`
`No. 25-1477
`
`UNITED STATES COURT OF APPEALS
`FOR THE FIRST CIRCUIT
`
` STATE OF RHODE ISLAND, et al.,
` Plaintiffs-Appellees,
` v.
` DONALD J. TRUMP, in his official capacity as President of the United States, et al.,
`Defendants-Appellants.
`
`
`
`
`On Appeal from the United States District Court for the District of Rhode Island,
`Hon. John J. McConnell, Jr., U.S. District Chief Judge
`
`BRIEF OF AMICUS CURIAE NATIONAL FEDERATION OF FEDERAL
`EMPLOYEES-INTERNATIONAL ASSOCIATION OF MACHINISTS AND
`AEROSPACE WORKERS, AFL-CIO IN SUPPORT OF PLAINTIFFS-
`APPELLEES AND AFFIRMANCE OF THE DISTRICT COURT’S ORDER
`
`
`Samuel A. Spital
`NAACP LEGAL DEFENSE &
`EDUCATIONAL FUND, INC.
`40 Rector Street, 5th Floor
`New York, NY 10006
`(212) 965-2200
`
`Christopher E. Kemmitt
`Jennifer A. Holmes
`Anuja D. Thatte
`Molly M. Cain
`Counsel of Record
`Maydrian A. Strozier-Lowe
`NAACP LEGAL DEFENSE &
`EDUCATIONAL FUND, INC.
`700 14th Street N.W.,
`Suite 600
`Washington, DC 20005
`(202) 682-1300
`
`Counsel for Amicus Curiae
`Case: 25-1477 Document: 00118335649 Page: 1 Date Filed: 09/03/2025 Entry ID: 6748224
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`TABLE OF CONTENTS
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`T
`ABLE OF AUTHORITIES .................................................................................... iv
`RULE 29(a)(4)(E) STATEMENT ............................................................................ xi
`CORPORATE DISCLOSURE STATEMENT ....................................................... xii
`INTEREST OF AMICUS CURIAE ............................................................................ 1
`INTRODUCTION ..................................................................................................... 2
`BACKGROUND ....................................................................................................... 4
`I. For Decades, Congress Has Affirmed the MBDA’s Mandate to Promote
`Economic Advancement of Disadvantaged Business Owners.................. 4
`A. Creation of the MBDA. ................................................................. 4
`B. History of Discrimination Against Minority Business Owners,
`Including Black Business Owners. ............................................... 6
`C. The MBDA’s Work and its Significant Benefits for American
`Business Owners and the American Economy. .......................... 10
`II. The Federal Workforce, Including the MBDA, Has Long Provided
`Opportunities for Black Americans Dedicated to Public Service. .......... 12
`III. The Reduction EO Left MBDA Unable to Carry Out Its Important Work
`Advancing American Entrepreneurship. ................................................. 14
`ARGUMENT ........................................................................................................... 16
`I. Dismantling the MBDA Would be Devastating for Black Businesses,
`Other MBEs, Business Centers and Grantees, and Would Harm the
`American Economy. ................................................................................ 16
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`II. Gutting the MBDA Would Significantly Harm the Employees Who Carry
`Out Its Important Mission and Who Have Already Suffered as a Result of
`the Trump Administration’s Actions. ...................................................... 20
`A. Because of the Reduction EO, employees of the MBDA were
`removed from their positions in a harsh, expedited, and atypical
`manner. ........................................................................................ 21
`B. The Reduction EO caused the MBDA employees severe harm. 22
`III. The Reduction EO Appears to Be Part of the Trump Administration’s
`Larger Attack on Anything it Deems as “DEI.” ...................................... 24
`CONCLUSION ........................................................................................................ 30
`CERTIFICATE OF COMPLIANCE........................................................................ 32
`CERTIFICATE OF SERVICE ................................................................................. 33
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`iv
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`TABLE OF AUTHORITIES
`Cases
`Nat’l Fed’n of Fed. Emps. v. Cheney, 884 F.2d 603 (D.C. Cir. 1989) ...................... 1
`Nat’l Fed’n of Fed. Emps. v. Greenberg, 983 F.2d 286 (D.C. Cir. 1993)
` ............................................................................................................................... 1
`Nat’l Fed’n of Fed. Emps., Loc. 1442 v. Dep’t of the Army , 810 F.3d
`1272 (Fed. Cir. 2015) ............................................................................................ 1
`Van Meter v. Barr, 976 F.2d 1 (D.C. Cir. 1992)........................................................ 1
`Statutes
`15 U.S.C. § 9501 et seq. ..................................................................................... 2, 5, 6
`15 U.S.C. § 9522 ...................................................................................................... 11
`5 U.S.C. § 3502 .................................................................................................. 21, 22
`Pub. L. 100-460, 102 Stat. 2229 (1988) ..................................................................... 6
`Other Authorities
`Aallyah Wright, USDA Ends Key Support for Black Farmers amid
`Trump Anti -DEI Orders , Cap. B News (July 17, 2025),
`https://capitalbnews.org/usda-ends-dei-policy-black-farmers/ .......................... 29
`Adam G. Levin, Congr. Rsch. Serv., R48616, The Minority Business
`Development Agency: An Overview of Its History and Programs
`(2024) ........................................................................................................ 5, 10, 11
`Am. Ass’n of Blacks in Energy, AABE Calls for Urgent Expansion of
`LIHEAP Funding to Address Rising Energy Burden (Mar. 7, 2025),
`https://www.aabe.org/index.php?component=news&id=1153 .......................... 29
`Andre M. Perry et al., Driving Prosperity: How Black -owned
`Businesses Fueled Recent Economic Growth, Brookings Inst. (Feb.
