The U.S. Department of Justice (“DOJ”) leadership has provided insight into how DOJ is pursuing investigations related to unlawful diversity, equity, and inclusion (“DEI”) programs.
In comments made on February 19, 2026 during the Federal Bar Association’s 2026 Qui Tam Conference and covered by several media outlets, Brenna Jenny, deputy assistant attorney general commercial litigation branch, suggested that the Trump Administration’s efforts should not be viewed as combatting DEI programs per se, but instead as targeting discrimination which may or may not arise out of DEI programs. Jenny noted that not all DEI programs are unlawful and that the DOJ’s use of the False Claims Act (“FCA”) in this area focuses on investigating programs by federal contractors and potential grant recipients in which participation is “restricted on the basis of race or sex” such as executive training and mentoring programs.1
Background
On January 21, 2025, President Trump issued an executive order restricting federal agencies, contractors, and grant recipients from promoting “illegal” DEI policies and conditioned government funding on adhering to this restriction. See Executive Order 14173, found here. However, the executive order did not include specifics on the factors that would render a DEI program “illegal,” resulting in many companies and universities that regularly work with the U.S. government or receive federal grants either scaling back components of their DEI programs or ending them entirely.
In May 2025, the DOJ launched a new initiative called the Civil Rights Fraud Initiative (“CRF Initiative”), which reportedly sought to use the FCA to target universities’ and government contractors’ DEI programs. Our prior discussion of this Initiative is here.
The FCA, 31 U.S.C. §§ 3729-3733, one of the government’s most powerful enforcement tools provides that, “any person who knowingly submits, or causes to submit, false claims to the government” is liable for treble damages plus a penalty that is linked to inflation.2 FCA liability can also be imposed where one, “knowingly uses a false record material to a false claim or improperly avoids an obligation to pay the government.” For further information on the DOJ’s settlements and judgments pursuant to the FCA, see Record-breaking U.S. DOJ year of settlements and judgments under the False Claims Act, which is found here.
Examples of discriminatory programs
While DOJ has made clear that it would use the FCA to investigate DEI programs, the types of programs that DOJ viewed as “illegal DEI” was not specified. During her comments, Jenny, who characterized DOJ’s investigations as focused on discrimination rather than DEI programs per se, provided significant insight into the types of programs that DOJ viewed as problematic.
“At the top of the list for me and what's coming into focus as the heart of many of our investigations are companies that implemented programs and practices that pressured supervisors and management to make hiring and promotion decisions based on race or sex.”
Jenny went on to describe several other corporate programs that have often been part of a corporate DEI program or commitment, including creating and tracking demographic goals, tying employee compensation to the achievement of corporate demographic goals, and requiring employees to develop their own DEI goals that affect their compensation and promotion. Jenny added that “[a] couple other programs we’ve been taking a look at are executive training and mentoring programs, where participation is restricted on the basis of race or sex and diverse slate policies.” Jenny noted that these programs can offer special access to company leadership and mentorship that are reserved for employees of a certain race or gender.
Nevertheless, significant aspects of DOJ’s effort to investigate what it describes as illegal DEI programs include the number of investigations being initiated, how FCA damages might be calculated in these cases, and, perhaps most importantly, whether the federal courts will ultimately agree that these programs constitute FCA violations. Nonetheless, the February 19, 2026 panel discussion suggests the DOJ is indeed implementing the President’s executive orders and that recipients of federal funds should look closely at how they describe and implement any corporate program that takes into account an individual’s race or gender.
Footnotes
1.
The U.S. Equal Employment Opportunity Commission (“EEOC”) recently joined the DOJ in providing more insight into how it views workplace DEI programs. On February 26, 2026, the EEOC released a “Reminder of Title VII Obligations Related to DEI Initiatives” to executives, general counsels and board chairs warning that the “EEOC stands ready to combat [] discrimination” and “widespread adoption of DEI in the Fortune 500 and elsewhere . . . does not change longstanding legal prohibitions against the use of race, sex, and other protected characteristics in employment.” The letter can be found here.
2. U.S. Department of Justice, The False Claims Act, https://www.justice.gov/civil/false-claims-act.
