The D.C. Circuit Court of Appeals has surprised me: Contrary to expectations, late on Thursday, they denied the plaintiffs' petition for a rehearing en banc (by the full court) in the USAID funding case. This follows a somewhat stunning win for the Trump administration on the matter two weeks ago, when a three-judge panel of the court vacated lower court injunctions regarding USAID funding.
In that prior 2-1 decision, the appellate court held:
The district court erred in granting that relief because the grantees lack a cause of action to press their claims. They may not bring a freestanding constitutional claim if the underlying alleged violation and claimed authority are statutory. Nor do the grantees have a cause of action under the APA because APA review is precluded by the Impoundment Control Act (ICA). And the grantees may not reframe this fundamentally statutory dispute as an ultra vires claim either. Instead, the Comptroller General may bring suit as authorized by the ICA. Accordingly, we vacate the part of the district preliminary injunction involving impoundment.
Unsurprisingly, the plaintiffs in the consolidated cases filed a petition for rehearing en banc and sought a stay of the decision. And, as noted in my prior reporting on this, things somewhat stalled out at that point, prompting the Trump administration to take its case back to the Supreme Court in light of a looming deadline regarding FY 2025 appropriations.
READ MORE: While the D.C. Circuit Twiddles Its Thumbs, Trump Admin. Takes USAID Case Back to SCOTUS
And Another One: D.C. Circuit Court of Appeals Vacates Injunction on USAID Funding
The D.C. Circuit issued a series of rulings on Thursday afternoon, including several correcting/amending the court's August 13 opinion. Most notably, the court amended the above bolded language to now read:
Nor do the grantees have a cause of action to enforce the Impoundment Control Act (ICA) through the APA, because the ICA precludes such review. And the grantees may not reframe this fundamentally statutory dispute as an ultra vires claim either.
That reframing may seem a bit murky, but I suspect it will be key down the road as the case will inevitably wind up before the Supreme Court on the merits, and the majority of the Circuit Court clearly felt the clarification was warranted. The court's decision to deny rehearing on the matter is accompanied by a brief concurrence from Judges Katsas, Henderson (who authored the initial opinion), Rao, and Walker, and a rather salty dissent from Judge Pan (who authored the dissent in the initial opinion, as well).
It's unclear what this will mean as to the application for stay filed by the administration with the Supreme Court on Tuesday, but presumably, it obviates the need for the stay, so we may see the administration withdraw the application. (I'd predicted a decision from SCOTUS on the application either today or tomorrow in my Morning Minute.)
But, as noted above, it's highly likely the case will be back before the Supreme Court on the merits, as I expect the plaintiffs to appeal the Circuit Court's ruling. So, there will, undoubtedly, be more to report in the USAID funding saga. But for now, this is a big win for the administration.
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