`19, 2025), https://www.brookings.edu/articles/driving- prosperity-
`how-black-owned-businesses-fueled-recent-economic-growth/ .................. 17, 18
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`v
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`Anne Perry & Nikole Snyder, Trump DEI Executive Orders - Impacts
`on Small Businesses and Small Business Subcontracting, Sheppard
`Mullin: Gov. Conts. & Investigations (Apr. 4, 2025),
`https://www.governmentcontractslawblog.com/2025/04/articles/ex
`ecutive-orders/trump-dei-executive-orders-impacts-on-small-
`businesses-and-small-business-subcontracting/ ................................................. 28
`Arthur Allen, Trump HHS Eliminates Office that Sets Poverty Levels
`Tied to Benefits for at Least 80 Million People, CBS News (Apr. 11,
`2025), https://www.cbsnews.com/news/trump- hhs-poverty-levels-
`medicaid-benefits/ ............................................................................................... 29
`Assessing Access: Obstacles and Opportunities for Minority Small
`Business Owners in Capital Markets: Hearing Before the Comm.
`on Small Bus. And Entrepreneurship, 111th Cong. (2010) .............................. 6, 7
`Bianca Flowers & Disha Raychaudhuri, Trump’s First 100 Days Target
`Diversity Policies, Civil Rights Protections, Reuters (Apr. 30, 2025)
` ............................................................................................................................. 25
`Brad Plumer, Entire Staff Is Fired at LIHEAP , N.Y. Times (Apr. 2,
`2025) ................................................................................................................... 29
`Brandon Tensley, How The Cutting of Federal Jobs Puts Black
`Workers at Risk , Cap. B News, (Feb. 14, 2025),
`https://capitalbnews.org/black-federal-workers-jobs-trump/ ............................. 26
`Closing the Gap: Exploring Minority Access to Capital and
`Contracting Opportunities: Hearing Before the S. Comm. on Small
`Bus. and Entrepreneurship, 111th Cong. 24-31 (2011) ................................... 7, 8
`David E. Sanger, Trump Blames D.E.I. and Biden for Crash Under His
`Watch, N.Y. Times (Jan. 30, 2025) .................................................................... 25
`Dean Kotlowski, Black Power-Nixon Style: The Nixon Administration
`and Minority Business Enterprise, 72 Bus. Hist. Rev. (Autumn) 411
`(1998) .................................................................................................................... 5
`Disparities in Access to Capital: What the Federal Government is
`Doing to Increase Support for Minority Owned Firms: Field
`Hearing Before the H. Comm. on Small Bus., 115th Cong. 2 (2018) .................. 8
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`vi
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`Drew DeSilver, What the Research Says About Federal Workers, Pew
`Rsch. Ctr. (Jan. 7, 2025), https://www.pewresearch.org/short -
`reads/2025/01/07/what-the-data-says-about-federal-workers/ ........................... 13
`Eric Katz, Treasury Eliminates Offices and Outsources Work, With
`More Layoffs Coming, Gov. Exec. (Apr. 10, 2025),
`https://www.govexec.com/workforce/2025/04/treasury-eliminates-
`offices-and-outsources-work-more-layoffs-coming/404472/ ............................. 28
`Erik Gunn, Judge Blocks Trump Order Against Three Federal
`Agencies, Wis. Exam’r, (May 6, 2025),
`https://wisconsinexaminer.com/2025/05/06/judge-blocks-trump-
`order-against-three-federal-agencies/ ................................................................. 18
`Exec. Order No. 14,151, 90 Fed. Reg. 8339 (Jan. 20, 2025) ................................... 26
`Exec. Order No. 14,173, 90 Fed. Reg. 8633 (Jan. 31, 2025) ................................... 26
`Exec. Order No. 14,217, 90 Fed. Reg. 10577 (Feb. 19, 2025) ................................ 25
`Exec. Order No. 14,238, 90 Fed. Reg. 13043 (Mar. 14, 2025) ........... 3, 4, 14, 20, 24
`H.R. 6904, 86th Cong. (1980) .................................................................................... 5
`H.R. Rep. No. 94-468 (1975) ..................................................................................... 6
