A federal appeals court grilled the Trump administration on Wednesday over its bid to overturn a ruling that stopped it from gutting three small federal agencies the administration considered “unnecessary.”

In March 2025, President Donald Trump signed an executive order reducing several agencies, including the Minority Business and Development Agency, the Federal Mediation and Conciliation Service, and the U.S. Interagency Council on Homelessness, to the minimum staffing and size mandated by law, as part of sweeping cuts his administration made to the size of the federal government. The order was challenged by a coalition of Democrat-led states, leading a federal district court judge to strike down the order as unlawful. A three-judge panel on the U.S. Court of Appeals for the 1st Circuit heard arguments from the Justice Department and the coalition of Democratic states as the administration seeks to reverse that ruling.