CIVIL RIGHTS

AI Bias Is Becoming the Next Civil Rights Battleground as Democrats and States Move to Fill the Federal Void   

• Trump signs executive order blocking states from enforcing their own regulations around AI 
• Ensuring a National Policy Framework for Artificial Intelligence: Executive Order #14365
• Gavin Newsom pushes back on Trump AI executive order preempting state laws
• Democrats Warn Biased Algorithms Could Worsen Inequity As They Reintroduce AI Civil Rights Act 

OVERVIEW

Between December 11 and December 13, 2025, the federal government, several states, and Democratic lawmakers took actions that underscored competing approaches to the governance of artificial intelligence (AI) and its intersection with civil-rights protections.

On December 11, Trump signed an executive order titled “Ensuring a National Policy Framework for Artificial Intelligence,” directing federal agencies to identify and challenge state and local laws regulating artificial intelligence that the administration determines interfere with federal priorities, interstate commerce, or innovation. The order instructs the Department of Justice and other agencies to review existing state AI laws and authorizes the federal government to consider enforcement actions, including litigation, against states whose regulations are deemed inconsistent with federal objectives. The order also permits agencies to evaluate the use of federal funding as leverage in addressing state-level AI regulation.

In response, California Governor Gavin Newsom criticized the executive order as an encroachment on states’ regulatory authority. He emphasized that California’s existing and proposed AI laws are intended to address risks related to discrimination, transparency, and consumer protection, and stated that the state would continue to advance its AI oversight framework despite federal opposition.

At the same time, Democratic members of Congress reintroduced the AI Civil Rights Act, legislation aimed at preventing discriminatory outcomes resulting from the use of automated decision-making systems. The bill would prohibit algorithmic discrimination in areas including employment, housing, credit, education, and access to public services, and would require entities deploying artificial intelligence systems to conduct impact assessments and adopt measures to mitigate biased or discriminatory effects. The legislation is structured to operate alongside existing civil-rights laws and does not preempt state-level regulation.

Taken together, these actions reflect a policy landscape in which federal executive authority, state regulatory initiatives, and congressional civil-rights legislation are advancing in different—and in some cases conflicting—directions with respect to artificial intelligence governance.

LEGAL INTERPRETATION

The December 11 executive order titled “Ensuring a National Policy Framework for Artificial Intelligence” directs federal agencies to assert federal authority over artificial intelligence regulation using existing constitutional and statutory powers. The order instructs the Department of Justice and other federal agencies to review state and local artificial intelligence laws and to pursue enforcement actions, including litigation, where such laws are determined by the administration to conflict with federal priorities or to interfere with interstate commerce. The order does not itself invalidate state laws or establish a comprehensive federal regulatory framework for artificial intelligence.

The order also authorizes federal agencies to consider the use of federal funding in connection with state artificial intelligence regulation. While the order references the federal government’s authority to administer federal programs, it does not identify specific funding programs, conditions, or enforcement mechanisms. Any funding-related actions taken pursuant to the order would be governed by existing constitutional limits on the federal spending power, including requirements that funding conditions be clearly stated, related to the purpose of the federal program, and not coercive.

In response to the executive order, California Governor, Gavin Newsom, asserted the state’s authority to regulate artificial intelligence under its traditional police powers. California’s position is that state artificial intelligence laws addressing discrimination, transparency, and accountability fall within established state authority over consumer protection and civil rights. California officials indicated that the state would continue to implement and advance its artificial intelligence regulatory framework notwithstanding the federal executive order.

The reintroduced AI Civil Rights Act, sponsored by Democratic members of Congress, reflects the use of federal civil-rights legislation to address discrimination associated with automated decision-making systems. The bill would extend nondiscrimination obligations to the use of artificial intelligence in covered areas, including employment, housing, credit, education, and access to public services. As drafted, the legislation is designed to operate alongside existing federal civil-rights statutes, including Title VII of the Civil Rights Act and the Fair Housing Act, and does not include express preemption of state artificial intelligence regulation.

