Federal Judge Rules New York’s $100M Grant Cuts Using ChatGPT Violated Constitution

New York’s attempt to eliminate over $100 million in grants using artificial intelligence has been struck down as unconstitutional. In a 143-page ruling issued Thursday, U.S. District Judge Colleen McMahon determined that the state’s Department of Government Efficiency (DOGE) improperly used ChatGPT to evaluate whether grant applications aligned with diversity, equity, and inclusion (DEI) standards.

The decision stems from a 2025 lawsuit filed by humanities organizations challenging the cancellation of grants from the National Endowment for the Humanities (NEH).

Judge Cites Unconstitutional Use of AI in Grant Decisions

In her ruling, Judge McMahon criticized DOGE’s reliance on AI, stating that the process “could not be more obvious” in disqualifying grants based solely on protected characteristics. The judge emphasized that the use of ChatGPT to assess DEI compliance violated constitutional protections.

"It could not be more obvious that DOGE used the mere presence of particular, protected characteristics to disqualify grants from continued funding."

Background of the Controversial Grant Cancellations

The DOGE’s decision to cancel the grants was part of a broader effort to review state-funded programs. However, the agency’s method of using AI to evaluate DEI criteria drew immediate legal challenges. The lawsuit argued that the automated process lacked transparency and fairness, leading to the cancellation of grants without proper human oversight.

Humanities groups, including those representing academic and cultural institutions, contended that the AI-driven review process was arbitrary and discriminatory. The lawsuit sought to reinstate the funding, arguing that the cancellations violated due process and equal protection under the law.

What Happens Next?

With the ruling in place, the affected grants must now be reconsidered under lawful criteria. The decision does not immediately restore funding but requires DOGE to revise its evaluation process. Legal experts anticipate further challenges as the state may seek to appeal the ruling.

The case highlights growing concerns over the use of AI in government decision-making, particularly in areas involving civil rights and public funding.