On Thursday, a Fourth Circuit panel unanimously concluded that Title VI of the Civil Rights Act of 1964 allows minority-owned corporations to challenge racial discrimination in contracting on behalf of their owners. The court rejected the corporate defendants’ spurious argument—asserted by the government in some recent cases—that because the plaintiff is a corporation, it cannot be a “person” that is protected by federal laws.
This is an increasingly popular argument on the left, sometimes articulated as the notion that because a corporation can’t pray, therefore it can’t have religious rights, and because a corporation can’t vote, it doesn’t have freedom of speech. The solicitor general has made this argument explicitly, arguing in Hobby Lobby and Conestoga Wood Specialties that corporations don’t have religious freedoms under federal law in the first instance, and even if they do, they lose those freedoms if they engage in for-profit activities (as if real religious exercise stops once synagogue, church, or Friday prayers are over).
But as Fourth Circuit judge Barbara Keenan (an Obama appointee) pointed out in a footnote, federal statute generally defines “person” to include corporations, and Title VI does not contain its own definition to override the Dictionary Act. The Fourth Circuit adopted a line of cases from the Ninth Circuit saying that a corporate entity can assert the racial identity of its owners in an anti-discrimination claim. All that the plaintiff corporation had to show was that it was minority-owned and certified to be so.
This conclusion makes sense: A corporation may not have an independent racial identity, but its shareholders and managers do. The law does not ask courts to pretend that corporations are robots because corporations are owned and operated by people.
Judge Keenan’s opinion also shows what is at stake in affording such protections to the corporate form. Although anticorporate special interests typically don’t want to admit how broadly their argument would sweep, if the Fourth Circuit had come to the opposite conclusion, antidiscrimination law would not extend to minority-owned businesses organized as corporations. This would effectively force minority business owners either to abandon financial protections available to all other businesses or abandon legal protections against discrimination. That sort of Hobson’s choice should never be imposed on any constitutionally protected class, whether racial, religious, or otherwise.