On May 19, 2025, Deputy Attorney General Todd Blanche issued a memorandum titled Civil Rights Fraud Initiative announcing the Department of Justice’s (DOJ) plan to use the False Claims Act (FCA) to “aggressively” pursue government contractors and any recipients of federal funds that knowingly violate civil rights laws. Blanche’s memo comes on the heels of President Trump’s January 21, 2025 executive order (EO), which targeted diversity, equity, and inclusion (DEI) programs at companies and organizations that do business with the federal government. The memo now puts into motion the enforcement mechanisms that the EO contemplated. And it marks a potentially seismic shift in FCA enforcement, one that creates substantial risk for any entity that contracts with or receives funding from the federal government, due to the FCA’s treble damages provision. But as explained below, any organization investigated or sued under the FCA for its DEI programs would likely have strong defenses, especially if the organization takes steps now to fortify compliance with civil rights laws.
What is the Civil Rights Fraud Initiative?
Under the Civil Rights Fraud Initiative, public universities, contractors, and other recipients of federal grants or contracts may face FCA liability if they knowingly violate civil rights laws and falsely certify compliance with such laws. Blanche’s memo initially focuses on universities and asserts that a university that “encourages antisemitism, refuses to protect...
A recent review of developments in the pharmaceutical and healthcare sectors highlights a $290 million penalty imposed on CVS Caremark under the False Claims Act, widespread non-compliance with HI...