Supreme Court Halts Education Grants: A Review of the Legal Battles
The Trump administration's efforts to reshape the federal role in K-12 education have faced significant legal challenges, particularly concerning the halting of education grants. Since January 2025, the administration has actively worked to reshape the federal role in K-12 education. These efforts have been met with resistance in federal courts, resulting in preliminary injunctions that temporarily halt the administration’s actions. This article provides an overview of the legal challenges to the Trump administration’s executive actions related to K-12 education and the implications of the Supreme Court’s involvement.
Executive Overreach and Legal Challenges
Given the limited role of the federal government in education (as the Constitution is silent on the topic of public education), many of the Trump administration's actions exceed the executive’s authority to dictate state and local K-12 school policy. The primary tool used by the federal government to influence state and local policy is to condition federal funds on specific actions. The administration has increasingly relied on nonbinding guidance, such as executive orders and Dear Colleague letters, to promote its policy priorities.
Several executive orders (EOs) have been issued aimed at changing federal K-12 education policy since the second Trump administration took office in January. These reach far beyond existing federal education law. Litigation has been a key strategy to limit executive overreach in education policy-and to some early successes.
Key Executive Orders and Their Impact
Executive Order 14151: Diversity, Equity, and Inclusion (DEI) Restrictions
EO 14151 targets DEI initiatives, but notably, the order does not define the terms “DEI,” “DEIA,” “environmental justice,” “equity,” or “equity-related.” Nor does it provide any examples of specific types of work or programs that it aims to target.
The most immediate impact of this EO in K-12 education has been felt through grant cancellations justified as necessary to comply with the directive. This includes the cancellations of $600 million in federal grants to support teacher workforce development. The order defines “discriminatory equity ideology” as one that endorses “treating individuals as members of preferred or disfavored groups, rather than as individuals, and minimizes agency, merit, and capability in favor of immoral generalizations.” Based on the examples provided in the order, this would include exposing students to concepts such as white supremacy, systemic racism, implicit bias, and privilege. The order defines “social transition” as the process of adopting a “gender identity” or “gender marker” that differs from a person’s sex.
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Like EO 14151, this EO has the potential to have much broader significance for public schools given the breadth of ongoing attacks against DEI and civil rights, including the rights of transgender youth. This EO, for example, may also serve to chill educators’ speech or lead to changes in instruction and school programming through preemptive compliance on the part of school leaders or board members.
The status of this EO varies by case, with litigation ongoing.
Dear Colleague Letter (DCL) of February 14
On Feb. Department of Education issued nonbinding guidance in the form of a “Dear Colleague” letter (DCL) that aimed to clarify schools’ and colleges’ obligations under federal civil rights law to avoid racial discrimination in education policy and practice. The DCL declared, without the authority to do so, that any race-conscious policies, programs or initiatives (e.g., DEI programs) would be considered illegal racial discrimination under Title VI of the 1964 Civil Rights Act. Following the letter’s publication, the administration took additional steps to enforce their new definition of illegal racial discrimination. In April, ED took the additional step of issuing a new certification requirement to state and local education agencies that asked them to confirm their compliance with the Trump administration’s new interpretation of anti-racial discrimination law.
In August, a federal judge issued a summary judgment declaring the guidance letter and the certification requirement unlawful and vacated.
The states that refused to sign the new certification requirement risked losing their federal education funding. Even though federal courts previously blocked the administration from enforcing the DCL and its requirements, at least 21 states confirmed their intention to comply with the administration’s directives as litigation was ongoing.
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Executive Order 14242: Workforce Reduction at the Department of Education
EO 14242 was issued shortly after ED announced a reduction in its workforce (RIF). The RIF resulted in nearly half of the department’s staff being placed on administrative leave beginning March 21, 2025. A core question of the legal challenges to this EO and the related RIF has focused on whether ED can still carry out its congressionally mandated functions with only half its staff. Federal courts initially issued a preliminary injunction preventing the Trump administration from carrying out its plans to dismantle ED and calling for previously laid off federal workers to be rehired. However, in July 2025, the Supreme Court paused the lower court’s preliminary injunction using the emergency docket (meaning no formal opinions explaining their rationale were issued, though Justice Sonia Sotomayor issued a dissent that was joined by the two other liberal justices).
Executive Order 14280: Reinstating Commonsense School Discipline Policies
Executive Order 14280: Reinstating Commonsense School Discipline Policies directs the education secretary and other cabinet members to issue new guidance to clarify K-12 public schools’ obligations to avoid racial discrimination in the application of school discipline under federal civil rights law. Importantly, the order proposes a definition of racial discrimination that is inconsistent with existing federal law. Like the Feb. 14 DCL, the order defines any race-conscious or equity-based approach to remedy racial inequality as illegal racial discrimination (which is contrary to how racial discrimination is defined in the Title VI regulations). The order also directs administration officials to release a report analyzing the status of “discriminatory equity ideology”-based school discipline and “behavior modification techniques” in public education. The order misrepresents education research and is vague on details. Importantly, EO 14280 was released alongside EO 14281, which called for an end to the use of “disparate impact analysis,” an approach to assessing civil rights violations under Title VI which aims to consider whether a racially neutral policy or practice disproportionately impacts different racial/ethnic groups (which is permissible under the relevant federal regulations).
Supreme Court Intervention
The Supreme Court has played a significant role in these legal battles, particularly concerning the Department of Education's freeze of DEI-related grants. In one instance, the justices allowed the administration to keep frozen $65 million for teacher training and professional development, halting a lower court order that had temporarily reinstated the grants. The court's unsigned opinion comes about a month after a similar dispute in which the justices left in place a lower court order to pay USAID contractors for services already performed. This time, however, with education grants on the line, the court majority ruled that even though Congress had already appropriated money for the programs, the Education Department could stop funding them while the case is litigated in the lower courts.
