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• By Clemon White & Paige Duggins-Clay, J.D. • IDRA Newsletter • June-July 2026 •

The Fifth Circuit’s ruling invalidating the Texas Dream Act resulted from a collusive lawsuit in which federal and state officials worked toward the same outcome rather than presenting an actual legal dispute. The strategy has already been repeated in other states, threatening tuition-equity laws and creating a potential blueprint for invalidating democratically-enacted policies through the courts.

On July 9 of this year, the Fifth Circuit Court of Appeals upheld a federal district court ruling in USA v. Students, finding the Texas Dream Act unconstitutional. The strategy leading to the decision undermines the will of Texans and the rule of law. The case has catalyzed identical collusive litigation in at least 13 other states (Higher Ed Immigration Portal, 2026).

IDRA and our strong, bipartisan coalition of business, higher education, civil rights and student leaders denounce the Fifth Circuit’s ruling. We continue to work together to ensure every student, regardless of immigration status, has access to college and career opportunities.

What Happened

The Fifth Circuit’s decision arose in a troubling, collusive manner. For nearly 25 years, the Texas Dream Act promoted tuition equity by allowing undocumented Texas students to qualify for in-state tuition. After repeated failed attempts by extremist politicians to repeal the act through the democratic process, the U.S. Department of Justice and the State of Texas turned to the courts to achieve what repeated legislative efforts could not.

Despite the Texas Dream Act delivering clear, measurable benefits to Texas, on June 4, 2025, the U.S. Department of Justice partnered with the Texas Attorney General’s Office to summarily file and resolve a collusive lawsuit invalidating the law. A federal district judge rubber-stamped the illusory lawsuit, entering a consent decree deeming the Texas Dream Act unconstitutional mere hours after the lawsuit was filed.

Collusive lawsuits, with “sweetheart adversaries” in which the parties do not oppose each other but instead work together to obtain a particular judicial ruling, harm the public interest by undermining legislative authority and judicial integrity. State policy is meant to be made or repealed through legislative deliberation, as legislatures exist to enact policies that reflect the will of the people.

Last year, IDRA and our partners at the Texas Immigration Law Council (TxILC) organized a bipartisan, interdisciplinary coalition to file an amicus brief in support of student and civil rights organizations’ efforts to defend the law when our state leaders declined to do so (2025).

As the dissent in the July 2026 case explains, the Fifth Circuit avoided addressing whether the parties’ litigation strategy was an appropriate way to achieve their shared policy objective. Instead, the court relied on its own prior dicta – statements in earlier opinions that are not legally binding – from previous litigation involving the Texas Dream Act. By denying intervention to Texas Dreamers, the court excluded from the courtroom the people most impacted by the case. The result is a troubling decision that appears to prioritize a policy outcome over established legal principles.

The Cornerstone of the Department of Justice’s Campaign Against Tuition Equity

The consequences of the court order reach well beyond individual students: undermining tuition equity will ultimately harm Texas’ workforce and economy by disrupting this pipeline of skilled, educated workers.

Despite the advantages the Texas Dream Act has secured for the state, extremist politicians have long challenged the legislation. But they failed to repeal it through democratic means, as the Texas legislature has repeatedly refused to repeal the nearly 25-year-old law because it serves the state’s long-term interests (LBR, 2023).

In 2001, Texas was the first state to enact a tuition equity statute, allowing students to be classified as Texas residents for tuition purposes if they graduated from a Texas high school and had continuously lived in Texas for three years leading up to their high school graduation. The legislation received extensive bipartisan support and passed almost unanimously.

In 2005, the legislature expanded this residency pathway to all students who met the statutory requirement, regardless of immigration status (THECB, 2007).

These reforms expanded college access by establishing an alternative basis for in-state tuition for students who could not qualify under traditional domicile-based residency determinations due to their immigration status.

Since its enactment, the Texas Dream Act has delivered clear, measurable benefits to Texas.

Texas employers rely heavily on immigrants, who make up almost a quarter (23%) of the state’s labor force (García, 2026). Among Texas’ workforce, an estimated 1.2 million workers are either undocumented or have temporary legal protections, such as Deferred Action for Childhood Arrivals (DACA), Temporary Protected Status, or an active asylum claim. This represents almost 8% of the total workforce.

Immigrants also make up large percentages of the labor force in key industries in Texas, including healthcare and education, where many provide essential services during crises, such as the COVID-19 pandemic and natural disasters (Garcia, 2026).

Because undocumented immigrants are integral to our communities and labor force, expanding college access by ensuring tuition equity results in a better-educated workforce and a more prosperous economy for all.

Because undocumented immigrants are integral to our communities and labor force, expanding college access by ensuring tuition equity results in a better-educated workforce and a more prosperous economy for all.

A Dangerous Blueprint for Dismantling Democracy

The fight for tuition equity and the growing campaign against it are not confined to Texas. According to the Higher Ed Immigration Portal, 18 states and Washington, D.C., provide undocumented students with “comprehensive access” to in-state tuition and scholarships, while other states offer more limited forms of tuition equity (2026). Following Texas’ trailblazing enactment of the Texas Dream Act, numerous states have enacted similar legislation, expanding in-state tuition for undocumented students. Nebraska has become the latest battleground in the growing effort by extremists to dismantle tuition equity.

