KHVPF Insight
The Supreme Court Curbs Universal Injunctions: What Employers Need to Know About Trump v. CASA, Inc.
The Supreme Court’s recent decision in Trump v. CASA, Inc. marks a pivotal moment in federal litigation, altering how executive branch actions can be challenged in court. This ruling directly addresses the controversial practice of “universal” or “nationwide” injunctions, which have become a prominent feature in legal battles against federal policies in recent decades. The Court’s decision, while not ruling on the underlying policy’s legality, has profound implications for the balance of power between the judiciary and the executive, and, critically, for employers navigating federal regulations.
Understanding Universal Injunctions
Universal injunctions are court orders that prevent the government from implementing a challenged law, regulation, or policy against all relevant persons and entities, even if they are not parties to the lawsuit. This contrasts with traditional injunctions, which typically provide relief only to the specific plaintiffs who brought the case. The issuance of universal injunctions have surged dramatically in the last two decades. This rapid increase indicates that the practice of issuing universal injunctions has become a common tool, either because executive actions are increasingly national in scope and impact, leading to more widespread challenges, or because lower courts have become more willing to employ this broad remedial power.
Proponents of universal injunctions tout that they prevent widespread harm, reduce litigation burden, and promote uniformity and the rule of law. Critics, on the other hand, argue that they undermine class actions, incentivize forum shopping, and raise serious separation of powers concerns. A key argument against universal injunctions highlights their “asymmetry.” Critics contend that these injunctions operate disproportionately against the government: a plaintiff needs only one successful universal injunction to halt a policy nationwide, while the government must win every single challenge (or avoid any universal injunction) to fully implement its policy across the country. This imbalance can lead to “policy paralysis,” where new federal initiatives are effectively stalled or abandoned due to the high cost and complexity of defending them in numerous lawsuits, even if the underlying policy is ultimately deemed lawful. This affects the executive’s ability to govern efficiently and implement its agenda, regardless of the policy’s merits.
The Trump v. CASA, Inc. Decision
The Trump v. CASA, Inc. case originated from challenges to President Trump’s Executive Order regarding birthright citizenship, but the Court’s decision did not address the constitutionality of the Executive Order itself. The Court stated that the issue before it was solely one of remedy: “whether, under the Judiciary Act of 1789, federal courts have equitable authority to issue universal injunctions.”
In a 6-3 decision, the Supreme Court held that “universal injunctions likely exceed the equitable authority that Congress has given to federal courts.” The majority’s reasoning hinged on a historical interpretation of federal courts’ equitable authority. It asserted that the Judiciary Act of 1789 granted federal courts only those equitable remedies “traditionally accorded by courts of equity” at the nation’s founding. But the Court found no historical analogue for universal injunctions, in either 18th or 19th-century English Chancery practice or early federal courts.
The Court dismissed the argument that universal injunctions were necessary to provide “complete relief,” clarifying that “complete relief is not synonymous with ‘universal relief’” and applies only “between the parties.” The majority also criticized universal injunctions for circumventing the procedural protections of Federal Rule of Civil Procedure 23, which governs class actions. As the majority opinion rhetorically asks, “Why bother with a Rule 23 class action when the quick fix of a universal injunction is on the table?”
All this suggests that the Court views universal injunctions as bypassing the established, rigorous requirements for group litigation. By curtailing universal injunctions, the Court is effectively channeling broad relief claims into the more stringent procedural framework of Rule 23, meaning plaintiffs who wish to achieve widespread impact for a federal policy challenge will now likely have to invest more time, resources, and effort to meet the higher bar of class certification, making broad relief more difficult and costly.
Key Takeaways for Employers: Navigating a New Landscape
So what does all this mean for employers? The most immediate impact for employers is the likely end of immediate, broad injunctions from single district courts that halt federal policies nationwide. Thus, if an employer or an industry group challenges a federal regulation or executive order, any resulting injunction will generally apply only to the specific plaintiffs with standing to sue. Without the availability of immediate, broad injunctive relief, employers seeking a ruling with widespread impact for a large group of similarly situated entities will now likely need to pursue Federal Rule of Civil Procedure 23 class actions. Also, without nationwide injunctions, federal policies will be enjoined for some entities or in certain states, but not others. Employers operating across state lines or in multiple sectors will therefore need to track varying compliance requirements, adding a layer of administrative and legal complexity to compliance efforts.
Three Unresolved Questions and Future Considerations
While the Court’s ruling provides some clarity on universal injunctions, it leaves several critical questions unanswered that will shape future litigation.
1. Precise Boundaries of “Complete Relief.” The Court deferred to lower courts to determine the precise scope of “complete relief” for the state plaintiffs, acknowledging that state harms (e.g., financial injuries from citizen-dependent benefits programs due to cross-border movement) might necessitate broader relief than individual plaintiffs.
2. Evolving Role of State-Led Litigation and Third-Party Standing. The ability of states to use “third-party standing” doctrine to obtain broad relief for all of their residents remains unclear. Justice Alito’s concurrence specifically warns that if states can use third-party standing to obtain broad relief for their residents, it could undermine the decision’s effect. This suggests that state-led challenges to federal policies, particularly those impacting state-administered programs or populations, will remain a key area of legal strategy but will likely face increased scrutiny regarding standing.
3. Interplay with Administrative Procedure Act’s “Set Aside” Authority. The Court explicitly stated that its decision “does not resolve the distinct question whether the Administrative Procedure Act authorizes federal courts to vacate federal agency action.” Section 706(2) of the APA allows courts to “hold unlawful and set aside agency action.” These “set aside” or “vacatur” orders can have the same nationwide impact as a universal injunction. This creates a clear, statutory pathway for plaintiffs to continue seeking broad relief against agency actions (for example, regulations issued by the Department of Labor or the EPA), even if direct injunctions against the Executive are limited.
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The Supreme Court’s decision in Trump v. CASA, Inc. alters the strategic landscape for challenging federal executive actions. If broad, single-court injunctions are likely no longer available, interested employers must pivot to a decentralized and potentially fragmented approach to legal challenges against federal policies. That will entail more localized legal strategies, which might involve filing individual lawsuits in their specific jurisdictions, intervening in existing cases, or actively participating in or initiating Rule 23 class actions.
This decentralization implies a need for greater legal agility, potentially requiring legal teams to manage multiple, concurrent challenges across different federal districts. It also highlights the value of of industry associations or collective actions to pool resources and pursue class-wide or APA-based relief. Employers should consult with legal counsel to assess risks, identify strategic litigation options, and ensure compliance in what is now a more complex and potentially fragmented regulatory environment.