These developments reflect parallel exercises of authority by the executive branch, state governments, and Democratic lawmakers under existing constitutional and statutory frameworks governing artificial intelligence and civil-rights protections.

BRIDGE POV

The convergence of federal executive action, state resistance, and Democratic-led civil-rights legislation highlights a growing governance challenge for organizations deploying artificial intelligence: accountability for discriminatory outcomes is expanding even as regulatory authority over AI remains fragmented.

The December 11 executive order, Ensuring a National Policy Framework for Artificial Intelligence, seeks to constrain state-level regulation by asserting federal primacy over AI policy. At the same time, California’s response reflects continued state reliance on consumer-protection and civil-rights frameworks to regulate automated systems. The reintroduction of the AI Civil Rights Act further underscores that, among Democratic lawmakers, algorithmic decision-making is increasingly treated as subject to existing nondiscrimination law rather than as a novel or exempt category of technology.

This dynamic creates both legal and reputational exposure. Federal policy signals may discourage or complicate the use of bias-detection tools, impact testing, or fairness safeguards in certain contexts. Yet existing civil-rights statutes continue to govern the outcomes produced by AI systems, and courts have demonstrated a willingness to scrutinize automated decision-making using traditional legal frameworks. At the same time, public, employee, and investor expectations around responsible AI use increasingly align with transparency, fairness, and inclusion — regardless of regulatory ambiguity.

As prior Project FORWARD coverage has shown, organizations cannot rely on claims of technological neutrality, vendor design, or automation to shield themselves from accountability. Nor can they assume that regulatory uncertainty will insulate them from scrutiny. Inconsistent or opaque AI practices now pose a dual risk: potential civil-rights liability and erosion of institutional trust with employees, consumers, and the market.

In this environment, AI governance is no longer a technical or compliance issue alone. It is a core question of enterprise risk management, brand integrity, and leadership credibility — requiring alignment between legal obligations, operational practices, and publicly stated values.

ACTIONABLE STRATEGIES

1.  Integrate AI Oversight Into Civil-Rights and Risk Governance: Ensure that artificial intelligence systems are governed through the same enterprise risk and compliance structures that apply to employment, lending, housing, and consumer practices. AI-enabled decisions should be reviewed for disparate impact, documented for business justification, and monitored using processes already familiar to legal, HR, and compliance leaders.
   
   
2. Treat Inclusive AI as a Reputational Safeguard, Not a Policy Preference: Recognize that the absence of bias-detection, transparency, or fairness controls in AI systems carries reputational risk independent of regulatory enforcement. Employees, consumers, investors, and partners increasingly expect organizations to demonstrate that automated systems are designed and deployed responsibly. Misalignment between AI practices and stated commitments to fairness or opportunity can quickly undermine trust.
   
   
3. Build Consistency Across Jurisdictions and Vendors: Map where AI systems are deployed across the organization and identify differences in regulatory expectations across jurisdictions. Establish enterprise-wide standards for documentation, testing, and accountability that apply to both internally developed and vendor-provided tools. Consistency in governance reduces exposure to both legal challenge and public criticism when systems are questioned.
   
   

See also: Trump Issues Executive Order On The Use Of Dei In AI (Issue 23); Federal Court Lets Age-Bias Claims Against Workday’s AI Hiring Tools Proceed in Landmark Test of Algorithmic Screening (Issue 31)

COURTS & LITIGATION

Florida Sues Starbucks, Alleging Corporate DEI Policies Constitute Unlawful Racial Discrimination 

• Starbucks’ ‘illegal race-based’ DEI at center of Florida AG’s lawsuit    

OVERVIEW

On December 11, 2025, Florida Attorney General Ashley Moody filed a civil lawsuit against Starbucks Coffee Company in Florida state court, alleging that the company’s diversity, equity, and inclusion (DEI) initiatives unlawfully discriminate on the basis of race in violation of state civil-rights law.

The complaint alleges that Starbucks implemented employment practices that relied on workforce representation goals, internal demographic metrics, and leadership accountability mechanisms tied to diversity outcomes. According to the filing, the state contends that these practices resulted in race-based decision-making in hiring, compensation, promotion, and professional development, and disadvantaged certain applicants and employees.

