Suits by state, cities over federal grant money likely to proceed, judge says

SAN FRANCISCO -- A federal judge seemed all but certain Wednesday to allow lawsuits filed by California and San Francisco against the federal government to go forward after hearing arguments on the defendant's motion to dismiss the case.

U.S. Department of Justice lawyers argued that the government was well within its powers to condition grant money on compliance with federal immigration laws and said that the lawsuits were getting ahead of decisions that had not been made yet about granting the funds.

Lawyers for the state and San Francisco said the Department of Justice could not place conditions on funds without an act of Congress and argued that certain state laws complied with federal statutes.

"I do think there will be another day when it comes to the merits," U.S. District Judge William H. Orrick said of the combined case toward the end of the hearing. He also said he expected the case to boil down to a 10th Amendment issue regarding the interpretation of a federal law that prohibits interfering with the sharing of immigration status information.

"That's part of what I'm looking forward to sorting out with the parties regarding a motion for summary judgment," Orrick said.

California Attorney General Xavier Becerra sued the U.S. Department of Justice in August after it placed conditions on certain law enforcement grants, including approximately $31.1 million in federal funds that California says it uses for law enforcement.

The case is being heard jointly with a similar suit brought by the City and County of San Francisco. California v. Sessions, 17-CV04071, (N.D. Cal., Aug. 14, 2017).

Acting Assistant U.S. Attorney General Chad A. Readler told Orrick that the conditions placed on federal law enforcement funding were within the powers of the agency.

The government "has placed conditions regarding information sharing about criminal aliens held by the grantees," Readler said. "We think that's both authorized by statute and constitutionally."

Arguing for the California Department of Justice, Deputy Attorney General Lee Sherman said the conditions were unlawful.

"This case is fundamentally about defendants' attempt to legislate from the executive branch," Sherman said. He added that the conditions had to be related to the grants in question and that Congress "has never in the decades-long history of this grant identified immigration enforcement as a purpose area of this grant and it has even rejected attempts to do so."

In briefs filed by the U.S. Department of Justice in January, lawyers defended placing conditions on the grant money, saying that California was wrong to argue that Congress had not authorized the U.S. DOJ to impose conditions on the money and that their doing so did not violate the separation of powers clause in the U.S. Constitution.

The lawsuit asks Orrick to permanently enjoin the federal government from withholding law enforcement grants based on noncompliance with certain immigration laws and also asks the court to declare certain state laws as not in conflict with federal statute -- including a recently passed law that limits California state employees from cooperating with federal immigration authorities.

The case is separate from a different suit brought by San Francisco and Santa Clara counties challenging an executive order by President Donald J. Trump and the constitutionality of rescinding federal funding from "sanctuary jurisdictions" that do not cooperate with federal law enforcement authorities. Orrick issued a permanent nationwide injunction in that case in November.