California May Challenge Trump Administration’s Broadband Funding Conditions in Court

California faces a difficult legal challenge after accepting BEAD funds

If California accepts federal broadband funding, the state’s attorney general may be limited in how it can challenge conditions imposed by the Trump administration, according to Goodman.

Goodman said California would likely have to bring such a challenge in the US Court of Appeals for the District of Columbia Circuit. That court “basically can only review a conviction for fraud or corruption,” he said, adding that proving those claims would be “a very high bar.”

However, California could potentially take the case to the Ninth Circuit Court of Appeals if it sues before finalizing its agreement with the Trump administration.

“Right now, the California Legislature could sue and say, ‘Hey, this general condition is illegal. You can’t ask us to do that,’” Goodman said. The case could be litigated in California, where the Ninth Circuit “has kind of taken a favorable view of that argument.”

Under that approach, the state would have a “pretty good outlook for success,” Goodman said. The D.C. Circuit would present “a much tougher push,” he added. “It’s not impossible, but it’s very difficult.”

The CPUC has a deadline to sign the agreement with the NTIA at the end of this month. Goodman said California “will get a 30-day extension and then can challenge it in court.”

New York’s Affordable Broadband Act could also be affected

New York may face a separate conflict over its Affordable Broadband Act, which requires internet service providers to offer broadband service to low-income customers for $15 or $20 per month.

New York defended the law in court against broadband industry lobbying groups and won that legal battle less than two years later. The state nevertheless agreed to receive $664.6 million in Broadband Equity, Access, and Deployment (BEAD) funding from the Trump administration.

New York Governor Kathy Hochul said in an April 2026 press release that closing the digital divide requires bringing broadband to every household while “remaining affordable as it reaches them.”

“Through its landmark Affordable Broadband Act and its commitment to reaching the last 1 percent of unserved and underserved households, New York State is showing the rest of the world that both are possible,” Hochul said.

However, New York’s acceptance of BEAD funding may prevent the state from enforcing the Affordable Broadband Act against internet service providers that receive federal subsidies.

We reached out to Hochul’s office and New York State Attorney General Letitia James and will update this article if we hear back.