Judge Strikes Down Trump Administration's Anti-DEI Teacher-Grant Policy, But the Money Stays Frozen

A federal judge in Boston has struck down the legal basis the Trump administration used last year to cancel roughly $600 million in teacher-training grants, ruling that the Education Department acted unlawfully when it tied the funding cuts to programs it labeled as promoting diversity, equity and inclusion.

U.S. District Judge Angel Kelley, ruling in a case filed by eight Democratic-led states, found that the department's February 2025 directive violated the Administrative Procedure Act because it gave grantees no clear standard for what counted as impermissible "DEI" content and because officials never weighed the damage the cancellations would do to teachers already in training. The decision, issued Thursday in State of California v. U.S. Department of Education, is the latest turn in a fight over federal teacher-preparation money that has already gone to the Supreme Court once.

The numbers

The dispute centers on two long-running federal programs, the Teacher Quality Partnership program and the Supporting Effective Educator Development grant, both authorized under Title II of the Higher Education Act to help colleges and school districts recruit and train teachers for high-need schools and subjects such as math, science and special education. In February 2025 the department canceled more than 100 individual grants under those two programs, wiping out over 90 percent of the awards then in effect, after concluding the underlying projects promoted "divisive ideologies."

The scale of the cuts was uneven but concentrated. In California alone, the state said in its original complaint that the terminations eliminated $148 million in funding, disrupting training for 276 teacher candidates at Cal State Los Angeles, roughly 225 students at Chico State, 60 teacher residents in rural districts, and a UCLA-run program reaching more than 15,000 students in Los Angeles County classrooms, according to the lawsuit filed by California Attorney General Rob Bonta in March 2025. Similar disruptions were cited by the other seven plaintiff states — Colorado, Illinois, Maryland, Massachusetts, New Jersey, New York and Wisconsin.

How we got here

The states sued within weeks of the February 2025 cancellations, arguing the department had violated federal rulemaking procedures by terminating active, multi-year grants without notice or an opportunity for public comment. A district judge issued a temporary restraining order blocking the cuts that March, and the First Circuit Court of Appeals initially declined to disturb it. The administration then sought emergency relief from the Supreme Court, and in April 2025 the court's conservative majority granted a stay, allowing the terminations to take effect while the underlying lawsuit continued in the lower courts — a procedural win for the administration that left the merits of the states' claims unresolved.

Thursday's ruling resolved those merits. Kelley concluded that the department's rationale for cutting the grants was not just wrong on the facts but legally deficient under the Administrative Procedure Act, which requires agencies to explain policy reversals and account for the reliance interests of those affected.

"In short, the reliance interests are many, substantial, and deep-rooted," Kelley wrote, faulting the department for issuing a directive that "does not acknowledge the fact that thousands of teachers, as well as teachers in teacher-training pipelines, would be affected."

The ruling came the same day a separate Boston federal judge, Allison Burroughs, found in an unrelated case that the Office of Management and Budget had improperly used a budget apportionment footnote to withhold hundreds of millions of dollars in separate education research funding — a pair of decisions that, taken together, amounted to a rebuke of how the administration has used funding mechanics to reshape education policy without going through Congress or formal rulemaking.

Who is affected, and what happens next

The practical effect of Thursday's ruling is narrower than the headline finding suggests. Kelley's order does not automatically restore the roughly $600 million already withheld; because the underlying grants were federal contracts, claims to recover that specific money must be pursued separately in the U.S. Court of Federal Claims, a specialized tribunal that hears monetary claims against the government. What the ruling does is bar the Education Department from applying the same rationale — an undefined anti-DEI standard — to future awards under the two grant programs, including new Teacher Quality Partnership and Supporting Effective Educator Development competitions the department and the Labor Department had already opened for fiscal year 2026 with a combined $160 million in funding.

School districts and teacher-preparation programs in high-need areas, particularly rural districts and urban schools with chronic staffing shortages in math, science and special education, are the most direct stakeholders. States that sued had warned the cuts would deepen an already acute national teacher shortage by cutting off pipelines that trade tuition support and stipends for multi-year commitments to teach in hard-to-staff schools.

The Education Department did not respond to a request for comment on the ruling, according to wire reporting corroborated by The Boston Globe and WBUR, Boston's public radio station. Neither the department nor the Justice Department, which represented it in the case, has said whether it will appeal Kelley's ruling to the First Circuit, which previously declined to lift the trial court's initial block on the cuts before the Supreme Court intervened.

For now, the ruling leaves the underlying $600 million in a legal limbo familiar from other funding fights of the past year and a half: a court has found the government's process unlawful, but the money itself remains tied up, its return contingent on a separate and slower claims process, an appeal, or a change in the department's approach when it structures the next round of teacher-training grants.