Florida asserts that the challenged practices violate the Florida Civil Rights Act, which prohibits discrimination in employment on the basis of race. The lawsuit seeks declaratory and injunctive relief barring Starbucks from engaging in race-based employment practices, as well as civil penalties. Public reporting indicates that the state is seeking financial relief that could total up to $100 billion, depending on the number of alleged violations.

Starbucks has denied the allegations, stating that its employment decisions are merit-based and that its DEI initiatives are designed to expand opportunity and ensure fairness, not to impose quotas or preferences.

The Florida lawsuit follows earlier state-led litigation involving Starbucks’ DEI practices. A separate lawsuit filed by the Missouri Attorney General, which raised similar allegations under federal and state anti-discrimination laws, remains pending.

LEGAL INTERPRETATION

The lawsuit filed by Florida Attorney General Ashley Moody is brought under the Florida Civil Rights Act, which prohibits employment discrimination on the basis of race in hiring, compensation, and other terms and conditions of employment. The statute also bars employers from classifying employees or applicants in ways that limit employment opportunities because of race.

Florida’s complaint alleges that Starbucks’ DEI initiatives resulted in race-based decision-making through the use of workforce representation goals, demographic metrics, and leadership accountability measures tied to diversity outcomes. Under the Florida Civil Rights Act, employment practices that treat individuals differently based on race are unlawful, regardless of whether they are characterized as diversity or inclusion efforts.

The state seeks declaratory and injunctive relief prohibiting race-based employment practices, as well as civil penalties authorized by statute. Starbucks has denied the allegations and maintains that its employment practices are lawful and merit-based. The court will be asked to determine whether the challenged policies involved impermissible consideration of race under state civil-rights law.

BRIDGE POV

The Florida lawsuit against Starbucks reflects a continued effort by some state officials to use civil-rights litigation to challenge corporate DEI frameworks, rather than a shift in the underlying standards governing employment discrimination. These cases push beyond traditional enforcement boundaries by recasting lawful inclusion efforts as discrimination claims without clear evidence of race-based decision-making.

This case underscores the overreach of state attorneys general, as DEI programs are increasingly scrutinized as a proxy for broader ideological disputes rather than evaluated on their legal merits. That scrutiny does not alter the legal baseline: employers remain permitted—and in many contexts expected—to pursue inclusive practices that expand opportunity, provided employment decisions are grounded in race-neutral criteria and lawful business judgment.

This moment calls for legal precision and strategic confidence. Organizations that treat inclusion as a core enterprise capability—aligned with growth, talent strategy, and market competitiveness—while maintaining disciplined compliance will be best positioned to navigate politicized challenges without abandoning their values or objectives.

ACTIONABLE STRATEGIES

1. Build Inclusion as an Enterprise Capability for Growth: Embed inclusive practices across talent, leadership development, and business strategy rather than isolating them as standalone programs. When inclusion is integrated into how the organization attracts talent, innovates, and competes, it is more resilient to external challenge and better aligned with long-term growth.
    
2. Ground DEI Programs in Legally Defensible Design: Ensure that DEI initiatives focus on expanding access, opportunity, and fairness—not quotas or preferences—and that individual employment decisions are based on race-neutral criteria. Regular legal review helps ensure programs remain compliant across federal and state civil-rights frameworks.
    
3. Align Legal, Business, and DEI Leadership: Maintain clear documentation showing how inclusion efforts support business objectives and comply with nondiscrimination law. Strong alignment across leadership functions enables organizations to respond confidently and coherently when programs are questioned or challenged.

