Fourth Circuit Lifts Nationwide Injunction of Executive Orders Addressing DEI Programs

Late on Friday, March 14, 2025, the U.S. Court of Appeals for the Fourth Circuit granted the government’s application for stay pending appeal of a nationwide preliminary injunction against parts of two executive orders: Executive Order 14151 Ending Radical and Wasteful Government DEI Programs and Preferencing; and Executive Order 14173 Ending Illegal Discrimination and Restoring Merit-Based Opportunity (collectively the “DEI EOs”).

The Federal District Court for the District of Maryland had enjoined key provisions of the DEI EOs – including provisions which pertain to federal contractors and grantees and which require those entities to certify that they did not engage in any illegal DEI activities; and a provision authorizing the U.S. Attorney General to prosecute DEI activities which violate federal criminal law. (For more on the district court’s initial decisions in this case, see our February 24, 2025, and March 13, 2025, legal alerts.)

A Fourth Circuit panel of three judges found that the government had demonstrated a sufficient likelihood of success on the merits to warrant a stay of the lower court’s preliminary injunction. Central to the appeals court’s analysis was the government’s representation that the DEI EOs “on their face, are of a distinctly limited scope” and “do not purport to establish the illegality of all efforts to advance diversity, equity or inclusion, and they should not be so understood.” (Judge Harris, concurring.) Rather, the key provisions of the second DEI EO only apply to conduct which violates existing federal antidiscrimination law and provisions of the first DEI EO direct termination of grants only based on their type of activity, subject to applicable law. With these significant qualifications, the court found that the DEI EOs do not, on their face, violate the First or Fifth Amendment, as the court below had concluded.

The concurrences noted that “any enforcement actions that go beyond the orders’ narrow scope may well raise serious First Amendment and due process concerns” as had been explained by the District Court below. Judge Harris’s concurrence emphasized that the EOs were “directives from the President to his officers” and were therefore not before the court with respect to any particular enforcement action implementing those orders. Chief Judge Diaz and Judge Harris, in their concurrences, expressly recognized the good accomplished by well-constructed lawful DEI programs. Chief Judge Diaz wrote, “People of good faith who work together to promote diversity, equity and inclusion deserve praise, not opprobrium.”

All three judges left open the potential that an injunction may be proper against particular actions taken in furtherance of the EOs, especially if they go beyond the narrow scope of the EOs as outlined by the government attorneys. This may be tested in several lawsuits that have recently been filed in the federal district courts of Maryland, Massachusetts, and New Hampshire challenging the government’s recent cancellation of educational training grants because they were suspected of advancing divisive DEI principles. (See our March 13, 2025, legal alert for more details). Notably, the federal district courts of Rhode Island and District of Columbia previously granted a preliminary injunction preventing the government from enforcing aspects of OMB Memorandum M-25-13 that ended or paused the disbursement of already appropriated federal funds to the 24 states that filed one of the lawsuits and under all open federal awards of financial assistance. This included ending or pausing funding to enforce the DEI EOs. The Office of Management and Budget has since rescinded this Memorandum.

Several federal district courts outside of the Fourth Circuit (District of Columbia, Illinois, and California) have yet to rule on lawsuits similarly challenging the constitutionality of the DEI EOs. Any one of these courts, and their corresponding circuit court, could issue a decision prohibiting the enforcement of the DEI EOs, creating a circuit court split that would need to be resolved by the Supreme Court.