Nebraska enacted a tuition-equity law in 2006 that closely resembles the Texas Dream Act. Like the Texas law, Nebraska’s tuition-equity statute has become the target of a coordinated effort to undermine the democratic process by overturning a statute through collusive litigation as opposed to the legislative process.

In April 2026, the Department of Justice filed a lawsuit challenging the constitutionality of Nebraska’s tuition-equity law. Instead of defending the democratically enacted statute, the Nebraska Attorney General, its counterpart in Texas, immediately sided with the department and made an agreement that invalidated the statute. And like its counterpart in Texas, a federal district court judge approved a sham consent decree invalidating Nebraska’s nearly 20-year-old law.

Nonprofit immigrant rights organizations The Orel Alliance and True Potential Scholarship, represented by Democracy Forward and Nebraska Appleseed, sought to intervene to defend the statute, but their motion was denied (2026). The proposed interveners then appealed the denial to the Eighth Circuit Court of Appeals, where the case is currently pending.

If the Eighth Circuit follows the Fifth Circuit in legitimizing collusive lawsuits between the U.S. Department of Justice and state officials who refuse to defend their own democratically enacted laws, it will jeopardize the educational opportunities of thousands of students and deprive states of an educated workforce. It would also establish a dangerous blueprint for invalidating democratically enacted legislation through litigation, allowing governments to circumvent the democratic process.

What We Can Do Now

IDRA believes that all students, regardless of their immigration status, should have access to affordable higher education. While the future of tuition-equity laws remains uncertain due to mounting litigation, there are numerous ways to support undocumented students.

For example, institutions and advocates can establish and support mutual aid funds for undocumented Texas students, much like the fund organized by Students Engaged in Advancing Texas (SEAT) and Texas Students for DEI, which raised over $20,000 to support Texas students impacted by the invalidation of the Texas Dream Act (SEAT, 2025).

Students, families, and institutions committed to tuition equity can also use IDRA’s Student Guide to Navigating Texas Dream Act Changes, which offers tools and resources for students impacted by this litigation (IDRA, 2026).

Regardless of the decisions of federal courts and state and federal attorneys general, community support and continued legislative advocacy are essential to advancing equal educational opportunity for all students – including immigrant students – in Texas and across the country.

Citations available online.

Clemon White is an IDRA summer law clerk (clemon.white@idra.org). Paige Duggins-Clay, J.D., is IDRA’s chief legal analyst (paige.duggins-clay@idra.org).

Resources

Connor, P., Hsin, A., Moriarty, A., Ortega, K., & Shih, K. (2026). Forfeiting the Trillion Dollar Dream: The Long-Term, Staggering Human and Economic Cost of Ending DACA. Coalition for the American Dream.

Democracy Forward. (May 7, 2026). Nebraska Organizations Move to Defend Access to Affordable Higher Education.

Garcia, Z. (April 17, 2026). Immigrants Are Crucial to Texas’ Economy. FWD.us.

Higher Ed Immigration Portal. (July 20, 2026). In-State Tuition Litigation Updates.

Higher Ed Immigration Portal. (2026). Tuition & Financial Aid Equity for Undocumented Students.

IDRA. (2026). Student Guide to Navigating Texas Dream Act Changes.

LBR. (August 23, 2022). A Reckless Anti-Immigrant Lawsuit Challenges Texas Tuition Laws, podcast episode. Latino Business Report. 

SEAT. (December 23, 2025). Keeping the Texas Dream Fund. Students Engaged in Advancing Texas.

THECB. (April 2007). Residency and In-State Tuition. Texas Higher Education Coordinating Board.

United States of America v. State of Texas, Br. of Texans for Economic Growth, et al., Amicus Curiae, Case No. 7:25-cv-00055 (2025).

FAQs

What happened to the Texas Dream Act?

The Fifth Circuit upheld a federal district court ruling that invalidated the Texas Dream Act. The ruling followed a lawsuit in which the U.S. Department of Justice and the State of Texas agreed that the law should be declared unconstitutional rather than presenting opposing positions in a traditional legal dispute.

What did the Texas Dream Act provide?

The Texas Dream Act allowed qualifying students, including undocumented students, to establish Texas residency for tuition purposes if they graduated from a Texas high school and met state residency requirements. This enabled eligible students to pay in-state rather than out-of-state tuition.

What is collusive litigation?

Collusive litigation occurs when parties presented as legal opponents actually seek the same result from the court. This can allow government officials to obtain a policy outcome through litigation rather than through the legislative process.

Why does the Texas Dream Act ruling matter outside Texas?

The strategy used to invalidate the Texas law has been repeated in challenges to tuition-equity policies in other states. Courts’ acceptance of this approach could make it easier for officials to invalidate other democratically enacted laws without a genuine adversarial legal process.

How can communities support students affected by the ruling?

Colleges, community organizations and advocates can support emergency and mutual-aid funds, connect students with financial and legal resources, and advocate for policies that preserve access to affordable higher education.

Timeline

2001: Texas enacts its tuition-equity law.

2005: The Texas Legislature expands the residency pathway.

June 4, 2025: Federal and Texas officials file and resolve the lawsuit challenging the law.

July 9, 2026: The Fifth Circuit upholds the district court ruling.

April 2026: The Department of Justice files a similar challenge to Nebraska’s law.

[© 2026, IDRA. This article originally appeared in the June-July edition of the IDRA Newsletter. Permission to reproduce this article is granted provided the article is reprinted in its entirety and proper credit is given to IDRA and the author.]