Labor & Employment Law Daily Wrap Up, PROCEDURE—D.C. Cir.: Preliminary injunction against USAGM stayed pending appeal, (May 5, 2025)

By Kathleen Kapusta, J.D.

“I regret that networks charged with exemplifying the ideals of free speech, free opinion, and a free press to the world at large are silenced by our own government’s action in disregard of the expressed will of Congress—actions that, as the district court most ably explained, are likely to be found unlawful.”

In a per curiam order, a divided D.C. Circuit granted the government’s motion for a partial stay pending appeal of a preliminarily injunction that required the United States Agency for Global Media (USAGM), which oversees six federally funded broadcast networks including the Voice of America (VOA), to restore its employees and contractors to their status prior to the issuance of President Trump’s Executive Order directing USAGM leadership to reduce the agency to the minimum level of operations required by statute. Not only did the district court likely lack jurisdiction over USAGM’s personnel actions, said the court, it likely lacked jurisdiction to restore grants issued to Radio Free Asia and Middle East Broadcasting Networks. Dissenting, Judge Pillard argued that the stay silences Voice of America for the foreseeable future and eliminates Radio Free Asia (RFA) and Middle East Broadcasting Networks’ (MBN) ability to see this case through to the end (Widakuswara v. Lake, Nos. 25-5145, 25-5144, and 25-5151 (D.C. Cir. May 3, 2025)).

Executive Order. Directed by President’s Trump’s March 14 Executive Order, Continuing the Reduction of the Federal Bureaucracy, to reduce USAGM to the minimum level of operations required by statute, agency leadership placed over 1,000 employees on administrative leave, terminated nearly 600 personal-service contractors, and terminated RFA’s and MBN’s grant agreements for the 2025 fiscal year. The agency also directed its personnel abroad to cease broadcasting through VOA.

Preliminary injunction. In response, various plaintiffs, including USAGM employees, contractors, and grantees, challenged these actions in court. A federal district court, in one of the cases, granted a preliminary injunction requiring USAGM to (1) restore its employees and contractors to their pre-March 14 status; (2) restore its FY 2025 grants with RFA and MBN; and (3) restore VOA as “a consistently reliable and authoritative source of news.” USAGM appealed, seeking a stay of the first two portions of the preliminary injunction.

Jurisdiction over personnel actions. Granting the stay, the court first found that the district court likely lacked jurisdiction over USAGM’s personnel actions. Rather than using the APA to challenge agency employment actions, said the appeals court, federal employees must instead follow the comprehensive statutory schemes established by Congress for adjudicating employment disputes with the federal government. While the plaintiffs, in their stay briefing, framed their claims as challenging the “wholesale shuttering of VOA” and seeking to undo broad government actions” to “dismantl[e] an entire federal agency,” the court explained that they cannot use the APA to mount “wholesale” challenges to an agency’s “entire program.”

Finding that the alleged “dismantling” is really a collection of “many individual actions” that cannot be packaged together and “laid before the courts for wholesale correction under the APA,” the court noted that while USAGM’s employees and contractors might have viable, discrete claims with respect to their individual personnel actions, those claims must be pursued through other remedial channels.

Jurisdiction to restore grants. In addition, said the court, the district court also likely lacked jurisdiction to restore RFA’s and MBN’s FY 2025 grants. Pursuant to the Tucker Act, the appeals court observed, the Court of Federal Claims (CFC) has jurisdiction over claims “founded … upon any express or implied contract with the United States.” Here, the court found controlling the U.S. Supreme Court’s recent decision in Department of Education v. California staying a district court’s order “enjoining the Government from terminating various education-related grants.” According to the High Court, the district court likely lacked jurisdiction to bar termination of the grants because the Tucker Act likely conferred jurisdiction over the dispute on the CFC.

Congress, said the court here, created a statutory scheme that authorizes USAGM to fund RFA, MBN, and other networks through “grants and cooperative agreements.” The governing appropriation statute allocates specific funding amounts for grants to those networks, which in return promise to use the funds to advance statutory objectives. “These exchanges of promises—reflecting offer, acceptance, consideration, mutuality of intent, and action by an official with authority to bind the government—constitute government contracts for Tucker Act purposes,” the court declared, noting that the disputes at issue arose when USAGM terminated these agreements.

Contractual remedy. Further, said the court, whether “phrased as a declaration that the agreements remain in force, or an order to pay the money committed by those agreements, the injunction in substance orders specific performance of the grant agreements—a quintessentially contractual remedy,” making the CFC the exclusive forum for this suit.

