The Hello Alice trial could have high issues for the diversity of companies

But the message was not a spam. America First Legal allegedly allegedly allegedly allegedly made a subsidy of $ 25,000 at the disposal of commercial vehicle companies belonging to blacks, she violated a law on civil rights law from 1866 which prohibited racial discrimination in contracts.

The email AFL launched a long emotionally draining legal battle that has consumed Gore and its co -founder Elizabeth Rodz since, explains Gore, even if Hello Alice has continued to grow. Although the battle takes place far from national spotlights, it provides a test field for legal arguments that could help companies defend their diversity programs against the claims of reverse racism.

A battle of $ 25,000, a two -year battle

The program in question was sponsored by progressive, the insurance company, co-defense of the prosecution, as well as the parent of Hello Alice. The legal dispute was raised on behalf of Nathan Roberts, a white man in Ohio who has a company called Freedom Truck Dispatch.

Last year, the fight briefly seemed to be finished: a federal judge in the northern Ohio district agreed to reject the case because the complainants did not show that Roberts would have won the subsidy if the competition for it had been neutral. In legal terms, he had not “standing” to bring the case, a conclusion linked to some details on the situation. (On the one hand, Roberts did not ask for the subsidy during the request window and continued the company only after closing the window.)

But America first appealed to this decision, and at the end of July, the trial was submitted to the Sixth Circuit Court of Appeal in Cincinnati, where the AFL again argued that its client had been injured because he could not ask for the subsidy.

From now on, on the basis of the discussion before a panel of three judges in the sixth circuit, it seems that the Hello Alice trial will consolidate a reliable, but not sexy tool, that companies can use to defend themselves against the claims of reverse racism in the anti-dei campaigns: arcanic rules and techniques.

For years, companies have used procedural reasons to escape the accusations of discrimination in the employment linked to the employment brought by people of color, women, LGBTQ + and others. The Hello Alice affair can show that companies can successfully protect themselves against anti-dei proceedings motivated politically in the same way.

“We were really satisfied with the questions of the court,” said DC, DC law firm, Milbank, and represent Hello Alice in Washington, DC law firm, and represents hello Alice. Fortune. Indeed, many of these questions have definitively closed on procedural issues. (The court asked, for example, what about the terms and conditions of Hello Alice prevented the AFL’s customer from requesting the grant.) “They obviously read everything and asked exactly the right questions. And we are impatiently awaiting the resolution of this case.”

Could such questions help defendants scuttle the cases before the two parties even approached more important questions, in particular: was the federal law on the contracts in question never supposed to help resolve reverse discrimination? (For the record, Hello Alice maintains that this is not the case.) And gives money as a subsidy a form of freedom of expression, similar to the creation of political gifts? (The 11th short circuit rejected this argument in a separate case, but the case did not reach the Supreme Court.)

The result of the Hello Alice case can also point out to companies that they do not need to make programs back for marginalized groups out of fear.

AFL did not immediately respond to a request for comments. Fortune Tentré to reach Freedom Truck Dispatch, but found that a phone number listed for the company was out of service.

A push for inclusion

Since Hello Alice left the ground a decade ago, said Gore, the company served 1.6 million small businesses, which helps them get loans and benefit from a multitude of information and resources. “We have all the financial planning software they need to create their business plans,” says Gore.

The co -founders also spend part of their time defending small businesses and collecting funds for philanthropic subsidies. To date, Hello Alice has issued $ 60 million in small subsidies in the United States, according to Gore. “Part of our commitment since the first day was to guarantee that small businesses that have a kind of barrier at the entrance, which we dig and make sure to be part of the platform,” she says. The company has helped veterans, for example, and women who have been in the care economy, the two groups of people who may not have the credit history necessary to launch a business.

The company is faced with a movement that recently gained momentum. Conservative activists who claim that the diversity of businesses, equity and inclusion efforts are a form of reverse discrimination have been embraced by the support of the judicial system and the White House. In 2023, the decision of the Supreme Court in the student affair for fair admissions (SFFA) prohibited colleges from considering the race as part of their admission process, a change that sent companies to blur to understand what the new law meant in the private sector. In addition, President Trump has published decrees this year that have prohibited certain types of DEI in companies with federal contracts and have warned that his administration would investigate companies in the private sector discovered such as the most “flagrant” offenders in Dei.

It remains to be seen whether the Hello Alice affair will answer more important questions about the legality of Dei. “Initially, this case presented the big question: can positive action be authorized within the framework of the company?” Katyal explained. “But the court of first instance said that the complainants had not even been able to ask this question. They were not allowed to do so because they had not satisfied the legal requirements to be able to carry a case before the Federal Court.” Now, says Katyal, the question before the sixth circuit is: “” Can someone try to complain about a program to give subsidies to companies belonging to minorities when they cannot even claim that they would have obtained the subsidies anyway? “”

With the kind permission of Hello Alice

While the legal battle took place for Hello Alice, Gore found the support of friends and customers through the political spectrum. “We are based in Houston, Texas, and (there are a large one) many people who, in your opinion, would be against us, and they have not done so,” she said, adding: “Think of biker societies and traditional truck companies.”

Gore says that business owners who discussed the question with it – they identify as republican or democrat – did not think that the government should tell businesses how to deploy their money. This is also what his legal team also believes: private companies should have the freedom to manage or reject positive action programs such as grants for black companies. Whether these Dei initiatives are good for a company, morally justified, or, as the AFL claims, the racist, should be debated in a meeting room and not in a federal court. And there is nothing intrinsically illegal in a private company offering a subsidy dedicated to a minority population.

Offensive

Recently, many companies have made the cohort specific programs back down just to avoid the costly types of headache with which Hello Alice was confronted. Kenji Yoshino, professor of constitutional law at the Nyu School of Law and director of his center of Meltzer for diversity, inclusion and belonging, believes that this is the right approach for our time.

Yoshino explains that his center “beat the drum to go from cohorts to content”. In other words, he suggests that companies carry out programs such as purses focused on diversity at the workplace available to all those who wish to apply, without changing the ultimate mission of the scholarship. “It really allows a business to make an end to the end of the SFFA decision,” he said.

At the same time, he applauds Gore to stick to his program for black business owners and preparing to advance not only the technical argument of the trial – according to the white male trucker does not have the ground to continue, but perhaps much more. Beyond the questions on the initial intention of article 1981, or if these subsidies constitute a contract, there is this more complicated question on the rights of the first amendment which have not yet reached the highest court of the country.

If Gore or another business owner can make the law say that they simply express their opinions with Grant Dei’s programs, says Yoshino, “it would be the greatest victory of all.”

Find lightness

Taking over this trial was not an easy decision. When he struck for the first time, Hello Alice was in the middle of an increase in the C series, and the Silicon Valley Bank, his second largest investor, had just collapsed. Hello Alice also had to disclose the trial to other investors, “and there was this factor of fear around the AFL,” explains Gore. “While the capital flew through the door.” But there was a lot in play, she adds. If the AFL should prove that subsidies for companies belonging to minorities have violated the 1981 section, millions of dollars for small American companies could be lost. Until now, the cost of fighting the trial has exceeded $ 1 million.

The day before the oral arguments of the sixth circuit, she dined in a restaurant near the Cincinnati courthouse. It turned out that the restaurant, Frankie’s, was a hello Alice client. For Gore, it was a reminder of the importance of his work. In heavy times, she said, “It gave me lightness.”