This is Bloomberg Law with June Brusso from Bloomberg Radio.
The opinion issue today by the United States Supreme Court marks the beginning of the restoration of the color blind legal covenant that binds together our multi racial, multi ethnic nation.
Conservative activist Edward Blum won his decades long fight against affirmative action in college admissions in June. Now Blum is turning his attention to the corporate world. He's suing Fearless Fund, an Atlanta based venture capital firm that supports black women who own small businesses, accusing it of unlawful racial discrimination and using the same playbook he used to get rid
of affirmative action in colleges. Joining me is Anthony Michael Christ, a professor at the Georgia State University Knowledge of Law tell us about Blum and his anti affirmative action efforts.
Yeah, so, Blum is part of the group individuals who have been kind of on a wor path for lack of a better term, against all kinds of race conscious programming, and namely, what most people might be familiar with is the recent Supreme Court ruling about race conscious student admissions policies at Harvard and UNC Chapel Hill. There was a challenge under the fourteenth Amendment and under the Civil Rights
Act in nineteen sixty four, which was successful. And so now you know, Blum and associated groups are certainly moving a pace and trying to take that with victory and expand its footprints into other spaces.
Yeah.
So the space he try and expand into is an Atlanta based venture capital fund and the lawsuit specifically targets a grand program that awards twenty thousand dollars to black women entrepreneurs.
So this is a group that was founded in twenty nineteen and it was three black women who decided that there needed to be more investment in black owned businesses, and so this entity was created in order to fundraise from a variety of investors. And so they were very successful in getting big investors like Bank of America in General,
Mills and JP Mortgage Chase and the Lights. And what they were going to do would be to provide grants to help entrepreneurs get a good start and invest in their businesses and their future endeavors with their small businesses. And so there is this backlash from Blum and other folks who believe that that kind of targeted investment in certain minority owned businesses is unlawful and should not be permissible under federal law.
With the affirmative action suits, he formed a group called Students for Fair Admissions and he sued on behalf of Asian American students. Here, he's formed a group called American Alliance for Equal Rights and it purports to represent and sixty white and Asian business owners who are ineligible for these grants based on their race. Is he using the same playbook?
So?
I think that's a really interesting tactic. I think part of it is, perhaps, you know, to be able to identify the group and fundraise off of that, and to kind of give the litigations greater public exposure. You know, that is certainly something that I think folks have tried before in a variety of ways, right to get the most sympathetic kinds of clients when you go before federal
judiciary and impact litigation. I think it's really kind of consistent with that trend and that trajectory and that history.
And here the people that they have organized, and I think this is particularly true in the Harbord case, right that they're looking for individuals who are you know, perhaps the most sympathetic and I think that that's part of the strategy here, and part of the strategy is the fundraise and to kind of build on all these victories that they're starting to aggregate in the federal judiciary and
really make a litigation based movement out of that. And so I think we need to understand what Blum is doing here, both in terms of traditional strategy right to get the most sympathetic kinds of plaintiffs, but also there's an aim here to build an infrastructure here to support long term litigation strategies.
I know that you know, with the Harvard case, a lot of Asian Americans and Asian American students at Harvard disagreed with that lawsuit, oh absolutely.
And I think part of the strategy here and was shoot in the Harvard case, is that you know, very oftentimes there are segments of people who you know, recoil at this idea of reverse discrimination, right, This idea that white Americans are somehow a beliegued group of people doesn't really sit well with a good chunk of Americans. And so I think there was a really calculated strategy there to use a non white group in order to lodge this complaint against Harvard, and we're seeing that kind of
tactic repeated here. So again, I think it's this idea of, you know, you want to bring your most sympathetic potential plaintiffs, but they're certainly not to be a uniformity in any group in terms of how they respond to being kind of put front and center or being used to justify and that litigation strategy.
He claims that there's a violation of section nineteen eighty one of the Civil Rights Act.
Yeah. So Section nineteen eighty one is an old law from the reconstruction era. Its origins date back to the thirteenth Amendment, and it was passed in eighteen sixty six really in response to the Black Codes in the South, where say, the first post Civil War governments that were coming up back in former Confederate states were passing laws that were incredibly restrictive of recently freed persons and their ability to contract and their ability to buy and rent
and access property. And so the The Rights Act of eighteen sixty six was passed in order to ensure that all recently freed persons, all non white persons, enjoyed and this is basically the verbiage that the law uses enjoyed this same right as white persons. And so this particular part of that Civil Rights Act is now codified in
section nineteen eighty one. And what's important about this is, unlike say the Civil Rights Act in nineteen sixty four and Title seven, section nineteen eighty one applies to all contractual relationships, so it's not just employment. So it covers a large number of entities, you know, it's not limited to just employment relationships. And so that's really a big question here because at the end of the day, you know, I think there's those serious debates to be had whether
a small grant funding program is really a contractual relationship. Now, the terms under which these grants are given, you know, the Fearless Fund does basically say that it creates a contractual relationship for the grant recipient to do the work consistent with what the grant's purpose is for. And so there's a real interesting question there about what kind of relationship exists between these entrepreneurs who are receiving these grants and the Fearless Fund. So I think it's a really
novel question in some ways. It will be interesting to see how the federal court here in Atlanta deals with that.
Let's say this is successful, does that open up a lot of corporations to lawsuits if they have contracts, you know, which preference minorities in some way?
Certainly, I think it opens up the doors to challenging preferences for you know, minority owned businesses and subcontracts. It opens up the door to attacking other programs like the Fearless fun It also potentially opens up the door to maybe attacking scholarship programs that are targeted towards certain affinity groups or certain racial groups. So for Sec. Nineteen eighty one to apply, though, it really would have to be
a contractual relationship. So if a case like this was successful, there would be certainly some if not many, programs in the corporate world which would be subject to litigation and attack. And there might be some other areas that you know, advocates like Blum might well try to target for future litigation.
If I think at the end of the day, there would be some significant change in how multiple businesses conduct their practices and the kinds of opportunities that they affirmatively provide and they consciously consider race in their process.
And Blum said, this lawsuit is the first of many that he intends to file through this group to contest race based corporate practices. How important is this lawsuit as an opening salvo.
I think it's a huge risk in terms of the kinds of programs that have existed throughout corporate America. There are two main avenues of attack that the business community will see in this space. There will be and there are questions about affirmative action programs under Title seven in the employment setting. And then there are these kinds of contractual quosi contractual relationships that are removed from the employment space but which are very important in the business community
as well. And we see both of those things simultaneously being undertaken by Blum and folks like him. So it's really a very perilous time for any business or any corporation that has race conscious programming of any kind. And I think we'll really have to see what the federal courts do with it going forward, but certainly, you know, it's a space that people should watch if they're particularly concerned about issues of diversity, equity, and inclusion in the corporate space.
So he's also launched a new campaign with a website called West Point not fair. It asks were you rejected from West Point or the Naval Academy or the Air Force Academy, It maybe because you're the wrong race. So would you just explain how there was a footnote in the Supreme Court affirmative action cases that exempted military academies and now it appears he's going to try to go after that footnote.
Yeah. So an important part of the Grass and Grutterer decisions which upheld affirmive action in certain contexts in the early two thousands out of the University of Michigan, was that there were impa is articulated by former military braath about how affirmative action and how race conscious programming was important in order to ensure a diverse military, and that a diverse military was essential for national security, and that diversity was a real important strength in order to preserve
better decision making and better unit cohesion and things of that nature. And so that the Supreme Court, I think, in the recent UNC Harvard case acknowledged that there might be a significantly different and perhaps constitutionally justifiable reason to have race conscious programs or race conscious admissions in the military academy is given that line of history that goes back to those cases from the early two thousands, and so they were essentially exempted from the decision that came
out this past June. And so now that's where we're at where it'll take an additional challenge that specifically targets the military academy for the federal courts to weigh. And so BLOB is now using the UNC Harvard decision to kind of go the next step and challenge any kind of race conscious programming in the military academy.
Although that might not be an area the Supreme Court wants to wade into. We'll have to wait and see. Thank you so much. That's Anthony Michael Christ, Professor at Georgia State University College of Law.
Honorable the Chief Justice and the Associate Justices of the Supreme Court of the United States. Oh yay, oh yay, oh yay. All persons having business before the Honorable the Supreme Court of the United States are admonished to give their attention. So the court is now sitting.
When the Supreme Court kicks off its next term on the first Monday in October, it will be off to a slow start. The justices will hear just six cases in October, even though they have ten slots available. In addition, they have just over half the number of cases they normally hear for the first three months of the term. Joining me is someone who's looked into this all the numbers,
Bloomberg Laws, Supreme Court reporter Kimberly Strawbridge Robinson. So it appears that the Court will be off to a slow start in October.
Yeah, well, it actually may be surprising to some listeners, but that's been a recent trend of the Supreme Court. And we hear so much about these huge, big cases that the justices are deciding, but on the whole, they've actually been deciding a lot less and it looks like this next term is going to follow that. At least
at the start. The justices released to their first sitting of arguments for October and there's just six cases on the docket, which is you know, as E've been saying something that's a trend.
Why is this? Why have they been cutting back on cases year after year?
Well, it's been at its highest in the nineteen eighties, they were deciding some one hundred and fifty cases. Now we're around sixty at best. So it's slowly happening, and there's not a real reason that anybody's been able to put their thumb on. You know, the Supreme Court justices themselves have said that they are aware that the case flowed is getting lighter, and they're looking for cases, but
that they're just not there for them. You know. Other people say, you know, there are plenty of cases for the justices here, but there's really no one reason that I can think of for why this keeps happening.
And in contrast, is the shadow docket, which are the cases that are not argued or fully briefed. Is that getting larger.
It is getting larger, and we're seeing you know, the emergency doctor used to be mostly about death penalty cases, you know, trying to stop executions that are getting ready to happen imminently. But during the Obama administration, during the Trump administration, and now continuing on into the Biden administration, we're seeing so many of these culture war cases coming up to the justices, and they've been more willing to jump in at early stages rather than sort of let
them play out in the lower courts. And so not only are those things to be happening without breathing an argument. But there have been some cases you think about the vaccine mandate, the abortion a lot of Texas where they've actually said, you know, we do need briefing an argument on this, and they've set a really expedited process for those. And even still with those added cases, the case flowed overall is really low.
So how many cases were decided last term and how does that compare to prior terms.
Well, last term they decided just under sixty cases. If you look at the Supreme Court's website, it will say the justices here about seventy cases each term. So the little out of dates, but you know, as I've been saying each year, it's sort of been ticking down. We had a historical load during twenty twenty or twenty twenty one, whenever the court was disrupted for the pandemic.
But without that.
Blip, we're still seeing this kind of flowed to decline. And so the six cases that they have kicking off their first sitting is something I haven't seen in a really long time.
The Justices did just take the case over Purdue Pharma's six billion dollars opioid settlement off the shadow docket and scheduled it for arguments in the December sitting, So are they likely to add more cases.
What happens is that why the justices are taking their summer breaks and doing teaching gigs. All these cases will sort of build up over the summertime, and then the justices come back in September to what we call the Long Conference and they'll grant a handful of cases.
Off of that.
But those cases, because there has to be briefing before they can be argument, those cases probably won't get hurt until twenty twenty four, so still in this term. But the cases that the justices have now are the ones that sort of stuck with through.
The end of the year.
And I take it there hasn't been a slowed down in surf petitions, which the parties file to ask the court to take their case.
No, there's not been a slowdown in the number of filings that they get. You know, we see a lot of cases dealing with everything from guns to abortion to admin law, and for some reason or another, the justices just can't get for to agree that it's cases they need to take up.
So let's talk about a couple of the cases that are coming up in October, and in one the Consumer Financial Protection Board will be under fire again at the court. We already saw in twenty twenty where the court rule that the president can fire the director for any reason.
Right.
So, as you mentioned, this is the latest challenge to the CFPD, which of course came up in the wake of the two thousand and eight financial crisis. You mentioned that twenty twenty case. The more the Supreme Court, you know, did rule against the CSPV, but they were able to sort of lighten the blow a little bit and they just sort of struck that provision, but less the CFPB as a whole in place and it was able to
go on mostly businesses normal. This case presents a much bigger challenge to the Supreme Court and the CFPB if they do find if they agree with the challengers here, who are saying that the funding mechanism that funds the agency is unconstitutional. And you know, the cfpv's funding mechanism is a little complex, but basically, you know, the argument is that it bypasses Congress, that really takes Congress's role over the purse out of the CSPB, and that that in and of itself is unconstitutional.
The Biden administration is saying that it could cast out on every action the agency has taken for twelve years, and it could have implications for the Federal Reserve Board, the FDIC, and the Controller of the Currency.
That's right. So you know, there are other agencies, very important agencies like the ones you mentioned, who are funded in a similar way, and so you know, the implications beyond the cfpbre are pretty enormous. But even within the CSPP, you know, these are really a string of cases that the justices have been very closely trying to police the power between the judiciary, the executive and Congress. And they've
been tinkering a lot of these cases. And what we've seen is why they've made pretty sweeping constitutional rulings sort of digging out that power. They've really tried to limit the effect it has. So, you know, so they do what they've done in the past, and the actions the CFPP had taken will probably be okay. What will be the big question is how they move forward without that funding mechanism. That really seems like they'll have to go to Congress for something.
Like that, And the Court is going to hear an argument in a challenge to Congressional redistricting in South Carolina. Tell us about that.
That's right. I mean this may sound familiar or because well, the Supreme Court, you know, at the end of its term, we've decided a similar case out of Alabama. These redistricting cases kind of have a fast track up to the Supreme Court, so we talk about them a lot. We have, you know, one or two or three every year. This one comes out of South Carolina, but it's very similar to that Alabama case. In it, black and minority voters say that a Republican led redistricting process to draw maps
unconstitutionally used race. So that's you know, this time it's involving South Carolina. You know, all of these cases when we look at the House and how close it is, have major implications for the balance of power between Republicans and Democrats. So it's going to be another big one.
Yeah, And Republicans say they were motivated by politics, which is permissible, not race, which is not. Well, that's due to a Supreme Court opinion from a couple of years ago.
That is, you know, the Supreme Court really had been for a long time really not sure whether or not federal courts could police sort of challenges to partisanship in the redistricting process. Ultimately, you know, a few years ago they decided no, there's no real way for federal courts to wag through this. They left the possibility for state courts to do it. But as we saw in the last term, that can get even messy as well. You know, it's not really clear sort of who has the authority within
the states to make that determination. So as long as you know there's sort of this loocal for partisanship, I think it's going to be hard for mostly Democrats to be making these claims of racial German. But that said, I think, you know, we all we have to do is to that Alabama case where it was pretty surprising ruling out of the court, but they decide with the Democrats in that case.
So, Kimberly, last term there were some blockbuster cases on affirmative action, voting rights, President Biden's student loan forgiveness plan, gay rights versus religious rights. Do you see any blockbusters coming up next term?
Well, two that are on the court docket right now really stand out to me. One of them is similar to the CFAD case we talked about. It has to deal with administrative law and sort of the balance of power between administrative agencies and courts. And this is really taking aim as a foundational principle an administrative law called the Chevron doctrine. The Court is considering just mixing that all together. So that's going to be a really big one.
I'm not exaggerating when I say that it has implications that could potentially reach to every aspect of American lives. You just think about how big the administrative state is and how much agencies do in this country. You know, the impact is really hard to state. And then the other one that has already been granted by the Justices is another gun case from the court. I'm not entirely sure that the justices were super excited to take a second amendment so quickly on the heels of, you know,
their big decisions a couple of terms ago. But this one, the lower court had ruled on constitution a federal law that prohibited individuals with a domestic violence restraining order against them from having guns. And it sort of really feels like that's the case that the justices have to decide since it's striking down a federal law.
Thanks so much for being on the Bloomberg Law Show. Kimberly, that's Bloomberg Law, Supreme Court Reporter Kimberly, Strawbridge Robinson and that's it for this edition of The Bloomberg Law Show. Remember you can always get the latest legal news on our Bloomberg Law Podcast. You can find them on Apple Podcasts, Spotify, and at www dot Bloomberg dot com slash podcast Slash Law, And remember to tune into The Bloomberg Gloss Show every
weeknight at ten pm Wall Street Time. I'm June Grosso and you're listening to Bloomberg