Letitia James Files Lawsuit Against Trump Administration Over Federal Grants Freeze

NEW YORK, UNITED STATES – 2024/11/06: Attorney General Letitia James speaks during the press briefing with Governor Kathy Hochul at Governor’s office discussing impacts of 2024 Presidential Election as Former President Donald Trump won second term. (Photo by Lev Radin/Pacific Press/LightRocket via Getty Images)

New York Attorney General Letitia James has initiated legal action against the Trump administration following its recent directive to halt federal grants and loans. This move, announced on January 27, 2025, by the Office of Management and Budget (OMB), aimed to pause disbursements to reassess funding priorities. The freeze excluded programs like Social Security and Medicare but led to widespread confusion and concern.

Legal Challenges Emerge

Attorney General James criticized the administration’s action as “reckless and dangerous,” emphasizing that “programs in communities across the entire nation depend on this funding to support our families.” She further stated, “Not only does this administration’s new policy put people at risk, but it is plainly unconstitutional.” In her lawsuit, James is joined by attorneys general from multiple states, including California, Illinois, and New Jersey, aiming to ensure the continuation of essential services.

In response to the legal challenges, a federal judge temporarily blocked the funding freeze, allowing for further judicial review. The administration clarified that the pause was intended to align financial assistance with its priorities, targeting programs it deemed inconsistent with its agenda. White House Press Secretary Karoline Leavitt stated, “This is not a blanket pause on federal assistance and grant programs from the Trump administration.”

Impact on Public Services

The funding freeze’s announcement led to immediate disruptions. Healthcare providers reported issues accessing Medicaid portals, and law enforcement agencies paused certain operations due to funding uncertainties. James highlighted these concerns, noting that “millions of Americans rely on federally funded programs every day to get the health care they need, support their families, and stay safe in their communities.”

The lawsuit contends that the administration’s action violates the Impoundment Control Act of 1974, which restricts the executive branch from unilaterally withholding funds allocated by Congress. Legal experts suggest that this case could test the boundaries of presidential authority over federal spending.

As the legal proceedings unfold, the temporary block on the funding freeze provides a reprieve for programs nationwide. The outcome of this case will have significant implications for the balance of power between federal and state governments and the future of federally funded services.