WASHINGTON — Four people familiar with the discussions say that U.S. Agency for International Development employees and contractors are talking about possible lawsuits against the government agency in response to the unprecedented onslaught by President Donald Trump’s administration.
In the face of legislative legislation that established and funded the agency and its programs, lawsuits based on revenue loss could be used to raise serious constitutional issues regarding presidential power.
As Trump attempts to unilaterally reshape the federal government without the consent of Congress, these lawsuits would be the most recent in a series challenging his aggressive and unprecedented use of executive action. It is anticipated that more will follow, as he is accused of lacking the legal right to do so.
The Trump administration has so far blocked foreign funding, shut down USAID’s offices in Washington, and said that many staff members worldwide will be placed on administrative leave.
Nonprofit organizations and businesses with agency contracts may file claims based on losses resulting from the government’s breach of contract.
According to a senior official of a USAID contractor, certain businesses that depend on USAID contracts face impending bankruptcy if payments are not provided.
The organization’s goal of helping the poor has been abandoned in the meanwhile, and vital aid that was en route is currently in limbo.
According to a lawyer involved in strategic discussions, the nonprofit organizations are anticipated to allege, among other things, that the government has broken the Administrative Procedure Act, which mandates that agencies adhere to the proper legal processes prior to making decisions.
Courts have the authority to invalidate an action that they believe to be “arbitrary and capricious” under that statute.
Plaintiffs could also claim that the administration is illegally withholding monies that Congress has appropriated and contest the legitimacy of Elon Musk’s alleged Department of Government Efficiency.
The opponents can ask for an urgent injunction to stop Trump’s actions, which go against Congress’s authority to pass laws on these matters. It’s unclear if Trump plans to completely dissolve the agency, as Musk has stated, or if he plans to significantly reform it.
Which particular contractors would be involved in any prospective litigation could not be confirmed by NBC News.
In a separate statement, the government employee union, the American Foreign Service Association (AFSA), stated that it “plans to take legal action in the days ahead” in response to the agency’s decision to recall foreign employees.
Randy Chester, the group’s vice president for USAID, told NBC News that many law firms had been contacted for advice and direction on what can be done.
Unfortunately, we have very little recourse because they will lose a huge workforce, and ultimately, America loses. “America loses if USAID closes,” he continued.
According to legal scholars, a federal agency established by Congress cannot be abolished by the president. Originally created by executive order in 1961, USAID was subsequently codified in a legislation passed by Congress in 1998.
According to Richard Briffault, a professor at Columbia Law School, the president cannot unilaterally dissolve USAID by executive order, even though he might oversee more collaboration between USAID and the State Department and possibly even transfer parts of its tasks.
In a letter to senators on Monday, Secretary of State Marco Rubio, who has taken over as head of USAID, seemed to finally comply with a more recent law that mandates the executive branch inform Congress on any proposed reorganization.
The most current notification regarding worldwide personnel was the sole content on the USAID website as of Wednesday afternoon. A request for comment was not immediately answered by the State Department.