Labor & Employment Law Daily Wrap Up, PROCEDURE—D. Mass.: Court adopts bifurcated approach to jurisdictional question regarding canceled teacher training grants, (Nov 14, 2025)

By Todd Harrison, J.D.

Drawing upon various Supreme Court opinions and undisturbed precedent, the court held that retrospective and prospective claims must be analyzed separately.

Partially granting the federal government’s motion to dismiss claims brought by several plaintiff states concerning the cancellation of teacher training grants, a federal district court in Massachusetts determined that it lacked jurisdiction over the grants that were already terminated, as the Tucker Act vests jurisdiction to the Court of Federal Claims. However, the court kept the door open for a remedy on the prospective claims, explaining that if it found the government’s actions to be unlawful under the APA and the Constitution, the grantees may file suit in the Court of Federal Claims to request money damages under the contract. This approach preserves binding authority and upholds systemic stability as intended by the doctrine of stare decisis, said the court (State of California v. U.S. Department of Education, No. 25-CV-10548-AK (D. Mass. Nov. 13, 2025)).

Congress established the Teacher Quality Partnership (TQP) and the Supporting Effective Educator Development (SEED) grant programs in 2008 and 2011, respectively. The programs were established to help train, place, and support teachers in an effort to address a nationwide teacher shortage.

Grants terminated. In January 2025, President Trump issued a series of executive orders targeting programs believed to be based on DEI principles. TQP and SEED recipients found themselves in the crosshairs and began receiving letters on February 7 informing them that their grants were going to be terminated. At the time of the grant terminations, there were more than 40 TQP and SEED programs across the eight plaintiff states, with total grant awards exceeding $250 million.

Lawsuit. On March 6, the plaintiff states filed a complaint in the District of Massachusetts against the government alleging that its termination of grants under the TQP and SEED programs violated the APA. They also moved for a temporary restraining order to restore them to their original status prior to the grants’ termination and to prevent the government from trying to reinstate the termination. A TRO was issued effective until March 24, which was subsequently converted to a motion for a preliminary injunction. The government’s motion to stay was denied by the First Circuit, and the district court extended the TRO until its decision on the preliminary injunction was made.

The government then applied to the Supreme Court for vacatur of the TRO and an administrative stay. The Supreme Court granted the government’s motion. The plaintiff states then withdrew the TRO-turned-preliminary injunction motion in the district court and it was subsequently terminated as moot. The government submitted an unopposed motion to dismiss the TRO appeal in the First Circuit, which was then voluntarily dismissed.

On May 12, the government submitted a motion to dismiss for lack of jurisdiction, or, in the alternative, to transfer to the Court of Federal Claims, arguing the district court lacked subject-matter jurisdiction based on the Tucker Act and caveats within the APA.

Amended complaint. Following this motion, the plaintiff states filed an amended complaint on June 2. They maintained their initial claims regarding substantive violations of the APA, while adding four additional claims, including constitutional claims and ultra vires allegations. Because of this amended complaint, the government’s original motion to dismiss was terminated as moot.

On June 30, the government moved to dismiss the amended complaint and submitted a second motion to dismiss for lack of jurisdiction, or, in the alternative, to transfer to the Court of Federal Claims. The plaintiff states opposed the motion. This motion is what was presently before the court.

Supreme Court guidance. At the outset, the court noted the importance of the doctrine of stare decisis. However, it noted that not all Supreme Court writings are equal, explaining that emergency docket orders often involve preliminary judgments without the benefit of robust briefing. However, a judicial decision’s reasoning, or ratio decidendi, can help guide lower courts to uniform conclusions.

In this instance, the Supreme Court granted the emergency application to stay the TRO via an unsigned, per curiam opinion, leading to confusion among the courts over its precedential value. The confusion is warranted, said the court here, given there is another Supreme Court case, Bowen v. Massachusetts, 487 U.S. 879 (1988), which has been the primary authority on explaining the distinction between an action at law for damages and an equitable action for specific relief. Because the Supreme Court neither distinguished its holding from nor explicitly overruled Bowen, courts have continued to apply the precedent established by Bowen.

The confusion somewhat abated in August 2025, continued the court. For a third time, the Supreme Court issued a per curiam opinion granting a partial stay in National Institutes of Health v. American Public Health Association, 145 S. Ct. 2658 (2025) (APHA). The opinion was accompanied by five separate concurring opinions, each reflecting a distinct rationale.

Upon review of the concurring opinions, the court here noted that Justice Barrett attempted to establish a middle ground for these types of cases, writing in support of a two-track litigation bifurcating vacatur claims in the district court while sending terminated grants to the Court of Federal Claims. This, she stated, requires the plaintiffs to proceed sequentially rather than simultaneously.