`H.R. Rep. No. 97-956 (1982) ..................................................................................... 6
`How Invidious Discrimination Works and Hurts: An Examination of
`Lending Discrimination and Its Long -term Economic Impacts on
`Borrowers of Color: Hearing B efore Subcomm. on Oversight and
`Investigations of the H. Comm. on Fin. Servs., 117th Cong. 7 (2021)
` ........................................................................................................................... 7, 8
`Ismael Cid-Martinez et al., Cuts to Medicaid Will Disproportionately
`Hurt People of Color and Children, Econ. Inst. (Apr. 2, 2025),
`https://www.epi.org/blog/medicaid-cuts-will-disproportionately-
`hurt-people-of-color-and-children/ ..................................................................... 30
`J. David McSwane, Dismissed by DEI: Trump ’s Purge Made Black
`Women with Stable Federal Jobs an “ Easy Target, ” ProPublica
`(June 4, 2025), https://www.propublica.org/article/trump-dei-black-
`women-minorities-careers-jobs-dismissed ................................................... 26, 27
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`vii
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`Jennifer Ludden, As Trump Jettisons Its Staff, HUD Puts Its D.C.
`Headquarters Up for Sale , NPR (Apr. 17, 2025),
`https://www.npr.org/2025/04/17/nx-s1-5368254/hud-headquarters-
`d-c-for-sale-scott-turner-doge ............................................................................. 27
`Jess Huff, Federal DEI Funding Cuts Threaten the Work of the Few
`Remaining Black Farmers in East Texas, Tex. Trib. (July 17, 2025),
`https://www.texastribune.org/2025/07/17/east-texas-black-farmers-
`donald-trump/ ...................................................................................................... 29
`Jessica Fulton, Exploring Challenges for Small -Business Owners
`Across Race 21, Joint Ctr. for Pol. & Econ. Stud. (Apr. 13, 2022),
`https://jointcenter.org/wp-content/uploads/2022/04/Exploring-
`Challenges-for-Small-Business-Owners-Across-Race-Joint-
`Center.pdf .............................................................................................................. 8
`Jonathan Rothwell & Andre M. Perry, Why Don’t More Americans
`Work for Black -owned Firms? Implications for Increasing Well-
`Being, Brookings Inst. (June 21, 2024),
`https://www.brookings.edu/articles/why-dont-more-americans-
`work-for-black-owned-firms-implications-for-increasing-well-
`being/ ................................................................................................................... 18
`Julie M. Lawhorn & Adam G. Levin, Cong. Rsch. Serv, IN12337,
`District Court Ruling on MBDA Business Development Program
`(2024) .................................................................................................................... 6
`Madeleine Ngo, Trump’s Dismantling of Minority Business Agency
`Could Hinder Job Growth, N.Y. Times (Apr. 1, 2025) ..................... 2, 12, 16, 25
`Marisa Peñaloza & Hansi Lo Wang, Federal Work Shaped a Black
`Middle Class. Now It’s Destabilized by Trump’ s Job Cuts , NPR
`(Apr. 27, 2025), https://www.npr.org/2025/04/27/nx- s1-
`5349442/black-federal-employees-trump-cuts ............................................. 13, 20
`MBDA, 2024 Year in Review , https://www.mbda.gov/about -
`mbda/year-in-review/2024-year-in-review (last visited Aug. 26,
`2025) ............................................................................................................. 11, 12
`MBDA, Annual Performance Summary: Fiscal Year 2024,
`https://www.mbda.gov/sites/default/files/2025-03/fy-2024-annual-
`performance-report.pdf (last visited Aug. 22, 2025) .................... 2, 11, 12, 16, 25
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`MBDA, Off. Pol’y Analysis & Dev., The Contribution of Minority
`Business Enterprises to the U.S. Economy 7 (Sept. 2021),
`https://www.mbda.gov/sites/default/files/2021-
`09/The%20Contribution%20of%20MBEs%20to%20US%20Econo
`my%20Report%20%20-%20September%202021.pdf ...................................... 17
`MBDA’s Enduring Legacy at Risk: What Funding Cuts Mean for
`Minority Businesses , Trivision (Mar. 18, 2025),
