The administration's decision not to defend DOMA in cases involving the Second Circuit was huge. That circuit apparently has no set standard for review of these types of cases, so the administration thinks the standard should be a form of heightened scrutiny and that under their proposed standard, DOMA is unconstitutional. Even if this were to only apply to Second Circuit cases, it's a huge deal. Yesterday, Clarknt67 explained why.
Greenwald has more:
I think Andrew Sullivan and others are under-stating the significance of Obama's DOMA decision. It's true that courts (including the Supreme Court) are still free to find the statute constitutional; it's true that DOMA will still be enforced until a final court ruling; and it's also true that DOMA will still have plenty of competent lawyers vigorously defending its constitutionality (including from Congress). But the question in these constitutional challenges is whether the Government has a legitimate (or greater) interest in treating groups of citizens differently, and when the U.S. Government is standing up in court and telling judges that there is no such interest, that makes a substantial difference. That's why, as Jack Balkin documents, many of the most momentous shifts in civil rights law and the law in other areas comes after (and due to) changes in the Government's position; it's not binding on courts, of course, but it's quite influential.
Moreover, the significance extends beyond DOMA. Perhaps the most consequential aspect of the DOJ's announcement is that it now formally adopts the position that gay people are a "suspect class" for Equal Protection analysis, and laws targeting them thus merit heightened constitutional scrutiny. That the DOJ now formally adopts what until very recently was a fairly radical legal position will almost certainly change the face of constitutional analysis -- for the better -- as it concerns equal rights for gay Americans.
However, the administration has decided today to stop defending DOMA in the Massachusetts combined cases in the First Circuit. This wasn't entirely expected. It was likelier that they'd continue asserting that there's a rational basis - the lowest form of scrutiny - for the law to exist.
I assume we'll see someone in Congress step up to defend it soon. All of these cases are being appealed and more and more are without a defense by the day. In the meantime this is an exciting thing happening. The legal landscape of antigay laws is changing rapidly. This is truly earth shattering.