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By Megan Sayles
AFRO Business Writer
msayles@afro.com
Progressive Insurance and Hello Alice, a small business resource platform based in Houston, are in the midst of a legal battle with America First Legal (AFL) over a grant program that targeted Black businesses. The conservative nonprofit law organization filed a class-action lawsuit against the pair regarding the Driving Small Business Forward grant, which awarded $25,000 to 10 Black entrepreneurs in August, alleging that the program was racially discriminatory.
Credit: Photo Courtesy of Hello Alice
On Dec. 13, Hello Alice filed a motion to dismiss the case. In it, Hello Alice contended that the lawsuit is “wrong in every relevant respect.”
“Hello Alice’s mission is to help small businesses throughout this country, and Hello Alice vehemently opposes racial discrimination. Indeed, Hello Alice’s core mission is to combat the effects that generations of pernicious racism have had on America’s capital infrastructure. Federal law does not compel purely private actors like Hello Alice, when choosing how and to whom they will donate money, to blind themselves to the centuries of invidious racism that have produced substantial existing racial inequities in access to capital.”
On Dec. 20, the Southern Poverty Law Center, Lawyers’ Committee for Civil Rights Under Law, Hispanic National Bar Association and Asian Americans Advancing Justice filed an amicus brief supporting the dismissal of the case.
This is not the first time AFL has lodged a class-action lawsuit against a company earmarking grants for underrepresented entrepreneurs. In July 2022, it sued Amazon for a diversity grant that deployed $10,000 to Black, LatinX and Native American business owners to cover startup costs.
Nathan Roberts, owner of an Ohio trucking company, is at the center of AFL’s suit against Hello Alice and Progressive. Roberts, who’s White, allegedly received an email about the Driving Small Business Forward grant program and began filling out an application before realizing it was exclusive to Black entrepreneurs, according to the complaint. Once he did, he closed the application.
“All Americans deserve to be free from racial discrimination, yet major corporations across the United States inject racial considerations into every aspect of their business operations, employment practices and so much more. As alleged in our complaint, our client—who is a small business owner fighting to create a better life for himself and his family—was denied a contract with Progressive that would have provided him with $25,000 toward the purchase of a new truck solely because of the amount of pigment in his skin,” said Gene Hamilton, vice president and general counsel for AFL, in a statement. “Progressive’s racially discriminatory arrangement is offensive to the American ideal, and we will fight to vindicate his rights and the rights of all similarly situated Americans.”
Credit: Photo Courtesy of America First Legal
In a statement on X, Hello Alice executives, Elizabeth Gore, Carolyn Rodz and Kelsey Rudger, called the case baseless, saying it sets the nation and small businesses back.
“Hello Alice strongly disagrees with the legal theory of this lawsuit, which is part of a larger strategy to attack voluntary, private-sector efforts to combat the lingering effects of racism on the American economy.”
“This lawsuit alleges that Hello Alice engaged in unlawful racial discrimination by helping Progressive Insurance award grants to 10 Black-owned small businesses,” wrote the Hello Alice executives in the post. “Hello Alice strongly disagrees with the legal theory of this lawsuit, which is part of a larger strategy to attack voluntary, private-sector efforts to combat the lingering effects of racism on the American economy.”
In response to the suit, Hello Alice has initiated a new grant program enabling individuals to nominate small businesses they believe to be “American Dream” visionaries. The winners will receive $1,000 in funding, access to a small business accelerator and media coverage.
“Hello Alice has administered over $40 million in grants to entrepreneurs who are job creators of all races, industries, genders and geographies. Our technology has connected 1.4 million of you with loans, credit, grants or resources to grow your business,” wrote the Hello Alice executives in the statement. “Now that AFL has poked the small business bear, we are doubling down, and doing so, as always, in a lawful way that holds true to America’s core values.”
Megan Sayles is a Report For America corps member.
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