Court rules Biden admin can't discriminate based on race for small business loans: 'Stake in the heart of DEI'

Three small business owners filed suit and won in court against the Biden administration for attempting to choose winners and losers solely based on race when deciding who would receive government financial support.

The Wisconsin Institute for Law & Liberty (WILL) sued the Minority Business Development Agency (MBDA), a federal agency that was expanded under the Biden administration and charged with supporting minority-owned businesses, in March 2023 on behalf of Jeffrey Nuziard, Matthew Piper and Christian Brucker. 

The MBDA sought to serve "minority business enterprises (MBEs) owned and operated by African Americans, Asian Americans, Hasidic Jews, Hispanic Americans, Native Americans and Pacific Islanders." The agency was created as part of a presidential executive order in the 1960s, and permanently authorized through the Infrastructure Act in 2021. 

All three plaintiffs sought to use the MBDA to support their businesses, but were unable to do so because of their race, according to the lawsuit. In addition, the MBDA also discriminated on the type of minority eligible for aid, excluding racial groups from the Middle East, North Africa or North Asia. 

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The court ruled Wednesday that the MBDA violated the Constitution’s core requirement of equal treatment under the law and that the government agency can no longer run programs or grants based on race. 

U.S. District Judge Mark Pittman noted in his decision that while the MBDA "can still operate its Business Centers, it must simply do so without vetting applicants based on race."

He said the federal agency’s "very design" "punishes" those of certain disfavored racial groups, adding "the federal government may not flagrantly violate such rights with impunity. 

"The MBDA has done so for years," he concluded. "Time’s up."

Christian Bruckner, a Romanian immigrant to the United States who owns a contracting company in Florida, reached out to the MBDA to inquire about federal assistance, but when he did, he was told the agency's focus was "to help grow businesses owned by people of ethnic minorities," according to the lawsuit. He was instead directed to a private company where he would have had to pay for assistance. Bruckner came to the U.S. in the 1970s because of the belief that America is the freest nation on Earth, which is why he originally said he wanted to pursue the lawsuit. 

He told Fox News Digital that the decision gives him "great confidence in the justice system" and that he hopes "there will be equality for all American citizens regardless of race, especially in taxpayer-funded programs like this."

Plaintiff Jeffrey Nuziard, a U.S. Army veteran from the Dallas-Ft.Worth area, wanted to expand his business, Sexual Wellness Centers of Texas, but when he looked at the grants offered by the MBDA, he discovered he was ineligible due to his race. He previously called it "just plain offensive that President Biden set up an agency devoted to helping some races, and not others."

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The third plaintiff, Matthew Piper, who owns an architecture agency in Wisconsin, also discovered he was ineligible for assistance through the MBDA due to his skin color. When he filed suit, Piper said "the American dream should be afforded to all Americans regardless of skin color or cultural background." 

Daniel Lennington, deputy counsel at WILL, told Fox News Digital that the decision is a great win for equality and a "stake in the heart of DEI."

"Victory in this case means that governments and businesses who use DEI can no longer just make assumptions about people, they have to actually help people who need help, which is what we think the government should do," Lennington said. "They should treat people as individuals and not members of racial groups."

WILL president and general counsel, Rick Esenberg, applauded the decision that put an end to actions by "a discriminatory agency that persisted for decades." 

"The Biden Administration re-invigorated it and then refused to help millions of businesses based on race," he said. "Those days are now over. Equality must be the law of the land, and through the bravery and persistence of our clients, we are closer to fulfilling that dream."

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Lennington explained that this case is the third win as part of the larger project by WILL, known as the Equality Under The Law Project, which takes aim at numerous programs in the Biden administration that promote a racial equity agenda, according to the organization. 

WILL filed a lawsuit against the Biden Administration for its Farmer Loan-Forgiveness program that canceled certain farm loans based on race and the Restaurant Revitalization Fund, which provided COVID-19 benefits to certain restaurants using racial preference. WILL obtained injunctions against both programs. 

WILL is also challenging another portion of the 2021 Infrastructure Act, which is currently pending in federal court. In the fourth case brought by WILL against the Biden administration, the lawsuit aims to open up the Disadvantaged Business Enterprise (DBE) program, a $37 billion infrastructure fund, which is currently only available to minorities. 

Lennington said a decision in the case is expected in the coming weeks or months. 

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