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Suits seeking continued US funding will likely be routed to Court of Federal Claims after SCOTUS decision, law prof says

By Debra Cassens Weiss

April 7, 2025, 11:42 am CDT

A decision on Friday by the U.S. Supreme Court in a challenge to an education-grant freeze will likely redirect many other lawsuits regarding Trump administration spending decisions to the Court of Federal Claims, according to a law professor.

The Supreme Court’s 5-4 decision allowed the Trump administration to freeze $65 million in education-related grants while a suit filed by eight states is litigated.

The Supreme Court found that the government was likely to succeed in its argument that a district court lacked jurisdiction to order the payment of money under the Administrative Procedure Act. The law waives government immunity but not for court orders to enforce a contractual obligation to pay money along the lines of the order by U.S. District Judge Myong J. Joun of the District of Massachusetts, the Supreme Court said.

Instead, the Court of Federal Claims has jurisdiction to hear such suits, the high court said.

Writing at the Volokh Conspiracy, Josh Blackman, a professor at the South Texas College of Law in Houston, said the ruling “should quickly knock out many other ‘spending’ cases and redirect them to the Court of Federal Claims. This is a court most people have never heard of but will soon become very important.”

The Supreme Court’s decision stayed a March 10 temporary restraining order issued by Joun, report Politico, Reuters, Howe on the Court, the Washington Post and the New York Times.

Chief Justice John Roberts dissented from the decision but did not issue or join a dissent. The Supreme Court’s three liberal justices also dissented.

The Trump administration had canceled the grants because they included diversity, equity and inclusion initiatives. The states that sued are California, Massachusetts, New Jersey, Colorado, Illinois, Maryland, New York and Wisconsin.

Joun’s order had required the government to pay past-due grant obligations and to continue paying the obligations as they accrue. The judge based the decision on a finding that the challengers were likely to succeed on their claim that the freeze was arbitrary and capricious in violation of the Administrative Procedure Act.

The Supreme Court disagreed with that finding.

Generally, TROs cannot be appealed, but the order issued by Joun was more akin to a preliminary injunction, the majority said.

In a dissent, Justice Elena Kagan said the general rule is that Administrative Procedure Act suits go to federal district courts, even when a remedial order may result in the disbursement of funds.

“So the court’s reasoning is at the least underdeveloped, and very possibly wrong,” she said.

Kagan also criticized the majority for making a decision based on the government’s emergency application.

“The risk of error increases when this court decides cases—as here—with barebones briefing, no argument and scarce time for reflection,” she wrote.

Justice Ketanji Brown Jackson wrote a separate dissent, joined by Justice Sonia Sotomayor.

“It is beyond puzzling that a majority of justices conceive of the government’s application as an emergency,” Jackson wrote. “It is likewise baffling that anyone is persuaded that the equities favor the government when the government does not even argue that the lower courts erred in concluding that it likely behaved unlawfully.”

The decision is Department of Education v. California.

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I was honored to facilitate the “What’s Hot?” session for leading large law firm innovation professionals at the 2025 invitation-only Strategic Knowledge & Innovation Legal Leaders’ Summit in New York City on March 27, with Oz Benamram, the event’s co-founder and the former chief knowledge and innovation officer at Simpson Thacher & Bartlett.

In a combination of discussion and exploration of survey research, the conversation served as a roadmap for law firms aiming to advance their practices into the future.

The SKILLS survey interviewed approximately 100 professionals in the first quarter of 2025 regarding their use of various artificial intelligence applications. The research respondents primarily came from large law firms, although firms of all sizes that emphasize innovation were encouraged to participate. The overwhelming majority (70) were based in the United States, with nine from the United Kingdom, eight from Canada and 13 from international law firms, mainly split between New York and London headquarters and various other countries. Completing the survey was a requirement to attend SKILLS.

Large law firms are deploying generative AI

The report identified 22 use cases and 180 solutions. On average, the law firm leaders that responded have 18 active generative AI solutions, six in a pilot phase and 22 under consideration. The most common use cases included contract drafting, time entry, due diligence and legal research.

One foundational principle resonating with the group is the leadership essential for driving change, and participants offered several recommendations to gain support. First, effective change management demands consistent communication from the top down throughout the organization. Second, innovation leaders who report directly to an executive, including the managing partner, may wield more influence in implementing change. Third, cross-functional leadership can enhance a team’s value for specific projects.

Nearly all SKILLS law firms have AI use policies

Nearly all law firms that responded (99%) have an AI use policy. However, fewer firms have developed an AI strategy (92%) or created an AI task force (87%). These results underscore the significant importance that law firm leaders place on tactical AI guidance, effective deployment protocols and collaborative talent.

They also serve as vital benchmarks for innovation teams dedicated to laying the groundwork for new initiatives. Without policies, strategies and skilled teams, companies may struggle to gain the essential trust of their internal stakeholders and clients needed to succeed with generative AI. This is particularly important as many legal professionals still fear and remain unfamiliar with several AI applications used by the respondents.

