By Samantha Paul A major legal battle between University of California researchers and the Trump administration is moving through the federal courts over the cancellation of research grants worth nearly $2 billion. The case, Thakur v. Trump, challenges the administration’s decision to terminate or suspend federal grants connected with research involving diversity, health equity, environmental justice, gender issues and other subjects that federal agencies considered inconsistent with administration priorities.
The lawsuit has become an important test of how much authority a president and federal agencies have to cancel research funding that Congress has already authorized. UC researchers argue that the terminations violated constitutional protections, including the First Amendment, while the federal government maintains that agencies have substantial authority to decide which projects advance their current priorities.
Why Did UC Researchers File the Lawsuit?
The case was filed on June 4, 2025, in the U.S. District Court for the Northern District of California.
The original plaintiffs included researchers affiliated with UC San Francisco and UC Berkeley whose multiyear grants had been terminated by agencies including the Environmental Protection Agency, National Science Foundation and National Endowment for the Humanities.
Among them is Dr. Neeta Thakur, a UCSF physician and researcher who became the lead named plaintiff.
The researchers alleged that federal agencies abruptly cancelled grants using standardized notices stating that the projects no longer matched agency priorities. They argued that the government was not conducting genuine project-by-project evaluations but instead carrying out Trump administration executive orders and policies targeting certain areas of research.
Why Were the Research Grants Cancelled?
Court filings have provided additional details about how some grants were selected for termination.
Federal agencies acknowledged using criteria and keywords associated with subjects including diversity, gender, health equity, structural racism, sexual orientation, vaccine hesitancy and COVID-19 when reviewing projects.
According to court filings reported in July 2026, more than 1,000 UC grants were affected, and attorneys for the researchers estimate that the cancelled funding approached $2 billion. The National Institutes of Health alone reportedly suspended or terminated more than 1,000 UC grants at one stage of the funding dispute.
The researchers argue that selecting projects because they expressed or were believed to express viewpoints disliked by the administration amounts to unconstitutional viewpoint discrimination.
What Are the UC Researchers Claiming?
The lawsuit raises several constitutional and federal-law arguments.
One of the most significant is the First Amendment claim. Researchers contend that the government cannot award competitive research grants and then cancel them simply because officials disagree with the ideas, subjects or viewpoints expressed by the funded research.
The plaintiffs have also raised separation-of-powers arguments, claiming that executive agencies improperly prevented money appropriated by Congress for research grants from being used for the purposes Congress directed.
An equal-protection claim also developed after the Department of Energy acknowledged that it terminated 283 grants in states that voted for Kamala Harris in the 2024 presidential election while leaving 340 grants in Trump-voting states untouched based on the political identity of the recipients’ states.
What Did the Ninth Circuit Rule?
The case has already produced an important ruling from the U.S. Court of Appeals for the Ninth Circuit.
On May 26, 2026, the appeals court upheld part of a preliminary injunction protecting researchers whose grants had been terminated because of DEI-related policies.
The Ninth Circuit concluded that those researchers were likely to succeed on their First Amendment claim because agencies appeared to select grants for cancellation based on perceived DEI, DEIA or environmental-justice viewpoints.
The court stated that suppressing viewpoints with which the government disagrees likely violates the First Amendment.
However, the researchers did not win every issue.
The Ninth Circuit reversed preliminary relief for another group whose grants had been cancelled through generic form letters. It concluded that their Administrative Procedure Act claim was essentially contractual and that the federal district court likely lacked jurisdiction over that particular claim under the Tucker Act.
Federal Agencies Make Significant Admissions
The researchers gained potentially important evidence in July 2026 through factual stipulations agreed to by several federal agencies.
The NSF, NEH, Department of Defense, Department of Transportation and NIH-HHS acknowledged that certain grants were selected for termination because they expressed, or were presumed to express, viewpoints disfavored by the administration.
Several agencies also acknowledged terminating grants funded through congressional appropriations without moving that money into other grant-making programs.
The researchers have cited these admissions in asking U.S. District Judge Rita F. Lin to grant summary judgment and permanently rule the cancellations unconstitutional without requiring a full trial.
EPA Settlement in the Grant Lawsuit
Another significant development came in July 2026 when attorneys announced that the UC researchers had reached a settlement in principle with the Environmental Protection Agency.
The proposed agreement is intended to resolve the plaintiffs’ claims against the EPA on a class-wide basis. Other federal agencies remain involved in the broader lawsuit.
Trump Administration Takes the Case to the Supreme Court
The litigation has now reached the doorstep of the U.S. Supreme Court.
The Trump administration filed a petition for a writ of certiorari on August 18, 2026, asking the Supreme Court to review the Ninth Circuit decision. The case was docketed as Donald J. Trump, President of the United States, et al. v. Neeta Thakur, et al., No. 26-210, on August 19.
The Supreme Court has not agreed to hear the case. As of August 29, 2026, the researchers’ deadline to respond to the petition has been extended to October 19, 2026.
Current Status of the UC Researchers Grant Lawsuit
The UC researchers grant lawsuit remains active and no final nationwide ruling has resolved all of the disputed grant cancellations.
The plaintiffs are seeking permanent relief and summary judgment in the Northern District of California, while the Trump administration is asking the Supreme Court to review the appellate ruling protecting grants allegedly cancelled because of disfavored viewpoints.
The case could have consequences far beyond the University of California. Its eventual outcome may help determine when a presidential administration can change federal research priorities and when cancelling already-awarded grants crosses the constitutional line into discrimination based on political or academic viewpoints.