New Administration Outlook: Key Provisions of Trump DEI Orders Blocked

On Friday, the U.S. District Court for the District of Maryland issued a preliminary injunction against several provisions of two executive orders signed by President Trump that sought to dismantle diversity, equity, and inclusion ("DEI") initiatives across federal agencies, contractors, and the private sector. This ruling, delivered by Judge Adam B. Abelson, represents a significant victory for organizations advocating for DEI and constitutional protections—but doesn't eliminate the risks posed by a hostile administration and evolving legal landscape to DEI and related initiatives, even in the private sector.

The Executive Orders at Issue

The challenged provisions stem from two executive orders in which Plaintiffs sought to enjoin three specific provisions:

• The "Termination Provision" (in the "J20 Order") directed federal agencies to terminate all "equity-related" grants or contracts.
• The "Certification Provision" (in the "J21 Order") imposed certification requirements on federal contractors and grantees to affirm they do not operate DEI programs that allegedly violate federal anti-discrimination laws.
• The "Enforcement Threat Provision" (also in the J21 Order) directed the attorney general to develop enforcement strategies targeting DEI programs in the private sector. This provision directed further: "As a part of this plan, each agency shall identify up to nine potential civil compliance investigations of publicly traded corporations, large non-profit corporations or associations, foundations with assets of 500 million dollars or more, State and local bar and medical associations, and institutions of higher education with endowments over 1 billion dollars."

Following the J20 and J21 Orders, on February 5, 2025, Attorney General Pamela Bondi issued a memorandum for all Department of Justice ("DOJ") employees subject-lined, "ENDING ILLEGAL DEI AND DEIA DISCRIMINATION AND PREFERENCES" (Feb. 5, 2025) (the "Bondi Memo"). The Bondi Memo directs the Civil Rights Division of the DOJ, together with the Office of Legal Policy, to submit a report to the Associate Attorney General, by March 1, 2025, outlining, among other things, a plan "including proposals for criminal investigations and for up to nine civil compliance investigations" of particular entities. Id. at 2.

But those initiatives are now halted. Plaintiffs, including the National Association of Diversity Officers in Higher Education ("NADOHE"), the American Association of University Professors ("AAUP"), and the City of Baltimore, argued that these provisions were unconstitutional, vague, and posed a chilling effect on free speech—and they prevailed.

Key Findings Supporting the Injunction

The court's nationwide injunction (meaning that it was not limited to the Plaintiffs in the case) held that Plaintiffs were likely to succeed on the merits of their claims, particularly under the First and Fifth Amendments.

Termination Provision

The court ruled that the directive to terminate "equity-related" grants or contracts was unconstitutionally vague. Terms like "equity-related" were undefined, leaving federal contractors and grantees uncertain about what activities might trigger termination. This vagueness invited arbitrary and discriminatory enforcement and failed to provide fair notice, violating due process protections under the Fifth Amendment.

Certification Provision

The court observed that "[t]he language of the Certification Provision makes clear that the sole purpose of the provision, regardless of the individualized implementation by executive agencies, is for federal contractors and grantees to confirm under threat of perjury and False Claims Act liability that they do not operate any programs promoting DEI that the government might contend violate federal anti-discrimination laws." The court then stated: "Because even the government does not know what constitutes DEI-related speech that violates federal anti-discrimination laws, Plaintiffs have easily shown a likelihood that they will prevail in proving that the Certification Provision operates as a content-based prior restraint on their speech, and likely will also prevail in showing that the Certification operates as a facially viewpoint-discriminatory order as well." The court further found this provision violated the First Amendment by chilling speech related to DEI, even outside the scope of federally funded activities. The court emphasized that the government cannot leverage funding to suppress speech on matters of public concern.

