Judge Vacates Education Department's Anti-DEI Teacher-Grant Directive

The court erased the directive—not every consequence of it

BOSTON — A federal judge on Thursday vacated the U.S. Department of Education directive that ordered officials to terminate grants associated with diversity, equity and inclusion, handing California and seven other states a final district-court judgment on their challenge to the policy.

U.S. District Judge Angel Kelley granted summary judgment to the states, denied the department's competing motion and set aside the February 5, 2025 directive in its entirety. Her 70-page order found the directive arbitrary and capricious and contrary to federal education statutes and regulations under the Administrative Procedure Act.

The legal result is significant but narrower than an automatic refund. The judgment invalidates the agency-wide directive; it does not itself reinstate each canceled grant, direct the Treasury to pay recipients or announce that the disputed money has returned to teacher-training programs.

More than $600 million in grants had been canceled

The Education Department announced in February 2025 that it was canceling more than $600 million in grants it said supported divisive ideologies, including DEI and social-justice activism. The affected awards funded K-12 teacher preparation through the Teacher Quality Partnership and Supporting Effective Educator Development programs.

Reuters reports that 109 grants were terminated, representing more than 90% of the existing awards in those two programs. Forty of the canceled grants went to universities and other institutions in the eight plaintiff states: California, Massachusetts, New Jersey, Colorado, Illinois, Maryland, New York and Wisconsin.

The court found that the directive gave officials no discernible standard for deciding which grants counted as DEI-related and failed to account for the teachers, trainees and institutions that had relied on multi-year federal awards.

Congress wrote equity and teacher-shortage goals into the programs

Kelley's order examined the statutes behind the grants rather than treating DEI as a free-floating political label. Congress created the Teacher Quality Partnership program to improve teacher preparation, recruit qualified educators and serve high-need schools. The SEED program funds evidence-based educator development and staffing efforts.

The court also pointed to the General Education Provisions Act, which directs federal education grant applicants to address barriers to equitable participation, including barriers based on race, sex, national origin, disability and age.

Against that statutory framework, the judge concluded that the department could not abruptly substitute an undefined anti-DEI command for the criteria Congress and the agency had used to award the grants. The ruling therefore rests on administrative-law and statutory grounds, not a declaration that every program carrying a DEI label must receive federal funding.

Why the Supreme Court's 2025 action does not erase this ruling

The states initially won an order requiring the grants to be restored, but the U.S. Supreme Court stayed that relief in April 2025 while the litigation continued. The Supreme Court's order allowed the cancellations to remain in effect at that stage; it did not decide the ultimate legality of the underlying directive.

The district court later ruled that claims seeking money or reinstatement of individual grants belong in the U.S. Court of Federal Claims. Kelley retained jurisdiction over the states' separate challenge to the department-wide directive and resolved that policy claim Thursday.

Affected institutions therefore may still need additional litigation to recover money tied to particular awards. The administration may also appeal Thursday's final judgment or ask a higher court to pause it. The Education Department had not provided Reuters an immediate response when its report was published.

What changes now—and what does not

The department may no longer rely on the vacated February 2025 directive as lawful authority. Any new grant policy would have to satisfy the governing statutes, regulations and administrative-law requirements and could face a fresh legal challenge.

The decision does not prohibit the federal government from policing fraud, enforcing grant conditions or changing future funding priorities through lawful procedures. It also does not establish that every canceled grant recipient will prevail on a claim for compensation.

The next material developments are an appeal, any request to stay the judgment and any Court of Federal Claims actions seeking money for canceled awards. Until one of those occurs, the confirmed result is a final district-court judgment against the directive—not the automatic restoration of more than $600 million.

About the image

The accompanying photograph shows the Lyndon Baines Johnson Department of Education Building in Washington, D.C., in May 2017. The photographer, Farragutful, released the image under the Creative Commons Attribution-ShareAlike 4.0 license through Wikimedia Commons.

It is an authentic institutional image used for context. It does not depict Judge Kelley, the federal court in Boston, any grant recipient, the canceled programs or Thursday's ruling.