U.S. District Judge Loren AliKhan, an appointee of former President Joe Biden, held a hearing in federal court in Washington, D.C on the request by groups representing non-profits and small businesses. The freeze is set to take effect at 5 p.m. ET (2200 GMT) on Tuesday.
The groups argued that the U.S. Office of Management and Budget exceeded its authority in taking the action and said the freeze “will have a devastating impact on hundreds of thousands of grant recipients.”
Schwei said the funding freeze applies only to programs implicated by Trump's recent executive orders on issues such as diversity, climate and immigration.
“This policy is reckless, dangerous, illegal and unconstitutional,“ James said. “The president does not get to decide which laws to enforce and for whom.”
The nonprofit groups - the National Council of Nonprofits, the American Public Health Association, Main Street Alliance and SAGE - said in the lawsuit that OMB lacked authority to unilaterally terminate all federal financial assistance programs across the government.
“The actions taken yesterday are a callous disregard for the rule of law and a drastic abuse of power that will harm millions of Americans across the country,“ said Skye Perryman, the head of the liberal-leaning legal group Democracy Forward, which is representing the plaintiffs.
The U.S. Justice Department, which would defend the policy in court, did not immediately respond to requests for comment.
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