By Nate Raymond and Jack Queen
BOSTON (Reuters) -U.S. President Donald Trump on Tuesday lost the latest round in a court battle over his administration’s bid to freeze federal spending after an appeals court declined to pause a court order requiring the government to continue delivering funds.
The U.S. Department of Justice had asked the Boston-based 1st U.S. Circuit Court of Appeals to put on hold an order a Rhode Island federal judge issued on Monday, after finding the administration had defied his January 31 ruling by continuing to withhold billions of dollars in federal funding.
The Justice Department argued U.S. District Judge John McConnell engaged in “intolerable judicial overreach” as Trump’s authority to direct agencies to carry out actions consistent with his policy preferences was “well-settled.”
But the three-judge appellate panel in a short order said it was confident McConnell would quickly clarify the concerns the administration had raised, including that his order bars Trump from exercising his lawful authority.
The ruling marked the first appellate court setback that Trump’s agenda has faced since he returned to office on January 20. The 1st Circuit did not bar the administration from seeking again to have McConnell’s order put on hold and said it could file additional papers seeking to do so by the end of Thursday.
The three-judge panel included U.S. Circuit Judges David Barron, Lara Montecalvo and Julie Rikelman, all appointees of Democratic presidents. The White House said it would continue to fight in court.
“These unlawful injunctions are a continuation of the weaponization of justice against President Trump,” White House press secretary Karoline Leavitt said in a statement.
The 1st Circuit ruled as Trump, key members of his administration and billionaire ally Elon Musk have been criticizing judges who have blocked major pieces of the president’s agenda, in some cases arguing judges have no power to intrude on the president’s authority.
Trump said on social media on Tuesday that “certain activists and highly political judges want us to slow down, or stop,” the administration’s efforts to eliminate federal government waste.
“Democracy in America is being destroyed by judicial coup,” Musk, the world’s richest man, wrote on social media on Tuesday, after calling for the impeachment of a judge in New York who barred his Department of Government Efficiency from accessing Treasury Department systems.
Such comments have fueled concerns about whether the Trump administration would abide by court rulings. The American Bar Association, in a statement on Monday, raised concerns about “wide-scale affronts to the rule of law itself” under Trump.
The lawsuit before McConnell was filed by Democratic attorneys general from 22 states and the District of Columbia, who sued after the White House’s Office of Management and Budget issued a memo announcing a freeze that implicated trillions of dollars in spending.
OMB later withdrew that memo. But McConnell had concluded a temporary restraining order was still necessary because of evidence a funding freeze remained in effect and OMB’s rescission of the memo was in “name-only.”
The case is one of dozens of lawsuits in which Democratic-led states, civil rights groups and progressive advocacy organizations have obtained court orders blocking for now Trump’s efforts to reduce the size of the federal government, cut spending and crack down on immigration.
The Democratic state attorneys general on Friday urged McConnell to enforce his funding freeze order, saying the administration had taken the position it could still withhold billions of dollars in infrastructure and environmental funding under the Inflation Reduction Act and the Infrastructure Improvement and Jobs Act.
McConnell, an appointee of Democratic former President Barack Obama, said on Monday his earlier order was “clear and unambiguous” and barred all categorical pauses or freezes in federal funding.
Rhode Island Attorney General Peter Neronha, who is helping lead the litigation, in a statement said the 1st Circuit’s decision ensured McConnell’s “order remains in full force, and we expect the administration to comply.”
(Reporting by Nate Raymond in Boston; Editing by Rod Nickel, Alexia Garamfalvi, David Gregorio and Chris Reese)
