The Supreme Court sided on Wednesday with a federal judge who had ordered the U.S. Agency for International Development to pay its contractors for completed work, rejecting the Trump administration’s wish to continue to withhold roughly $2 billion in funds. It’s the first significant decision the court has handed down on President Trump’s whirlwind of executive orders—and a sign of support for lower court judges who are wrestling with intransigence and potential defiance of judicial orders from the Trump administration.
At the same time, the 5–4 ruling’s narrow split—Justice Clarence Thomas, Samuel Alito, Neil Gorsuch, and Brett Kavanaugh emphatically dissented, while their conservative colleagues Chief Justice John Roberts and Justice Amy Coney Barrett sided with the three liberal justices—is less reassuring when it comes to predicting future legal battles with White House.
“Does a single district-court judge who likely lacks jurisdiction have the unchecked power to compel the government of the United States to pay out (and probably lose forever) 2 billion taxpayer dollars?” Alito wrote in his dissent, which the other three justices joined. “The answer to that question should be an emphatic ‘No,’ but a majority of this court apparently thinks otherwise. I am stunned.”
The case, Department of State v. AIDS Vaccine Advocacy Coalition, sprang from the administration’s decision to dismantle USAID and freeze tens of billions of dollars in foreign aid that it distributed. The AIDS Vaccine Advocacy Coalition and other litigants sued the State Department over work and products that it had already completed for USAID. Those contractual obligations remain despite the agency’s fate.
Judge Amir Ali, a federal district court judge in Washington, D.C., issued a temporary restraining order last month that instructed the State Department to make the payments. That order apparently went unheeded, through either incompetence or malice. Late last month, after receiving evidence that the administration was (at best) dragging its feet on the payments, Ali issued a new, more forceful order that instructed the State Department to “pay all invoices and letter of credit drawdown requests” for all of its contracts, grants, and programs “for work completed prior to the entry of the Court’s [order] on February 13,” and to do so by midnight on February 26.
Shortly before Ali’s deadline, the Trump administration asked the justices to pause the lower court’s order. “This directive was not party-specific, was not limited to invoices that are due or overdue, and did not explain how agencies are supposed to identify those invoices,” the Justice Department complained in its stay request. It claimed the lower court lacked jurisdiction and that the Administrative Procedures Act, which governs how agencies issue new rules and policies, did not waive the federal government’s sovereign immunity in this case.
The AIDS Vaccine Advocacy Coalition, for its part, urged the justices to reject those arguments—and the false sense of urgency that the Justice Department had invoked. “The government comes to this Court with an emergency of its own making,” it argued in the opening line of its reply brief. AVAC also emphasized the ongoing, immediate harms of the State Department’s noncompliance with the lower court’s order.
“By forcing thousands of American businesses and nonprofits to suspend their work, and by halting disbursements for work that they had already performed, even work that already had been reviewed by the government and cleared for payment, the government plunged respondents into financial turmoil,” the group claimed. AVAC noted that they and their fellow litigants have faced “cancellation of credit lines, civil and regulatory actions for employment violations, evictions, insolvency, and even physical threats to personnel in conflict areas.”
The Justice Department’s stay request went first to Roberts, the chief justice, in his role as the circuit justice for the D.C. Circuit Court of Appeals. He granted a last-minute administrative stay to Ali’s order before the deadline expired. That move preserved the status quo and gave the rest of the justices time to deliberate about the matter. Much of that deliberation over the last five days appears to have been used by the four justices in the minority to craft a dissenting opinion.
As is customary for the high court’s emergency-docket work, the five-justice majority did not write an opinion of their own to outline their reasoning. An unsigned order announcing their decision briefly instructed Ali to write a new temporary restraining order since his previous one had been overtaken by events. But the justices wrote enough to suggest that their support for the lower court may not be unlimited.
“Given that the deadline in the challenged order has now passed, and in light of the ongoing preliminary injunction proceedings, the district court should clarify what obligations the government must fulfill to ensure compliance with the temporary restraining order, with due regard for the feasibility of any compliance timelines,” the majority wrote.
That passage is a Rorschach test of sorts. One could read it as a simple instruction to restart the payment deadlines, which is the practical effect it will have. Telling the lower court to “clarify” the State Department’s obligations and show “due regard” for the “feasibility of any compliance timeline” could also be read as a subtle admonition of its approach thus far. Either way, the outcome is the same: The State Department must pay up.
That outcome drew a furious response from the four dissenting justices. Alito chastised the lower court for labeling the order as what he described as a “non-appealable TRO,” meaning a temporary restraining order that could not ordinarily be challenged before a higher court, and for “demand[ing] that the money be paid within 36 hours,” even though Ali had already given the State Department roughly a fortnight to comply.
Alito’s primary concern was not the harm inflicted on the plaintiffs, but the potential harm to the Trump administration if it had to pay out completed contracts. “As a result, the Government must apparently pay the $2 billion posthaste—not because the law requires it, but simply because a district judge so ordered,” he wrote. “As the nation’s highest court, we have a duty to ensure that the power entrusted to federal judges by the Constitution is not abused. Today, the court fails to carry out that responsibility.”
That phrase—“not because the law requires it, but simply because a district judge so ordered”—is a troubling one. What is “the law” in this case? Is it the Foreign Assistance Act of 1961, which created USAID and the decades of regular appropriations bills that kept it funded? Is it the Administrative Procedures Act, which generally bars federal agencies from adopting “arbitrary and capricious” rules and policies? Is it the Impoundment Control Act of 1974, which generally forbids the executive branch from refusing to spend congressionally appropriated funds?
Or, alternatively, is “the law” the executive order of a president who claims unlimited authority to stop and start congressional appropriations at a whim? Alito’s phrasing seems to suggest that he and the other three dissenters think it’s the latter. “Today, the Court makes a most unfortunate misstep that rewards an act of judicial hubris and imposes a $2 billion penalty on American taxpayers,” he wrote toward the end of his dissent.
Except it’s not a “$2 billion penalty on American taxpayers.” It’s $2 billion in owed compensation for services undertaken on the American taxpayer’s behalf. Alito’s choice of words here mirrors the rhetoric of Trump and Elon Musk, the head of the Department of Government Efficiency. They have regularly justified their freezes and impoundments under the premise that they are saving taxpayer money, when there is little evidence to support that claim and plenty of reason to doubt it.
If Alito and the other three justices, who presumably signed off on their colleague’s opinion before its release, are willing to freely adopt the Trump-Musk framing on these matters, then the administration will only need to persuade one other justice to prevail in future cases. Roberts and Barrett were willing to hold the line on executive power in this dispute; they will be asked to do it again and again for the next four years.
