On January 21, 2026, the US Department of Education (ED) dropped its appeal of an August 2025 district court decision that stopped the Trump administration's efforts to withhold federal education funding from educational institutions maintaining diversity, equity, and inclusion (DEI) programs.
On August 14, 2025, in American Federation of Teachers et al. v. Department of Education et al., Judge Stephanie Gallagher of the US District Court for the District of Maryland struck down two ED directives: a February 14, 2025, Dear Colleague Letter and an April 3, 2025, Certification Requirement.1 The Dear Colleague Letter directed federally funded educational institutions to stop using race or race-based proxies with respect to their operations. The Certification Requirement mandated that state education agencies ensure all school districts certify compliance with the Trump administration’s interpretation of Title VI of the Civil Rights Act of 1964 or risk losing federal funding.
In her decision, Judge Gallagher held that the ED had not followed required procedures when threatening to withhold funding and that the directives raised concerns about educators’ free speech rights.
Key Takeaways From Judge Gallagher’s Ruling
- The ED bypassed required rulemaking steps, violating the Administrative Procedure Act.
- The ED skipped mandatory public comment periods and offered insufficient justification for directives that shifted federal education policy and created uncertainty for educational institutions.
- The ED may advance and implement policy positions; however, it must do so within statutory procedures and constitutional limits.
- Both the Dear Colleague Letter and the Certification Requirement were invalidated, thus ending their implementation.
If you have any questions regarding the content of this alert, please contact Buster Melvin, Higher Education Team co-leader, at emelvin@barclaydamon.com; Chloe Shortz, associate, at cshortz@barclaydamon.com; or another member of the firm’s Higher Education Team.
1American Federation of Teachers, et al., v. Department of Education, et al., 2025 U.S. Dist. LEXIS 157166, (D. Md. Aug. 14, 2025).