Staff attorneys within the Justice Department recently sent higher-ups the recommendation. At the same time, the Justice Department's Civil Division, which oversees the majority of immigration enforcement issues for the department, has drafted a "civil complaint" that would be filed in federal court in Arizona, sources said.
The draft complaint challenges the Arizona law as unconstitutional, saying it is illegal because it impedes federal law, according to the sources, who would not offer any more details about the draft complaint or the arguments made in it.
Two weeks ago, Attorney General Eric Holder told lawmakers such an issue was being considered by Justice Department lawyers reviewing the new law, which outlines and possibly broadens the authority of police to detain those suspected of being in the country illegally.
"We are examining the [Arizona] law and trying to determine if it contravenes the federal responsibility [toward] immigration, whether or not what the Arizona legislature has tried to do is actually preempted by federal law, by federal statutes." he told the House Judiciary Committee on May 13. "The regulation of our borders and the immigration that occurs by crossing our borders is something that is inherently something I believe for the national government to take responsibility for."
He also said it would not be "an extended period of time" before his department decides whether to take action on "preemption" grounds, adding that the Justice Department's "view of the law will be expressed relatively soon."
Two sources with knowledge of the review said the draft complaint, which is now receiving input from the attorney general's office and other Justice Department offices, is not an indication that the Justice Department will ultimately file a lawsuit.
One source said the Arizona law has sparked a "huge battle" with national implications, and the Justice Department is therefore conducting a "slow analysis of all of the options."
If Justice Department higher-ups decide to move forward with the civil complaint, concrete action likely would not take place for some time, according to the source, who predicted it will be "a while before anything would be filed."
"This is going to be slow going," the source said.
Holder echoed that sentiment when he was on Capitol Hill.
"There's a wide variety of things that go into the determination that ultimately we will have to make, and I want to make sure that we take as comprehensive a look as we can before we make what I think is going to be a very consequential decision," he said.
If the Justice Department's Civil Division decides against filing the complaint, others within the Justice Department could step in. In fact, the attorney general's office, the deputy attorney general's office and the Civil Rights Division are all reviewing options.
Holder told lawmakers that the Civil Rights Division will be monitoring the application of the Arizona law, set to go into effect in late July, and could take subsequent action.
"We are concerned about the potential impact that it has and whether it contravenes federal civil rights laws, potentially leading to racial profiling," he said. "We would constantly be monitoring it to see if there are civil rights violations, civil rights concerns, that are generated by the implementation of the law."
He said such monitoring would occur in any case.
Kris Kobach, a Republican law professor who helped author the Arizona law, said the legislation "expressly prohibits racial profiling." As for the issue of preemption, he said the law was "drafted extremely carefully to avoid any preemption problems at all."
Holder said the Justice Department will also be looking at other issues, including "the history that is involved in all of this" and memos or opinions from other offices within the Justice Department.
Holder himself has raised concerns that the Arizona law could push a "wedge" between police officers and the communities they serve, something he's expected to discuss during a meeting with police chiefs, including three from Arizona, at the Justice Department on Wednesday morning.
"Arizona police chiefs are concerned that the new ... law in Arizona will drive a wedge between the community and the police, and will damage the trust that police agencies have worked to establish over many years with members of all their communities," a statement from the police chiefs said.
Others have raised concerns that a 2002 memo from the Office of Legal Counsel could complicate federal challenges to the Arizona law, especially preemption-related challenges. The 2002 memo said state and local police can arrest illegall immigrants for violating federal law.
But after reviewing the Arizona law and options for challenging it, at least some Justice Department lawyers have concluded that the 2002 memo would not pose a problem because, in their view, it is narrow enough in scope to permit a challenge.
As for whether the U.S. government will end up challenging the Arizona law in any form, Holder recently insisted that's still up in the air.
"I don't know exactly ... what we are ultimately going to do with regard to our review of the law," he told lawmakers.
But, he said, there is "certainly an illegal immigration problem that this country needs to face," and he understands the "frustration" of Arizona citizens.