Press Release:
August 1, 2024
Contact:
Edward Blum
edwardjayblum@gmail.com
703-505-1922
American Alliance for Equal Rights Wins Lawsuit Against Founders First Community Development Corporation
(Austin, Texas) – A U.S. District Court in Texas has granted the American Alliance for Equal Rights a preliminary injunction against Founders First Community Development Corporation’s “Texas Job Creators Grant.” The court found that the grant program violated 42 U.S.C. § 1981 because it excluded certain applicants by race. The opinion is attached.
As noted in the opinion, Founders’ program is a contract under Section 1981, a factnot disputed by Founders. Founders has made clear that applicants must belong to preferred demographic groups to apply. In numerous instances, Founders has repeatedly. insisted that applicants must belong to one of its preferred demographic groups. On its website, Founders has historically listed six “Eligibility Requirements” for the program, the first of which is the: “Founder identify as one of the following: Latinx, Black, Asian, Women, LGBTQIA+, Military Veteran, or located in a Low or Moderate Income area.” This eligibility requirement is corroborated by a FAQ page for the program that asks, “Can any company apply for this program?” In response Founders answers, “No, the company must be diverse-led; meaning founders that are people of color, women, LGBTQ community, military veterans or [someone] located in a low or moderate income area.” This eligibility requirement was further emphasized in press releases, quarterly reports, media interviews, and marketing materials. Edward Blum, president of AAER, said, “We are grateful that the court has recognized that this grant program is unlawful and should be open to all applicants, regardless of their race.”
Blum added, “Providing resources to emerging small businesses is a worthwhile endeavor, but excluding some owners because they are not the preferred race is unfair, polarizing and illegal.”