Straws in the Wind - Part 235

From Inside Higher Ed: Education Secretary Linda McMahon and her legal team have dropped their appeal of a federal court ruling that blocked the department from requiring colleges to eradicate all race-based curriculum, financial aid and student services or lose federal funding. The motion to dismiss was jointly approved by both parties in the case Wednesday, ending a nearly yearlong court battle over the department’s Feb. 14 Dear Colleague letter that declared race-based programming and policies illegal. If institutions didn’t comply within two weeks, department officials threatened to open investigations and rescind federal funding. In response, colleges closed offices related to diversity, equity and inclusion; scrubbed websites; and cut other programming.

First Amendment advocacy groups and the DEI leaders who remain in higher ed declared it a major victory for public education. Democracy Forward, the legal group that represented educators in the case, went as far as to say that it marks the “final defeat” of Trump’s effort to censor lessons and scrub student support programs...

Colleges and universities aren’t entirely in the clear, though. Just days before the Maryland District Court issued its ruling on the ED letter, the Department of Justice released its own nine-page memo on DEI. That guidance, which went even further than ED’s guidance, said that basing services on stand-ins for race—like “lived experience,” “cultural competence” and living in a minority-heavy geographic area—could also violate federal civil rights laws. In response, colleges have closed campus centers and publications cater to certain racial or ethnic groups...

Full story at https://www.insidehighered.com/news/government/politics-elections/2026/01/22/ed-drops-appeal-order-blocking-anti-dei-guidance.

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From the Cornell Daily Sun: A federal judge ruled... that an antitrust lawsuit filed four years ago against Cornell and 16 other elite colleges and universities must proceed to trial. The lawsuit alleges that the schools conspired to reduce financial aid and favor wealthy students. The suit also alleges that Cornell, through a now-defunct organization of 30 elite universities known as the 568 Presidents’ Group, conspired to reduce financial aid in violation of the Sherman Antitrust Act. The 1890 act prohibits monopolies by restricting collusion that might limit competition. 

Specifically, the plaintiffs argue that Cornell and other universities worked together to ensure that financial aid pricing was similar between institutions. Because similar pricing of aid across universities was less than what the aid would have been without collaboration, the plaintiffs argue, the 538 Presidents Group ultimately favored wealthy students by increasing the overall cost of attendance. The 568 Presidents’ Group was named after Section 568 of the Improving America’s Schools Act of 1994. The section was an exemption to the Sherman Antitrust Act that allowed need-blind institutions to collaborate on financial aid principles to ensure financial aid was similar among universities. The group disbanded in 2022 after its namesake section expired and amid the filing of this suit alleging misuse.

However, the plaintiffs, a group of alumni from the 17 elite universities, allege that the universities listed in the suit are not protected under Section 568 because they did not behave in a way that was truly need-blind...

Full story at https://www.cornellsun.com/article/2026/01/federal-judge-rules-financial-aid-lawsuit-against-cornell-must-proceed.