Feds Block ‘Racially Exclusive’ Program Available Only to African-American Women

(FeaturedHeadlines.com) The 11th Circuit Court of Appeals ruled on June 3, 2024 that a grant competition managed by venture capital funding organization Fearless Fund likely violates federal anti-discrimination laws. The court suspended one of the group’s grant programs, which was only available to black women.

In August 2023, the American Alliance for Equal Rights (AAER) sued the group to challenge the program, dubbed the Fearless Strivers Grant Contest. The program awards quarterly grants of $20,000 to businesses with black female founders.

AAER challenged the grant competition under a federal law that grants all persons in the United States the same right to “make and enforce” contracts. After AAER launched its lawsuit, Fearless Fund changed the contest rules to eliminate language acknowledging the competition as a type of contract.

The court found that the Fearless Fund’s program is “substantially unlikely” to enjoy protection under the First Amendment of the US Constitution. The group will presumably need to change the rules of the grant competition to comply with anti-discrimination laws, Judge Kevin Newsom said in the court decision.

The decision overturned a lower court ruling, which declined to block the program. The circuit court remanded the case with instructions to enter a preliminary injunction.

AAER President Edward Blum said that the organization is grateful that the court suspended Fearless Fund’s “racially exclusive” grant competition. US civil rights laws do not allow racial distinctions based on relative degrees of representation in various endeavors, Blum said. The grant competition was “unjust and polarizing,” Blum added.

However, Fearless Fund CEO Arian Simone called the decision “devastating” for the group. The court sent the message that diversity should not exist in corporate America, education, or elsewhere, Simone said. Fearless Fund is evaluating options to fight the lawsuit, the group’s legal counsel, Alphonso David, said.

Although the case has not reached a final resolution, the court has ensured that the racially exclusive grant competition cannot move forward while under adjudication.

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