`https://trivision.com/branding/mbdas-enduring-legacy-reflecting-
`on-its-impact-and-future-amid-federal-reductions/ ............................................ 18
`Michael Embrich, Trump is Cutting Tens of Thousands of Veterans
`Affairs Workers, Rolling Stone (July 9, 2025) ................................................... 28
`Michael Madowitz, et al., Public Work Provides Economic Security for
`Black Families and Communities , Ctr. for Am. Progress (Oct. 23,
`2020), https://www.americanprogress.org/article/public -work-
`provides-economic-security-black-families-communities/ ............................ 3, 13
`Minority Access to Capital: Field Hearing Before the S. Comm. on
`Small Bus. and Entrepreneurship, 114th Cong. 32 (2015) ................................ 10
`Minority Business Development Act of 1988: Hearing on H.R. 1769
`Before the H. Sub. Comm. on Procurement, Innovation, and
`Minority Enterprise Development of the Comm. on Small Bus. ,
`100th Cong. (1988) ............................................................................................... 6
`Notice of Report on the Lawful Uses of Race or Sex in Federal
`Contracting Programs, 87 Fed. Reg. 4955 (Jan. 31, 2022) .................................. 6
`P’ship for Pub. Serv., A Profile of the 2023 Federal Workforce ,
`https://ourpublicservice.org/fed-figures/a-profile-of-the-2023-
`federal-workforce/ (last visited Aug. 26, 2025) ................................................. 13
`Robert W. Fairlie & Alicia M. Robb, Disparities in Capital Access
`Between Minority and Non- Minority-Owned Businesses: The
`Troubling Reality of Capital Limitations Faced by MBEs , MBDA
`(Jan. 2010),
`https://www.mbda.gov/sites/default/files/migrated/files-
`attachments/DisparitiesinCapitalAccessReport.pdf ............................................. 9
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`Robert W. Fairlie, Latino Business Ownership: Contributions and
`Barriers for U.S.-born and Immigrant Latino Entrepreneurs 15-16,
`U.S. Small Bus. Admin. (2018), https://advocacy.sba.gov/wp-
`content/uploads/2019/03/438-Latino-Business-Ownership-
`Report.pdf ........................................................................................................... 10
`S. 2068, 117th Cong. (2021) ...................................................................................... 5
`S. 2565, 96th Cong. (1980) ........................................................................................ 5
`Sam Berger & Jacob Leibenluft, Trump Administration’s Mass Layoffs
`of Federal Workers Are Illegal, Ctr. on Budget & Pol'y Priorities
`(May 2, 2025), https://www.cbpp.org/research/federal -
`budget/trump-administrations-mass-layoffs-of-federal-workers-
`are-illegal ............................................................................................................ 29
`Samantha Dorisca, Minority Business Development Agency Gets
`Dismantled After Dispersing $3.2B in Contracts Under the Biden
`Administration, AfroTech, (Apr. 22, 2025),
`https://afrotech.com/minority-business-development-agency-
`funding-dismantles .............................................................................................. 18
`Sarah Javaid, Attacks on the Federal Workforce Target Women and
`People of Color , Nat’l Women’s L. Ctr. (May 2025),
`https://nwlc.org/wp-content/uploads/2025/05/Federal-Workforce-
`FS-5.5.25v2.pdf ............................................................................................ 27, 28
`Sephora Charles, Federally -funded WA Business Center Closes This
`Month, Leaving ‘Huge Void’, News Trib. (June 29, 2025) ................................ 19
`Small Bus. Majority, Gutting of CDFI Fund, MBDA is Bad Small
`Business Policy (Mar. 15, 2025),
`https://smallbusinessmajority.org/press-release/gutting-cdfi-fund-
`mbda-bad-small-business-policy ........................................................................ 12
`Teon Hayes, Reconciliation Changes to SNAP Would
`Disproportionately Harm Black and Brown Communities and
`Families with Low Incomes, Ctr. for L. & Soc. Pol ’y (May 16,
`2025), https://www.clasp.org/blog/reconciliation- changes-to-snap-
`would-disproportionately-harm-black-and-brown-communities-
