Good morning - Last night, the Supreme Court issued a decision on the emergency orders list in National Institutes of Health v. American Public Health Association, a case involving grant terminations. In the case, 5 Justices voted to grant the federal government's application for a stay of the district court's order declaring the grant terminations were unlawful under the APA. The majority of the Justices concluded the case was controlled by the Court's prior decision in Department of Ed. v. California, which held that the APA's limited waiver of sovereign immunity does not extend to breach of contract claims and that these claims for grant terminations must therefore be brought in the Court of Federal Claims under the Tucker Act. As Justice Kavanaugh explains in his concurrence: "The reason is straightforward: The core of plaintiffs' suit alleges that the Government unlawfully terminated their grants. That is a breach of contract claim. And under the Tucker Act, such claims must be brought in the Court of Federal Claims, not federal district court." The Court split more on whether the challenge to the associated NIH guidance belonged in district court. Here, the majority concluded the district court could hear that challenge with Justice Barret joining Justices Roberts, Kagan, Sotomayor, and Jackson. The latter 4 Justices would have also denied the application for a stay. In explaining why he would have denied the stay, the Chief Justice noted that the vacatur of the challenged guidance / directives distinguished the case from the Department of Ed. as that type of relief had implications beyond the specific grants. And if the district court retained jurisdiction to vacate the directives, then in his view, it also retained jurisdiction to vacate the resulting grant terminations. But that view only carried 4 votes. While Justice Barrett agreed the district court retained jurisdiction to vacate the guidance documents / directives, that did not mean that it retained jurisdiction to reinstate the grants. In deciding this dual track for future litigation, Justice Barrett's decision (which ultimately decides that the challenge to the guidance can stay in federal district court and the challenge to the grant terminations must be brought in the Federal Court of Claims), notes that vacating the guidance does not reinstate terminated grants. She reasons that "the plaintiffs cannot end-run" the Court of Federal Claim's exclusive jurisdiction over grant terminations "simply by packaging them with a challenge to agency guidance." She also explains that because a plaintiff cannot sue the government in two forums for the same issue simultaneously, if there is the requisite factual overlap between the two claims (the challenge to the guidance and the grant terminations) then the plaintiffs will need to proceed sequentially rather than simultaneously. In her dissent, Justice Jackson points out that Department of Ed. was decided in 9 days on the emergency order list without the benefit of full briefing or argument, but that it now "apparently governs all APA challenges to grant funding determinations that the Government asks us to address in the context of an emergency stay application." She also laments that "[t]he Court also lobs this grenade without evaluating Congress's intent or the profound legal and practical consequences of this ruling." Justice Jackson defends the district court's 103-page decision. She explains that court's findings with respect to arbitrariness concluded, among other things, that DEI (which was the driving component of the directives) was not defined "leaving individual agency employees ' to arrive at whatever conclusion [they] wish[e]d." In terms of the consequences of the decision, Justice Jackson explains that plaintiffs like these may not be able to get complete relief in these cases going forward because the Court of Federal Claims does not have the power to issue equitable relief, which means that court cannot reinstate unlawfully terminated grant funding, it can only award money damages. There were two suits in this case brought in tandem. The Complaints in NIH were based on claims under the APA, separation of powers, the Spending Clause and the Fifth Amendment, but the Supreme Court only addressed the APA claims in its decision. The lawsuit was brought after the federal government canceled hundreds of NIH funded projects based on new guidance / directives that indicated NIH would no longer fund research projects with any connection to "gender identity," "Diversity, Equity, and Inclusion" or COVID. Going forward, this decision will make challenges to grant termination in federal district court even more difficult. Justice Jackson also provides a good bit of analysis on the difficulty the two tracks the Court creates for these cases will pose. However, this case should not impact cases that challenge conditions on grants such as San Francisco v. Trump or King County v. Turner. It is possible the Supreme Court will take up one of these grant termination cases on the merits and provide more fulsome reasoning. You can review the Supreme Court decision and concurrences / dissents here: https://www.supremecourt.gov/opinions/24pdf/25a103_kh7p.pdf You can review the underlying Complaints here: https://storage.courtlistener.com/recap/gov.uscourts.mad.282821/gov.uscourts.mad.282821.1.0.pdf https://ag.ny.gov/sites/default/files/court-filings/masssachusetts-et-al-v-robert-f-kennedy-jr-united-states-department-of-health-and-human-services-et-al-complaint-2025.pdf [logo]<https://imla.org/> [facebook icon]<https://www.facebook.com/InternationalMunicipalLawyersAssociation/>[twitter icon]<https://twitter.com/imlalegal>[linkedin icon]<https://www.linkedin.com/company/international-municipal-lawyers-association-inc./> Amanda Karras (she/her) Executive Director / General Counsel International Municipal Lawyers Association P: (202) 466-5424 x7116 D: (202) 742-1018 51 Monroe St. Suite 404 Rockville, MD, 20850 Plan Ahead! See IMLA's upcoming events<https://imla.org/events/>, calls and programming.