a hearing last Thursday, plaintiffs' attorney Kevin Friedl stated that the earlier temporary restraining order has "shown its value," as "funds have been unfrozen."
Justice Department attorney Daniel Schwei opposed the preliminary injunction, describing it as an "inherently speculative proposition" that the administration might attempt another funding freeze.