While the plaintiffs argued that because Congress appropriated specific sums for RFA and MBN, they could file an APA claim to force USAGM to disburse the appropriated amounts, the governing statutes, said the court, do not give the networks an unqualified right to the appropriated funds but instead allocate funds for the networks that may be disbursed only as grants. USAGM obligated the appropriated funds through grants and the grant agreements require the government to make monthly payments to the networks, the court observed, noting that the claims of government nonpayment necessarily challenge its performance under the grants. “Such claims are squarely contract claims under the Tucker Act.”

As to the plaintiffs’ non-APA claims, including mandamus, impoundment, Presentment Clause, Appropriations Clause, Spending Clause, Take Care Clause, Separation-of-Powers, and ultra vires claims, the court found that “these constitutional claims simply flow from allegations that the Executive Branch has failed to abide by governing congressional statutes, which does not suffice to trigger the distinctively strong presumptions favoring judicial review of constitutional claims.”

Irreparable harm. Next, the court found the government established that it would face irreparable harm without a stay. Regarding the reinstatement of USAGM employees and personal-service contractors, the court stressed the Executive Branch’s significant interest in maintaining control over personnel matters. USAGM, the court observed, is responsible for presenting the government’s views and supporting U.S. foreign policy objectives” in the international community and by “depriving the Executive Branch of control over the individuals involved in its international broadcasting, the injunction threatens its prerogative to ‘speak with one voice’ on behalf of the United States in foreign affairs.”

As to restoring the grants, the court noted that absent a stay, USAGM would be forced to imminently pay out some $15 million to RFA and MBN, which they intend to immediately spend. Because the district court did not require the plaintiffs to post any injunction bond, USAGM could not recover these funds even if it should prevail on appeal.

Harm. Regarding the harms identified by the plaintiffs, including loss of employment, the possible collapse of MBN and RFA, the elimination of a union’s bargaining unit, and the removal of alien employees and contractors to countries hostile to the free press, the court pointed out that loss of government employment generally does not constitute irreparable injury especially since employees seeking to challenge their termination or placement on administrative leave may seek emergency stays from the Office of Special Counsel and the MSPB. Further, personal-service contractors can challenge their termination under the Contract Disputes Act, unions can file complaints on behalf of their members before the FLRA, and journalists may seek relief in immigration proceedings to avoid potential persecution based on their political opinions.

Public interest. Finally, as to public interest, the court explained that personnel and grant disputes directly concern the public fisc and “Congress has limited the resolution of these potentially costly claims to specialized tribunals such as the MSPB and the CFC.”

Dissent. Dissenting, Judge Pillard argued that the government was not likely to succeed on the merits. Though the government argued that the correct response to the wholesale removal of employees from the workforce was for them to proceed with a separate, identical administrative claim at the MSPB or FLRA, Judge Pillard refused to “indulge any such fiction. Defendants themselves never did. They took broad, blunt, and decisive action to gut USAGM and VOA. They sent identical notices to all VOA employees. Nothing about each decision or its execution was individualized. No employment-related rationale was offered—except the cold comfort that the action was not for any ‘disciplinary purpose.’”

In addition, Judge Pillard stated, all the employees raise constitutional claims that the government fails to acknowledge. “The agencies’ lack of expertise or capacity to address plaintiffs’ properly framed APA and constitutional claims is another reason the channeling requirement is unlikely to apply to them.”

Judge Pillard also argued that the government was not likely to succeed on the merits of its challenge to the preliminary injunction as it applies to RFA and MBN. Their asserted rights, she contended, arise from federal statutes and the Constitution and exist independent of any contract with USAGM.

Turning finally to public interest, Judge Pillard declared that “Rather than preserving the relative positions of the parties, this stay all but guarantees that the networks will no longer exist in any meaningful form by the time this case is fully adjudicated. I regret that networks charged with exemplifying the ideals of free speech, free opinion, and a free press to the world at large are silenced by our own government’s action in disregard of the expressed will of Congress—actions that, as the district court most ably explained, are likely to be found unlawful.”

The case is Nos. 25-5145, 25-5144, and 25-5151.

Judge: Per curiam.

Attorneys: Daniel M. Eisenberg (Emery Celli Brinckerhoff Abady Ward & Maazel) for Patsy Widakuswara. Kristin Bateman (Democracy Forward Foundation) for Middle East Broadcasting Networks, Inc., and Radio Free Asia. Daniel Tenny, U.S. Department of Justice, for Kari Lake.

Companies: Middle East Broadcasting Networks, Inc.; Radio Free Asia

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