Legal Showdown Over Foreign Aid Spending Reaches Critical Stage

Legal Showdown Over Foreign Aid Spending Reaches Critical Stage
  • calendar_today August 24, 2025
  • News

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Attorneys for the Trump administration requested the Supreme Court on Tuesday evening to grant an emergency injunction in a case that returns the question of money for the U.S. Agency for International Development (USAID) to the high court for the second time in six months.

Trump administration lawyers filed an emergency injunction Tuesday, asking the high court to block the Trump administration from disbursing billions of dollars in foreign aid that Congress had already appropriated.

The Trump administration is asking the court to prevent the Justice Department from having to spend almost $12 billion that Congress has already approved for the USAID. The funding is designed to go to nonprofit groups that do projects overseas, and Congress has required the funding to be obligated by Sept. 30.

President Donald Trump wasted little time on his return to the White House in January. He signed an executive order on his first day back in office that ordered the federal government to delay nearly all foreign aid spending.

The move was part of the president’s bid to end “waste, fraud, and abuse” in how the federal government allocates foreign aid, the president said at the time.

U.S. District Judge Amir Ali of Washington, D.C., issued an injunction on the executive order in February, in response to a lawsuit brought by the foreign aid groups against the president’s freeze on spending.

Judge Ali ordered the White House to resume the payment of money on billions of dollars in USAID grants that the administration had put on hold.

Trump administration attorneys appealed, however, and a divided U.S. Court of Appeals for the D.C. Circuit ruled 2-1 to overturn the lower court’s injunction on the freeze.

“The plaintiffs simply have no cause of action under the impoundment control statute or the APA, and their amended complaint was properly dismissed,” wrote Judge Karen L. Henderson, an appointee of George H.W. Bush, for the majority in the appeals court.

In theory, that should be the end of the case. But the appeals court has yet to issue its formal mandate to make its ruling on the case take effect. As such, Judge Ali’s ruling and order are still in place until the court changes its mind.

Because of this delay, the administration is in a legal and logistical rush to try and prevent being forced to have to release the nearly $12 billion in USAID grants before the fiscal year ends in a month at the end of September.

Emergency Injunction to the Supreme Court

In a Tuesday filing to the Supreme Court in response to the appeal court’s decision, U.S. Solicitor General D. John Sauer made the case that the justices need to act before Sept. 30 if they don’t want the administration to “rapidly obligate $12 billion in foreign-aid funds.”

“The Constitution, however, contemplates no such circumstance,” Sauer wrote in his emergency injunction to the high court. “Congress did not upset the delicate interbranch balance by allowing for unlimited, unconstrained private suits.”

Sauer’s position is that the court has no business weighing in and that “any lingering dispute about the proper disposition of funds that the President seeks to rescind shortly before they expire should be left to the political branches, not effectively prejudged by the district court.”

The aid groups at the center of the lawsuit contend just the opposite.

Their case, as outlined in court documents, is that the president simply cannot order that money, once Congress has decided to spend it, not be spent.

The Trump administration’s legal position, by contrast, is that the president has the power to veto laws and decisions made by Congress, and Congress should have to come to the president to lift the freeze.

The case law the plaintiffs are using to support their argument is primarily found in the Impoundment Control Act (ICA), a federal statute first passed in the 1970s to restrict the executive branch’s power in federal spending. The APA is also in play as the administration reviews whether the aid should be approved.

But in theory, the plaintiffs don’t even need a ruling to make their case.

Judge Ali, in his February decision, has already said that the president can’t act against a congressional decision to appropriate the funding, and the appeals court has ruled on the case. All that remains is for the appeals court to actually make its ruling take effect.

What the plaintiffs and defendant agencies want is a definitive ruling one way or another. In the meantime, the clock continues to tick as the fiscal year 2020 closes at the end of September.

The Supreme Court took up an almost identical question earlier this year. The narrow 5-4 decision on the freeze didn’t offer a categorical answer as to the future of the spending either.

In that decision, the justices ordered the district court to rehear the case in light of the more recent arguments and evidence brought by both sides. The latest filing for an emergency injunction by the Trump administration asks the justices to throw out the district court’s ruling and take over the dispute.

Tuesday’s emergency injunction filing to the Supreme Court doesn’t carry the day on its own. The Court could simply refuse to accept the filing, leaving the matter in the hands of the lower courts. Or, they could expedite the case and rule quickly on whether the administration is in the right or not.

The case, and Trump’s general executive power position on budget authority, will continue to get worked out in court as more battles over executive power over the budget and foreign aid spending crop up.