A federal judge has dismissed a lawsuit brought by New York Attorney General Letitia James and 18 other states challenging DOGE-affiliated employees’ access to sensitive federal payment systems at the Treasury Department, ending one of the higher-profile legal fights to emerge from the Trump administration’s cost-cutting initiative.
U.S. District Judge Jeannette Vargas, an appointee of President Biden, ruled Wednesday that the states’ claims over DOGE access to the Bureau of the Fiscal Service were moot because the Treasury DOGE team no longer exists. “Plaintiffs’ claims related to access by DOGE-affiliated employees to sensitive Treasury information are dismissed as moot,” Vargas wrote, noting there was no ongoing access practice left for the court to block.
The judge separately dismissed a related claim over an automated payment-review system, finding the states never alleged that the process actually froze or canceled any specific payment owed to them.
How the case started
The dispute traces back to a January 2025 executive order from President Trump that created the Department of Government Efficiency, directing federal agencies to form their own DOGE teams to root out fraud, waste and abuse ahead of a July 4, 2026 sunset date for the U.S. DOGE Service Temporary Organization.
James led the multistate coalition that sued the following month after the Treasury Department granted DOGE-affiliated employees access to the Bureau of the Fiscal Service’s systems, which process federal payments and hold sensitive financial data. The states argued the administration had acted unlawfully by opening those systems to DOGE personnel, exposing state financial information and federal payments to risk.
Vargas initially sided with the states in February 2025, issuing a preliminary injunction barring Treasury’s DOGE team from the covered payment systems. Over the following months she modified that order to allow access for personnel who met specific vetting, training, hiring, reporting and mitigation requirements.
The bigger picture
The lawsuit was one of several legal clashes between James and the Trump administration. James, a longtime critic of the president, previously brought a civil fraud lawsuit against Trump and the Trump Organization in 2022 after campaigning on scrutinizing his business dealings. That case initially produced more than $450 million in penalties before an appeals court upheld Trump’s liability but threw out the financial penalty.
Fox News Digital reported that it reached out to the White House and the New York attorney general’s office for comment on Wednesday’s ruling.
