Investigations, Enforcement, & Compliance Alerts

On March 24, 2026, the U.S. District Court for the Northern District of Illinois decided that federal grantees can challenge grant terminations by the Administration if at the time of termination the grantees were compliant with Administration policies that were in place at the time the grant was awarded, as opposed to new rules or policies subsequently imposed by the Trump Administration. This decision could aid federal contractors and grantees in their legal challenges to the numerous contract and grant terminations, which have occurred since January 2025, based on alleged failure of the contracts or grants to align with or effectuate new Administration programs, policies, goals, and/or priorities, including, but not limited to, those relating to diversity, equity and inclusion (DEI) programs and policies. 

The early days of the Trump Administration have caused nothing less than a complete shake-up of the federal procurement system, with impacts on federal contractors, subcontractors, and recipients of federal financial assistance, such as grants and loans. Through a series of Executive Orders and Agency Memoranda issued by the heads of the Office of Management and Budget (OMB), General Services Administration (GSA), Department of State, and others, the government is suspending work and, in some cases, terminating federal awards. For example, GSA issued a complete “Acquisition Pause,” the State Department issued a pause on U.S. foreign assistance funded by or through the State Department and U.S. Agency for International Development (USAID) and is actively terminating contracts and grants, and other agencies, including Department of Energy, Veterans’ Affairs, Department of Housing and Urban Development, and National Institute of Health are issuing stop-work orders and/or termination of contracts and grants, in whole or in part.