The Education Department had frozen the grants in anticipation of trying to claw back unspent funds that had been appropriated by Congress. A federal district judge had issued two consecutive 14-day temporary restraining orders to consider the question of the frozen funds. While such 14-day orders are rarely appealable, the Supreme Court majority viewed this case differently, and granted the administration's request to block the lower court order from going into effect.
The Education Department funding went to two grant programs targeting teacher shortages. Recipients included "high need" institutions, nonprofits, Historically Black Colleges and Universities, and Tribally Controlled Colleges and Universities. The Department of Education cut nearly all of the existing grants in February, notwithstanding the fact that Congress had already appropriated the funds to be spent for these specific purposes. The administration said it eliminated 104 of 109 grants because they "fund discriminatory practices-including in the form of DEI." The Department also sent letters to the recipients stating that their programs violated federal civil rights laws by discriminating based on race, sex, or other protected characteristics.
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Legal Arguments and Court Reasoning
Eight states whose universities and nonprofits had their grants terminated-California, Massachusetts, New Jersey, Colorado, Illinois, Maryland, New York, and Wisconsin-sued in federal district court. The challengers argued that the Department of Education's decision to cancel the grants violated federal law. In response, the government argued that it was well within its broad regulatory authority to cancel the grants because the so-called "DEI initiatives" were no longer aligned with government policy. A federal judge in Boston issued a temporary restraining order, which reinstated the funding for up to 28 days while he considered the states' claims. After a failed attempt to overturn the order in the federal court of appeals, the Department of Education asked the Supreme Court to stop the lower courts from reinstating the grant money, at least for now.
The Department insisted that it should not be forced to continue funding millions of dollars in "taxpayer money that may never be clawed back" while the lawsuit plays out in the courts. It pointed out that, even if it eventually wins this case, it would have a hard time getting the millions in federal dollars back once the "federal funding spigots" had been turned back on. The eight states that are part of the lawsuit against the administration countered that it would make little sense for the Supreme Court to intervene at this stage, given that the grant reinstatement would expire soon anyway. And, they pointed out, the order's limited shelf life gave grant recipients little time to continue receiving government funds. In that sense, the schools would be getting a drop in the bucket compared to the government's image of a "funding spigot." And that would still be less than they were promised in their five-year grant.
Dissenting Opinions
Justice Elena Kagan dissented, saying that the Court had made a serious "mistake" when it intervened too swiftly, effectively changing the court's rules with only a "barebones briefing, no argument and scarce time for reflection." Justice Ketanji Brown Jackson, joined by Justice Sonia Sotomayor, noted that it was exceptional for the Court to intervene when the temporary restraining order would expire in only three days, and that that the administration had not presented a convincing enough argument as to why such an extraordinary intervention was necessary. While Chief Justice John Roberts noted his disagreement with the majority, he did not join either dissenting opinion.
Implications of the Supreme Court’s Decision
The Supreme Court’s ruling suggests that the district court does not have jurisdiction to reinstate the grants. The court’s reasoning-that all grant termination litigation must go to the Court of Federal Claims, which handles contract disputes-means that “there’s a very good chance that that whole case [to reinstate terminated grants in federal district court] will disappear.”
The government will contend that this ruling applies to all federal grant terminations. The amount of damages that the grantee can recover may be affected by whether the agency breached the grant by terminating it. The government will likely take the position in most cases that it did not breach the grant because the Uniform Grant Regulations, as amended in 2020, allow it to terminate a grant "to the extent authorized by law, if an award no longer effectuates the program goals or agency priorities." 2 C.F.R. § 200.340(a)(4). The government will assert that an agency can terminate a grant whenever its priorities change, just as it can terminate federal contracts under "termination for convenience" provisions whenever it chooses to do so. But the extent of an agency's authority to terminate a grant on this basis remains an unresolved question at this time, especially when other grant or regulatory provisions limit the agency's ability to terminate a grant.
Other Legal Battles
Challenges to Grant Terminations Under the Administrative Procedure Act (APA)
Federal grantees facing the termination of their grants by the new administration have challenged those terminations by filing suits under the Administrative Procedure Act (APA) in federal district courts. In about a half a dozen cases, district courts have issued temporary restraining orders (TROs) enjoining a grant termination. However, the applicability of the APA to grant terminations is an evolving area of law.
The APA, by its terms, can be invoked only where a plaintiff has no other adequate remedy. The federal courts of appeals have held that the Tucker Act and Contract Disputes Act provide an adequate remedy for contract disputes with the government and, thus, impliedly forbid an APA action in federal district court that is based on contractual claims. However, federal circuit courts have ruled that "litigants may bring statutory and constitutional claims in federal district court [under the APA] even when the claims depend on the existence and terms of a contract with the government," and "even where the relief sought is … In the case before the Supreme Court, the First Circuit ruled that APA claims were proper because "if the Department [of Education] breached any contract, it did so by violating the APA" and the relief sought was not damages for past wrongs but a restoration of funding.
Attack on State Regulation of Artificial Intelligence
President Trump issued an executive order attacking state regulation of artificial intelligence (AI). The order builds on the administration’s previous efforts, including its “AI Action Plan,” which directed agencies to ensure that AI development is “unencumbered.” The order directs federal agencies to withhold funding from states if they enact regulations that are more than “minimally burdensome.” It also establishes a task force to file lawsuits against states’ AI regulations and threatens to withhold critical broadband funding.
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