Edward Blum has filed dozens of lawsuits challenging racial preferences in American life, from affirmative action to voting rights. His most recent win came when he sued Harvard over its race-conscious college admissions policies.
Now fresh off that landmark affirmative action victory, Blum has set his sights on the private sector.
His organization, American Alliance for Equal Rights, recently filed two racial discrimination lawsuits. In August, he sued an Atlanta firm, Fearless Fund, that backs Black women entrepreneurs. He also sued two major law firms, Morrison Foerster and Perkins Coie, for offering fellowships to diverse candidates. Morrison Foerster this week quietly opened its diversity fellowship to students of all races. It did not respond to a request for comment.
Blum’s quest to dismantle corporate diversity initiatives began in 2021 when he took the state of California and the NASDAQ stock exchange to court over board diversity mandates.
The anti-affirmative action activist says he has more lawsuits planned.
“Racial classifications and preferences need to be handled with the most delicate of gloves or corporations and other institutions will be in violation of the law,” Blum told USA TODAY in an interview.
Conservatives seize on affirmative action ruling to attack diversity programs
Corporate diversity, equity and inclusion initiatives – DEI for short – were already under fire from GOP leaders like Florida Gov. and presidential hopeful Ron DeSantis. Republican criticism only intensified in the wake of the Supreme Court ruling in June that struck down affirmative action.
Though it does not apply to employers, conservative activists seized on the high court ruling, saying it raises fundamental issues about how corporate America addresses workplace inequality.
“The decision was clear that all Americans have the same civil rights, and those rights forbid discriminating for or against anyone on the basis of race, sex or orientation,” said Scott Shepard, director of the National Center for Public Policy Research’s Free Enterprise Project which challenges DEI and other “woke” initiatives in corporate America.
Since then, the nation has seen an uptick in legal challenges from conservative activists.
America First Legal – a conservative group founded by Stephen Miller, former senior adviser to President Trump, and other former Trump administration officials – has filed complaints with the Equal Employment Opportunity Commission against diversity programs at more than a dozen companies including Starbucks, McDonald’s and Morgan Stanley. In a blog post, America First Legal claimed that all DEI programs are illegal.
“If a major corporation said in proxy statements to shareholders or in the HR section of their website, we are going to increase the white composition of our workforce by 15% this year, I think most folks would say, well, that’s kind of racist and that seems wrong,” Gene Hamilton, vice president and general counsel of America First Legal, told USA TODAY in an interview.
From ESG to CRT, the conservative backlash against big business is spreading
From ESG to CRT, the conservative backlash against corporate America’s embrace of social issues is the nation’s latest cultural wedge.
DeSantis and other GOP leaders have accused corporations of running diversity programs that paint all white people as racist and abandoning colorblind systems based on merit to hire and promote people of color.
Daniel Morenoff, executive director of the American Civil Rights Project, which for years has pressured companies like Coca-Cola and McDonald’s to back off diversity programs, says the Supreme Court ruling has energized conservatives to block the increasingly leftward tilt of big business.
“I think it would be safe to say that there appears to be greater interest in the activity in this sphere,” Morenoff told USA TODAY.
Immediately after the Supreme Court ruling, Republican state attorneys general warned large employers like Microsoft and Walmart against race-conscious practices in hiring and contracting.
Democrats fired back, accusing GOP state attorneys general of attempting to intimidate corporations into abandoning “permissible diversity efforts.”
Top lawyers from seven states promised legal cover to companies whose DEI programs face challenges from GOP officials.
“We write to reassure you that corporate efforts to recruit diverse workforces and create inclusive work environments are legal and reduce corporate risk for claims of discrimination,” the Democrats wrote. “In fact, businesses should double-down on diversity-focused programs because there is still much more work to be done.”
The Lawyers’ Committee for Civil Rights Under Law and six other civil rights groups this week filed an amicus brief in support of the Fearless Fund, a program that awards $20,000 grants to small businesses owned by Black women that was sued by Blum. Black women receive less than 1% of venture capital funding.
