Budget reconciliation bill strikes blow against activist judges
Sometimes the most powerful part of a bill isn’t a sweeping mandate but a single, strategic sentence. Deep in the House reconciliation package is just such a provision. It bars courts from enforcing injunctions through contempt unless plaintiffs post the required bond.
That may look minor, but this clause is the rampart that will repel the courtroom assault on President Trump’s agenda.
The language needs tightening, but it would save the taxpayers billions, meets Senate budget reconciliation criteria — and must be passed.
The provision works not by making new law, but by simply enforcing the current law governing federal courts. Rule 65(c) requires parties seeking a pre-trial injunction to post bond to cover damages if the defendant is later found to have been wrongfully enjoined. The rule is designed both to make defendants whole and to deter frivolous claims.
The text and history make clear that bonds are mandatory, but district judges exhibit a disturbing level of defiance. One judge declared himself “simply unwilling” to impose a “burdensome” bond on “public interest” litigants. But invoking the “public interest” is a purely subjective exercise. Those challenging a government policy have no stronger claim to the public good than the millions who voted to implement that policy in an election.
The House finally had enough of activist judges evading the bond requirement, but the provision still must survive the “Byrd Rule” in the Senate.
Because budget reconciliation bills can pass the Senate with only a simple majority, there is a strong incentive to include non-budgetary policy matters. To prevent this, Section 313 of the Budget Act bars any provision that results in budgetary changes that are “merely incidental” to the provision’s non-budgetary goals. For example, in 2021, the Senate parliamentarian blocked a measure to grant amnesty to 8 million illegal immigrants, reasoning that the policy change “substantially outweighs” its estimated $120 billion budgetary impact.
The injunction bond provision is not remotely in that situation. It is not a policy change — it merely enforces an existing policy whose express purpose is to protect defendants’ wallets. This protection is essential because the Supreme Court has said that a “party injured by the issuance of an injunction later determined to be erroneous has no action for damages in the absence of a bond.”
Right now, because judges are systematically ignoring the bond rule, the federal government is being forced to make outlays of billions of dollars that are irrecoverable.
For example, in February, a federal judge issued a temporary restraining order requiring, in the words of Justice Samuel Alito’s eventual dissent, the “United States to pay out (and probably lose forever) 2 billion taxpayer dollars” to reinstate cancelled USAID contracts.
There are many such cases. A California district court required the government to reinstate 16,000 fired probationary employees. The government warned the court this would inflict “massive financial costs that cannot be recouped.” Still, no bond was ordered. A Maryland court issued a similar ruling covering 24,000 employees. Although both were later stayed, the government had to comply for over 3 weeks, at an estimated cost of $41 million. Had these plaintiffs posted the required bond, these multimillion-dollar losses would have been prevented.
To the extent the provision’s 10-year budgetary impact is hard to estimate precisely, it is not because it lacks direct effect, but because the number of activist judges’ injunctions is unpredictable. Each time an injunction is sought, the provision will trigger, thus saving compliance costs. While its frequency is uncertain, its direct budgetary effect will be clear once activated.
That said, baseline estimates are possible. Recently, a federal judge blocked planned layoffs of some 180,000 positions at 22 federal agencies. Assuming conservatively that the positions are all paid at the lowest government wage of $22,360, this preliminary injunction is costing the government $350 million each month. But the judge in the case claimed she had no way to determine the financial impact and ordered a bond of $10.
The plaintiffs in the case also attest that as many as 700,000 jobs are threatened. If we accept that figure and use the average government salary of $106,000, the bond provision could save taxpayers, in this instance alone, $74 billion if the litigation lasts a year.
This House provision makes an injunction without a sufficient bond unenforceable. This would substantially decrease government outlays by ensuring the government always gets its money back when wrongfully enjoined. This is a clear and direct budgetary consequence, and the savings are not “merely incidental” but are the whole point of the provision.
However, the language needs refining before passage. First, explicitly limit it to preliminary injunctions and TROs to address constitutional concerns about curbing courts’ remedial powers. Second, it should include temporary administrative stays to prevent circumvention. Third, align with Rule 65(c) in requiring a bond amount “proper to pay the costs and damages,” to preclude judges from setting trivial bonds.
Finally, extend the enforcement ban to executive branch officials, who have far greater incentive to obey than the activist judges whose brazen defiance of Rule 65(c) necessitated this congressional action.
Daniel Huff worked as a lawyer in the first Trump White House and is a senior legal fellow at the American Path Initiative.