Developing an AI roadmap requires leadership and a framework

During the discussion, attendees recommended that policies governing the use of artificial intelligence include provisions for ethics, restrictions on firm-approved products, the significance of human involvement and a framework for risk assessment. Companies should also enhance their efforts by collaborating with external providers to supplement limited in-house resources.

While the adoption of generative AI at some firms is strong and sustained, the audience agreed that no clear demographic patterns exist. One attendee noted that the more senior a professional is, the greater value they can derive from using an AI platform by asking “smarter questions,” given their depth of knowledge and ability to add substance to a prompt.

Innovation teams are adapting to the shift from tools to transformation

Unsurprisingly, the innovation teams at the responding law firms hold primary responsibility for implementing the firms’ AI strategies (59%), closely followed by knowledge management (44%) and IT (43%), both of which share a similar level of oversight.

While the innovation team’s involvement has remained stable over the past year (59% in 2025 compared to 62% in 2024), knowledge management (44% in 2025 compared to 63% in 2024) and IT (43% in 2025 compared to 74% in 2024) have seen changes. Additionally, a quarter of respondents in 2024 indicated that other departments provided input, and 15% relied on external support for their AI initiatives.

Specific law firm trends have influenced which teams are responsible for certain actions. The discussion among law firm leaders regarding the deployment of artificial intelligence has quickly transitioned from technology to transformation. Law firms are increasingly reexamining their entire suite of applications and evaluating the quality and integrity of their data to ensure that any large language models they use can deliver the best results.

In 2025, this will concentrate less on technology and more on redefining the law firm’s strategy for maximizing the value of its information. Consequently, the innovation, IT and knowledge management teams will work together to navigate AI’s transformative impact on the firm.

Many organizations lacked clarity a year ago as law firms were still assessing potential applications and use cases. The rapid pace of AI development and the insatiable demand for its availability necessitates a cross-functional and interdisciplinary team to drive the firm forward, with a designated ambassador coordinating its proliferation. That diplomat is the head of innovation at many firms, whose responsibilities are broader and deeper than in 2024, yet the diplomatic corps remains multifaceted.

In particular, the role of IT teams in law firms has become significantly more prominent since the pandemic. As budgets have increased, cybersecurity has become essential, and growth is closely aligned with technology. This position emphasizes holistic operational excellence rather than merely digital transformation.

Another important trend to note is the expansion of knowledge management to include innovation, legal operations and artificial intelligence. Today, law firms frequently recruit talent from knowledge management and either assign responsibilities for innovation or promote a KM leader to a broader innovation-focused role. While only 35% of respondents work at firms that have appointed a “Chief Artificial Intelligence Officer” or created a similar leadership position, this will likely change and influence who addresses or navigates these challenges.

While the data indicates that innovation teams are becoming the primary AI stakeholders, the ownership structure remains more nuanced due to overlapping talent and experience. Additionally, more professionals use the term “innovation” in their titles.

The majority of law firms have deployed generative AI

More than two-thirds of participants (73%) have implemented an internal generative AI solution—either developed an AI chatbot internally or deployed one through a secure API. Sixteen percent reported that they built or commissioned a custom internal language model. Although uncommon, almost a quarter (24%) have created client-facing or revenue-generating products using generative AI. This trend appears to mirror the actions of law firms several years ago, which initially developed mobile apps for internal use and later began offering more comprehensive versions to clients.

One participant suggested creating a fully accessible library for generative AI prompts and project-specific recommendations, akin to Netflix for queries.

OpenAI’s GPT is the leading LLM in law firms, but the generative AI support market is fragmented

Among the 73% of respondents who have implemented a generative AI solution, about three-quarters (76%) use OpenAI’s GPT as their foundational LLM model. Anthropic’s Claude ranks second with 19%, while Google‘s Gemini ranks third with 15%. Interestingly, 3% reported developing with China’s DeepSeek.

A third (33%) reported using an external provider to help them build their language model; however, the market remains fragmented. Respondents mentioned about 15 applied AI partners. Although consolidation is expected, the current demand will likely drive short-term growth rather than contraction in the provider market.

Encouraging the adoption of generative AI remains challenging

While 73% of respondents indicated that their firms utilize a legal AI assistant or chatbot, 62% have adopted the application across the entire firm or a substantial subset for testing purposes.

Adoption rates have remained low, with only 22% reporting a 50% to 100% adoption rate. This low adoption level is one reason certain teams stopped using specific tools. Other factors include cost-effectiveness and the availability of better alternatives. As the market grows and the barriers to entry diminish due to advancements in robust AI models, competition will continue to intensify.

To ensure success, the attendees agreed that law firms should begin their initiatives with individuals who are willing and passionate, especially since adoption is rising within the existing user base rather than from a surge in new participants in any given project.

Additionally, when evaluating technology and processes, exploring markets beyond the United States, especially in Europe, can be advantageous for generating fresh ideas and acquiring a thorough understanding of the evolving legal industry.

In some firms, discussions about generative AI use cases are reigniting interest in document automation. It is experiencing a renaissance, as it may provide a more effective and cost-efficient solution to the challenges that some professionals expect generative AI to address.

