AG Brown joins challenge to federal administration’s culture war on contractors

Attorney General Nick Brown today joined a coalition with 19 other attorneys general in suing the federal administration over the addition of new contract terms that-in the name of purging any "diversity, equity, and inclusion" (DEI) initiatives-impose unclear and confusing requirements on state agencies doing business with the federal government.

The vague new terms depart from antidiscrimination policies that contractors have followed for decades and threaten severe penalties on federal contractors without adequate notice of what is prohibited, threatening the delivery of public services through these partnerships.

In their lawsuit, filed in the U.S. District Court for the District of Maryland, the coalition challenges the federal agencies' rushed implementation of President Trump's Executive Order No. 14398. The executive order, issued March 26, directs federal agencies to adopt new contract terms prohibiting federal contractors, including state agencies, from engaging in what it calls "racially discriminatory DEI activities" in connection with their contract work.

"The federal administration has created more chaos and confusion with its ongoing culture war," Brown said. "This executive order shows utter disregard for the law and for the contractors, including the State of Washington, who have done business with the federal government in good faith for decades."

In implementing the order, federal agencies took shortcuts around mandatory procedures that promote good government. For example, the agencies failed to invite public comments as required by law. Largely because of these shortcuts, contractors have no clear guidance on what the new contract terms require in practice, or whether or how the new requirements differ from existing laws that already prohibit racial discrimination.

Contractors that fail to comply face severe penalties, including cancellation of their contracts, exclusion from all future federal contracts, and lawsuits under the False Claims Act. The imprecise and confusing contract terms impose needless costs on contractors and threaten to chill lawful efforts to prevent, detect, and remedy discrimination.

Washington and its agencies regularly contract with the federal government, and the coalition states collectively hold existing federal contracts worth billions of dollars. Federal agencies began adding the new terms into contracts in April 2026 and have been directed to modify existing contracts by July 24, 2026. The federal government estimates the order could affect as many as 640,000 contracts and subcontracts nationwide, including more than 160,000 contracts with over 34,000 unique vendors.

The coalition alleges that the federal agencies implementing the executive order violated the Administrative Procedure Act (APA) by failing to provide notice to the public or accept comments (as required by federal procurement law), exceeded their legal authority, and neglected to adequately explain or justify the new requirements. The lawsuit asks the court to hold the agencies' actions unlawful and bar the agencies from imposing the new contract terms.

Joining Brown in filing the lawsuit are the attorneys general of California, Colorado, Connecticut, District of Columbia, Hawaiʻi, Illinois, Maine, Maryland, Massachusetts, Michigan, Minnesota, Nevada, New Jersey, New Mexico, Oregon, Rhode Island, Vermont, Virginia, and Wisconsin.

A copy of the complaint is available here, along with Exhibit 1 and Exhibit 2.

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