Woonasquatucket River Watershed Council v. U.S. Department of Agriculture

After holding a fourth status conference on May 5 about compliance with the preliminary injunction, the court issued an order explaining its determination that EPA did not violate the preliminary injunction by terminating approximately 800 grants. The court said the preliminary injunction fundamentally concerned “pauses, not terminations” and that the EPA’s termination of “only about 800 of the approximately 3,000 IIJA and IRA grants that were previously frozen … suggests to the Court that a more thoroughgoing individualized review had taken place between the mass freeze and the Court’s order enjoining it.” The court said the terminations created “fundamentally different legal issues” than the funding freezes and that the organizations could file another lawsuit to challenge the terminations.

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On April 15, 2025, the federal district court for the District of Rhode Island granted six nonprofit organizations’ request for a preliminary injunction enjoining five federal agencies from freezing “on a non-individualized basis” the processing and payment of funding appropriated under the Inflation Reduction Act (IRA) or the Infrastructure Investment and Jobs Act (IIJA) that had already been awarded. The agencies were the U.S. Department of Energy, the U.S. Environmental Protection Agency (EPA), the U.S. Department of Housing and Urban Development (HUD), the U.S. Department of the Interior, and U.S. Department of Agriculture. Funding at issue in the case included a grant to support localities with plans to plant more trees and manage existing forests under the IRA’s Urban and Community Forestry Program and a grant through HUD’s Green and Resilient Retrofit Program funded by the IRA. The court also ordered the Office of Management and Budget (OMB) and the National Economic Council (NEC) Director to notify agencies not to implement their memorandum directing agencies to pause disbursement of funds supporting “Green New Deal” programs implicated by the policy set forth in President Trump’s “Unleashing American Energy” executive order. The court found that the organizations demonstrated standing against all defendants and that the doctrine of claim-splitting did not narrow their case despite some plaintiffs being involved in litigation challenging federal funding freezes in another court. The court also said it was “confident” that it had jurisdiction under the Administrative Procedure Act (APA) because the agency actions were final and the organizations’ claims were not “simple contract actions for money damages” that would be required to be heard in the Court of Federal Claims. On the merits, the court found that the organizations demonstrated a strong likelihood of success on their APA claim that the freeze of awarded funds was arbitrary and capricious because the freeze was not reasonable or reasonably explained and failed to account for reliance interests. The court also found that federal law did not authorize the “broad powers” asserted by the five agencies and by OMB and the NEC Director, even if the agencies “likely possess narrower powers related to individualized funding pauses and terminations.” The court also found that the organizations adequately demonstrated irreparable harm and that the balance of the equities and the public interest “weigh heavily” in favor of injunctive relief. The court—which declined to require the organizations to provide a bond—concluded that a nationwide injunction was appropriate. The federal government appealed the injunction to the First Circuit.