This question is testing COMPARISONS and MODIFIERS.

Whenever a sentence begins with a comparison signal like "unlike" or "like," we must make sure that we're comparing logically comparable ideas. In the original sentence, we have "Unlike the team of lawyers..., the government's argument centered..."

It does not make logical sense to compare a team to an argument. Since the main clause ("the government's argument...") is not underlined, we need something that says "Unlike one argument..., another argument..." Eliminate A.

"The argument from the petitioner" and "the petitioner's argument" are both comparable to "the government's argument," so there is no need to choose between those. We must now look to the modifying clause that comes after.
- if it says "the argument from the petitioner," the clause that follows should begin with "whose," modifying the petitioner. Eliminate B.
- if it says "the petitioner's argument," the clause that follows should begin with "which," modifying the argument. Eliminate D.

We are left with C and E, which at a quick glance might seem identical. But observe the difference:

C) the petitioner's argument, which rested on a questionable interpretation of a bill that only recently passed Congress

E) the petitioner's argument, which rested on a questionable interpretation of a bill that recently only passed Congress

The difference between these two is in the placement of the modifier "only." When modifiers move, they change the meaning! In C, "only" is modifying "recently" - i.e. it did not happen in the past, it only happened recently. In E, "only" is modifying "passed" - i.e. it only passed Congress, it didn't do anything else. This doesn't make much sense.

That leaves us with C.

For more on comparisons with LIKE / UNLIKE:
https://www.beatthegmat.com/similar-to- ... tml#771270
https://www.beatthegmat.com/the-use-of- ... tml#539972
https://www.beatthegmat.com/gprep-sc-9- ... tml#722472
https://www.beatthegmat.com/og13-unlike ... 97508.html
https://www.beatthegmat.com/contrast-in ... tml#706159
https://www.manhattanprep.com/gmat/blog ... orrection/