AI legal assistants and chatbots are leading use cases

The research indicated that an AI legal assistant or chatbot was the most popular use case. Other significant applications included data extraction, summarization, legal drafting, contract review and analysis, proofreading, research and searching. In contrast, the least cited applications were patent and IP drafting, litigation management, automation of discovery responses, pitches and proposals, and compliance.

When considering a new application, “try to avoid signing a long-term agreement,” advised an audience member, who added, “Price renewals are also absurd, and a similar tool is often available at half the cost with better functionality.” A peer offered, “Applications without a unique value proposition, i.e., a moat protecting their competitive advantage, may not be worth a long-term investment.” Finally, one participant cautioned, “Don’t try to learn everything because the technology will continue to evolve and only get faster.”

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Ari Kaplan is a lawyer and legal industry analyst who publishes benchmarking reports on legal technology trends and is an experienced webinar and conference facilitator.

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This column reflects the opinions of the author and not necessarily the views of the ABA Journal—or the American Bar Association.

Cedarville, Calif. – The Bureau of Land Management is seeking public comments on a plan to manage wild horse populations in three herd management areas in far northeast California and far northwest Nevada. The environmental assessment, available for review and comment through the BLM National NEPA Register, addresses population management actions on the Carter Reservoir, Coppersmith and Buckhorn herd management areas.

“Wild horse populations in these herd management areas have greatly exceeded the appropriate management level established in our Resource Management Plan,” said Craig Drake, manager of the BLM Applegate Field Office. “Managing the population at the appropriate management level is important to maintaining healthy, viable herds as part of a thriving natural ecological balance on the range, as required by the Wild Free-Roaming Horses and Burros Act.”

A 30-day comment period runs through Nov. 22. Anyone interested can comment by using the “participate now” button on the above NEPA Register page. Those who need the document in printed form can contact the BLM’s Surprise Field Station in Cedarville at 530-279-6101. Comments can also be sent to the Bureau of Land Management, Surprise Field Station, 602 Cressler St., Cedarville, CA 96104, attention Wild Horse Gather. 

The BLM plans to gather excess wild horses from the three HMAs to achieve and maintain populations within the appropriate management level range shown in the EA. The HMAs are not managed for burros; any that have roamed into the HMAs would be removed.

Based on aerial surveys, ground observations, and expected annual population increases, the BLM expects there are more than 700 wild horses in the three HMAs, where the combined appropriate management level is 134 – 195 wild horses. This overpopulation has impacted water and riparian resources on both public and private lands. The BLM would conduct new population survey flights prior to any gathers. The BLM does not intend to reduce populations below the appropriate management level range in any of the herd management areas. Wild horses removed from the range would be made available for private ownership through the BLM’s adoption and sales programs.

The BLM is responsible under the Wild Free-Roaming Horses and Burros Act for protecting and managing wild horses and burros to protect resources and ensure healthy herds. The agency periodically removes animals from the range when populations exceed levels established to allow the herds to thrive in balance with other users including wildlife and permitted livestock. More information about the BLM’s Wild Horse and Burro Program is available online. 
 

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Kasowitz Benson sues former Gibson Dunn partner for nearly $500K in latest suit seeking legal fees

By Debra Cassens Weiss

February 29, 2024, 2:34 pm CST

Kasowitz Benson Torres is seeking nearly $500,000 in legal fees from a former Gibson, Dunn & Crutcher partner in a lawsuit filed Tuesday in New York state court.

The suit seeking fees from suspended lawyer Ignacio Foncillas “is the latest in a string of court actions the firm has initiated against former clients since the start of 2023 for a total of $5.2 million in legal fees,” Law.com reports.

Kasowitz Benson had helped Foncillas negotiate a “highly favorable sentencing agreement,” according to the suit allegations cited by Law.com.

Foncillas pleaded guilty in June 2018 to operating an unlicensed money transferring business between the United States and Mexico. Operating without a license allowed customers to evade anti-money-laundering safeguards, according to prosecutors. The company allegedly aided the transmission of more than $9 million between the two countries.

Foncillas was sentenced to time served, two years of supervised release, 500 hours of community service and a $7,500 fine. He also consented to entry of a $9.4 million forfeiture judgment, but the government agreed to accept more than $262,000 in satisfaction of that amount, according to a court opinion affirming his one-year suspension.

Foncillas did not immediately respond to the ABA Journal’s request for comment, sent to an email address listed by the New York court system. His representatives did not return Law.com’s request for comment.

Other defendants sued by Kasowitz Benson for fees include a financial adviser, a real estate developer and a marketing agency, according to Law.com. The largest amount sought was $2 million, related to Kasowitz Benson’s representation of real estate companies in connection with a mortgage foreclosure.

Law.com spoke with Michael Heller, CEO of Cozen O’Connor, about the risk of suing for unpaid fees.

“Most law firm general counsel will try to caution their law firm leaders against filing for unpaid fees because you could get a counterclaim of malpractice,” Heller said.

He declined, however, to comment specifically on the Kasowitz Benson suits.