An Appeals Court Rules the Fearless Fund’s Grant Program is Discriminatory—What This Means for Similar Programs

“The numbers are there, so I wouldn’t harp on those. What I would rather do is come to a solution,” Fearless Fund founder Arian Simone previously told EBONY in March. “I would like to express that the plaintiff and I ultimately desire the same outcome, living in a world where race doesn’t matter. Fearless Fund isn’t here to be this eternal vehicle, we’re here to solve a problem and once that problem is solved—we don’t necessarily have to be here. We just haven’t gotten there.”

It’s a statement that Simone made in response our question, “What would you want a court to take away as far as the importance of and necessity for Fearless Fund?”

In 2023, the brand found themselves on the opposing end of a lawsuit brought by Edward Blum of conservative group, The American Alliance for Equal Rights. In his complaint, Blum alleged that the Fearless Fund’s Fearless Strivers Grant Contest only being available to Black women-led businesses, violates section 1981 of the Civil Rights Act of 1866. For context, this act was originally intended to protect formally enslaved people from economic exclusion in regards to contracts. So in turn, Blum is using an act designed to protect Black folks against Black folks in an “Uno reverse” sort of manner.

On June 3, 2024, in a 2-1 decision, the Georgia Federal Court of Appeals for the 11th Circuit delivered its ruling on a pending appeal for injunctive relief filed by Blum. In essence, the court found that the grant contest, which provides $20,000 to businesses that are majority owned by Black women, was discriminatory—overturning a Northern Georgia District Court’s decision that injunctive relief should not be granted.

“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 stated while praising the appeals court’s decision.

What this now means for Fearless Fund is the grant program must legally pause until a formal ruling is made on the original lawsuit brought by Blum, an act Simone describes as “devastating.” It could also mean that Blum is likely to prevail on the case once it is set before the court again.

“The message these judges sent today is that diversity in Corporate America, education, or anywhere else should not exist,” Arien Simone said in statement in response to the appeals court’s ruling. “These judges bought what a small group of White men were selling.”

The future of DEI and similar race-based initiatives

In 2020, the nation saw an influx of diversity, equity and inclusion initiatives sweep through Corporate America and many higher education institutions. Most being performative at best, they were launched in an effort to mitigate the backlash happening around the time George Floyd was murdered.

Just a few short years later, DEI departments are being erased just as quickly as they were created. Many legal experts are saying that it all boils down to the political make-up of the jurisdictions that the DEI and race-based cases are being heard in front of. For example, most conservative courts are against such efforts and are finding that such programs shouldn’t be allowed on a similar basis as the current Fearless Fund appeal. On the other hand, more liberal jurisdictions are still very much in favor of diversity efforts as evidenced by dissenting judge, Judge Robin Rosenbaum.

“At bottom, American Alliance and its members have shown nothing more than flopping on the field when it comes to establishing an injury in fact,” she wrote in her dissenting opinion. “For that reason, they have failed to satisfy standing, and we lack jurisdiction. In short, this is not a “genuine, live dispute.”

In other words, Rosenbaum feels that Blum and his American Alliance for Equal Rights counterparts will not face any true harm or damage from the grant program remaining in place. As is the case with most DEI efforts across the nation.

This is just one of the reasons why this year’s election is so crucial. We’re not just electing the next president, but also the outcome of the House, Senate and several important state and local positions. The court that ruled on Simone’s appeals case was made up of two Trump administration appointees—the two who ruled that the program should not be allowed to move forward—and Rosenbaum, who was appointed during the Obama administration and saw no issue with letting Fearless Fund proceed with their efforts to simply give Black women an even playing field.

“This is not just our fight, this is our fight,” Simone previously said to EBONY. “This is a precedent case. Whatever happens to us, may happen to everyone. We need policies put in place to protect our access to capital.”

Updated: June 7, 2024 — 6:04 pm