In the wake of a federal court of appeals ruling that suspended Fearless Fund’s grant program for Black women business owners, reactions have been swift and polarized.
Fearless Fund CEO and Founder Arian Simone described the ruling as “devastating” for the organization and the women it aims to support.
“The message these judges sent today is that diversity in Corporate America, education, or anywhere else should not exist,” Simone stated, accusing the judges of aligning with “a small group of white men.”
The decision represents another win for conservative groups challenging diversity initiatives across various sectors. Edward Blum, the conservative activist behind the lawsuit, hailed the ruling.
“Programs that exclude certain individuals because of their race, such as the ones the Fearless Fund has designed and implemented, are unjust and polarizing,” Blum said.
Civil rights organizations, employment lawyers, and the venture capital sector have all expressed concern about suspending the Atlanta-based Fearless Fund’s Strivers Grant Contest, which offers $20,000 to companies with majority-Black female ownership.
Alphonso David, legal counsel for the Fearless Fund and president and CEO of the Global Black Economic Forum, emphasized that the organization is exploring all options to continue the fight against the lawsuit.
The case is part of a broader legal strategy against diversity initiatives, with conservative groups seeing both victories and setbacks. Just last week, a federal district judge in Ohio dismissed a lawsuit challenging a program by Progressive and Hello Alice that provides grants to Black-owned small businesses. Similar dismissals have occurred in cases against Amazon, Pfizer, and Starbucks.
But the recent 2-1 decision by the U.S. Court of Appeals for the 11th Circuit found that Blum is likely to succeed in his claim that the Fearless Fund’s grant program violates section 1981 of the 1866 Civil Rights Act, which prohibits racial discrimination in contracts. This ruling reversed an earlier decision that had allowed the contest to continue.
The appeals court panel, consisting of judges appointed by former presidents Donald Trump and Barack Obama, rejected arguments that the grants were charitable donations protected by free speech rights.
In a vigorous dissent, Judge Robin Rosenbaum likened the plaintiffs’ claims to soccer players faking injuries, arguing that they failed to demonstrate any real intent to apply for the grants.
David Glasgow, executive director of the Meltzer Center for Diversity, Inclusion, and Belonging at NYU’s School of Law, highlighted the polarized nature of judicial decisions on diversity programs and predicted the issue might ultimately reach the Supreme Court.
Support for the Fearless Fund has been robust from various sectors. The National Venture Capital Association defended the grant program as a crucial step toward creating equal opportunities in an industry historically excluding Black women. Philanthropic leaders, such as Kathleen Enright, president and CEO of the Council on Foundations, warned that restricting targeted giving could harm both philanthropy and the nation.
The Rev. Al Sharpton, president and founder of National Action Network, condemned the ruling, calling it “outrageous” and a significant setback for diversity, equity, and inclusion (DEI) efforts. Sharpton emphasized the importance of continuing the fight for DEI despite setbacks.
“When I stood outside the courthouse in Atlanta with the Fearless Fund last year and have since led a campaign to protect DE&I, I reminded everyone that there would be victories and losses in this battle, but we must keep up the fight,” Sharpton declared. “Because from the moment Edward Blum launched his deceitful crusade against workplace diversity, the deck has been stacked against the Fearless Fund. An organization built to help fix the enormous disparity in venture capital funding for women of color-owned businesses is seeing its mission be dismantled under the guise of fairness and equality.
Sharpton added that the nation should be preparing to celebrate the 60th anniversary of the Freedom Summer and the Civil Rights Act of 1964. Instead, he said, the country is witnessing right-wing litigants and judges “butcher the legacy of the civil rights movement.”
“The National Action Network continues to stand with the Fearless Fund, the Fearless Foundation, and all the women of color entrepreneurs who have been given an opportunity to succeed because of their investments,” Sharpton asserted. “It’s time we show the nation that for every single Ed Blum or Stephen Miller, there are thousands who believe in DEI.”
