NJ Attorney General Leads Multistate Lawsuit Over Trump-Era Cuts to Federal Funding

Lawsuit challenges use of OMB regulation allowing agencies to terminate grants based on shifting priorities

New Jersey Attorney General Matthew J. Platkin is leading a coalition of 21 state Attorneys General and the state of Pennsylvania in a lawsuit against the Trump Administration, alleging illegal termination of billions in federal grants using a single clause in federal regulations. Filed in the U.S. District Court for Massachusetts, the suit targets the Office of Management and Budget (OMB) and multiple federal agencies for invoking a regulation that allows them to cancel grants if they no longer "effectuate agency priorities."

“The Trump Administration and DOGE have mounted an unprecedented campaign to terminate billions of dollars of federal funding to states that supports critical programs for our residents. That reckless slash-and-burn campaign has rested on the flimsiest of legal justifications. And it has continued unabated for months—which is why we’re taking the fight to the Trump Administration to stop these reckless and illegal cuts from continuing,” said Attorney General Platkin. “We’re proud to lead this lawsuit to prevent the Trump Administration from deciding on a whim and without any notice that it no longer wishes to provide states with the funding Congress has promised. It is unconscionable that this Administration has illegally stripped our state of funding Congress authorized to protect public safety, to support lifesaving medical research, to ensure that our kids can access clean water and air, and so much more. We won’t let that continue to happen. We’ll see the Trump Administration in court.”

Since January 20, federal agencies under the Trump Administration have used this clause to terminate numerous grant programs—actions directed under a February executive order by President Trump and carried out by the Department of Government Efficiency (DOGE) appointees.

Programs affected in New Jersey include those supporting public safety, law enforcement technology, food security in schools, clean drinking water, medical research, and broadband expansion in underserved communities. The lawsuit argues that the regulation does not permit terminations based solely on changing agency priorities after grants have been awarded, calling the practice a sharp departure from prior federal standards.

The coalition is seeking a declaratory judgment that the Trump Administration lacks authority to retroactively apply these changes and is also asking the court to vacate terminations already made under the contested rule. In addition to the OMB, the complaint names several federal departments and agencies including Justice, Agriculture, Defense, Homeland Security, Labor, and the Environmental Protection Agency.

The New Jersey Attorney General’s Office legal team includes Solicitor General Jeremy Feigenbaum and several Deputy Attorneys General. Joining New Jersey in the lawsuit are states including New York, California, Massachusetts, and Maryland.