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By Gabe Whisnant and Sonam Sheth
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A federal judge on Friday extended a temporary ban preventing Elon Musk's government cost-cutting task force, the Department of Government Efficiency (DOGE), from accessing Treasury Department systems that handle trillions of dollars in payments.
U.S. District Judge Jeannette Vargas declined to rule on a longer term preliminary injunction at a hearing in Manhattan but kept in place an initial temporary restraining order against DOGE that was issued on Saturday.
The Context
Friday's arguments were part of a sprawling lawsuit brought by 19 Democratic attorneys general that sought to block DOGE from accessing personal data.
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What To Know
The attorneys general filed the lawsuit after DOGE employees gained access to the Treasury's payments system, which controls trillions of dollars in federal disbursements for tax refunds, veterans' benefits, Social Security payments, Medicare, Medicaid and other services.
It also houses a massive network of Americans' personal and financial information.
DOGE also obtained access to the Office of Personnel Management—which essentially functions as the government's HR arm and contains the personal data of millions of federal government workers—and the General Services Administration, among other agencies.
The lawsuit alleges that by granting Musk and his team access to the Treasury's payments system, the Trump administration violated federal law.
"The President does not have the power to give away our private information to anyone he chooses, and he cannot cut federal payments approved by Congress," New York attorney general Letitia James, one of the plaintiffs in the suit, said in a statement last week.
The lawsuit names Trump, Treasury Secretary Scott Bessent and the U.S. Treasury Department as defendants.
Protesters gathered outside the courthouse as Friday's hearing was underway.
Andrew Amer, a lawyer in the New York attorney general's office, presented arguments on behalf of the plaintiffs. Jeffrey Oestericher, the head of the civil division at the U.S. attorney's office for the Southern District of New York, argued on behalf of the government.
Amer said the plaintiffs incurred "concrete and particularized injury" as a result of DOGE's Treasury access, adding, "We are here because the state's bank information has been accessed. That has happened. We know it's happened."
Oestericher countered that while "it's clear that the states' concern is that payments for the states are going to be flagged and blocked," those claims cannot be "bootstrapped" to an access issue.
Vargas grilled the defendants about whether any of the information that Musk's team accessed was shared within federal agencies, to which the government's lawyer replied, "The short answer is we don't presently know."
The judge also asked whether the two DOGE workers who were granted access to Treasury systems had any training beforehand.
"I don't actually know" the answer, Oestericher said.
Amer later pushed back on the claim that DOGE's employees accessed the data to help with the Treasury's core functions, noting that one of Musk's staffers said his role was to "operationalize the President's policy priorities."
"This was unlawful from Day 1," Amer said. "It was an attempt to operationalize the administration's priorities in a way that was not permitted by law."
Last week's lawsuit from the 19 states highlighted that until recently, only a small number of career civil servants had access to the Bureau of Fiscal Service—the Treasury's payments system—so they could ensure the system was functioning securely and as intended when it disburses federal funds and payments.
That changed, the lawsuit says, when Trump and Bessent granted "expanded access" to BFS to "political appointees and 'special government employees' for reasons that have yet to be provided," except for "one apparent purpose."
The purpose "is to allow DOGE to advance a stated goal to block federal funds from reaching beneficiaries who do not align with the President's political agenda," the complaint alleges. "For example, DOGE was tasked with freezing payments issued by the U.S. Agency for International Development ('USAID') and sought access to BFS payment systems to accomplish that goal."
What People Are Saying
Amer said at Friday's hearing: "Less than three weeks ago, the Treasury Department began implementing the engagement plan ... to flag and pause funding requests that are authorized by congressional appropriation simply because of an ideological litmus test that they don't align with the administration's priorities."
Oestericher countered in his closing arguments: "There's nothing unlawful about the Treasury carrying out the priorities of a new administration using special government employees."
What Happens Next
Vargas said she will issue a ruling on the request for a preliminary injunction "shortly" but it won't be on Friday.
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