Fearless Fund founders Arian Simone and Ayana Parsons have retained prominent civil rights attorney Ben Crump to fight the lawsuit.
“In the face of persistent, systemic discrimination against Black people and all people of color arising from our country’s long history of racism, Ed Blum and his recently-created front group are bent on dismantling programs benefiting the Black community,” Damon Hewitt, president and executive Director of Lawyers’ Committee for Civil Rights Under Law, said in a statement. “They seek to kneecap any effort to undo entrenched racial inequalities.”
Corporate diversity programs are not affirmative action, law professor says
Most Americans say companies should not take race and ethnicity into account in hiring and promotions, according to a 2019 survey from the Pew Research Center.
But federal law already prohibits employers from considering race and other protected characteristics, according to Joan Williams, Sullivan professor of law and director of the Center for WorkLife Law at UC Law SF.
Conservatives are attempting to mislead the public by conflating diversity programs with affirmative action, Williams said. “And this,” she said, “is just nonsense.”
By casting a wide net for qualified workers from different backgrounds, initiatives to attract diverse talent help employers make their workforces less homogeneous and their workplaces more inclusive, she said.
Williams has worked with scores of companies over the years. In a database of nearly 20,000 professionals, 80% to 88% of white men report fair access to career-enhancing assignments while the proportion among women of color plunges as low as 50%.
“The bottom line is what the Supreme Court said is that you have to have a meritocracy,” she said. “What a good DEI program does is produce a true meritocracy.”
Conservative backlash is ‘bluster,’ diversity advocate says
In the fight to level opportunities for underrepresented groups, the stakes are high, according to Shijuade Kadree, director of tech equity and the tech accountability coalition at the Aspen Institute.
The unfolding conflict is a modern civil rights struggle for people of color who historically have been excluded and discriminated against in the workplace, Kadree said.
“They are using the Supreme Court ruling on affirmative action as a proxy to attack any DEI initiative,” she said. “And that attack is stemming from a fear of losing power.”
The top ranks of America’s largest corporations are still predominantly white and male, while women and people of color are concentrated at the lowest levels with less pay, fewer perks and rare opportunities for advancement, a USA TODAY analysis found.
Despite pledges to improve racial equity following George Floyd’s murder in 2020, little progress has been made.
White men today are more likely than their grandfathers to be managers even as the workforce diversifies and research studies show that diverse companies outperform peers.
At current rates, it could take decades – if not centuries – for corporate leadership to reflect the demographics of the workforce, researchers have found.
Kadree says she’s worried about the backslide in corporate diversity commitments she’s observed over the last year and a half. For companies looking to reduce staff and initiatives, the Supreme Court affirmative action decision is a convenient scapegoat, she said.
The flurry of legal actions from conservative groups has prompted some companies to retreat from public targets for racial diversity in their executive ranks and from leadership training programs geared to underrepresented groups. Others are removing “diversity” from job titles.
Most companies, however, are looking to the future and know they have a lot of work that remains so that their workforces and leadership will one day better reflect the changing demographics of the country and their customers, Kadree said.
“They get that it’s a lot of bluster,” Kadree said.
GOP activists face key challenge in taking on big business diversity initiatives
The conservative pushback has run into obstacles.
A federal judge in August dismissed a lawsuit against Starbucks’ board of directors that opposed the coffee giant’s diversity, equity and inclusion policies and practices.
The lawsuit was brought by the National Center for Public Policy Research over hiring goals for Black and other workers of color, awarding contracts to diverse suppliers and linking executive pay to diversity goals.
Chief U.S. District Judge Stanley Bastian in Spokane, Washington, rejected the claims, saying the courts have no business interfering with “legitimate and legal decisions made by the boards of directors of public corporations.”
Historically the courts have given boards of directors wide discretion, assuming they act in good faith and in the best interests of the company.
“If the plaintiff doesn’t want to be invested in woke corporate America, perhaps it should seek other investment opportunities rather than wasting this court’s time,” Bastian said.
Shepard said the National Center for Public Policy Research is “surprised and disappointed by the result.”
