Attorney General Bonta Secures Appellate Victory Affirming Permanent Injunction Against Trump Administration over Unlawful NIH Funding Cuts for Universities and Research Institutions

OAKLAND — California Attorney General Rob Bonta today issued the following statement after a three-judge panel of the U.S. Court of Appeals for the First Circuit unanimously affirmed a lower court’s decision, which permanently barred the Trump Administration from decimating funds that support cutting-edge medical and public health research at universities and research institutions across the country — including at the University of California (UC) and at the California State University (CSU). The funds at issue — known as “indirect cost” reimbursements — cover expenses to facilitate biomedical research, such as lab, faculty, infrastructure, and utility costs. As part of a coalition of 22 attorneys general, Attorney General Bonta sued the U.S. Department of Health and Human Services (HHS) and the National Institutes of Health (NIH) on February 10, 2025 to block the attempted funding cuts from taking effect.

“The Trump Administration wanted to eviscerate funding for medical research that helps develop new cures and treatments for diseases like cancer, diabetes, and Alzheimer’s. Let that sink in: Life-saving research — proudly happening at UCs and CSUs across our state — was under attack,” said Attorney General Bonta. “My fellow attorneys general and I stepped in to stop these illegal actions. The district court sided with us, and now, the First Circuit has, too. We’re starting the new year by building on our previous successes and securing yet another important victory against the Trump Administration.”

On Friday, February 7, 2025, the NIH announced in Supplemental Guidance that it would abruptly slash indirect cost rates to an across-the-board 15% rate, which is significantly less than the cost required to perform critical medical research. The NIH purported to make this cut effective the very next business day, Monday, February 10, giving universities and institutions no time to plan for the enormous budget gaps they would be facing. Less than six hours after Attorney General Bonta filed suit against the Trump Administration on February 10, the U.S. District Court for the District of Massachusetts issued a temporary restraining order against NIH, barring its attempts to cut the critical research funding. The court subsequently issued a nationwide preliminary injunction, which was converted into a permanent injunction at the parties’ request. The Trump Administration appealed that ruling to the First Circuit. 

In today’s decision, the First Circuit wrote that “the public-health benefits of NIH-funded research are enormous” and concluded that:

• “[T]he district court properly exercised subject-matter jurisdiction over the plaintiffs' claims,” and
• “NIH’s attempt, through its Supplemental Guidance, to impose a 15% indirect cost reimbursement rate violates the congressionally enacted appropriations rider and HHS’s duly adopted regulations.”