`and-families-with-low-incomes/ ......................................................................... 30
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`Terry Gerton, The Outlook for Federal Workers Involuntarily Placed
`on Administrative Leave, Fed. News Network (June 25, 2025),
`https://federalnewsnetwork.com/workforce/2025/06/the-outlook-
`for-federal-workers-involuntarily-placed-on-administrative-leave/ ................... 27
`The Compelling Interest for Affirmative Action in Federal
`Procurement: A Preliminary Survey, 61 Fed. Reg. 26042 -01 (May
`23, 1996) ........................................................................................................... 6, 7
`U.S. Chamber of Com., Access to Capital for Minority -Owned
`Business, https://www.uschamber.com/finance/growth-
`engine/access-to-capital-for-minority-owned-businesses (last
`visited Aug. 22, 2025) ....................................................................................... 8, 9
`U.S. Dep ’t of Com., MBDA, Contracting Barriers and Factors
`Affecting Minority Business Enterprises: A Review of Existing
`Disparity Studies (Dec. 2016) ........................................................................... 6, 7
`U.S. Dep ’t of Com., MBDA, Fiscal Year 2025 Congressional
`Justification 1819 (2024),
`https://www.commerce.gov/sites/default/files/2024-03/MBDA-
`FY2025-Congressional-Budget-Submission.pdf .......................................... 11, 12
`U.S. Dep ’t of Com., MBDA, MBDA Grantees (Dec. 19, 2024),
`https://www.mbda.gov/research/data/mbda-grantees ......................................... 10
`U.S. Dep ’t of Com., MBDA, The Minority Business Development
`Agency: Vital to Making America Great,
`https://www.mbda.gov/sites/default/files/migrated/files-
`attachments/MBDAVitaltoMakingAmericaGreat_170330.pdf (last
`visited Aug. 22, 2025) ........................................................................................... 9
`U.S. Dep’t of Educ., U.S. Department of Education Initiates Reduction
`in Force (Mar. 11, 2025), https://www.ed.gov/about/news/press -
`release/us-department-of-education-initiates-reduction-force ........................... 21
`U.S. Small Bus. Admin., Small Business Administration Announces
`Agency-Wide Reorganization (Mar. 21, 2025),
`https://www.sba.gov/article/2025/03/21/small-business-
`administration-announces-agency-wide-reorganization ..................................... 28
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`RULE 29(a)(4)(E) STATEMENT
`Amicus curiae files this brief with the consent of all parties. See Fed. R. App.
`P. 29(a)(2). Pursuant to First Circuit Rule 29(a)(4)(E), undersigned counsel states
`that no party’s counsel authored the brief in whole or in part; that no party or party’s
`counsel contributed money that was intended to fund preparing or subm itting the
`brief; and that no person other than the amicus curiae contributed money that was
`intended to fund preparing or submitting the brief.
`
`September 3, 2025
` /s/ Molly M. Cain
` Molly M. Cain
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`CORPORATE DISCLOSURE STATEMENT
`Pursuant to Federal Rule of Appellate Procedure 26.1(a), counsel for amicus
`curiae hereby certifies that no party to this brief has a parent corporation, issues
`stock, or is a publicly held corporation.
`
`September 3, 2025
` /s/ Molly M. Cain
` Molly M. Cain
`
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`1
`INTEREST OF AMICUS CURIAE
`Established in 1917, the National Federation of Federal Employees -
`International Association of Machinists and Aerospace Workers , AFL -CIO
`(“NFFE”) is the first and oldest union to represent civil service federal employees,
`representing approximately 110,000 federal government workers across the United
`States. This includes thirty -five current or former employees of the Minority
`Business Development Agency (“MBDA”). NFFE’s mission is to advance the social
`and economic welfare and education of federal workers, including its members.
`For decades, NFFE has litigated cases advocating for its members. See, e.g.,
`Nat’l Fed’n of Fed. Emps., Loc. 1442 v. Dep’t of the Army, 810 F.3d 1272 (Fed. Cir.
