A US District Court ruled on Thursday that the Department of Government Efficiency (DOGE)'s cancellation of over $100 million in grants was unconstitutional. The 143-page decision by Judge Colleen McMahon cited DOGE's process for eliminating grants, which involved using ChatGPT to determine if a project was related to diversity, equity, and inclusion (DEI).
The ruling stems from a 2025 lawsuit filed by humanities groups. The court found it "could not be more obvious that DOGE used the mere presence of particular, protected characteristics to disqualify grants from continued funding" from the National Endowment for the Humanities (NEH). Judge McMahon detailed several instances where DOGE appeared to use ChatGPT to scan and eliminate grants based on their relation to characteristics such as race, national origin, religion, and sexuality.
Court filings included testimony from Justin Fox, a DOGE staffer who, with colleague Nate Cavanaugh, eliminated 97 percent of NEH grants. This process partly relied on ChatGPT's understanding of DEI. Fox testified that he used ChatGPT "[t]o highlight why [a] grant may relate to DEI" and "to pull out anything related to DEI."
To achieve this, he submitted each cursory grant description from the NEH spreadsheet to ChatGPT using a standardized prompt: "Does the following relate at all to DEI? Respond factually in less than 120 characters. Begin with ‘Yes.’ or ‘No.’ followed by a brief explanation." Fox admitted he did not define "DEI" for ChatGPT and had no understanding of how the AI interpreted the term.
Beyond asking ChatGPT for DEI indicators, Fox also instructed the chatbot to scan NEH grants for what he termed "Detection Codes" related to "protected characteristics." According to the filing, after being deployed from DOGE to NEH, Justin Fox used these search terms—labeled "Detection Codes"—to identify grants he dubbed "Craziest Grants" and "Other Bad Grants." These search terms included, among others, "BIPOC (Black, Indigenous, People of Color)," "Minorities," "Native," "Tribal," "Indigenous," "Immigrant," "LGBTQ," "Homosexual," and "Gay." When questioned if he "r[a]n this list of words through every grant description" received from NEH, Fox confirmed, "yes." This method established and applied explicit classifications based on protected characteristics as operative criteria for revoking federal grants.
Judge McMahon concluded that DOGE deemed hundreds of grants "wasteful because they related to Blacks, women, Jews, Asian Americans, and Indigenous people." She emphasized that "the very subjects DOGE treated as markers of waste, lack of merit, or ideological contamination are the subjects that Congress made expressly germane to NEH’s mission." Examples of grants categorized as "wasteful" included projects on the Holocaust, civil rights, and an educational experience exploring Indigenous cultures.
