A U.S. District Judge has temporarily blocked the Trump administration from imposing conditions on federal grants related to diversity, equity, and inclusion (DEI) policies, which could have resulted in the loss of millions of dollars in homelessness assistance funding for several major U.S. cities and counties.

On Wednesday, Judge Barbara J. Rothstein ruled in favor of four cities and five counties, granting a temporary restraining order (TRO) that shields them from the potentially unconstitutional conditions attached to grants administered by the U.S. Department of Housing and Urban Development (HUD). The cities involved in the case include New York City, Boston, San Francisco, and Seattle, along with several counties such as King County in Washington and Santa Clara County in California.

In her decision, Judge Rothstein stated that HUD's actions effectively forced local governments to choose between accepting policies that violate constitutional principles or risk losing critical federal funds already committed to homelessness programs. The judge emphasized that this "Hobson's choice" caused irreparable harm to vulnerable populations who depend on these resources.

"The harms this choice presents are patently irreparable and acute, and they include impacts on the very vulnerable population that plaintiffs are attempting to serve with the grants they hope to achieve," Judge Rothstein said.

The court found that the conditions placed on the grants by HUD—requiring the cities and counties to abandon DEI programs—were not approved by Congress and did not directly relate to the purpose of the grants. Furthermore, the judge determined that these new conditions would not make the grants more effective or efficient in addressing homelessness.

The plaintiffs, including legal representatives from King County, Washington, argue that the Trump administration's DEI-related conditions were not only unconstitutional but also conflicted with existing regulations tied to the grants.

"Here the plaintiffs are facing irreparable injury—a choice between violating lawful policies and practices of our local governments or forgoing essential government funding that has already been committed," said Paul J. Lawrence, attorney for King County, Washington.

The lawsuit, filed in Seattle’s federal court, seeks to prevent HUD from imposing illegal conditions on homelessness grants, with a specific focus on the Trump administration's opposition to local DEI policies, immigration enforcement, and transgender rights.

HUD has yet to comment on the ruling, but the decision has significant implications for local governments that would be forced to either accept controversial conditions or risk losing funding that is crucial for homelessness services.