A federal judge on Thursday ordered the U.S. Department of Health and Human Services (HHS) to release $65 million in unpaid legal fees owed to nonprofit organizations representing unaccompanied migrant children in deportation proceedings. The funds were disbursed within an hour of the court’s 12 p.m. Pacific time deadline on Friday, according to U.S. District Judge Araceli Martinez-Olguin.
The payment resolves part of an ongoing legal dispute over a federal contract that expired on July 31, affecting 90 nonprofit providers and more than 24,000 unaccompanied minors across the U.S. The contract funded legal services for children in U.S. custody, many of whom face deportation without representation. This is the second time the judge has ordered compliance with a preliminary injunction in the case.
HHS did not immediately respond to requests for comment on the ruling. In a prior statement to The Los Angeles Times, the agency said it had remained “fully compliant with legal and regulatory obligations” and denied any intent to discourage children from seeking legal relief.
The dispute stems from the Trump administration’s decision to allow the contract to lapse, leaving nonprofits without funding and forcing layoffs at some organizations. The administration later awarded a $150 million contract to the Houston-based Burke Law Group—a firm with ties to the president—to provide legal representation to immigrant children, despite the group having only two attorneys specializing in immigration law out of 26 total staff.
Background: Contract Lapse and Legal Fallout
The original contract, which expired July 31, funded legal services for unaccompanied minors, many of whom fled violence or persecution in their home countries. The lapse disrupted services for thousands of children, with nonprofits reporting staff reductions and uncertainty over case continuity. The Acacia Center for Justice, one of the affected providers, laid off staff and warned that children could be left without representation ahead of court dates.
A federal judge ruled last year that the government must continue funding these services. However, HHS withheld payments for months, arguing in court filings that it was reviewing the legitimacy of the nonprofits’ work. The administration also sought to extend the prior contract only if providers shared confidential client information, a condition nonprofits resisted on privacy grounds.
New Contract Raises Concerns
On August 15, the Office of Refugee Resettlement (ORR) plans to begin a new $150 million contract with Burke Law Group, awarded without a standard bidding process. Critics, including immigrant rights groups, have called the selection “clearly unqualified”, citing the firm’s lack of immigration law expertise. The contract’s terms remain unclear, but ORR officials have stated that children “need legal representation” and are working to resolve the matter.
Legal and Advocacy Responses
Plaintiffs in the lawsuit, including the Immigrant Defenders Law Center, argue that the withholding of funds left children vulnerable. Alvaro M. Huerta, the center’s director of litigation, stated in a written statement that “while the government withheld funding in defiance of its obligations, children were left to face deportation proceedings alone, and some potentially returned to the very abuse, persecution, and danger they fled.”
Immigrant advocates have also raised concerns about the new contract’s potential impact. Bettina Rodriguez Schlegel, chief of staff at Acacia, emphasized that “children must continue to be represented by attorneys who specialize in immigration law and are trained to handle trauma.”
HHS has not detailed how the new contract will address the backlog of cases or ensure continuity for children already in legal proceedings. The agency’s spokesperson said in a statement that it is “actively working to resolve this matter.”