The Trump administration has suffered its second loss in as many months over a policy to change the rules regarding sex marker designations on U.S. passports for transgender and nonbinary people.

In late June, U.S. District Judge Julia Kobick, a Joe Biden appointee, blocked the U.S. Department of State from making two significant alterations to its passport policy regarding sex markers.

“Whereas the State Department previously permitted transgender passport applicants to self-select male (“M’) or female (‘F’) sex markers that correspond to either their gender identity or sex assigned at birth, it now requires that passports reflect only the holder’s sex assigned at birth,” the court explained in its initial order. “And whereas the State Department previously allowed intersex, non-binary, and gender non-conforming applicants to elect ‘X’ as the sex marker on their passports, it now issues passports only with an ‘M’ or ‘F’ marker.”

In turn, the U.S. Department of Justice moved to dissolve the injunction and have the judge stay her own order as the government appeals before the U.S. Court of Appeals for the First Circuit.

On Thursday, Kobick nixed that request.

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In their 22-page motion to dissolve the preliminary injunction, the government cited a recent U.S. Supreme Court ruling that upheld Tennessee’s ban on certain medical care for transgender minors. That case is stylized as United States v. Skrmetti.

The government’s argument – while situated within a broadly similar set of facts due to the plaintiffs also being transgender – is largely focused on the framework of constitutional review.

“Like Plaintiffs here, the Skrmetti plaintiffs argued that the state law discriminated on the basis of sex and ‘transgender status’ and could not withstand intermediate scrutiny,” the motion reads. “The Supreme Court rejected those arguments and upheld the law under rational basis review, which requires only the existence of any conceivable state of facts that could provide a rational basis for the classification.”

Under longstanding ideas of constitutional analysis, the way a court approaches a question is often determinative if not dispositive. Typically, this is understood in terms of how harshly any given court will scrutinize the government’s behavior. In the parlance of the high court, there are three major frameworks: rational basis review, intermediate scrutiny, and strict scrutiny.

In general terms, rational basis review often yields a win for the government; strict scrutiny often yields a loss for the government; while intermediate scrutiny is anyone’s guess.

Here, the government says the passport policy should be subject to rational basis review – and is presumably highlighting the Skrmetti case because both policies targeted transgender people.

The district court judge was not convinced.

“The moving party ‘bears the burden of establishing that a significant change in facts or law warrants revision or dissolution of the injunction,'” the court’s electronic order reads – citing relevant precedent on the dissolution of injunctions. “The government has not carried that burden here.”

The judge declines to address whether the recent Supreme Court opinion actually did result in a relevant change in law. But, more importantly, she says the government did not fully address the entirety of her reasoning used to justify the injunction.

From the order, at length:

This Court previously concluded that members of the [preliminary injunction] Class were likely to succeed on the merits of four claims, only two of which the government now challenges based on subsequent changes in law and fact. Whether or not Skrmetti alters the Court’s conclusion that the Executive Order and Passport Policy must be reviewed under intermediate scrutiny—an issue on which the Court expresses no opinion—the government has not argued that Skrmetti or any other change in law disturbs the Court’s independent conclusion that [preliminary injunction] Class members are likely to succeed on their claim that the Executive Order and Passport Policy are based on unconstitutional animus toward transgender Americans.

The court went on to say the government also failed to address a finding that the passport policy is arbitrary and capricious under the Administrative Procedure Act, the statute that governs the behavior of administrative agencies.

“The government’s motion to dissolve the June 17, 2025 preliminary injunction, is accordingly denied,” Kobick ruled. “For the same reasons, the Court would deny any motion to stay that injunction pending an appeal.”

On Friday, the government added the district court’s latest ruling to its appeal already pending before the First Circuit.

The passport policy stems from President Donald Trump’s day one executive order entitled “Defending Women From Gender Ideology Extremism and Restoring Biological Truth to the Federal Government.” This order declared federal policy to “recognize two sexes, male and female” and decreed “sexes are not changeable and are grounded in fundamental and incontrovertible reality.”