The Nov. 4 order nullifies the requirement nationwide and ends a months-long legal challenge brought by 20 states. The directive touched nearly every stream of federal capital assistance that state transportation agencies rely on.

The dispute centers on an April 24 directive from Transportation Secretary Sean Duffy instructing governors, state DOTs and transit agencies to both certify compliance with federal immigration-detainer requests and remove “policies, programs or activities premised on prohibited classifications” that federal DOT applied to a range of DEI initiatives. 

Agencies that declined to comply risked having federal awards suspended or canceled.

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California, Rhode Island and 18 other states— all but one led by Democratic governors—filed suit May 13 in the Rhode Island court, arguing the directive exceeded department authority and attempted to impose conditions Congress never authorized under the Infrastructure Investment and Jobs Act or any other transportation statute. 

The 123-page complaint asserts that federal law contains no provision allowing DOT to condition Federal Highway Administration, Federal Transit Administration of Federal Railroad Administration funds on cooperation with immigration enforcement.

No Basis in Law

In his ruling, Chief Judge John J. McConnell Jr. found that DOT did not identify statutory authority for its immigration enforcement condition and violated the Administrative Procedure Act’s clear-statement and reasoned-decisionmaking requirements. 

Applying the Supreme Court’s Spending Clause framework under South Dakota v. Dole, McConnell concluded the condition lacked the required “relatedness,” writing that DOT presented “no plausible connection” between immigration-enforcement cooperation and the purposes Congress established for federal transportation programs.

The court reinforced findings from a June 19 preliminary injunction, when several states submitted declarations stating that compliance with the directive would require agencies to violate state civil-rights or sanctuary statutes. 

Those filings also described uncertainty for infrastructure act-funded work already under contract and for upcoming grant cycles, prompting agencies to pause internal compliance reviews until the court clarified DOT authority.

Programs administered by the Federal Highway Administration, Federal Transit Administration, Federal Railroad Administration, National Highway Traffic Safety Administration and Pipeline and Hazardous Materials Safety Administration were identified in the complaint as subject to the condition. 

Because DOT indicated the directive applied to all federal grantmaking, major competitive programs—including RAISE, INFRA, MEGA and FTA’s Capital Investment Grants—also faced potential exposure. 

Together, these formula and competitive programs distribute tens of billions of dollars annually for highway, transit and rail capital improvements. A post-ruling legal analysis states that McConnell’s decision vacates the condition from all DOT grant agreements nationwide. The docket shows no stay request or notice of appeal filed by the agency as of Nov. 6.

Nationwide Relief

The ruling’s nationwide sweep comes as the U.S. Supreme Court has sharply limited lower courts’ ability to issue such broad injunctions. 

In a June decision, the high court held that district courts “generally cannot prohibit the government from enforcing a law or executive action against non-parties to a lawsuit,” according to a Sidley law firm legal analysis. 

Other legal experts have made similar observations. A Dorsey & Whitney client alert noted that the scope of a federal court’s injunction must be “cabined to what is ‘necessary to provide complete relief to each plaintiff with standing to sue.’” 

Legal observers say that while no party has sought a stay or appealed the scope of the order, the breadth of relief in California et al. v. U.S. DOT could draw scrutiny under the court’s new standard.

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State officials praised the clarity the ruling provides. Rhode Island Attorney General Peter F. Neronha said the decision reaffirms the requirement that transportation dollars must be tied to statutory purposes. 

 “[USDOT] blatantly overstepped their statutory authority, violated the APA and transgressed well-settled constitutional limitations on federal funding conditions," he said. "The ability of Rhode Islanders to travel on safe roads and bridges cannot hang on the political whims of one man,”

Neronha praised the restorative certainty for long-planned work dependent on multi-year federal awards.

California Attorney General Rob Bonta said the ruling confirms arguments the coalition advanced when the suit was filed.  “Today, a court definitively rebuked the Trump Administration’s illegal efforts to withhold critical public safety funding from states that refuse to carry out his mass deportation agenda,” he said.

Massachusetts Attorney General Andrea Campbell said the ruling protects “billions of dollars” in planned transportation improvements. She said the decision prevents the administration from forcing states into enforcement strategies that have “no bearing on transportation mobility or safety.”

Infrastructure attorneys say the ruling also reinforces procedural expectations for federal agencies. Ayelet Hirschkorn, a partner at Kaplan Kirsch in New York, said the decision “amplifies the importance of following established rulemaking processes to ensure that transit agencies have sufficient time to comment on proposed changes that affect current and future projects.”

She said by email that the ruling offers added reassurance that agencies can advance infrastructure work without facing “the difficult choice of foregoing federal funds that are key to the projects’ success.”

Hirschkorn noted that by declaring the restriction void on its face, the order affects all 50 states—an outcome that differs from asserting broad injunctive relief and one that may invite future scrutiny under the Supreme Court’s ruling in Trump v. CASA. She said she is not aware of any decision by the administration on whether it will appeal.

USDOT has not issued a public statement in response to the ruling and did not respond to multiple inquiries from ENR and other outlets as of Nov. 6. The court stated that it will continue to consider any remaining issues in the case, but the core conditions have been permanently barred.