A court ruling striking down a scholarship programme for black students at the University of Maryland is sending shock waves through higher education in the United States.

The Benjamin Banneker programme, named after a 19th-century black scientist and inventor, covers tuition and books as well as board and lodging for 139 black undergraduates at the university which, like other southern US higher education institutions, was racially segregated until 1954.

It was one way for a university that once excluded blacks to signal they were welcome. The scholarship was valued at an average of $35,000 a student over four years.

Civil rights lawyers said the decision was a significant setback for affirmative action in higher education.

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"If this decision is not reversed, it will be devastating," said Janell Maria Byrd, a lawyer for the National Association for the Advancement of Coloured People. "It will disrupt minority scholarship programmes throughout the country."

The case was brought by Daniel J. Podberesky, a Spanish-speaking student, who sued the university after being denied a Banneker scholarship in 1990.

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He said: "It continues to be my firm belief that merit scholarships should be awarded solely on merit and any effort to limit awards based on one's race violates the United States constitution."

The university announced last week it would be appealing the decision to the Supreme Court. William Kirwan, president of the university's flagship College Park campus, expressed frustration at the bind he was in. One arm of the federal government was telling him to increase the number of black students; another was forbidding him to use a blacks-only scholarship programme. The university is still bound by an order from the Justice Department that it increase minority enrollment.

Mr Kirwan said: "I can't get over the irony of the rising African American jail population and then taking away a programme like this that tries to bring African Americans into the university."

Experts on affirmative action pointed to a mood shift among judges that affirmative action had been taken too far. The Maryland appeal court decision is the first ruling against a racially exclusive scholarship programme. It covers only five states -- Maryland, North Carolina, South Carolina, Virginia and West Virginia.

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The university won the case at the district court level when the judge ruled in favour of the university on the grounds that a "chilly climate" greeted black students on the campus. Therefore the scholarship scheme should stand, he said.

But his decision was sent back by an appeals panel for lack of statistical evidence to support the ruling. Judge Motz ruled again in favour of the university. Last month's appeals court ruling reversed his decision again.

While the court acknowledged that racism still existed, it said the university had failed to tailor the Benjamin Banneker programme to correct today's effects of past discrimination.

General discrimination in society, it said, cannot be a basis for approving a "race-conscious" remedy such as blacks-only scholarships. It noted that black students from out of state qualified for the awards.

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