Statement of Association of Public & Land-grant Universities, Association of American Universities, and American Council on Education Regarding Their Legal Challenge to the Administration’s Cut to Critical Defense Research

June 17, 2025 Update: U.S. Judge Brian E. Murphy issued a temporary restraining order (TRO) that covers all institutions in all states nationwide in the case filed by AAU, APLU, ACE, and 12 impacted higher education institutions against the U.S. Department of Defense. The judge’s order prevents the administration “….implementing, instituting, maintaining, or giving effect to the immediately effective portions of the Rate Cap Policy, i.e., those portions implementing a 15% cap for all awards issued on or after June 12, 2025, including but not limited to rejecting or treating adversely proposals for DOD funding submitted at universities’ negotiated rates rather than the 15% rate.”

On June 13, 2025, the administration began notifying universities yet again of another attempt to slash funding for critical American research. This time it announced it would cut facilities and administrative (F&A) reimbursements to 15% for all Department of Defense research grants that support breakthrough university research designed to help protect our military service members and strengthen our national defense.

F&A costs, also known as indirect costs, are the real and necessary costs of conducting groundbreaking research that has made our nation the world’s leading military superpower.

With funding from DOD, university researchers are making advancements in engineering, tackling complex intelligence challenges, developing state-of-the-art equipment such as undersea weapons, and finding ways to keep our military service members safe on the battlefield.

DOD’s latest action would have an immediate and dire effect on our national security by disrupting research designed to help our military. It would also harm our universities’ ability to continue research in critical emerging technology areas such as artificial intelligence and quantum computing that have significant military applications, and that China is investing in heavily.

To put it simply, this cut to university research would make our nation less safe, threaten our future defense readiness, and weaken our global security.

This is why, today, the Association of American Universities, the American Council on Education, and the Association of Public and Land-grant Universities filed a joint lawsuit in the United States District Court for the District of Massachusetts along with 12 higher education institutions seeking to halt the proposed DOD F&A cut.

Beyond its destructive impact on our military and on university research, this latest action again is patently unlawful, violating the governing regulations and statutes and basic tenets of administrative law

We look forward to presenting our case in court.