The University of Notre Dame could be required to pay back a government grant used to train teachers in Catholic schools if a judge rules that the use of the funds was unconstitutional, reported the Associated Press.

That was the 2-1 ruling issued in Laskowski v. Spellings by the 7th U.S. Circuit Court of Appeals in Chicago, April 13. The judges ruled that Indianapolis federal Judge Larry McKinney acted prematurely when he dismissed the case as moot because the $500,000 Department of Education grant had already been spent.

Notre Dame received the money to redistribute to other colleges to help them replicate a program that trains teachers who then teach in impoverished Catholic schools. Private donations also fund the program.

The lawsuit was filed by the American Civil Liberties Union of Indiana, on behalf of taxpayers. They argued that government had no business paying for religious education, reported the AP.

The ACLU wanted the court to order the Education Department to demand repayment. While Circuit Judge Richard Posner disagreed, he said it should not prevent restitution if a constitutional violation of the edict on the separation of church and state were found.

However, the 7th Circuit did not address whether using public money for the teacher-training program violated the constitution.

The attorney who represented Notre Dame, Michael Carvin, told the AP that the university handled the program in line with previous U.S. Supreme Court decisions.

He said he agreed with Circuit Judge Diane Sykes' 13-page dissent, in which she says the case was moot and the two-judge majority kept it alive by inventing a "newfangled" remedy inconsistent with previous rulings.

The university may decide to appeal the decision.