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US President Donald Trump suffered a legal setback on Tuesday as a federal appeals court declined to pause a ruling requiring his administration to continue delivering federal funds, marking the first appellate court defeat since his return to office.
The Boston-based 1st US Circuit Court of Appeals denied the Justice Department’s request to suspend an order issued by US District Judge John McConnell in Rhode Island. The judge had ruled on Monday that the Trump administration defied his earlier January 31 decision by continuing to withhold billions in federal funding.
The Justice Department argued that McConnell’s ruling amounted to “intolerable judicial overreach,” contending that Trump had the authority to direct federal agencies in line with his policy priorities. However, the three-judge appellate panel responded with a short order stating it was confident McConnell would address the administration’s concerns and clarify whether his ruling restricted Trump’s lawful executive authority.
The panel included US Circuit Judges David Barron, Lara Montecalvo, and Julie Rikelman—all appointees of Democratic presidents. While the court did not entirely block the administration from contesting McConnell’s order, it allowed the Justice Department to submit additional arguments by Thursday.
The White House swiftly denounced the ruling, with press secretary Karoline Leavitt calling the injunctions “a continuation of the weaponisation of justice against President Trump.”
Trump himself took to social media, claiming that “certain activists and highly political judges want us to slow down, or stop,” his administration’s efforts to cut government waste. His ally, billionaire Elon Musk, echoed the criticism, writing on social media that “Democracy in America is being destroyed by judicial coup,” after calling for the impeachment of a judge in New York who barred his Department of Government Efficiency from accessing Treasury Department systems.
Such remarks have heightened concerns over whether the Trump administration will comply with court rulings. The American Bar Association warned on Monday of “wide-scale affronts to the rule of law itself” under Trump’s leadership.
The lawsuit before McConnell was filed by Democratic attorneys general from 22 states and the District of Columbia after the White House’s Office of Management and Budget (OMB) announced a spending freeze affecting trillions of dollars. Though the OMB later withdrew the memo, McConnell ruled that a temporary restraining order was still necessary, citing evidence that the administration’s funding freeze remained in effect.
The Democratic attorneys general have urged McConnell to enforce his order, accusing the administration of continuing to withhold billions in infrastructure and environmental funds tied to the Inflation Reduction Act and the Infrastructure Improvement and Jobs Act.
Rhode Island Attorney General Peter Neronha, a leading figure in the litigation, welcomed the appellate court’s decision, stating it ensured that McConnell’s “order remains in full force, and we expect the administration to comply.”
The case is one of several lawsuits in which Democratic-led states and civil rights organisations have successfully blocked Trump’s efforts to reduce the federal government, cut spending, and tighten immigration policies. With legal battles mounting, the administration faces increasing judicial pushback on its policy agenda.
Melissa Enoch
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