The Supreme Court’s decision to halt a $1.5 billion payment to the government for the phone bills of millions of Americans was a setback for the Obama administration.
The decision came in a case brought by the American Civil Liberties Union, which had sued the federal government in federal court.
In the past, the Trump administration had said that the payments were meant to benefit states, not the federal agency, and that it had no choice but to pay the bills.
The ACLU argued that the administration had violated the Constitution’s due process clause by refusing to comply with a court order to pay $1 billion in back taxes.
The Supreme Courts declined to hear the case.
The administration was hoping that the court would reverse a lower court’s ruling that it could keep paying the taxes.
But in the meantime, the administration agreed to stop paying them, the ACLU argued in court filings last week.
“We are pleased that the Court’s Order does not result in any constitutional violations, and we will continue to fight for the President to honor the Court of Appeals’ decision to stop the payment,” said Laura B. Crain, senior staff attorney for the ACLU’s Speech, Privacy, and Technology Project.
In a brief filed in the Supreme Court on Wednesday, the government said that “the President must now begin to pay back the money that was unlawfully withheld.”
“The Administration intends to pay all the back taxes that were due under the Act of May 15, 2017,” the brief said.
“The President’s request for this payment is in line with the President’s obligation to comply fully with the Constitution and statutes.
The Administration will continue its efforts to make payments to the states and municipalities under the law.
The President should comply fully and expeditiously with this order.”
The Department of Justice declined to comment on the Supreme Courts’ ruling, but a spokesman said that, while the department is reviewing the decision, the agency is “confident that it will prevail in its case to vindicate the President.”
“As we have previously stated, the Administration’s position in this matter is entirely consistent with the Administration, which is now fully complying with the Court,” spokesman Jonathan Ferrell wrote in an email to reporters.
“In our view, this case should be resolved before the Court issues a final order that could affect billions of dollars in back tax payments to our state and local governments.”
The court ruling came in an administrative lawsuit brought by a group of Republican governors, who argued that they were entitled to receive back taxes for the years 2001 to 2020 under a law enacted after Hurricane Katrina.
They argued that their states had no way of knowing whether the federal agencies that were supposed to pay them were actually doing so.
But the Obama Administration has maintained that it is paying back the taxes, arguing that it was complying with a federal law that Congress passed in 2003, which allows for such payments.
The Trump administration argues that the law was meant to help states, and not the government, and is arguing that the Supreme’s decision is an unconstitutional attempt to change the law so that states would be forced to pay for back taxes and that the money would be a waste.
The court is expected to issue its ruling by the end of the month.
The case will likely be appealed.
The ruling came after the Trump Administration asked the Supreme court to strike down the states’ right to withhold back taxes, which would force states to cover their share of the cost of the bills, which can reach tens of millions per year.
The Obama administration argued that states could withhold their own tax and refund that to the federal Treasury without having to pay taxes on the money, which amounts to a subsidy.
But some states have argued that Congress has the power to make such payments, and they have pointed to the fact that the federal governments has made these payments for more than a century.
In September, the Supreme was asked by Democrats to rule on a similar case brought against the Obama administrations decision to withhold money from states and localities.
In that case, the Obama Justice Department argued that those payments are constitutional because they are part of a federal tax code.
But Justice Anthony Kennedy, who served as the court’s chief justice, said that that’s not what the law says.
“Congress did not intend that this money be used for the purpose of subsidizing the states,” Kennedy said.
But Republican attorneys general and conservative groups in the court have been challenging the administration’s efforts to withhold those payments.
“This decision demonstrates the need for Congress to take action to fully enforce the law, to restore federal fiscal responsibility, and to avoid the threat of future taxpayer bankruptcies,” said Jennifer Cogan, senior counsel for the Competitive Enterprise Institute, which has been challenging those payments since before the 2010 election.