Judge Grants Preliminary Injunction Limiting Treasury Access To Treasury’s Payment Systems
We previously covered the ridiculous 1 a.m. Saturday morning ex parte TRO granted by an emergency duty judge in the Southern District of New York which, by its plain terms, barred political leadership of the Treasury Department, including the Secretary of Treasury, from accessing Treasury payment systems based on hysterical hype. Judge Issues Emergency Order Halting DOGE Access To Treasury Payment Systems (February 8, 2025).
Whatever the ultimate merits, depriving the Secretary of Treasury of the ability to run the Department of Treasury as he deems proper is not something that should have been decided this way, even temporarily. I understand that litigants play these games, but it’s a bad look that damages faith in the judiciary when a court allows it.The short version of the complaint and claims is that Secretary Bessent violated various procedural requirements and that there is a threat that sensitive private information could be exposed. Considering that the Chinese government thoroughly hacked the Treasury computer systems under Biden, it’s odd that the mere possibility that DOGE might mishandle the information required a Friday night court intervention. I think there are serious ‘standing’ issues with the states bringing the case as well as the harm being speculative.
The judge permanently assigned to the case, Judge Jeanette Vargas, scaled back the TRO somewhat after an emergency motion to dissolve the TRO:
- Trump Admin Moves To Dissolve “Impermissible and Anti-Constitutional” Weekend TRO Against Treasury (February 10)
- Court Partially Modifies Ex Parte Treasury TRO – Only Senior Officials Restored To Access (February 11)
Even that scaled back TRO was not warranted and represents yet another example of the federal district courts usurping Executive Branch authority, in this case as to what constitutes adequate security measures and how best to run the department. There never was any clear legal violation much less one that the states would have standing upon which to sue, and the alleged irreparable harm — leaking private information– was speculative.
Judge Vargas took time in coming to her ruling on the request for a longer-term preliminary injunction, and we lost track of the case as dozens of other lawsuits seekiing to freeze the executive branch were filed and resulted in a mixed bag of ruling for and against the Trump administration.
In her Order Granting the preliminary injuction, Judge Vargas effectively continued the terms of her prior TRO (which scaled back the initial ex parte emergency TRO)
For the reasons stated herein, Plaintiffs’ motion for a preliminary injunction is GRANTED. The preliminary injunction substantially tracks the terms of the temporary restraining order (“TRO”) that is presently in place, in that it bars the Treasury Department from granting access to any member of the DOGE team within the Treasury Department to any payment record, payment systems, or any other data systems maintained by the Treasury Department containing personally identifiable information and/or confidential financial information of payees. But Plaintiffs have not demonstrated that they are entitled to the broad and sweeping relief they seek, which would far exceed the scope of the present TRO to prohibit members of the DOGE team from developing automated (or even manual) processes to halt payments coming through Treasury Department payment systems. The remedy in this case must be narrowly tailored to redress the specific harm asserted by the Plaintiffs: the threatened disclosure of the States’ sensitive bank information contained in the Treasury Department’s payment systems. Plaintiffs’ proposed preliminary injunction order is anything but narrow.Additionally, the duration of the preliminary injunction also has the potential to be limited in scope. The Court is providing Defendants with an opportunity to promptly cure the procedural defects relating to the protection of sensitive and confidential information that the Court has identified in this Opinion. Should Defendants do so, the Court will determine whether termination or modification of the preliminary injunction is warranted.
You can read the full Order and reasoning, which rejected almost all of the legal arguments from the states but rested primarily on alleged violations of the Administrative Procedures Act because the DOGE access was too rapid and unstructured:
The process by which the Treasury DOGE Team was appointed, brought on board, and provided with access to BFS payment systems could have been implemented in a measured, reasonable, and thoughtful way. To date, based on the record currently before the Court, it does not appear that this has been the case….Here, Plaintiffs sufficiently allege irreparable harm from the risk of “expanded access” to the BFS payment systems that will possibly compromise the systems to become “far more vulnerable to hacking or activities that render the information corrupted or compromised.” Pls. Br. at 13. The Court finds that there is a “substantial risk of future harm” where the data access protocols in place do not satisfactorily vet the employees with access and rigorously train them in data security measures….Defendants’ interest in the modernization and increased efficiency in Treasury payment systems is not undercut by the relief the Court is Ordering. Indeed, taking the time to adequately mitigate potential security concerns and properly onboard members to engage in this work outweighs the Defendants’ immediate need to access and redevelop Treasury systems. Without addressing these issues, the potential consequences of a cybersecurity breach could be catastrophic.It is undisputed that the BFS payment systems are critical to the financial infrastructure of the nation. Moreover, those systems contain sensitive PII and financial data regarding millions of American citizens. The public interest is plainly served by requiring the Treasury Department to ensure, to the maximum extent possible, the security of these systems and the information contained therein.
It’s ridiculous that a federal judge is opining on security protocols when the security experts employed by Treasury have certified to the security measures they have in place. Judge Vargas appears to recognize the weak foundation of her ruling by giving the government a chance to cure, but that is not enough of a remedy for an executive branch department which has had its own constitutional power restricted.
I hope the government seeks expedited appellate review.
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