See also: Emboldened GOP-Led States File Lawsuits (Issue 3); Starbucks Files Motion To Dismiss In Missouri Case (Issue 9)

FEDERAL FUNDING & OVERSIGHT

HHS Threatens Head Start Funding Over DEI Compliance, Escalating Federal Pressure on Early Childhood Programs  

• Head Start centers told to avoid 'disability,' 'women' and more in funding requests

OVERVIEW

In early December 2025, court filings revealed that the U.S. Department of Health and Human Services (HHS) is moving to withhold or delay federal Head Start funding from certain early childhood education providers that do not certify compliance with the administration’s anti-DEI directives. Head Start grantees in multiple states have received notices indicating that continued funding may be conditioned on eliminating or restructuring programs, training, or language that HHS characterizes as DEI-related.

The funding conditions became public through litigation filed by Head Start associations and early childhood program networks challenging the guidance. The plaintiffs allege that the certification requirements and language restrictions conflict with statutory obligations under the Head Start Act, which requires services for children with disabilities, culturally and linguistically appropriate programming, and engagement with tribal and underserved communities.

Head Start serves more than 800,000 low-income children nationwide and is funded through annual congressional appropriations. Congress has not amended the Head Start Act or reduced funding for the program. Providers argue that the new administrative conditions create uncertainty about how to comply simultaneously with federal grant requirements and statutory service mandates.

The dispute centers on whether federal grant administration can be used to impose new compliance requirements without changes to the governing statute.

LEGAL INTERPRETATION

The Head Start dispute centers on the scope of the federal government’s authority to administer grant conditions under the Head Start Act, which establishes statutory requirements for the program. Head Start grantees receive federal funding through HHS and must comply with statutory mandates and valid regulatory requirements governing the use of those funds.

The litigation challenges HHS’s use of grant administration tools—such as certifications, application review criteria, and restrictions on language used in grant applications—to enforce compliance with anti-DEI directives. Plaintiffs argue that conditioning Head Start funding on such requirements imposes obligations not authorized by the statute and conflicts with statutory program requirements.

Because the disputed requirements are being implemented through agency guidance and grant administration rather than through a formal rulemaking process, the case also raises administrative law questions about whether the agency has imposed binding conditions without adequate statutory authorization. The legal inquiry focuses on whether the challenged actions are consistent with the Head Start Act and within the federal government’s authority to attach conditions to discretionary grant awards.

BRIDGE POV

The Head Start funding dispute illustrates how federal grant administration is being used to impose policy constraints that Congress has not enacted through statute. By conditioning funding on certifications and application requirements tied to DEI-related concepts, the administration is testing the limits of its authority under the Head Start Act rather than changing the law itself.

For organizations that depend on federal funding, this approach creates operational uncertainty. When statutory mandates remain unchanged but administrative expectations shift, grantees are forced to navigate conflicting compliance signals that can affect program continuity and governance without clear legal resolution.

ACTIONABLE STRATEGIES

1. Re-anchor Federally Funded Programs in Statutory Authority: Review federally funded programs to ensure operational decisions and service delivery are grounded first in statutory requirements, not informal guidance or shifting administrative priorities. Clear alignment with governing statutes strengthens an organization’s position when funding conditions are questioned or challenged.
    
2. Strengthen Governance Over Grant Compliance Decisions: Elevate decisions about grant certifications, application language, and compliance commitments to senior legal and executive leadership. Treat grant administration as a governance issue, not a clerical function, particularly where conditions may conflict with statutory obligations or organizational mission.
    
3. Prepare for Conditional Funding Risk Across Programs: Assume that funding conditions may increasingly be used to advance policy objectives beyond the text of governing statutes. Build contingency planning, documentation, and internal escalation protocols to manage funding risk without compromising legal compliance or service obligations.

See also: USDA Keyword Purge Triggers Massive Grant Terminations and Federal Lawsuit (Issue 39); Institutions Push Back on Federal DEI Rollbacks Through Funding Conditions (Issue 32)

EXECUTIVE ORDERS & FEDERAL POLICY 

U.S. Chamber Draws Conservative Scrutiny for DEI Stance 

• It abandoned DEI, but it's still accused of being 'woke.' Here's why.  

OVERVIEW

On December 10, 2025, the U.S. Chamber of Commerce became the subject of public criticism from Consumers’ Research, a conservative advocacy group, over the Chamber’s positions on diversity, equity, and inclusion (DEI) and related public policy issues. In public statements and a recent “Woke Alert,” Consumers’ Research accused the Chamber of supporting corporate DEI initiatives and opposing policy efforts aimed at restricting diversity-related programs in the private sector.

