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Federal judge grants temporary restraining order in Colorado discrimination lawsuit over relief funds

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Robert Davis | The Center Square contributor

(The Center Square) – A federal judge issued a temporary restraining order prohibiting Colorado’s economic development office from giving minority-owned businesses preference for COVID-19 relief grants.

The lawsuit was initially filed last week by Stephen Collins, the owner of Resort Meeting Source, an event-planning business. Collins, who is White, argues that his business qualifies as a “disproportionately impacted business” under state law but that he was denied a relief grant because the business is not minority-owned.

Collins alleges in the lawsuit against the Colorado Office of Economic Development and International Trade (OEDIT) that his business hasn't been treated equally under the law.

U.S. District Court Judge William Martinez on Tuesday granted the temporary restraining order (TRO), arguing that Collins showed “a substantial likelihood” that he would prevail on his claim that the racial classifications used in the program to determine what businesses were “disproportionately impacted” by COVID-19 run afoul of equal protection guaranteed under the law. 

The state Legislature passed Senate Bill 20B-001 during a special session to provide COVID-19 relief to minority-owned businesses, establishing the grant program administered by OEDIT. Lawmakers later modified the law to provide "relief for disproportionately impacted businesses."

The lawsuit alleges the state "continues to provide a racial preference" in distributing the grants. 

“To be clear, the Court is not prejudging the content of Defendant’s response or the evidence he will provide in response to the Motion, but given the fast-approaching deadline for the OEDIT to award grants, the Court finds that the interests of justice are best served through the immediate issuance of a TRO,” the judge's order reads.

Wen Fa, an attorney at the Pacific Legal Foundation, the public interest law firm representing the plaintiff, described the order as “a major victory for equality before the law in Colorado.”

“The government cannot disfavor individuals because of arbitrary racial distinctions, and that’s exactly what the government has done here. This restraining order will ensure that the doesn’t violate the constitutional rights of business owners,” Fa said in a statement.