A federal appeals court on Friday rejected a request from President Donald Trump’s administration to pause a judge’s order requiring the reinstatement of National Institutes of Health (NIH) research grants that were abruptly canceled earlier this year.
In a unanimous decision, the U.S. Court of Appeals for the First Circuit declined to stay a July 2 ruling by U.S. District Judge William Young — a Reagan appointee — who found that the Trump administration’s actions were “unlawful” and carried out with “haste to appease the Executive,” in violation of the Administrative Procedure Act (APA). The court said it found “no obvious error” in Judge Young’s conclusion that the government’s moves “bear all the hallmarks of arbitrary and capricious decision-making.”
The plaintiffs in the case — a coalition of public health groups led by the American Public Health Association — had warned of significant economic and non-economic harm to public health, scientific research, and medical innovation. The appeals court agreed, noting that the Department of Justice failed to address those harms or offer sufficient justification for the mass cancellation of the grants.
“The Department fails to address any of the non-monetary harms that the plaintiffs detailed, which cannot be remedied by belated payment,” the First Circuit wrote. “Thus, the Department has failed to show that the plaintiffs would not suffer substantial harm if the district court’s orders were stayed.”
The court further emphasized the broader consequences of halting NIH funding, stating that a stay would likely delay life-saving research “by years, if not decades,” and cut support for addressing critical public health challenges. As the appellate panel put it: “These are serious concerns that suggest the public’s interest is aligned with the plaintiffs, at least at this stage of the proceedings — not with the Department.”
Judge Young’s ruling faulted the Department of Government Efficiency (DOGE) for rapidly rubber-stamping the NIH cancellations — some approved within two minutes of being requested by email — without meaningful review or explanation. While acknowledging that every administration has the authority to reshape policy, the court emphasized that such changes must follow a reasoned and lawful process.
“The agencies that implement those changes have to have a reasoned and reasonable explanation for doing so,” Judge Young wrote.
According to the First Circuit, the administration’s rationale lacked substance. The district court had found that the prohibited categories of grants were never clearly defined — effectively allowing DOGE to terminate any NIH grant arbitrarily. The government’s claim that NIH had simply reevaluated its priorities was unsupported by evidence in the court record.
In fact, the appeals court highlighted how the lower court “found the exact opposite” — that the grant terminations were rushed, vague, and legally flawed.
This marks the second time in a matter of weeks that the First Circuit rebuffed the Trump administration over this issue. On July 4, the court rejected an earlier attempt to stay Judge Young’s initial nullification order, which required that the rescinded NIH grants be restored.
Controversial Executive Orders at the Center
The NIH funding controversy stems from executive orders issued earlier this year by President Trump targeting diversity, equity, and inclusion (DEI) initiatives, as well as research tied to so-called “gender ideology.” Those directives prompted NIH and DOGE to terminate hundreds of grants.
During trial proceedings in June, Judge Young sharply criticized those executive actions. He warned that the policies appeared to reflect discriminatory intent against racial minorities and LGBTQ Americans.
“I am hesitant to draw this conclusion — but I have an unflinching obligation to draw it — that this represents racial discrimination and discrimination against America’s LGBTQ community,” Judge Young said from the bench. “That’s what this is. I would be blind not to call it out. My duty is to call it out.”
By June 23, the court issued a formal vacatur of the NIH grant terminations, describing them in an all-caps conclusion as:
“OF NO EFFECT, VOID, ILLEGAL, SET ASIDE AND VACATED.”
As litigation continues, the Trump administration is expected to pursue a full appeal. But for now, the NIH must begin restoring the research grants — a move public health advocates have praised as essential to maintaining scientific progress and protecting vulnerable communities.
