Another Court Blocks DEI-Related Certification Requirement

On March 27, 2025, U.S. District Judge Matthew Kennelly of the United States District Court for the Northern District of Illinois issued a temporary restraining order (TRO) prohibiting the Department of Labor (DOL) from enforcing certain provisions of Executive Orders 14173 (Ending Illegal Discrimination and Restoring Merit-Based Opportunity) and 14151 (Ending Radical and Wasteful Government DEI Programs and Preferencing) against Chicago Women in Trades (CWIT), a domestic nonprofit that receives federal funding from the DOL. The court found that Executive Order (EO) 14173’s certification provision, which sought to require CWIT to certify that it does not operate any programs “promoting DEI that violate any applicable Federal anti-discrimination laws,” is problematic because the EO does not define what constitutes “illegal” DEI activities, and that the CWIT is likely to succeed on the merits of their claim that the certification provision violates the First Amendment of the U.S. Constitution. The court precluded the federal government from initiating any False Claim Act enforcement action against CWIT pursuant to the certification provision.[1]

Furthermore, the court determined that the federal government’s enforcement of its policy through EO 14151’s “termination provision,” which — as relevant to the court’s TRO — orders the government to “terminate, to the maximum extent allowed by law . . . all ‘equity action plans,’ ‘equity’ actions, initiatives, or programs, ‘equity-related’ grants or contracts” would cause irreparable harm to CWIT.

While the court’s ruling on EO 14151’s termination provision applies only to CWIT, its ruling on EO 14173’s certification provision extended to all grants and contracts controlled by the DOL, stating that the DOL “shall not require any grantee or contractor to make any ‘certification’ or other representation” contemplated by the provision. The TRO does not extend to other federal agencies.

The TRO will remain in effect for 28 days, and a hearing is scheduled for April 10, 2025, to determine whether the TRO should be converted into a preliminary injunction.

Compliance Obligations Under EOs 14151 and 14173

As previously reported, President Trump signed EO 14151 and EO 14173 on January 20 and 21, 2025, revoking various earlier executive orders, including EO 13985 (a Biden administration executive order requiring federal agencies submit “Equity Action Plans”) and EO 11246 (a longstanding executive order that required certain federal contractors to maintain affirmative action plans). As we noted articles published on February 24 and March 17, the courts have been asked to address the EO’s application and implications to various employers and businesses.

Of particular concern has been the language in EO 14173 requiring contracts and grants to include a term that “compliance in all respects with all applicable Federal anti-discrimination laws is material to the government’s payment decisions for the purpose of section 3729(b)(4) of title 31, United States Code” (the False Claims Act)” as well as requiring contractors and grant recipients “to certify, that [they do] not operate any programs promoting DEI that violate any applicable Federal anti-discrimination laws.”

Consistent with the requirements of EO 14173, some government agencies have begun to issue DEI self-certification forms to contractors and grant recipients to complete and return.

Compliance Implications

Organizations that contract with or seek to contract with the federal government should take proactive steps to ensure compliance with EO 14173 and EO 14151. This includes conducting risk assessments to identify potentially noncompliant DEI or DEIA policies. Organizations should also review and update internal training programs to reflect current obligations under the civil False Claims Act, ensuring training is tailored to relevant operational roles. For additional guidance or support, please contact your Foley & Lardner LLP attorney who can direct you to someone able to assist you in this evolving space.

[1] This reporting adds to our previous article published on April 3, 2024.

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