Oregon Attorney General Dan Rayfield sued the U.S. Department of Health and Human Services Jan. 13 over grant funding conditions the state says require it to agree to discriminate against transgender people. The lawsuit is Oregon's first against the Trump administration in 2026. The state sued the administration 52 times in 2025. “Oregon has worked hard to expand access to medical choice and make sure everyone can get the care they need,” Rayfield said in a statement. “This policy uses federal money to interfere with deeply personal medical decisions that belong to patients, families, and their doctors. Agencies shouldn’t be forced to take care away from people just to keep their funding.” Eleven other states are parties to the suit, which was filed in U.S. District Court in Rhode Island. They include New York, California, Colorado, Delaware, Illinois, Michigan, Minnesota, Nevada, Rhode Island, Vermont and Washington. The lawsuit targets what the states allege is "a novel and ambiguous funding condition" from HHS making receiving some grants dependent on the states following Title IX requirements, including the addition of a Trump executive order. The order, "Defending women from gender ideology extremism and restoring biological truth to the federal government," calls for the recognition of two sexes and says federal funding cannot "be used to promote gender ideology." The funding goes to federal grants for health, education and research, amounting to more than $300 million for the party states. The suit argues requiring agreement to comply with the order as a term to receive funding goes against Oregon and other states' laws that protect against discrimination because of gender identity. The states' complaint says HHS has violated the Administrative Procedure Act and the separation of powers and the Spending Clause with the funding requirements. The suit asks for the gender conditions to be found unlawful and stopped from being enforced. Oregon filed four suits in 2025 over gender affirming care or threats to funding over gender affirming language.

U.S. Senator Mark Kelly sued U.S. Defense Secretary Pete Hegseth on Jan. 12, saying Pentagon proceedings to demote the Arizona Democrat from his retired Navy captain rank violated Kelly's free speech rights because he urged troops to reject unlawful orders. Kelly, a retired Navy captain and former astronaut, said in his lawsuit in federal court in Washington that the Defense Department’s actions were retaliatory and violated the U.S. Constitution’s First Amendment protection of free speech. The lawsuit asked the court to block Hegseth's review and declare his actions unlawful. U.S. District Judge Richard Leon set a hearing for Jan. 15 on Kelly's request for a temporary restraining order. A Pentagon representative in a statement said it was aware of Kelly's lawsuit but does not comment on pending litigation. In November, Hegseth blasted Kelly for appearing in a video that reminded service members of their duty to reject unlawful orders. In the clip, Kelly stated: “Our laws are clear: you can refuse illegal orders.” Kelly’s remarks came as more Democrats were criticizing Republican President Donald Trump’s decisions to deploy the National Guard in U.S. cities and authorize lethal strikes on boats suspected of smuggling drugs from Latin America. Hegseth issued a censure letter on Jan. 5 accusing Kelly of “conduct unbecoming an officer.” The letter cited Kelly’s public criticism of military leadership and the November video. In a statement on Jan. 12, Kelly said Hegseth's "unconstitutional crusade against me sends a chilling message to every retired member of the military: if you speak out and say something that the President or Secretary of Defense doesn’t like, you will be censured, threatened with demotion, or even prosecuted.” Hegseth’s censure of Kelly followed a sweeping shakeup at the Pentagon during Trump’s second term. Several top military leaders were removed, including the chairman of the Joint Chiefs of Staff, the Navy’s top officer, and the director of the National Security Agency.

The U.S. Supreme Court declined on Jan. 12 to hear Citigroup's bid to avoid a lawsuit accusing the bank of causing more than $1 billion of losses by orchestrating a vast fraud at the bankrupt Mexican oil and gas services company Oceanografia. The justices turned away Citigroup's appeal of a lower court's May 2025 decision to revive the decade-old lawsuit by more than 30 plaintiffs including Oceanografia bondholders, shipping companies and Netherlands-based Rabobank. By doing so, the Supreme Court let the lower court's decision stand. Oceanografia provided drilling services to the state-owned oil company Petroleos Mexicanos prior to being seized by Mexico's government in 2014. It was declared bankrupt two years later. The plaintiffs accused New York-based Citigroup's Banamex unit of advancing $3.3 billion to Oceanografia between 2008 and 2014, despite knowing that the company had too much debt and had forged Pemex signatures on authorization forms. Citigroup later uncovered $430 million of fraudulent cash advances. The U.S. Securities and Exchange Commission fined Citigroup $4.75 million in 2018 over Banamex's internal controls. A three-judge panel of the 11th U.S. Circuit Court of Appeals found sufficient allegations that Citigroup withheld key information about Oceanografia from the plaintiffs, while benefiting from interest payments it collected on the advances. The panel also said that assuming the allegations were true, it "strains credulity" that a sophisticated bank such as Citigroup would not have known what Oceanografia was doing. Only the claims by bondholders were at issue in Citigroup's appeal to the Supreme Court. Citigroup said the bondholders should not have been allowed to pursue their "garden-variety" securities fraud civil claims under the Racketeer Influenced and Corrupt Organizations Act, or RICO, a federal anti-racketeering law that allows for triple damages. The bank also said the 11th Circuit decision conflicted with rulings from three other federal appeals courts. In response, bondholders said Congress did not intend to preclude their RICO claims simply because someone else, such as the SEC, might have pursued securities fraud claims. The bondholders also said it was possible no private plaintiff could bring securities fraud claims because there was no allegation that anyone traded in reliance on fraudulent statements.