Filed Date: March 31, 2025
Case Ongoing
Clearinghouse coding complete
This case challenged the freezing of federal grant funds meant for community financial development. Plaintiffs, Inclusiv, Inc., a nonprofit financial institution, filed a lawsuit in the United States District Court for the District of Columbia. The plaintiffs named Citibank, the U.S. Environmental Protection Agency (EPA), and the EPA Administrator as defendants. Inclusiv sought injunctive relief and damages, claiming the defendants unlawfully blocked access to grant funds that had already been awarded and disbursed.
The dispute stemmed from the National Clean Investment Fund (NCIF), a program under the Greenhouse Gas Reduction Fund (GGRF), which Congress established through the Inflation Reduction Act of 2022. Inclusiv was selected as a grantee in April 2024 and awarded $1.87 billion under the CCIA grant program, allowing them to make commitments to 108 credit unions to help low and moderate-income communities reduce energy costs, create jobs, and improve financial security. Under the terms of the grant, the funds were held at Citibank, which served as a financial agent under an Account Control Agreement (ACA) executed with the EPA.
The dispute arose in February 2025, when the EPA allegedly froze Inclusiv’s GGRF funds, preventing the organization from distributing them to community lenders. This came following the EPA Administrator’s public remarks expressing his opposition to the GGRF, calling it “criminal” and vowing to recover the funds. On March 11, 2025, the EPA formally terminated Inclusiv’s grant, citing unspecified compliance concerns. Simultaneously, Citibank, which managed Inclusiv’s grant funds under an Account Control Agreement (ACA), declined to process any disbursements. On March 18, 2025, the U.S. District Court for the District of Columbia issued a TRO in Climate United Fund v. Citibank, halting the effects of the March 11 termination letter. In reliance on the TRO order, Inclusiv sought disbursement of funds on March 21. Citibank did not respond to this letter, nor disperse any funds.
On March 31, Inclusive filed its complaint alleging claims against both the EPA and Citibank. Against the EPA, it claimed the agency’s actions violated the Administrative Procedure Act for engaging in actions that were contrary to federal law and EPA regulations, and for being arbitrary and capricious. It also claimed that the EPA violated the Separation of Powers and the Vesting, Spending and Appropriations, and Take Care Clauses by failing to distribute funds appropriated by Congress. Additionally, Inclusiv claimed the EPA deprived it of the Fifth Amendment right to Due Process by terminating its funds without notice or an opportunity to be heard. Finally, plaintiffs asserted an Ultra Vires claim that the EPA exceeded their constitutional and statutory authority under the “Administrative Procedure Act, the Inflation Reduction Act, the Congressional Budget and Impoundment Control Act, and the Anti-Deficiency Act by withholding obligated funds in contravention of these plain congressional mandates.” Against Citibank, plaintiffs asserted state law claims of breach of contract and conversion.
Plaintiffs sought a declaration that (1) the notice of termination was void; (2) the suspension of the grant award violated the APA, Separation of Powers, and the Due Process Clause, and exceeded statutory authority conferred on the EPA; (3) and that Citibank’s freezing of Inclusiv’s account was contrary to law and violated their contractual obligations under the ACA. They also requested a permanent injunction prohibiting the enforcement of the March 11 termination letter, and enjoining defendants from “[s]uspending, terminating, or attempting to suspend or terminate Inclusiv’s grant award, except as permitted by governing law.”
On April 1, plaintiffs filed both a preliminary injunction motion and a temporary restraining order (TRO). The preliminary injunction motion requested the Court to prevent the government defendants from enforcing the March 11 termination letter or suspending Inclusiv’s grant award, and Citibank from violating its contractual obligations under the ACA. The TRO requested a restoration of the plaintiffs’ grant funds to its Citibank account, which had been removed when Inclusiv’s CFO checked the balance of its Citibank account on April 1. Plaintiffs previously did not seek a TRO on reliance on the EPA’s statement that they would not move the money while the TRO in Climate United Fund v. Citibank was in effect. There was a dispute over the nature of this removal, as defendants argued this was a routine transfer that occurred monthly. Plaintiffs stated that if the money was returned to their account, they would withdraw their request for TRO. However, they requested that the Court engage in more careful monitoring of the money.
On April 1, plaintiffs also filed notice of a related case, Climate United Fund v. Citibank. The court consolidated this case with Climate United Fund v. Citibank on April 15. On April 16, in light of the preliminary injunction granted in Climate United Fund v. Citibank and this case's consolidation with Climate United Fund, the Court denied the plaintiffs' motion for preliminary injunction as moot. Further updates on this case can be found on Climate United Fund's Clearinghouse page.
Summary Authors
Jillian Snyman (4/2/2025)
Climate United Fund v. Citibank, District of District of Columbia (2025)
For PACER's information on parties and their attorneys, see: https://www.courtlistener.com/docket/69825680/parties/inclusiv-inc-v-united-states-environmental-protection-agency/
Chutkan, Tanya Sue (District of Columbia)
Johnson, Jay Christopher (District of Columbia)
Keraga, Kyle H. (District of Columbia)
Allen, Kenneth Winn (District of Columbia)
McElroy, Saunders Lee (District of Columbia)
See docket on RECAP: https://www.courtlistener.com/docket/69825680/inclusiv-inc-v-united-states-environmental-protection-agency/
Last updated Aug. 21, 2025, 9:58 p.m.
State / Territory: District of Columbia
Case Type(s):
Presidential/Gubernatorial Authority
Special Collection(s):
Trump Administration 2.0: Challenges to the Government
Trump Administration 2.0: Challenges to the Government (Spending Freezes/Cuts)
Trump Administration 2.0: Challenges to the Government (Environmental Protections)
Key Dates
Filing Date: March 31, 2025
Case Ongoing: Yes
Plaintiffs
Plaintiff Description:
Plaintiff is certified by the U.S. Department of the Treasury as a Community Development Financial Institution (CDFI) and partnered with credit unions to promote financial security and independence for everyday people.
Plaintiff Type(s):
Non-profit NON-religious organization
Public Interest Lawyer: No
Filed Pro Se: No
Class Action Sought: No
Class Action Outcome: Not sought
Defendants
Citibank (Sioux Falls, South Dakota), Private Entity/Person
United States Environmental Protection Agency, Federal
Defendant Type(s):
Case Details
Causes of Action:
Ex Parte Young (Federal) or Bivens
Administrative Procedure Act, 5 U.S.C. §§ 551 et seq.
Declaratory Judgment Act, 28 U.S.C. § 2201
Ex parte Young (federal or state officials)
Constitutional Clause(s):
Due Process: Procedural Due Process
Spending/Appropriations Clauses
Available Documents:
Outcome
Prevailing Party: None Yet / None
Nature of Relief:
Source of Relief:
Issues
General/Misc.:
Presidential/Gubernatorial Authority: