EVOLVING TRENDS IN DEI LITIGATION POST-SFFA
In June 2023, the Supreme Court issued a landmark decision holding that Harvard University and the University of North Carolina’s admissions programmes, which considered candidates’ race in admission decisions, violated the Fourteenth Amendment of the US Constitution and Title VI of the Civil Rights Act of 1964. While these decisions, known collectively as SFFA, do not directly apply to private entities like corporations and investment firms, litigations were quickly filed in their wake seeking to expand the reach to all aspects of an entity’s business operations, spanning from a corporation’s diversity, equity and inclusion (DEI) programmes to an investment fund’s decisions on recipients of funding. This article surveys the litigations brought in the post-SFFA era and analyses the defences asserted by companies in arguing against expanding the SFFA holding outside of the admissions context. It concludes with suggestions as to how companies should assess their DEI-related policies and practices within the broader context of pre-SFFA (and continuing) risks of litigation alleging discrimination against employees from historically underrepresented minority groups or a corporation’s failure to effectively implement and oversee a DEI programme and live up to DEI commitments.
Understanding the SFFA decision
Students for Fair Admission, a nonprofit group focused on activism against so-called ‘race-conscious’ university admissions policies, sued Harvard University and the University of North Carolina over admissions policies that permitted applicants’ race to be considered as one criterion, among many others, in their overall ‘holistic’ assessment of the individual’s candidacy. The Supreme Court’s majority held that these admissions programmes violated the Equal Protection Clause of the Fourteenth Amendment and Title VI.
Apr-Jun 2024 issue
Cleary Gottlieb Steen & Hamilton LLP