Week in Review

IN THE NEWS:

• The U.S. Supreme Court issued a 6-3 order allowing the Trump Administration to resume deportations of migrants to countries not identified in the migrants’ removal orders. The majority did not state a reason for pausing the order issued by Judge Brian E. Murphy of the U.S. District Court for Massachusetts, who had found that the deportations violate due process rights by failing to give detainees meaningful notice. The Court also did not decide the legality of the deportation policy. The Court ordered a full oral argument on whether the policy violates the Due Process Clause of the U.S. Constitution or international treaties on torture.
• The U.S. Department of the Treasury issued a temporary rule automatically enrolling more than 60 million children in Trump Accounts, a tax-deferred savings and investment account, starting October 1, 2026. The automatic enrollment replaced the previous opt-in structure that required parents or guardians to submit an IRS form with a tax return or apply through the website. Treasury Secretary Scott Bessent stated that more than 7 million children have signed up for Trump Accounts as of late July and roughly 86% are from families earning less than $200,000. The Treasury Department has not provided full details on how parents or guardians can claim automatically created accounts to make their own contributions.
• A federal court ruled that states can apply sports gambling laws to sports-related wagers on prediction markets. Kalshi and other prediction market platforms argued that the federal regulatory authority of the Commodity Futures Trading Commission (CFTC) preempts state regulation. The court, however, determined that the sporting event outcomes that customers place bets on remain outside the CFTC’s exclusive jurisdiction and that states may enforce their sports gambling laws against prediction market platforms. The U.S. Court of Appeals for the Sixth Circuit’s decision conflicted with a ruling from the U.S. Court of Appeals for the Third Circuit, prompting some experts to anticipate further litigation at the U.S. Supreme Court.
• The Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) issued a final rule expanding notice requirements for people who store regulated explosive materials, such as dynamite and detonators. Existing regulations require people storing these materials to notify local fire safety officials when storage begins and report the type of explosives, the storage capacity, and the site location. The new rule requires people who store explosives to provide an updated notice every 12 months, a notice when storage ends, and keep copies of each notice for five years. The ATF explained that keeping officials informed about explosives storage helps firefighters plan safer responses to emergencies.
• The Board of Governors of the Federal Reserve System proposed rules under the GENIUS Act for companies under its supervision that issue payment stablecoins, digital assets used for payments that issuers promise to exchange for a fixed amount of money. The proposal would require those companies to hold assets worth as much as their stablecoins still in circulation and keep those assets separate from their other holdings. Issuers would generally have to pay customers within two business days after receiving a request to exchange stablecoins for money. The Board explained that the proposed safeguards would help protect stablecoin holders from financial losses.
• The U.S. Postal Service (USPS) changed the environmental review processes it uses to adhere to the National Environmental Policy Act (NEPA). The USPS stated that it made the amendments to reduce regulatory burdens and bring its operations into compliance with recent legislation and judicial decisions establishing that NEPA is a procedural law not meant to subject agencies to substantive environmental responsibilities. The changes placed most of the USPS’s routine and administrative actions outside NEPA’s scope, narrowing the set of circumstances that trigger environmental review.
• Connecticut implemented a new law that regulates artificial intelligence (AI) companies and chatbots. The law prohibits the sale of consumers’ geolocation data to prevent personal data from being used to set prices. The law also protects employees who report AI outputs that pose a “catastrophic risk” to the public from employer retaliation. Companies that offer “AI companions” are also required to have protocols for detecting when user interactions indicate a risk of suicide, self-harm, or imminent violence, and for referring users to mental health resources.
• The Indiana Utility Regulatory Commission initiated an investigation into the operations of the Northern Indiana Public Service Company after recent storms caused extended power outages for thousands of residents. The commission indicated that the investigation would seek information about the thoroughness of the utility’s extreme-weather preparedness and its use of third-party contractors to mitigate storm impacts. The commission acted after residential customers, consumer advocates, and Indiana Governor Mike Braun demanded accountability from the utility company, which received approval for $2 billion to upgrade transmission and distribution infrastructure in 2026.

WHAT WE’RE READING:

• In a recent article in the Energy Law Journal, Uma Outka, a law professor at the University of Kansas, and Danielle Stokes, an associate professor of law at the University of Richmond, argued that centralized, state-level permitting for renewable energy projects could address development bottlenecks while incorporating input from local communities. Outka and Stokes contended that recent efforts by state governments to reclaim permitting authority from counties, municipalities, and townships would remove regulatory obstacles for renewable energy producers. Outka and Stokes evaluated policy changes in Michigan, New York, Illinois, and Massachusetts and concluded that states preempting or limiting local government authority can allow new development while maintaining opportunities for communities to negotiate financial and infrastructural benefits.
• In a recent report, the U.S. Government Accountability Office (GAO) examined how the U.S. Department of Education oversees federal K-12 education programs and tracks chronic absenteeism, defined as missing at least 10 percent of school days. GAO found that the Education Department stopped its most comprehensive compliance reviews in 2026, increasing the chance that the misuse of federal education funds would go undetected. GAO also found that absenteeism rates could be inflated because the Education Department measured enrollment on day, excluding students who enrolled at a later date. GAO recommended that the Education Department reinstate broader compliance reviews and require states to use compatible methods for reporting enrollment and chronic absenteeism so the Education Department can calculate accurate absenteeism rates.
• In a recent New America report, Daniel Kimmage and Darjan Vujica, fellows in the Future Security program of New America, argued that the most urgent AI threat is not a future autonomous system but the present-day erosion of democratic institutions and reinforcement of authoritarian repression. Kimmage and Vujica examined how authoritarian regimes are deploying AI to fabricate reality and silence dissent through deepfake pornography and surveillance. They noted that publicly available models have placed these capabilities in the hands of anyone with a laptop. Kimmage and Vujica contended that the United States has disarmed offices fighting information manipulation at agencies such as the Federal Bureau of Investigation, even as AI-generated content infiltrates domestic politics. They recommended that policymakers document AI’s harms and impose disclosure requirements.

EDITOR’S CHOICE:

• In an essay in The Regulatory Review, Suzanne Eckes, the Susan S. Engeleiter Professor of Education Law, Policy, and Practice at the University of Wisconsin–Madison, and Charles J. Russo, the Joseph Panzer Chair in Education in the School of Education and Health Sciences at the University of Dayton, explained that although states and local school boards control and regulate public schools, courts can intervene when decisions about what schools teach violate constitutional rights. Eckes and Russo described how a federal court found that school officials in Arizona violated constitutional rights by targeting a Mexican American studies program for racially discriminatory reasons. Eckes and Russo also noted that a Virginia state court rejected parents’ challenge to an anti-racism curriculum, concluding that parents could not veto lessons because the content conflicted with their beliefs. Eckes and Russo questioned whether President Donald J. Trump’s executive order addressing school curricula could survive court challenges, given federal laws restricting what public schools teach.