ICMYI: Warren Grills Trump Pick for Top Lawyer at Department of Health and Human Services Over Illegal Grant Cancellations
Senator Warren: “You are the lawyer who is giving advice to Secretary Kennedy…there's only one condition under which you can [cancel these grants], and that is, if the state has materially failed to comply with the agreements or other conditions…”
Warren questioned Stuart on HHS’s cancellations of grants that benefit the health of the American people.
Washington, D.C. — At a hearing of the Senate Finance Committee, U.S. Senator Elizabeth Warren (D-Mass.) questioned Michael Stuart, nominee for general counsel of the Department of Health and Human Services (HHS), about the legality of the Department's mass cancellation of grants.
Since January, the Department of Health and Human Services has been subject to more than a dozen lawsuits that allege the Department has illegally cancelled contracts and grants, including Substance Abuse and Mental Health Services Administration (SAMHSA) grants, which the administration argued were “no longer necessary.”
Federal law states that HHS can terminate SAMHSA grants only if “a state has materially failed to comply with the agreements or other conditions required for the receipt of the grant.” Senator Warren read Mr. Stuart the relevant law, but he refused to commit to advising Secretary Kennedy that canceling SAMHSA grants for being “no longer necessary” would be unlawful — despite a clear ruling from a federal judge indicating these actions were illegal.
“The only grounds [Secretary Kennedy] gave [for cancelling SAMHSA grants] were grounds that are not in the contract and clearly in violation of the law. So I hope, Mr. Stuart, based on what you said, you will deliver that message to Secretary Kennedy and give advice that is consistent with the law in the future," said Senator Warren.
Transcript: Hearing to Consider the Nomination of Michael Stuart to be General Counsel at the U.S. Department of Health and Human Services
Senate Finance Committee
July 31, 2025
Senator Warren: Congress is deeply worried about the opioid crisis and mental health issues, so last year, we allocated more than $7 billion for the prevention and treatment of these conditions. Secretary Robert F Kennedy Jr. heads the Department of Health and Human Services, which is charged by law with administering that funding through the Substance Abuse and Mental Health Services Administration, SAMHSA. Mr. Stewart, if confirmed, you will be the top lawyer at HHS advising Secretary Kennedy, so let's do a little law so that we can understand what kind of advice you would give to the secretary. 42 USC 300x 55 says “HHS shall terminate SAMHSA grants only if a state has materially failed to comply with the agreements or other conditions required for the receipt of the grant.” That is the only condition under which Congress says these grants can be canceled. So Mr. Stewart, let's start easy. I've read you the statutory language. Can Secretary Kennedy wake up in a bad mood one morning and simply say to the worker who is running a suicide hotline, I don't like your face, I'm canceling your state's grant money.
Michael Stuart: Well, let me first respond by saying, thank you very much for the opportunity, and I look forward to working with you in the future. I did receive your letter.
Senator Warren: I appreciate that, but we're very limited on time. Would that be legal?
Michael Stuart: So what I can tell you is that in every instance, I'll give the advice of complying with the law.
Senator Warren: No, that’s not the question I asked. I'm asking you, if Secretary Kennedy wakes up in a bad mood one morning, can he say to somebody. “I don't like your face, so I'm canceling your state's SAMHSA grant?”
Michael Stuart: Well, what I'd like to do is review the code and all the code provisions.
Senator Warren: I just read you the code language, did you have any problem understanding it? “You can only do cancellation if a state has materially failed to comply with the agreements or other conditions required for the receipt of the grant.” That's all it says.
Michael Stuart: The key words there are the agreements and the terms of those.
Senator Warren: You think there’s an agreement out there that says that the secretary can cancel a grant because I don't like your face?
Michael Stuart: So I think that—I don't believe—that's been the case. I don't believe that's ever happened.
Senator Warren: I have no reason — I’m asking you about the legal advice you will give, and I want to understand under a statute that says, “these are the only conditions under which a grant can be canceled,” do you think Secretary Kennedy can say, “I don't like your face, so I'm canceling your grant?”
Michael Stuart: So expecting that term I don't like your face, what I'm telling you is that the terms and conditions of those agreements matter, and so we have to review those.
Senator Warren: I don't think any of them say I don't like your face.
Michael Stuart: No, I agree with you on this, but I haven't heard Secretary—
Senator Warren: Look, we're three minutes into this. Can I just have a “Yeah, that would be illegal?”
Michael Stuart: You can't cancel a contract, to my knowledge, because you don't like somebody's face.
Senator Warren: Great, okay, let's do a second one. What if Secretary Kennedy wakes up in a bad mood, and he said, “I heard you're a Republican, and it turns out I really don't like Republicans, so I'm going to cancel your grant for your addiction treatment center.” You think that would be legal?
Michael Stuart: Secretary, I think that there's a formula to review these things. I believe Secretary Kennedy would go to counsel and ask for these things.
Senator Warren: Yes, there is a formula for reviewing them, I'm asking if the Secretary wanted to do that, he wanted to cancel all the grants that are held by Republicans. Would that be legal?
Michael Stuart: My advice would be to follow the rules and the laws with respect to every one of these.
Senator Warren: You are the one who is supposed to tell him how to interpret a statute that says the only conditions are if the state is not meeting the terms of the contract.
Michael Stuart: We've got to meet the terms of the contract. If they're outside the terms of the contract, it can be canceled.
Senator Warren: Okay, so can he cancel because you're a Republican?
Michael Stuart: If it's not included in the terms of the contract, no.
Senator Warren: It’s not included in the terms of the contract, bingo. Okay, so the answer is that would be illegal, right? How about the third one? “Your work is no longer necessary. Your state's grant is canceled.” Let's just say there's nothing in the contract about whether the work is necessary. Would it be illegal to cancel the grant under those conditions?
Michael Stuart: That’s not as easy a question as simply saying yes or no. Well, listen, we've got to be able to look in terms of the intent of these contracts as well.
Senator Warren: No, that's not what the statute says. And you are the lawyer who is giving advice to Secretary Kennedy, and so I want to know as the person who gives advice when you read statutory language that says there's only one condition under which you can do this, and that is, if the state has materially failed to comply with the agreements or other conditions, that you can cancel the grant. And by the way, you have to give notice and hearing for doing that. Can he wake up and say, “we decided we don't need you anymore?”
Michael Stuart: My advice will always be to follow the terms and agreements.
Senator Warren: So in this case, you would say “Can’t do that, Mr. Secretary?”
Michael Stuart: I will give the advice to follow the terms of both the code and those agreements.
Senator Warren: Okay, and if the contract doesn't say that, you will tell the secretary not to do it.
Michael Stuart: In every instance, we will follow the terms and conditions and make sure we follow the code.
Senator Warren: I really hope you do follow the terms and conditions in the agreement, because that is exactly the letter that Secretary Kennedy sent canceling projects all over this country, and the only grounds he gave were grounds that are not in the contract and clearly in violation of the law. So I hope, Mr. Stuart, based on what you said, you will deliver that message to Secretary Kennedy and give advice that is consistent with the law in the future. Thank you.
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