Enforcement Threat Provision

The court here observed that "[t]he Enforcement Threat Provision applies broadly to the private sector; therefore, unlike with the other provisions, the analysis is based on pure private speech regulated by the First Amendment as opposed to the speech of federal contractors or grantees." Further, "[t]he White House and Attorney General have made clear, through their ongoing implementation of various aspects of the J21 Order, that viewpoints and speech considered to be in favor of or supportive of DEI or DEIA are viewpoints the government wishes to punish and, apparently, attempt to extinguish." The court held that the directive to the Attorney General to deter DEI programs in the private sector constituted a viewpoint-based restriction on speech, targeting pro-DEI perspectives while ignoring other viewpoints. The court also ruled that the provision was unconstitutionally vague as it failed to define what constituted "illegal DEI discrimination or preferences." In other words, because the J21 Order seeks to limit what companies can say about DEI, it violates the First Amendment; and because it seeks to enforce those limits based on undefined standards, it also violates heightened principles of due process actionable under the First Amendment.

Broader Implications

The court's decision underscores the constitutional limits on executive power, particularly when it comes to regulating speech and imposing vague mandates. Judge Abelson noted that the provisions not only infringed on free speech but also created widespread uncertainty, leading to self-censorship among federal contractors, grantees, and private sector entities.

The ruling also highlights the importance of DEI initiatives in fostering inclusion and addressing systemic inequities. Plaintiffs successfully argued that the executive orders threatened the livelihoods of DEI professionals, the viability of DEI programs, and the broader mission of promoting equity in education, employment, and beyond.

At the same time, the injunction's protections should not be overstated—especially with respect to the Enforcement Threat Provision. Decisions like Students for Fair Admissions, Inc. v. President & Fellows of Harvard College, 600 U.S. 181 (2023), American Alliance for Equal Rights v. Fearless Fund Mgmt., LLC, 103 F.4th 765 (11th Cir. 2024), and American Alliance for Equal Rights v. Founders First Community Development Corp., 2024 WL 3625684 (N.D. Tex. July 31, 2024) have broadly interpreted federal civil rights laws to proscribe conduct that employs racial preferences and eligibility criteria in grantmaking, contracting, and program admissions—even for remedial purposes, and even where closely tied to expressive activities arguably shielded by the First Amendment. The Enforcement Threat Provision, in particular, may accordingly have a hypothetically legitimate sweep against private entities to the extent limited to conduct that violates 42 U.S.C. § 1981 and related anti-discrimination statutes.

Thus while the current J21 Order may be so vague that the Enforcement Threat Provision (for example) results in the overbroad regulation of speech, nothing prevents the Administration from curing that overbreadth by limiting the provision's sweep to restrict conduct ostensibly proscribed by existing law. A reviewing appellate court could similarly spare the Enforcement Threat Provision by construing it to have that meaning. Cf. United States v. Hansen, 599 U.S. 762 (2023) (sparing an otherwise overbroad regulation of speech by construing it narrowly to reach only unprotected speech activities integral to established criminal conduct). And in all events, nothing about the injunction against the J21 Order prevents the Department of Justice, Department of Labor, Internal Revenue Service, or Department of Education from independently exercising their existing authority to enforce violations of what they may contend constitute violations of existing law. All of those risks remain.

What's Next?

The Department of Justice has appealed the decision and moved for a stay of the injunction in the district court pending appeal. If that stay is denied, it will likely renew its request before the U.S. Court of Appeals for the 4th Circuit before merits briefing. Like many legal battles teed up by this Administration, the dispute will likely be litigated up to the Supreme Court. 

In the meantime, the district court's order provides some clarity at least with respect to the constitutional hurdles that would need to be overcome in order to bring civil actions, or criminal charges, against companies maintaining DEI programs. The preliminary injunction also halts not just the Enforcement Threat Provision, but also the Termination and Certification Provisions while the case proceeds. As noted, the injunction will not stop the Attorney General and other federal regulators from independently enforcing existing law. Nor will it stop them from preparing reports or even initiating investigations under the J21 Order, provided they do not result in actual enforcement actions.

Clients in the private sector interested in maintaining their programs should nevertheless take some degree of relief from this order that their programs enjoy constitutional protections, and especially if they craft those policies to ensure that nothing about them would violate federal anti-discrimination laws (as many companies' policies, obviously, do not).

Clients who are federal contractors or grant recipients that have received termination notices stemming from the J20 or J21 Orders may want to contact their contracting and grant officials to confirm the status of their awards and, specifically, whether such termination notices will be rescinded. And grantmakers, employers, and educational institutions that employ DEI and related programming may consider aligning their operations to fall within the protected zone identified by the court.

We will continue to monitor this case as it progresses.