Labor & Employment Law Daily Wrap Up, REMEDIES, DAMAGES—D. Mass.: Administration’s attempt to dismantle Education Department preliminarily enjoined, (May 28, 2025)

By Kathleen Kapusta, J.D.

“Not only is there no evidence that Defendants are pursuing a ‘legislative goal’ or otherwise working with Congress to reach a resolution, but there is also no evidence that the RIF has actually made the Department more efficient.”

Noting that this case arose out of the Trump administration’s attempt to shut down the U.S. Department of Education without Congressional approval, a federal court in Massachusetts granted a motion for a preliminary injunction filed by a consolidated group of plaintiffs that includes states, school districts, nonprofit organizations, and labor unions. “The Department,” said the court, “must be able to carry out its functions and its obligations under the DEOA and other relevant statutes as mandated by Congress” (State of New York v. McMahon, No. 25-10601-MJJ (D. Mass. May 22, 2025)).

On March 11, 2025, the defendants, including President Trump, the Department of Education, and the Secretary of Education, announced a massive reduction in force cutting the Department’s staff by half. On March 20, President Trump issued an executive order directing the Secretary to “take all necessary steps to facilitate the closure of the Department of Education.” On March 21, the President further announced that the federal student loan portfolio, and other programs, would be transferred out of the Department.

In consolidated actions, the plaintiffs sued, alleging that the RIF is an impermissible step toward dismantling the Department in its entirety. They also allege that the March 11 directive violates the Constitution’s Separation of Powers doctrine, the Take Care Clause of the Constitution, is ultra vires, and violates the Administrative Procedure Act (APA) because it is contrary to law and arbitrary and capricious. Moving for a preliminary injunction, the plaintiffs seek, among other things, to enjoin the agency defendants from implementing the RIF and to reinstate those federal employees terminated as part of the RIF.

Ripeness and standing. The court first found the plaintiffs’ claims were ripe for review as they do not involve uncertain or contingent events—they are based not on an actual closure of the Department, but on the effective incapacitation of the Department to carry out congressionally mandated functions. In addition, said the court, all three groups of plaintiffs—the states, school districts, and unions—have shown concrete, imminent harm sufficient to establish standing.

The states, observed the court, have experienced delays and disruptions in their receipt of primary and secondary education funding from the Department and the states and school districts have shown that uncertainty and delay stemming from the defendants’ actions are harming various state and local education agencies, colleges, and universities by making it extraordinarily difficult to plan, budget, and hire educators. Further, the union plaintiffs assert concrete injury on behalf of their members, who rely on federal student aid to afford their education and on positions created through federal work study.

Jurisdiction. Nor does the Civil Service Reform Act divest it of jurisdiction, said the court, explaining that “this case is not about unlawful terminations; this case is about the impact that those terminations have on the Department’s ability to fulfill its congressional obligations” and the plaintiffs are not “current or former employees of the Department, nor are they labor unions.” Rather, they are “local school districts and teachers’ unions that represent educators who work in state and local schools. They do not represent any federal employees at the Department of Education.”

Constitutional claims. Turning to the likelihood of success on the plaintiffs’ constitutional claims, the court explained that the EO’s direction to “facilitate the closure of the Department of Education and return authority over education to the States and location communities” goes directly against Congress’s intent in creating the Department to “supplement and complement the efforts of States, the local school systems and other instrumentalities of the States, the private sector, public and private educational institutions, public and private nonprofit educational research institutions, community-based organizations, parents, and students to improve the quality of education.” These actions, said the court, violate the separation of powers by violating the executive’s duties to take care to faithfully execute laws enacted by Congress, as well as its duties to expend funds that Congress has authorized it to appropriate.

Noting further that the defendants have publicly stated that their goal is to do away with the Department entirely, the court found this was plainly beyond the bounds of what they can do, and they did not point to any authority to the contrary. “Indeed,” said the court, “‘[t]he simple proposition that the President may not, without Congress, fundamentally reorganize the federal agencies is not controversial.’”

APA claims. As to the plaintiffs’ APA claims, the court found the agency defendants’ actions were final such that judicial review is available. Further, their actions could not fairly be categorized as mere managerial or staffing decisions that are typically afforded discretion. Further, the evidence indicated that the agency defendants “entirely failed to grapple with the potential disruption to operations and interference with statutory and non-statutory functions a sudden elimination of nearly 50 percent of the Department’s entire workforce would cause.” And while remand for further explanation by the agency is the typical remedy when the agency’s actions are held arbitrary and capricious specifically because the agency fails to provide an adequate explanation for its actions, the court also found the defendants likely acted contrary to law.

Here, said the court, “the Mass Termination amounts to a wholesale reorganization and reduction in the size and scope of the Department” in violation of the Department of Education Organization Act, which established the Department of Education. The plaintiffs, the court determined, are likely to succeed on the merits of this claim as the defendants have not pointed to any case that indicates that the Secretary’s effective dismantling of the Department is within her reorganization powers. In addition, observed the court, there are numerous federal laws that require the Department to carry out certain functions. Finally, the court continued, “to the extent that the Agency Defendants’ actions are an effective dismantling of the Department, I find that those actions are contrary to the DEOA’s mandate that the Department itself must exist—not just in name only, but to carry out the functions outlined in the DEOA and other relevant operating federal statutes.”

Irreparable harm. Next, the court found the plaintiffs met their burden of showing they are likely to suffer irreparable harm in the form of financial uncertainty and delay harming student education; impeded access to vital knowledge upon which students, districts, and educators rely; and loss of essential services provided by the office of Federal Student Aid and the Office for Civil Rights.

Balance of equities/public interest. As to the balance of equities, the court “there is a substantial public interest in having governmental agencies abide by the federal laws that govern their existence and operations.” In addition, said the court, a preliminary injunction would serve the public interest because there is a substantial risk that, without it, there will be significant harm to the functioning of public and higher education, particular in the plaintiff states.

Injunctive relief. Granting the plaintiffs’ motion for a preliminary injunction, the court enjoined the agency defendants from carrying out the RIF announced on March 11; from implementing President Trump’s March 20 Executive Order; and from carrying out the President’s March 21, 2025, Directive to transfer management of federal student loans and special education functions out of the Department. It also ordered the agency defendants to reinstate federal employees whose employment was terminated or otherwise eliminated on or after January 20, 2025, as part of the RIF announced on March 11 to restore the Department to the status quo such that it is able to carry out its statutory functions.

The case is No. 25-10601-MJJ.

Judge: Joun, M.

Attorneys: Jessica L Palmer, Office of the Attorney General, for State of New York. David Dana Day, Department of the Attorney General, for State of Hawaii. Lucia Choi, Office of the Attorney General, for State of California. Brad P. Rosenberg, U.S. Department of Justice, for Linda McMahon.

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