A venture capital firm has ended its small business grant contest for Black women following a settlement in a racial discrimination lawsuit launched last year by a conservative nonprofit.
The American Alliance for Equal Rights (AAER) initiated federal court proceedings in 2023, claiming the Fearless Fund’s Fearless Strivers Grant Contest, a $20,000 grant only for businesses where a Black female entrepreneur has at least a 51 percent stake, violated federal anti-discrimination laws.
“By strategically avoiding a Supreme Court ruling that could have eliminated race-based funding, we protected vital opportunities for the entire Black and brown community,” he said.
“This victory ensures that programs dedicated to uplifting underrepresented entrepreneurs remain intact and continue to serve their critical purpose.”
Crump said the Fearless Fund has also announced a new $200 million debt loan program to support under-resourced entrepreneurs and advance equity, or equality of outcome, and create “opportunities for those who have been historically marginalized.”
“Opening grant programs to all applicants, regardless of their race, is enshrined in our nation’s civil rights laws and supported by significant majorities of all Americans.”
The exact terms of the settlement have not been disclosed publicly by either party.
In June, a three-judge 11th U.S. Circuit Court of Appeals panel ruled 2-1 that the program was likely in violation of section 1981 of the 1866 Civil Rights Act, which prohibits discrimination based on race when enforcing contracts.
The appeals court found that the program would cause irreparable harm to those excluded from participation, and ruled against the fund’s argument that its grants are not contracts but charitable donations and, therefore, protected under the First Amendment.
The case comes after the Supreme Court struck down affirmative action efforts in higher education.
The Epoch Times has contacted the Fearless Fund for comment on the settlement.