The law for now. Like its predecessors, APHA lacked the ratio decidendi explaining why terminated grants must be separated from the challenged actions that terminated them. However, the court here stated that it can “take a hint,” and could “accept this is law until and if the Supreme Court changes its views about the Tucker Act.”

Accordingly, drawing upon various Supreme Court opinions and the undisturbed Bowen precedent, the court here held that retrospective and prospective claims must be analyzed separately, noting that the divergent views among the justices on how to apply these categories nevertheless informed the current approach to the issue.

New claims. Directing its attention to the case at hand, the court here joined the consensus of courts that have addressed the jurisdiction of claims requesting the repayment of grant terminations from federal agencies, which is that such claims belong in the Court of Federal Claims. However, the court noted that there was a notable change between this case’s initial filing in March 2025 and today—an amended complaint. As such, the court was required to address the government’s motion to dismiss in light of this new operative complaint which, in addition to the APA claims, also alleged that the government’s actions violated the Spending Clause, the separation of powers, and are ultra vires. Thus, the court was tasked with determining whether the amended complaint’s new claims vested jurisdiction with the court. Consistent with the framework described in APHA, the court bifurcated its analysis for terminated and prospective claims.

Rights and remedies. The jurisdictional boundary between the Tucker Act and the APA “is well- traversed by litigants seeking relief against the federal government,” said the court. Courts must look to the substance of the claim to determine whether the essence of the action is in contract. Such an inquiry encompasses two distinct aspects—the source of the rights upon which a plaintiff bases its claim and the type of relief sought.

Applying this rights and remedies framework to the terminated grants, the court agreed with the government that the source of rights stemmed from the grant agreements, which bore all the essential characteristics of a contract.

As to the relief sought, the government contended that the plaintiff states were seeking contractual remedies. The plaintiff states in turn argued that they were only seeking relief that involves “vacating, declaring unlawful, and enjoining Defendants’ actions.” The court was not moved.

“No matter how Plaintiff States manufacture their relief for terminated grant agreements, they are requesting disbursement of funds,” said the court. Accordingly, the court found that an injunction to correct the government’s unlawful agency action with regard to the terminated grants was, in effect, a request for disbursement under the terminated grants.

Tucker Act applies. Here, explained the court, the Tucker Act applied to these claims as the terminated grants are “any express or implied contract with the United States.” 28 U.S.C. § 1491(a)(1). As such, the Tucker Act vests jurisdiction away from the federal court and to the Court of Federal Claims for the terminated grants. Thus, the government’s motion to dismiss was granted with respect to the terminated grant agreements.

Prospective relief. Turning to the plaintiff states’ request for prospective relief, the court noted that these claims were grounded in the request to set aside unlawful agency actions, which was precisely the issue examined by Bowen. There, the Supreme Court concluded that “the District Court had the authority to hold unlawful and set aside agency action that it found to be not in accordance with law,” as the Court of Federal Claims “does not have the general equitable powers of a district court to grant prospective relief.”

Rejecting the government’s contention the plaintiff states’ entire lawsuit sounds in contract, the court explained that the amended complaint clearly requests that the court vacate and set aside agency directives. The states’ interest in procedural regularity and predictability of how the Department of Education will award grants in the future is distinct from their interest in obtaining retrospective monetary relief from the terminated grants.

Accordingly, it was clear that vacatur of the agency’s actions and enjoining its prospective implementation was equitable, prospective relief that must be addressed under the APA by the present court. This conclusion, continued the court, comported with APHA.

Constitutional, ultra vires claims. Next, the court considered the plaintiff states’ claim that the government violated the Spending Clause and the separation of powers, and it acted ultra vires. The court noted that these claims did not seek relief based on the already terminated grant agreements, and as such did not fall within the bounds of the Tucker Act. The court explained that this was not to say that the plaintiff states would prevail on these claims, only that the Tucker Act does not offer an alternative path to review for the plaintiff states to vindicate their rights and there is no jurisdictional barrier to review their constitutional and ultra vires claims. Accordingly, the court denied the government’s motion to dismiss all claims not related to the terminated grants.

The case is No. 25-CV-10548-AK.

Judge: Kelley, A.

Attorneys: Laura L. Faer, Office of the Attorney General, for State of California. Adelaide H. Pagano, Massachusetts Attorney General's Office, for Commonwealth of Massachusetts. Amanda I. Morejon, New Jersey Attorney General's Office, for State of New Jersey. Michael Fitzgerald, U.S. Attorney's Office, for U.S Department of Education.

Cases: Procedure GovernmentContracts RemediesDamages MassachusettsNews GCNNews