Community Legal Services in East Palo Alto v. U.S. Department of Health and Human Services
Case Overview
Nonprofit organizations that provide legal counsel to unaccompanied immigrant children, led by Community Legal Services in East Palo Alto, sued the U.S. Department of Health and Human Services, its Office of Refugee Resettlement, and the Interior Department before Judge Araceli Martinez-Olguin in the Northern District of California (No. 3:25-cv-02847). They challenged the government's abrupt termination of the funding that pays for lawyers to represent unaccompanied children in immigration court. The court granted a nationwide preliminary injunction restoring that funding.
The Interior Department sent the Acacia Center for Justice, the sole contractor for direct legal-representation services, a cancellation order directing it to "immediately stop all work," cutting off funding for counsel for unaccompanied children in immigration proceedings.
The court entered a temporary restraining order (ECF 33) enjoining the cancellation while it considered a preliminary injunction.
Judge Martinez-Olguin granted a nationwide preliminary injunction (ECF 87), finding the plaintiffs likely to succeed on their claim that the funding termination violated the Trafficking Victims Protection Reauthorization Act and the Office of Refugee Resettlement's own Foundational Rule, and enjoining the government from withdrawing the funding.
The plaintiffs filed an emergency motion to enforce the injunction (ECF 166), arguing the government had again stopped funding the legal representation the court had ordered restored.
Judge Martinez-Olguin granted the motion to enforce (ECF 172), ordering the government to release the funds it had withheld since December 2025 by noon the next day and to certify that it had done so. She rejected the government's attempt to recast the dispute as a mere contract disagreement, and, noting that the government's contract with the Acacia Center for Justice had expired July 31, 2026 leaving no mechanism for compliance, she ordered the government to report by August 13, 2026 on how it would keep funding counsel for unaccompanied children.
The Facts
Since 2012 Congress has appropriated funds for direct legal representation of unaccompanied children in immigration proceedings, a scheme built on the Homeland Security Act and the Trafficking Victims Protection Reauthorization Act (TVPRA) and implemented through the Office of Refugee Resettlement's (ORR) Foundational Rule. Those appropriations remained available, including funds appropriated as recently as March 15, 2025.
On or about March 20, 2025, ORR partially terminated the contract funding direct legal representation, and on March 21 the Interior Department directed the Acacia Center for Justice, the sole contractor, to "immediately stop all work." The plaintiff nonprofits, which represent unaccompanied children, were forced to issue layoff notices. They sued and obtained a temporary restraining order, then moved for a preliminary injunction.
The Issue
Whether the government's termination of funding for legal representation of unaccompanied children violated the Administrative Procedure Act as contrary to the TVPRA and ORR's Foundational Rule; whether the plaintiffs showed irreparable harm and that the equities and public interest favored relief; and whether any injunction should extend nationwide.
The Rules
HHS must ensure, to the greatest extent practicable, that all unaccompanied alien children have counsel to represent them and to protect them from mistreatment, exploitation, and trafficking.
ORR shall fund legal service providers to provide direct immigration legal representation for certain unaccompanied children, to the extent appropriations are available.
A reviewing court shall hold unlawful and set aside agency action found to be arbitrary, capricious, or contrary to law, relief that may reach nationwide.
A movant must show likelihood of success, irreparable harm, that the balance of equities tips in its favor, and that an injunction serves the public interest.
The Application
The court found the plaintiffs likely to succeed: cutting the funding, while appropriations remained available, conflicted with the TVPRA's command that HHS ensure unaccompanied children have counsel and with ORR's own Foundational Rule requiring it to fund legal-service providers, making the cancellation a likely violation of the APA. It found irreparable harm in the layoffs of specialized attorneys and in thousands of children going unrepresented, and held the balance of equities and public interest favored relief, noting there is "no legitimate government interest in violating federal law." Because the single contract at issue funds legal services nationwide and the APA requires setting aside unlawful agency action, the court held the injunction had to reach nationwide, and it waived any bond.
The Conclusion
The case is now in an enforcement posture. On August 6, 2026, Judge Martinez-Olguin found the government had withheld the funds since December 2025 and ordered their immediate release, rejecting its attempt to recast the fight as a mere contract dispute. With the government's Acacia contract now expired, she has ordered it to show how it will keep funding counsel for unaccompanied children, with a compliance report due August 13, 2026. The underlying preliminary injunction remains in force until a final judgment on the plaintiffs' claims.
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