`2015); Nat’l Fed’n of Fed. Emps. v. Cheney , 884 F.2d 603 (D.C. Cir. 1989); Nat’l
`Fed’n of Fed. Emps. v. Greenberg, 983 F.2d 286 (D.C. Cir. 1993). NFFE also has
`participated as amicus to advocate for its members. See Van Meter v. Barr, 976 F.2d
`1 (D.C. Cir. 1992).
`In this case, NFFE has a strong interest in uplifting the meaningful work of its
`members at the MBDA and bringing attention to the Trump Administration’s actions
`at issue which have had a significant detrimental impact on NFFE’s members and
`their work.
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`INTRODUCTION
`For more than half a century, the MBDA has helped make the American
`dream a reality for business owners across the country by helping them overcome
`discrimination and other barriers. Now codified by statute, 15 U.S.C. § 9501 et seq.,
`the MBDA helps Black-owned businesses, other minority -owned businesses, and
`businesses owned by other socially or economically disadvantaged people of all
`backgrounds—statutorily defined as “Minority Business Enterprises” or
`“MBEs”1—thrive through its nationwide network of Business Centers and other
`programs. The MBDA’s economic impact speaks for itself: in fiscal year 2024 alone,
`the Agency received $70 million 2 in funding, but returned a nearly $4.9 billion 3
`impact for the American economy writ large.
`
`1 Per the MBDA’s authorizing statute, MBEs must be at least 51% owned and
`operated by a socially or economically disadvantaged person. 15 U.S.C. §
`9501(9)(A). “Socially disadvantaged persons” are those who have “been subjected
`to racial or ethnic prejudice or cultural bias . . . because of the identity of the
`individual as a member of a group. . . .” Id. § 9501(15)(A). “E conomically
`disadvantaged persons” are those whose “ability . . . to compete in the free enterprise
`system has been impaired due to diminished capital and credit opportunities, as
`compared to others in the same line of business and competitive market area [,]
`because of the identity of the individual as a member of a group. . . .” Id.
`2 Madeleine Ngo, Trump’s Dismantling of Minority Business Agency Could Hinder
`Job Growth, N.Y. Times (Apr. 1, 2025) ,
`https://www.nytimes.com/2025/04/01/us/politics/minority-business-development-
`agency-trump.html.
`3 MBDA, Annual Performance Summary : Fiscal Year 2024,
`https://www.mbda.gov/sites/default/files/2025-03/fy-2024-annual-performance-
`report.pdf (last visited Aug. 22, 2025).
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`3
`Despite the MBDA’s success, the Trump Administration unlawfully seeks to
`dismantle it through Executive Order 14238 (the “Reduction EO”).4 This Reduction
`EO seeks to functionally eliminate the MBDA and its staff. Dismantling the MBDA
`would be devastating for Black businesses, other MBEs, and the MBDA’s critical
`programs. And t hese harms would have harmful ripple effects on the American
`economy overall.
`Gutting the MBDA also harms its majority -Black workforce who carries out
`its important work. These employees build on the long legacy of Black Americans’
`service in federal government , an employer that historically has provided Black
`Americans with stable jobs and a pathway to the middle class before such
`opportunities were open to them in much of the private sector.5 The Administration’s
`attempt to eliminate the MBDA tramples on this legacy.
`Finally, the attack on the MBDA is also of a piece with the Trump
`Administration’s larger efforts to eliminate programs that support underserved or
`disadvantaged populations . Despite the MBDA’s mandat e to support business
`owners of all backgrounds , and its record of economic success, it appears to be a
`casualty of the Trump A dministration’s crusade against anything it pejoratively
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`4 Exec. Order No. 14,238, 90 Fed. Reg. 13043 (Mar. 14, 2025).
`5 Michael Madowitz , et al. , Public Work Provides Economic Security for Black
`Families and Communities , Ctr. for Am. Progress (Oct. 23, 2020),
`https://www.americanprogress.org/article/public-work-provides-economic-
`security-black-families-communities/.
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`labels as diversity, equity, and inclusion (“DEI ”)—rather than any legitimate
`bureaucratic decision.
