In a noteworthy occurrence, the 11th Circuit Court of Appeals granted a preliminary injunction in favor of the American Alliance for Equal Rights (“AAER”) against Fearless Fund Management LLC. The latter, a company run by black women, was accused by the AAER for purported violation of Section 1981 of the Civil Rights Act of 1866.
The AAER had filed a suit alleging that Fearless was acting in breach of the Civil Rights Act by awarding grants solely to women of color entrepreneurs. However, the Northern District of Georgia had previously turned down a preliminary injunction meant to halt Fearless from its practices, a decision that prompted the AAER to lodge an immediate appeal.
Crucially, the appeal made by AAER to the 11th Circuit U.S. Court of Appeals proved fruitful. It resulted in the grant of the said preliminary injunction against Fearless Fund. This means, until the case is fully determined, Fearless will have to restrain from its practice of awarding grants to only women of color entrepreneurs.
For legal professionals, this case can be deemed of significant importance as it underlines the interplay between civil rights, corporate funding practices, and the nuances of the law in such matters. It further raises critical questions about using entrepreneurial grants as a tool for enhancing diversity in the business world. The full implications of this legal discourse, however, can only be discerned as the litigation develops and the final judgment unfolds.
For complete details of this legal development, refer to the comprehensive coverage by Foley & Lardner LLP on JD Supra.