NIH, States Battle Over Pause on Trump’s Cuts to Research Funds

A federal judge is extending a temporary restraining order against the Trump administration’s cuts to overhead research funds at the National Institutes of Health after weighing arguments at a Friday hearing.

The temporary restraining order was extended by Judge Angel Kelley of the US District Court for the District of Massachusetts until she makes a final decision on whether to issue an injunction.

“I have a lot of work to do,” Kelley said Friday.

At issue before the court are three cases challenging the Trump administration’s 15% cap on “indirect funds” at the NIH, which involves research money the government pays to universities and institutions to cover the expenses of facilities, utilities, laboratory equipment, and even project support staff.

The new rate was challenged Feb. 10 by 22 states and other academic membership organizations arguing the cap will have destructive effects on research and walk back decades of progress made by the scientific community. Kelley issued a temporary restraining order the same day to block the rate change from going into effect.

“There’s a statutory and regulatory process and neither of those were followed here,” said Katherine B. Dirks, an attorney in the Massachusetts attorney general’s office representing states.

Other attorneys representing universities and medical colleges argued that Trump’s moves violated the Administrative Procedure Act and failed to consider the effects they would have on research.

Kelley, however, recognized President Donald Trump‘s moves to drastically reduce federal spending and noted how previous administrations, such as under Presidents Bill Clinton and Barack Obama, made similar efforts.

Kelley asked government attorneys Friday whether they agree the NIH’s reduced fee rate would harm plaintiffs and whether plaintiffs deserve injunctive relief.

“Not irreparably,” said Brian Lea, an attorney for the US Department of Justice representing the NIH. Injunctive relief is supposed to be “rare,” Lea said.

The NIH estimates the cuts would save at least $4 billion for the government. The average indirect cost rate also averaged between 27% and 28% over time, and many organizations charge higher indirect rates of 50%, according to Trump administration.

The government is not “cutting” grant funding and it’s not “pocketed,” but rather it’s moving the indirect costs to other funding areas, Lea said.

The cases are Commonwealth of Massachusetts v. NIH, D. Mass., No. 1:25-cv-10338, hearing 2/21/25; Association of American Medical Colleges v. NIH, D. Mass., No. 1:25-cv-10340, oral argument 2/21/25; Association of American Universities v. HHS, D. Mass., No. 1:25-cv-10346, oral argument 2/21/25.