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States sue Trump administration over anti-DEI terms in federal contracts

Raoul and 19 other attorneys general say the new rules could cut off federal funding and force states to identify potential violators.

  • On Thursday, Illinois Attorney General Kwame Raoul co-led a coalition of 20 attorneys general in filing a federal lawsuit challenging Trump's executive order removing diversity, equity and inclusion from federal contracting.
  • Trump issued an executive order on March 26, 2026, directing federal agencies to adopt new contract terms prohibiting "racially discriminatory DEI activities," which the attorneys allege agencies rushed to implement without required public notice or comment.
  • Attorneys argue the administration circumvented the Administrative Procedure Act and repealed a decades-old executive order by President Lyndon Johnson requiring federal contractors to take affirmative action, forcing states to break federal antidiscrimination laws.
  • This filing follows a series of legal victories for Raoul, including a successful suit in September securing $2 billion in federal disaster relief funding; two months later, a judge released transportation funding after the administration attempted to block it.
  • "The president's executive order has sowed confusion among federal contractors," Raoul said, vowing to continue opposing efforts to scrap lawful DEI policies, which he argued would turn back the clock on hard-fought progress.
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Twenty U.S. states go to court against Trump's anti-DEI order.

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Reuters broke the news in New York, United States on Wednesday, June 10, 2026.
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