Federal District Court in Kentucky Halts Federal Contractor Vaccine Mandate for Federal Contractors in 3 States

This week has brought several blows to the Biden administration’s broad plans to mandate COVID-19 vaccines for healthcare institutions and now, federal contractors in certain states.  Specifically with regard to federal contractors, on November 30, 2021, a Kentucky federal district court issued a preliminary injunction halting the Biden administration from enforcing the vaccine mandate for federal contractors and subcontractors in all covered contracts in Kentucky, Ohio, and Tennessee.

The federal contractor vaccine mandate was part of President Biden’s extensive COVID-19 action plan announced on September 9, 2021.  In particular, Executive Order 14042 directed federal agencies and departments to include a new clause in their “contracts or contract-like instruments.”  This clause requires federal contractors and subcontractors to comply with a vaccination mandate and other safety protocols articulated in the Safer Federal Workforce Task Force’s Guidance (the “Guidance”).

On November 4, 2021, the attorneys general of Kentucky, Ohio, and Tennessee challenged President Biden’s authority to mandate vaccinations of federal contractor and subcontractor workforces.  This November 30, 2021 order from a Kentucky federal court imposed a preliminary injunction—an order used to stop activity or to preserve the “status quo” pending a trial or final judgment—to halt enforcement of the federal contractor vaccine mandate.

The Injunction Details

In establishing the court’s power to hear the case, the court called attention to the potential injury and real impact that a COVID-19 vaccine mandate on federal contractors may have within the challenging states.  According to 2020 data, the states of Kentucky, Ohio, and Tennessee were responsible for tens of billions of dollars’ worth of federal contracts performed in those states or held by vendors located within those states.

In its analysis, the court focused on two main inquiries:

1. Whether the President exceeded his statutory and constitutional authority in promulgating the executive order at issue; and
2. Whether the agencies at issue in this case followed the proper administrative procedures.

The President has powers under the Federal Property and Administrative Services Act (“FPASA”) to manage federal procurements; however, the court determined that President Biden exceeded his authority under the FPASA in promulgating Executive Order 14042.  Although presidents have broad powers under the FPASA delegated to them by Congress, the court noted “the President’s authority is not absolute” and cannot be a “blank check for the President to fill in at his will.”  The court also expressed concern that the federal contractor vaccine mandate exceeded the President’s constitutional authority as a potential violation of the U.S. Constitution’s Nondelegation Clause and 10th Amendment, specifically as an infringement of the states’ authority to regulate local matters of health and safety.

For the second inquiry regarding proper procedures in promulgating the vaccine mandate, the court largely sided with the Biden administration and found that appropriate procedures were followed.  Specifically, the court determined that the processes for the federal contractor vaccination mandate did not run afoul of required procedures under the Administrative Procedure Act (“APA”).  Further, the court was not persuaded by the states’ argument that the administration’s actions violated the APA’s requirement that agency actions are not “arbitrary” or capricious.”

Regardless, the court ordered a preliminary injunction on the grounds that, in all likelihood, the President may not use his congressionally delegated authority under the FPASA to manage federal procurements for imposing widespread vaccination requirements.

The Future: What Now?

For the time being, the federal contractor mandate is unenforceable in the states of Kentucky, Ohio, and Tennessee while the injunction stands (or until either the court orders otherwise or a trial is conducted on the merits).  For those federal contractors and subcontractors outside of Kentucky, Ohio, and Tennessee, there has been no such applicable injunction or stay, so Executive Order 14042 and the Guidance’s obligations remain in place.  It is possible, however, that this order could signal a trend for similar pending litigation.  Separate challenges to the federal contractor and subcontractor vaccine mandate await resolution in other courts—most notably a 7-state challenge to be heard soon by a Georgia federal court.

We will continue to monitor pending litigation for further developments.