Consumers’ Research asserted that the Chamber’s policy advocacy aligns it with what the group characterizes as “woke” corporate practices and places it at odds with initiatives seeking to limit the role of DEI in business operations and governance. The group urged businesses to reconsider their affiliation with the Chamber in light of these positions.

The Chamber has not issued a direct response to the December 10 criticism. However, in its public policy materials and statements, the Chamber has consistently emphasized that lawful nondiscrimination practices and inclusive workplaces support economic growth, workforce competitiveness, and business performance. The organization has framed diversity and inclusion as aligned with compliance with existing civil-rights law and with the practical needs of employers operating in a diverse economy.

The dispute highlights tensions between segments of the conservative advocacy community and traditional business organizations over the role of DEI in corporate governance and federal and state policy debates.

LEGAL INTERPRETATION

The dispute involving the U.S. Chamber of Commerce does not arise from litigation or enforcement action, but from public advocacy and policy positioning related to federal and state DEI initiatives. Consumers’ Research’s criticism targets the Chamber’s support for nondiscrimination principles and its opposition to broad restrictions on corporate DEI programs, rather than alleging specific statutory violations.

As a private membership organization, the Chamber is not subject to civil-rights liability based on its policy advocacy. Its positions reflect participation in public debate over executive orders, legislation, and regulatory actions affecting employers, including policies related to workplace diversity and inclusion. Advocacy in support of or opposition to such measures is protected under the First Amendment and does not itself create legal exposure.

The episode underscores how DEI policy debates increasingly play out through public pressure campaigns directed at business associations, rather than through formal legal processes. While the Chamber’s policy positions have drawn criticism from advocacy groups, no regulatory action, enforcement proceeding, or legal challenge has been initiated against the organization in connection with its DEI stance.

BRIDGE POV

The scrutiny directed at the U.S. Chamber of Commerce does not reflect a legal controversy, but an attempt by outside advocacy groups to pressure a mainstream business institution for articulating a lawful and widely held position on workforce inclusion. The Chamber has neither violated civil-rights law nor departed from established business norms; it has consistently framed DEI in terms of compliance, competitiveness, and economic value.

Framing DEI as an economic growth tool — rather than a system of preferences — aligns with lawful, race-neutral approaches to expanding opportunity and competitiveness. That framing is not novel, controversial, or legally suspect. It mirrors how many employers approach talent strategy, market expansion, and risk management under existing nondiscrimination law.

ACTIONABLE STRATEGIES

1. Anchor Inclusion in Lawful Business Strategy: Position DEI initiatives clearly as race-neutral efforts to expand opportunity, strengthen the workforce, and support growth. Ground messaging and program design in existing civil-rights law and business objectives, not political narratives.
   
   
2.  Maintain Institutional Confidence in Lawful DEI: Do not allow external pressure campaigns to redefine compliant inclusion as legal risk. Organizations that operate within the law should be prepared to state that plainly and consistently.
   
   
3. Ensure Consistency Between Advocacy, Practice, and Governance: Align internal DEI practices, public policy positions, and governance structures around a shared, defensible understanding of inclusion as a driver of performance and competitiveness. Consistency reduces vulnerability to mischaracterization.

Students and Professors Push Back:  Appeal Seeks to Block Alabama’s Ban on Campus DEI Programs 

• Professors, students appeal ruling on Alabama law banning DEI initiatives at public universities

On December 15, 2025, a coalition of students and university professors in Alabama filed an appeal of a federal court ruling that upheld a 2024 state law restricting diversity, equity, and inclusion programs and limiting the discussion of certain concepts at public colleges and universities. The appellants argue that the statute’s language is unconstitutionally vague and violates First Amendment protections by chilling academic speech and instructional activity. The appeal places the law back before the federal courts and continues ongoing legal challenges to state efforts to regulate DEI-related activity in higher education.