Legal Alert: Three Critical Updates on Trump DEI Legal Challenges

Key implications of the February 21, 2025 injunction and what’s next for federal contractors, universities, and corporations 

For employers and contractors: The Maryland District Court’s February 21, 2025 injunction immediately pauses major provisions of Trump’s DEI executive orders – here’s how it impacts your organization. 

What’s Blocked (and What’s Not) 

The preliminary injunction halts enforcement of three contested provisions: 

1. Termination of Equity Grants 
   • Blocked: Pending appeal, federal agencies cannot cancel “equity-related” contracts/grants under J20 Order § 2(b)(i) 
   • Impact: $2.1B in active DEI grants (e.g., higher education training programs) remain protected. 
2. Mandatory DEI Certifications 
   • Paused: For now, contractors are not required to certify DEI programs comply with anti-discrimination laws (J21 Order § 3(b)(iv)). 
   • Relief: Avoids False Claims Act risks for existing diversity initiatives. 
3. Targeted Enforcement Plan 
   • Blocked: DOJ’s pending report identifying “up to nine” DEI investigations against large corporations/universities (J21 Order § 4(b)(iii)). 

Still Active: Non-DEI provisions, including merit-based hiring mandates for federal agencies. The preliminary injunction does not block the Attorney General “from preparing a report [containing specific steps or measures to deter DEI programs or principles that constitute illegal discrimination] pursuant to the J21 Order. However, it prevents the Attorney General from acting on any report recommendations.   

“The orders are unconstitutionally vague in defining ‘DEI-related’ activities.” – Judge Abelson

Three Immediate Action Items 

1. Audit Vulnerable Contracts: Review federally funded DEI programs paused since January. Resume activities covered by the injunction 
2. Audit Existing DEI Programs: Audit existing DEI programs to ensure alignment with federal civil rights laws. Avoid efforts that exclude specific groups.  
3. Implement Periodic Risk Assessments: Perform periodic non-discrimination analysis. Analyzing workplace or organizational decisions will help proactively uncover any risks associated with Title VII.  

What’s Next: Timeline to Watch 

Up Next: Helpful Resources

Affirmative Action, DEI, and Non-Discrimination in Employment Webinar

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