Donald Trump faced a significant setback in his ambitions to have New York’s Penn Station and Washington-Dulles International Airport bear his name, following a court ruling on Friday.

A federal judge instructed the Trump administration to release funds for the New York/New Jersey Gateway Tunnel Project, which it had allegedly withheld to leverage the renaming of these landmarks.

During Friday’s proceedings, Judge Jeannette Vargas ruled in favor of a lawsuit filed by the attorneys general of New York and New Jersey. The suit claimed that Trump’s actions in withholding funds were illegal and detrimental to the metropolitan economy.

Trump had been in discussions with Senate minority leader Chuck Schumer about the tunnel project. According to Politico, the White House proposed releasing the funds if the transportation hubs were renamed in honor of the president.

A source familiar with Schumer’s position told the media outlet that no deal was possible: “The president halted the funding and has the power to restore it instantly.”

Judge Vargas determined that the attorneys general convincingly demonstrated that delaying a vital infrastructure project would harm the public interest.

The judge barred the federal government from suspending funding to the project until the case is concluded. 

The Gateway project would construct new rail bridges under the Hudson River from New Jersey to Manhattan, and the freezing of the $16 billion in funding by the Trump administration put more than 1,000 jobs on hold. 

Donald Trump’s hopes of renaming New York’s Penn Station and Washington-Dulles International Airport after himself were dealt a major blow in court on Friday as he was ordered to unfreeze funding used as a bargaining chip in negotiations 

The Trump administration was ordered by a federal judge to unfreeze $16 billion in funds for the New York/ New Jersey Gateway Tunnel Project (pictured), which will would construct new rail bridges under the Hudson River from New Jersey to Manhattan 

Friday’s ruling was celebrated by New York Governor Kathy Hochul, who said that is marked ‘a victory for the thousands of union workers who will build Gateway and the hundreds of thousands of riders who rely on it every day.’ 

‘We will work to protect this decision and move as soon as possible to get work back on track,’ Hochul said in a statement. 

Hochul’s office has used the controversy to mock Trump on social media, and in an X post she shared an image of Trump Tower in Manhattan renamed ‘Hochul Tower’, with the caption: ‘Counteroffer.’

Source close to Schumer previously said he was stunned by the White House’s offer to unfreeze the funds in exchange for renaming the landmarks, telling Politico: ‘There was nothing to trade.’ 

‘The president stopped the funding and he can restart the funding with a snap of his fingers,’ the insider said Thursday. 

New York Senator Kristen Gillibrand criticized the notion that the funding would be on the table, saying this week: ‘These naming rights aren’t tradable as part of any negotiations, and neither is the dignity of New Yorkers.’ 

‘At a time when New Yorkers are already being crushed by high costs under the Trump tariffs, the president continues to put his own narcissism over the good-paying union jobs this project provides and the extraordinary economic impact the Gateway tunnel will bring,’ Gillibrand said. 

The White House reportedly offered to unfreeze the funds in exchange for Penn Station in New York City (pictured) and Washington-Dulles International Airport to be renamed after the president 

New York Federal Judge Jeannette Vargas ordered the unfreezing of the funds as she said the New York and New Jersey lawsuit had ‘adequately shown that the public interest would be harmed by a delay in a critical infrastructure project’

Although Friday’s ruling set back Trump’s threats to cease the funding, the commission managing the Gateway project said in court that even winding down its operations briefly caused significant setbacks. 

The Gothamist reported that the commission was forced to halt work at five construction sites, and it would take almost a year of work and up to $20 million-a-month to secure and monitor the sites. 

New York Attorney General Letitia James thanked the court for halting the funding freeze. 

‘This is a critical victory for workers and commuters in New York and New Jersey. I am grateful the court acted quickly to block this senseless funding freeze, which threatened to derail a project our entire region depends on,’ James said.