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Client Alert: Attorney General Memorandum on DEI

February 07 2025

On February 5, 2025, the U.S. Attorney General issued a Memorandum (“Memo”) called “Ending Illegal DEI and DEIA Discrimination and Preferences.”  The Memo is separated into two parts:  (1) a directive to the Civil Rights Division and the Office of Legal Policy to submit a report to the U.S. Attorney General by March 1, 2025, and (2) a directive for the DOJ to work with the Department of Education in issuing directives related to federal funding.

This alert focuses on the first directive relating to private company DEI programs and principles. It is important to note that the Memo cites to the January 21, 2025 Executive Order “Ending Illegal Discrimination and Restoring Merit-Based Opportunity.” (“EO”)  Check out that EO here.  Check out the FAQ here.

March 1, 2025 Report

The U.S. Attorney General is directing that the Civil Rights Division and the Office of Legal Policy submit a report that addresses five topics. We will break it down by each topic.  The topics are bolded below and followed by analysis and explanation:

  • key sectors of concern within the Department’s jurisdiction. 
  • What is a Key Sector of Concern? This is a broad directive, and one that will be parsed out in the March 1, 2025   
  • the most egregious and discriminatory DEI and DEIA practitioners in each sector of concern. 
  • Who is a Practitioner? It is unclear what or who is deemed a “DEI and DEIA practitioner.” At this juncture it is unclear whether a practitioner is an individual or a company (or both).
  • a plan including specific steps or measures to deter the use of DEI and DEIA programs or principles that constitute illegal discrimination or preferences, including proposals for criminal investigations and for up to nine potential civil compliance investigations of entities that meet the criteria outlined in section 4(b)(iii) of Executive Order 14173. 
  • What is “Illegal Discrimination or Preferences?” In the employment arena, Title VII, the related regulations and case law set out what constitutes discrimination in employment (and thereby illegal).  As many employers are aware, there are two general types of discrimination: (1) disparate impact and (2) disparate intent.

Disparate Impact is where there is a facially neutral policy that has a discriminatory impact on a protected class. Disparate Intent is when there is a policy that specifically targets a protected class. In other words, it is not facially neutral.  Companies will have to wait for the Report to understand the Department of Justice’s idea of what constitutes “illegal discrimination or preference.”

  • DEI and DEIA Programs or Principles. It is worth noting that this directive mentions “DEI or DEIA Programs or principles.”  This is in line with the EO that directs an inquiry into DEI programs that are in existence under a different name. In fact, the EO directs each agency to provide a list to OMB of all programs that could be “misleadingly relabeled.” (“Each agency shall…provide the Director of the OMB with a list of all: agency or department DEI, DEIA or ‘environmental justice’ positions, committees, programs, services, activities, budgets, and expenditures in existence [under the previous Administration], and an assessment of whether these positions, committees, programs, services, activities, budgets and expenditures have been misleadingly relabeled in an attempt to preserve their [functions of DEI].”).
  • Criminal Investigations. Again the Report will parse out details as to how these criminal investigations will be conducted.   
  • Civil Compliance Investigations. The Report apparently will include proposals for up to 9 civil compliance investigations as set forth in the EO.

Section 4(b)(iii) of the EO directs the Attorney General to identify up to nine potential civil compliance investigations of certain entities.  The  EO identifies the following types of entities that would be the target of such civil investigation:

(1) publicly traded corporations

(2) large non-profit corporations or associations

(3) foundations with assets of 500 million dollars or more

(4) state and local bar associations

(5) institutions of higher education with endowments over $1 billion. 

  • additional potential litigation activities (including interventions in pending cases, statement of interest submissions, and amicus brief submissions), regulatory actions, and sub-regulatory guidance; and
  • AG Intervention in Current Litigation. Based on this directive, it seems likely the DOJ will be involved in current litigation.  The Report may flesh out precisely how this will look.
  • other strategies to end illegal DEI and DEIA discrimination and preferences and to comply with all federal civil-rights laws. 
  • This is a fairly broad directive. The Report will purportedly provide more guidance.

Analysis

Prudent organizations will stay up to date on developments from the AG.  During this time, it behooves organizations to understand the DEI Executive Order.  Understanding of the nuances of the Order allow for a company to make an informed risk assessment as to the next steps.