After a federal judge struck down the government guidance, the Trump administration chose to drop its legal fight over an anti-DEI effort tied to threats to federal funding for schools and colleges. In a court filing Wednesday, the U.S. Department of Education asked the court to dismiss its appeal, leaving in place the August ruling by U.S. District Judge Stephanie Gallagher that blocked the guidance.

Gallagher’s decision found that the Education Department’s approach violated the First Amendment and federal procedural rules. In the ruling, Gallagher said the guidance stifled teachers’ free speech and caused “millions of educators to reasonably fear that their lawful, and even beneficial, speech might cause them or their schools to be punished.”

The underlying dispute centered on federal direction telling schools and colleges that they would risk losing federal money if they continued a broad set of practices that the Republican administration described as diversity, equity and inclusion. The Education Department did not immediately comment on the dismissal, according to the Associated Press.

One of the documents at the heart of the case was a “Dear Colleague Letter” sent to schools last February. The memo said race could not be considered in decisions involving college admissions, hiring, scholarships and “all other aspects of student, academic, and campus life,” and it also said efforts to increase diversity had resulted in discrimination against white and Asian American students.

After that warning, the department asked K-12 schools to certify that they did not practice DEI, again tying the demand to threats to cut federal funding. Both the February letter and the later certification request were struck down by Gallagher in Maryland.

The challenge was filed by the American Federation of Teachers. Democracy Forward, a legal advocacy group representing the plaintiffs, said the government’s decision to dismiss the appeal was a favorable outcome for public education, with its president and CEO Skye Perryman calling the move “a welcome relief and a meaningful win for public education.”

Democracy Forward’s statement also quoted Perryman as saying, “Today’s dismissal confirms what the data shows: government attorneys are having an increasingly difficult time defending the lawlessness of the president and his cabinet.”

With the appeal dismissed, the case leaves Gallagher’s block in effect and keeps the rejected federal guidance from moving forward in the way the Education Department had described. The news comes as additional education-related funding fights involving the Trump administration continue to play out in courts, including rulings affecting other categories of federal support.