155 F.4th 35
1st Cir.2025Background
- Twenty-one states sued after Executive Order 14,238 (Mar. 14, 2025) directed agencies to eliminate non‑statutory functions and reduce statutory functions/staff to the minimum required by law; targeted agencies here: IMLS, MBDA, FMCS.
- Plaintiffs allege agency defendants terminated, placed on leave, or reassigned nearly all employees and cancelled or suspended numerous grants, causing immediate loss of services and funding to state programs.
- District Court granted a preliminary injunction (May 13, 2025) preventing implementation of Section 2 of the EO as to IMLS, MBDA, and FMCS, ordered restoration of employees and grant payments, but allowed non‑EO efficiency measures with reasoned explanation and no impairment of statutory duties.
- Appellants (agencies and President) appealed and sought a stay of the preliminary injunction pending appeal; the District Court denied a stay; appellants then moved for a stay in the First Circuit.
- First Circuit applied Nken’s four‑factor stay test and denied the stay, concluding appellants failed to show a strong likelihood of success on the merits and that equities/public interest did not favor a stay, though recognizing limited irreparable fiscal harms tied to grant disbursements and potentially unrecoverable salary payments.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Article III standing to challenge employee terminations and grant cancellations | States alleged concrete imminent harms: loss of funds, loss of services they rely on (research, mediation, centers), and program destabilization | Injuries are generalized or not traceable to defendants’ actions (argued as speculative or not particularized) | Court: Plaintiffs plausibly allege concrete imminent harms; appellants did not make a strong showing that plaintiffs lack standing |
| District court jurisdiction over constitutional and statutory challenges (including CSRA/Tucker Act arguments) | States asserted constitutional (Take Care, separation of powers) and APA/ultra vires claims; sought equitable relief restoring employees and grants | Appellants argued Dalton/CSRA or Tucker Act bars judicial review of certain claims or that claims are essentially statutory repackagings | Court: Appellants forfeited Dalton/CSRA arguments by not raising them below; Court rejected stay without reaching merits of those defenses |
| Whether plaintiffs’ constitutional claims are cognizable (vs. merely statutory) | Constitutional claims arise from executive actions that dismantled statutorily created agencies and thus present independent constitutional harms | Appellants: claims are a repackaging of statutory challenges (Dalton) and thus not cognizable; CSRA precludes review of employment decisions | Court: Did not resolve Dalton/CSRA on the merits (forfeiture); accepted District Court’s reliance on constitutional findings as a basis for injunction for purposes of stay analysis |
| Irreparable harm, balance of equities, and public interest for stay | Injunctive relief required to prevent immediate loss of services, layoffs, program closures, and unrecoverable harms to plaintiffs | Appellants claimed irreparable harm if forced to reinstate personnel and disburse funds that may be unrecoverable | Court: Appellants showed some limited irreparable fiscal risk (unrecoverable disbursements/salaries) but failed to show sufficient injury or public interest to justify stay; plaintiffs would suffer substantial irreparable harms from lost services and funding |
Key Cases Cited
- Nken v. Holder, 556 U.S. 418 (stay pending appeal factors and standard) (describing four‑factor stay test)
- Dalton v. Specter, 511 U.S. 462 (scope of constitutional claims that merely restate statutory violations)
- Elgin v. Department of Treasury, 567 U.S. 1 (CSRA and jurisdictional scheme for federal employment claims)
- Lujan v. Defenders of Wildlife, 504 U.S. 555 (standing injury‑in‑fact standard)
- TransUnion LLC v. Ramirez, 594 U.S. 413 (limits on informational injuries for Article III standing)
- Somerville Pub. Schs. v. McMahon, 139 F.4th 63 (1st Cir.) (recent related First Circuit stay denial and precedents on agency RIFs)
- New York v. Trump, 133 F.4th 51 (First Circuit) (procedural guidance on stay practice and equitable considerations)
- Hilton v. Braunskill, 481 U.S. 770 (stay/temporary injunction equitable factors)
- Department of Education v. California, 145 S. Ct. 966 (Supreme Court) (Tucker Act and limits on district court relief regarding money obligations)
- American Public Health Ass'n v. ... (Supreme Court partial stay discussed via 2025 WL 2415669 in opinion) (not listed above as an official reporter decision in the opinion but discussed for grant disbursement irrecoverability reasons)