Court Makes Clear Order Only Prohibits Federal Contractors and Subcontractors From Already-Prohibited Discrimination
October 15, 2026 - Baltimore – Groups representing nonprofit organizations, university faculty and staff, and federal contractors, 
subcontractors and their employees throughout the nation have obtained a court ruling that defangs a Trump executive order and Federal Acquisition Regulatory Council action that many contractors had been concerned could be used by the Trump-Vance administration to undermine efforts designed to promote inclusion and help ensure equal opportunity.
In a decision issued on Wednesday, the U.S. District Court for Maryland made clear that contentions by the government that the executive order had far-reaching consequences are not accurate. Rather, under the court’s opinion, the challenged executive order “only prohibits contractors from engaging in conduct that is already prohibited by federal law,” bars only intentional discrimination based on race or ethnicity under existing disparate treatment law, and applies only to work the contractor is performing for the government pursuant to the contract. Further, the court confirmed that “there is absolutely DEI activity that falls comfortably within the confines of the law.”
The court’s opinion also clarified that activities such as researching disparate negative health outcomes for particular races or teaching, researching, or publishing materials about diversity, equity, and inclusion are not, without more, prohibited under the executive order or the agency’s action. Moreover, the court stated that a threat of False Claims Act enforcement by the government based on those activities would both be unauthorized by the executive order and likely unconstitutional and unlawful.
In response to the court’s decision, the coalition of plaintiffs and co-counsel issued the following statement:
“This ruling provides crucial clarity for federal contractors and subcontractors: at bottom, the executive order challenged in this case means nothing more than ‘follow the well-settled law.’ And the court confirmed that order reaches no further than the work a contractor performs for the government on the specific contract where the language appears –it cannot reach activities outside the work the contractor does for the government. Federal contractors and subcontractors are crucial to the safe, effective, and efficient functioning of the country and should not have to fear that their lawful efforts to support diversity, equity, and inclusion will put them at risk of political prosecution by the Trump-Vance administration. Today’s ruling gives much-needed reassurance to thousands of federal contractors and subcontractors across the country.”
The lawsuit was filed on April 20, 2026 by the National Association of Diversity Officers of Higher Education (NADOHE); American Association of University Professors (AAUP); United Academics of Maryland-University of Maryland, College Park (UAM-UMD); National Association of Minority Contractors (NAMC); and the NAMC, District of Columbia, Maryland, Virginia Chapter (NAMC-DMV), and sought to prevent implementation of the president’s unlawful directive, which would directly harm and disrupt the work of Plaintiffs, their members, and other federal contractors and subcontractors, and their employees, throughout the nation. The coalition is represented in the matter by Democracy Forward. NAMC and NAMC-DMV are also represented by the Minority Business Enterprise Legal Defense and Education Fund (MBELDEF).
The case is NADOHE et al v. Trump, and the legal team at Democracy Forward in this case includes Brooke Menschel, Andrea Matthews, Briana Clark, Steven Bressler, and Brian Netter. The legal team at MBELDEF includes Sarah von der Lippe.
Read the full complaint here, and dig deeper into the executive order with this overview from Democracy 2025, a program of Democracy Forward.
Democracy Forward Foundation is a national legal organization that advances democracy and social progress through litigation, policy, public education, and regulatory engagement. For more information, please visit www.democracyforward.org.
Source: Democracy Forward Foundation
