Appeals court suspends VC grant program for Black women entrepreneurs
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A federal appeals court suspended venture firm Fearless Fund's grant program for Black women business owners in a 2-1 decision on Monday.
Why it matters: The lawsuit, filed by the conservative group whose case led to affirmative action in higher education being struck down by the Supreme Court, has been closely watched as a bellwether of what could happen to efforts to close the financing racial gap.
What they're saying: "Our nation's civil rights laws do not permit racial distinctions because some groups are overrepresented in various endeavors, while others are under-represented," said Edward Blum, who heads the American Alliance for Equal Rights and filed the suit, in a statement according to CNN.
The other side: "The message these judges sent today is that diversity in Corporate America, education, or anywhere else should not exist," Fearless Fund CEO Arian Simone said in a statement to AP.
- "These judges bought what a small group of white men were selling."
Zoom in: The ruling against the Atlanta-based company, from a panel of judges from the U.S. Court of Appeals for the 11th Circuit in Miami, found that the plaintiff is likely to prevail in its lawsuit that claims the grant program is discriminatory.
- The panel thus ruled in favor of a preliminary injunction of the program, halting it now as the lawsuit proceeds.
Yes, but: Not all such legal challenges have been successful.
- A similar lawsuit against insurer Progressive and fintech company Hello Alice was dismissed last week, as have others against Amazon, Pfizer, and Starbucks, per AP.
