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Government Grants: Disputes and Litigation

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When federal grant disputes escalate, Venable draws on extensive experience in administrative grant appeals and federal court litigation to help clients challenge adverse findings, defend funding, and resolve complex conflicts with federal and state agencies.

Venable’s federal grant attorneys strive to work cooperatively and collaboratively with federal, state, and local funders and pass-through entities of all types. When negotiations falter or parties reach an impasse, our team helps clients to develop a strategic response, and to address issues such as adverse audit findings, agency-imposed cost disallowances, grant terminations, and even allegations of fraud. With respect to administrative appeals under agency-specific procedures, our attorneys have litigated:

  • Department of Health and Human Services (HHS) Departmental Appeals Board grant appeals under 45 C.F.R. Part 16
  • National Institutes of Health (NIH) grant-related appeals under 42 C.F.R. Part 50, Subpart D
  • Department of Education (ED) Office of Hearings and Appeals/Office of Administrative Law Judges (OHA/OALJ) appeals, as well as appeals under less-formal procedures adopted by ED in 2025
  • Federal Emergency Management Agency (FEMA) appeals
  • Department of Defense (DoD) appeals under the DoD Grant and Agreement Regulations (DoDGAR), 32 C.F.R. § 22.815
  • Department of Veterans Affairs (VA) appeals, administered by the VA under its debt collection procedures
  • Less formal procedures offered by the U.S. Agency for International Development (USAID) and other agencies

When agency review procedures prove inadequate, Venable’s attorneys are experienced with litigation in both federal district court and the Court of Federal Claims (COFC). As federal court jurisdiction over grant disputes is evolving and complex, our experience in both district court and COFC enables us to provide comprehensive, thoughtful support in developing and pursuing litigation strategies.

We also recognize that federal action in critical research, social service, and environmental stewardship programs can have consequences that are more far reaching than just the impact upon the particular grantee whose federally funded project is impacted. In this regard, we have also represented clients in preparing amicus briefs in federal district and appellate circuit courts, as well as the U.S. Supreme Court.

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Representative Matters
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  • Defended the termination of a billion-dollar grant award by EPA. Successfully secured a temporary restraining order at the U.S. district court level. Litigation continues at the appellate level
  • Represented several health science organizations in preparing and submitting various amicus briefs in federal district and federal appellate courts and at the U.S. Supreme Court. The district court judge quoted from our brief in rendering her decision in favor of our position
  • Successfully appealed the termination of 17 grants by the Department of Housing and Urban Development (HUD) awarded to a national nonprofit client, totaling more than $70 million in federal funding. In light of the appeals, HUD rescinded all 17 termination notices and reinstated all 17 grants
  • Successfully appealed the termination of four grants by ED awarded to a national nonprofit client totaling nearly $60 million in federal funding. In response to the appeals, ED entered into settlement negotiations and ultimately agreed to reinstate all four grant awards
  • Successfully appealed the termination of multiple NIH grants in 2025 for a national research university, resulting in reinstatement of the grants
  • Led multiple HHS Departmental Appeals Board appeals arising from disallowances asserted by the Administration for Children and Families (ACF) in relation to programs funded by ACF’s Office of Refugee Resettlement
  • Successfully disputed a substantial cost disallowance asserted by the VA against a large nonprofit in the Support Services to Veteran Families (SSVF) program, and separately resolved similar findings asserted against another nonprofit SSVF grantee before they became final
  • Defended a nationally recognized university before DHS auditors seeking to recover more than $200 million in federal funds based upon alleged cost unallowability issues. Resolved matter by refunding only small inadvertent duplicative payments made by the funding agency, which were less than 5 percent of the original amount alleged to have been unallowable
  • Represented a local government on cost allowability issues pertaining to an unsuccessful grant program funded by the DOT’s Federal Transit Authority. After presenting argument and information, resolved the matter for a small fraction of the original disallowed amount
  • Defended a state agency in audits by HUD regarding the use of federal funds. Successfully disputed and defended against all cost unallowability claims and resolved audits with relatively minor programmatic changes
  • Represented a nonprofit in responding to an HHS cost disallowance. Issues ran the gamut of allowability, allocation, claims of insufficient documentation, and inconsistent cost treatment. Resolved the matter for a fraction of the originally disallowed amount