`In short, dismantling the MBDA would cut off far more than just funding: it
`would end a wide range of important services that the agency has long provided to
`MBEs, and in turn, to communities nationwide. Nor is this dismantling even justified
`by the Reduction EO’s stated objective: to “reduc[e] . . . the elements of the Federal
`bureaucracy that the President has determined are unnecessary”6—as the Reduction
`EO cannot be squared with the fact that the MBDA returns far greater economic
`impact than any funding it receives. And as Defendants-Appellants’ actions have
`demonstrated, nearly all of the employees of the MBDA responsible for this critical
`work have been subject to haphazard agency actions as a result of the Reduction EO.
`The Court should take account of these considerations and prevent further disruption
`and harm. The Preliminary Injunction should be affirmed.
`BACKGROUND
`I. For Decades, Congress Has Affirmed the MBDA’s Mandate to Promote
`Economic Advancement of Disadvantaged Business Owners.
`A. Creation of the MBDA.
`The MBDA was originally created in 1969 as the Office of Minority Business
`Enterprise (“OMBE”) by President Nixon, to foster opportunities for Black and
`
`6 Reduction EO § 1.
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`minority-owned businesses and advance the American economy.7 In 1979, President
`Carter renamed the OBME as the MBDA, and refocused the agency on its economic
`goal of helping “minority businesses develop into medium - and large-size firms in
`growth industries that produced jobs, stabilized communities, and improved the
`overall economy.”
`8
`Congress has continued to affirm this commitment to the MBDA and its
`mission. For over 55 years, Congress has reappropriated funding for the MBDA. 9
`And in 2021, through bipartisan action, Congress codified the MBDA in the
`Minority Business Development Act (the “Act”). 10 The Act recognized the MBDA
`as a statutorily -mandated agency housed in the Department of Commerce, and
`directed the MBDA to establish and maintain certain programs, including the
`MBDA Business Center Program.11 Although the MBDA originated with President
`Nixon’s focus on Black and minority-owned businesses, the MBDA’s programs and
`assistance today are available to all individuals who qualify as socially or
`economically disadvantaged regardless of race or ethnicity, a requirement enshrined
`
`7 Dean Kotlowski, Black Power -Nixon Style: The Nixon Administration and
`Minority Business Enterprise, 72 Bus. Hist. Rev. (Autumn) 411 (1998).
`8 S. 2565, 96th Cong. (1980); H.R. 6904, 86th Cong. (1980).
`9 Adam G. Levin, Congr. Rsch. Serv., R48616, The Minority Business Development
`Agency: An Overview of Its History and Programs 28, 32 tbl.A-1 MBDA
`Appropriations, FY1970-FY2024 (2024).
`10 S. 2068, 117th Cong. (2021).
`11 15 U.S.C. § 9501, et seq.
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`in the Act.12
`B. History of Discrimination Against Minority Business Owners ,
`Including Black Business Owners.
`In reappropriating funds for the MBDA over the past half- century and
`ultimately passing the Act in 2021, Congress was responding to significant evidence
`of ongoing discrimination and other barriers facing entrepreneurs from
`disadvantaged backgrounds. As the congressional record since 1970 demonstrates,
`discrimination and its lingering effects persist and continue to harm aspiring
`minority business owners.13 For example, congressional evidence from 1980 to 1995
`found that “[o]ver and over again, studies show that minority applicants for business
`loans are more likely to be rejected, and, when accepted, receive smaller loan
`amounts than nonminority applicants with identical collateral and borrowing
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`12 Id. § 9501(15)(A); Julie M. Lawhorn & Adam G. Levin , Cong. Rsch. Serv,
`IN12337, District Court Ruling on MBDA Business Development Program (2024).
`13 See H.R. Rep. No. 94-468 (1975); H.R. Rep. No. 97-956 (1982); Pub. L. 100-460,
`102 Stat. 2229 (1988); Minority Business Development Act of 1988: Hearing on H.R.
`1769 Before the H. Sub. Comm. on Procurement, Innovation, and Minority
`Enterprise Development of the Comm. on Small Bus. , 100th Cong. (1988); The
`Compelling Interest for Affirmative Action in Federal Procurement: A Preliminary
`Survey, 61 Fed. Reg. 26042- 01 (May 23, 1996); Assessing Access: Obstacles and
`Opportunities for Minority Small Business Owners in Today’s Capital Markets:
`Hearing Before the Comm. on Small Bus. And Entrepreneurship, 111th Cong.
`(2010); U.S. Dep’t of Com ., MBDA, Contracting Barriers and Factors Affecting
`Minority Business Enterprises: A Review o