Cocina Cultura LLC v. State of Oregon et al.

CIR has filed suit against the State of Oregon, Oregon’s Department of Administrative Services, and two Oregon non-profits, which established the Oregon Cares Fund, a coronavirus relief fund that exclusively provides federal grant money to black applicants, in violation of the Constitution and federal anti-discrimination law.  We are representing Cocina Cultura LLC, a small business owned by Maria Garcia, which operates the Revolucion Coffee House in downtown Portland, Oregon, and was denied coronavirus relief through the state’s race-exclusive fund.

In July, Oregon placed two non-profit corporations, The Contingent and the Black United Fund (BUF), in charge of administering The Oregon Cares Fund (“Fund”), which the state funded with $62 million of federal grant money.  The Fund’s creators described it as “A Fund for Black Relief and Resiliency.”  It would distribute federal aid (intended to provide relief to all people impacted by COVID-19) exclusively to Black individuals and Black-owned businesses.  The Contingent and BUF had full discretion in awarding grants, free of significant governmental oversight.

Oregon Cares Fund Discriminates in Time of Need

Oregon’s establishment of a race-exclusive fund comes at a time when small businesses across the state are competing for limited aid.  The lockdown that began in March continues to devastate small businesses, especially ones that rely heavily on foot traffic such as restaurants, cafes, and bars.  Many have yet to recover, and a good number of them will close permanently without financial assistance.

Yet, small businesses owned by Latino, Asian, Caucasian, Native American, or any other non-Black Oregonians are categorically ineligible to receive funds from an existing pool of federal funds solely because of their race. Under this system, a business with numerous Black employees, or one located in a predominantly Black neighborhood, will not receive aid merely because its owner is not Black.  Conversely, a Black-owned business operating in a primarily non-Black neighborhood or one with few Black employees could qualify merely on the basis of its owner’s skin color.

The Constitution and federal law prohibit state governments from arbitrarily awarding benefits on the basis of race.  In setting aside $62 million for the exclusively for the benefit of one race, Oregon has violated these prohibitions on racial discrimination.

Attempt to Justify Discrimination

The Contingent and BUF’s application made no claim of specific past government discrimination when it applied to distribute funds. Instead, the Department of Administrative Services accepted general claims that historic racism has resulted in the Black community as a group having on average lower incomes than whites, less access to homeownership, greater unemployment, and lack of generational wealth.

The Supreme Court has held that states may not employ racial classifications to remedy such general societal disparities. Nor were these issues created by the spread of COVID-19, which the federal grant money was meant to address.  Meanwhile, Latino and Native Americans across the State who are in need of grants are prohibited from applying for these funds, which were expressly intended to help all Americans.

On November 20, 2020, CIR filed a federal lawsuit against the State of Oregon, Oregon’s Department of Administrative Services, The Contingent, and Black United Fund under the Equal Protection Clause of the Fourteenth Amendment and federal anti-discrimination law.  The suit asks the court to enjoin the further enforcement of illegal racial discrimination in the awarding of grant funds and damages.