As the U.S. Department of Justice prepares to appeal a federal judge's decision to block the expansion of federally-funded embryonic stem cell research, hundreds of labs and academic institutions in New York and around the country are trying to figure out what it means for them. Health reporter Kafi Drexel filed the following report.

A federal judge's recent temporary injunction that blocks President Barack Obama's stem cell funding policy is not only a blow to the White House, but appears to be an all-out ban that nullifies his predecessor's even more conservative measures.

"In 1996, Congress passed the Dickey-Wicker Amendment, which said that federal funds cannot be used to create or destroy embryos," said Dr. Robert Klitzman, a bioethicist at Columbia University. "President [George W.] Bush in 2001 said he was going to follow that, but if there were stem cell lines that already existed that somebody else's money had created or destroyed, that it would be okay to use federal money to study those cells. Bush said it had to be just the 21 lines that already existed in 2001.

"What Obama did in 2009, was he said, 'I'm going to interpret the Dickey-Wicker Amendment the same way, but if there have been other stem cell lines that have been created since 2001, you can use federal money to study those lines as well,'" continues Klitzman.

Embryonic stem cells are attractive to researchers looking to cure diseases because they have the potential to become any cell in the body. The method is also controversial, because embryos are destroyed in the process, which opponents equate with the destruction of human life.

The new federal ruling says public funds cannot be used for the research, even if private funds paid for the development of cells.

"With the ruling, it has upset the apple cart, because nobody understands exactly what is going to happen. There's going to be several interpretations," said Dr. Stephen Chang of the New York Stem Cell Foundation. "It could have different extremes, all the way from no ability to do any research with any embryonic stem cells in existence to a limited usage."

"There are millions of dollars of research monies that are out there that universities are struggling to figure out what to do with," said Klitzman. "If I got a grant last week and I got $100,000, can I continue with research in my lab? Do I stop it?"

At the New York Stem Cell Foundation, the work they are doing is leading toward advances in heart disease, diabetes, Alzheimer's and Parkinson's research. The work will continue based on private and state funding, but even this local lab will still feel a negative impact bases on the federal ruling.

"It affects all of us because we learn from one another. When we see our colleagues not able to advance their research, we're hurt too," said Chang.