Three offshore wind developers have filed federal lawsuits since late December challenging the government's authority to suspend their leases. Revolution Wind is 87 percent built. Empire Wind has poured years into permitting. Dominion's Coastal Virginia project sits frozen. Each developer now faces the same question that will land in your next investor call or board meeting: Can the federal government halt a project that's already substantially complete?
The answer, as it plays out in federal courts over the next two weeks, will shape the risk calculus for every infrastructure project touching federal land, waters, or permitting.
What Happened
On December 22, 2025, the Bureau of Ocean Energy Management issued suspension orders halting five large-scale offshore wind projects. BOEM cited national security concerns but provided limited public explanation.
The developers didn't wait.
Revolution Wind LLC (Ørsted) filed a supplemental complaint in the U.S. District Court for the District of Columbia on January 1, 2026. The company followed with a motion for preliminary injunction, arguing that stopping construction on an 87 percent complete project would cause irreparable harm. All offshore foundations are installed. Fifty-eight of sixty-five turbines are in place. The project is bleeding $1.44 million per day in vessel contracts alone.
Empire Offshore Wind LLC (Equinor) filed suit in the same court on January 2, seeking to continue construction while litigation proceeds. Equinor has already invested over $4 billion.
Dominion Energy moved fastest, filing December 23 in the Eastern District of Virginia. Judge Jamar Walker converted Dominion's temporary restraining order into a preliminary injunction hearing, now scheduled for January 16 in Norfolk. The court directed the government to present any classified evidence supporting its decision by January 9. Dominion says the stoppage costs $5 million daily.
This isn't the first round. A prior blanket offshore wind pause was struck down by Judge Patti B. Saris in Massachusetts federal court, who found the sweeping ban "arbitrary and capricious" under the Administrative Procedure Act.
The Legal Arguments Taking Shape
The developers are building on three main legal theories. Understanding these helps you anticipate how courts might rule, and what the precedent means for projects outside offshore wind.
Outer Continental Shelf Lands Act Violations
The OCSLA governs activities on the outer continental shelf, including offshore energy development. Developers argue that BOEM's suspension order violates the statute's procedural requirements for modifying or terminating lease rights. A lease is a property interest. The government can't simply revoke it without following its own rules.
Dominion's complaint is direct: "BOEM's order sets forth no rational basis, cannot be reconciled with BOEM's own regulations and prior issued lease terms and approvals, is arbitrary and capricious, is procedurally deficient, violates the Outer Continental Shelf Lands Act."
Administrative Procedure Act Claims
The APA requires federal agencies to provide reasoned explanations for their decisions. "National security" isn't a magic word that ends judicial review. Courts can and do require agencies to explain their reasoning, even in sensitive contexts.
The classified evidence order in Dominion's case signals that the court won't accept conclusory assertions. If the government can't articulate a specific, factual basis for the suspensions, the APA claims gain strength.
Constitutional Due Process
Property interests in federal leases carry due process protections. Developers invested billions based on approved permits and executed leases. A retroactive suspension that offers no hearing or opportunity to respond raises serious due process questions.
This argument matters most for substantially complete projects. An 87 percent built wind farm isn't a speculative investment. It's a nearly finished piece of infrastructure.
What This Means for Your Portfolio
If you're a project developer, investor, or lender with exposure to federal permits or leases, here's what you need to think through before your next board meeting.
The Irreparable Harm Standard
Preliminary injunctions require showing irreparable harm: damage that money can't fix. Nearly complete projects have the strongest case. Equipment is in the water. Contracts are signed. Delay means corrosion, missed energy delivery deadlines, and potentially stranded capital.
Projects in earlier phases face a harder argument. Permitting delays are frustrating, but courts often view them as compensable through damages rather than injunctive relief.
The National Security Wild Card
The government's classified evidence presents an unusual variable. If the January 9 submission reveals concrete security concerns, courts may defer to executive judgment. If it reads as pretextual or generic, judges are likely to follow Judge Saris's precedent and demand more.
Watch the January 16 hearing closely. The questions judges ask will telegraph where they're leaning.
Precedent Beyond Wind
A ruling that agencies can't suspend substantially complete projects without specific justification would echo across sectors. Pipelines. Transmission lines. Mines. Data centers on leased federal land. The principle that property rights survive political transitions matters well beyond offshore wind.
Conversely, a ruling that defers broadly to national security claims would embolden similar actions against other industries perceived as politically disfavored.
Maryland Angle: The State Isn't Blinking
Maryland's Department of General Services announced it will proceed with a 20-year power purchase agreement procurement for offshore wind, with bids due January 16. The state is betting that courts will force the federal government to honor its commitments on the 2.2 GW Maryland Offshore Wind Project.
For developers considering whether to bid, this is a signal. Maryland is putting real procurement dollars behind its confidence in the legal arguments. If you're in the Maryland offshore wind supply chain, the state-level demand signal remains strong even as federal policy whipsaws.
Practical Takeaways
Review your force majeure and regulatory change provisions. If your project contracts don't address federal suspension orders, you've got a gap. Work with counsel to understand whether current language covers this scenario or whether you need amendments.
Assess construction completion percentages across your portfolio. Substantially complete projects have different legal options than early-stage permitting. Know where each asset sits.
Prepare board-level talking points on litigation timeline. The January 16 hearing is the next inflection point, but appellate review could extend uncertainty through mid-2026. Your board needs realistic expectations.
Map your exposure to BOEM-regulated projects. This suspension targeted offshore wind, but the legal theory could apply to any OCSLA activity. If you have interests in offshore oil and gas, submarine cables, or marine minerals, you're reading from the same regulatory playbook.
Evaluate PPA and offtake agreement implications. Delayed commercial operation dates trigger remedies in most power purchase agreements. Understand your exposure and whether litigation posture affects contract negotiations with offtakers.
Consider the insurance angle. Political risk insurance and construction delay coverage may apply, depending on policy language. Loop in your risk team.
If you're a lender, stress-test your collateral. A suspended project's value depends heavily on the litigation outcome. Run scenarios.
What We're Watching
January 9: Government deadline to present classified evidence in Dominion case
January 16: Norfolk hearing on Dominion preliminary injunction
January 16: Maryland offshore wind PPA bid deadline
Late January: Potential rulings on Revolution Wind and Empire Wind motions
February-March: Possible appeals regardless of which side wins
The next two weeks will determine whether federal project suspensions require specific justification or whether broad national security assertions suffice. For anyone building in regulated industries, the answer matters.