England’s Office for Students (OfS) took a major setback after the High Court rejected key aspects of its handling of a record £585,000 fine against the University of Sussex. The case involved the university’s trans and non-binary inclusion policy and the regulator’s conclusion that the approach created a chilling effect on free speech. The ruling found the OfS process flawed, including findings that the regulator “closed its mind” to relevant considerations about freedom of speech and mishandled parts of the academic-freedom analysis. Sussex argued the decision raised serious questions about the regulator’s approach. For the higher education sector, the decision intensifies pressure on the OfS to rebuild trust while continuing to police speech and inclusion standards in ways that withstand judicial review.