The Supreme Court Case That Will Fuel The Corporate DEI Debate In 2025

The U.S. Supreme Court is set to rule on an employment discrimination case in 2025 that could add fuel to the debate over corporate DEI programs—without ever mentioning diversity, equity, and inclusion. Ames v. Ohio Department of Youth Services involves a “reverse discrimination” claim. These claims are brought by members of a majority group alleging discrimination in favor of members of a minority group.

Employment law experts explain what’s at stake in the Ames case, and why the Supreme Court’s ruling might be used to challenge corporate diversity, equity, and inclusion initiatives.

The Lower Courts’ Rulings in Ames

Marlean Ames was hired in 2004 as an employee at a youth services agency, where she was promoted to an administrator position in 2014. Ames applied for a promotion to become a Bureau Chief in 2019. She did not receive that job and was instead demoted. Her employer promoted a gay man to fill her former administrator position. Her employer later selected a gay woman for the Bureau Chief job.

Ames is heterosexual. She filed a federal lawsuit against her employer alleging discrimination on the basis of her sexual orientation in violation of Title VII of the Civil Rights Act of 1964.

Title VII prohibits covered employers from discriminating against employees on the basis of race, color, religion, sex, or national origin. The Supreme Court held that sexual orientation is also protected under Title VII in the 2020 case of Bostock v. Clayton County.

Although sexual orientation is a protected status, the lower courts dismissed Ames’s Title VII lawsuit for insufficient evidence.

All employees who file Title VII discrimination claims must meet an initial evidentiary showing for their lawsuit to proceed. Because Ames was claiming reverse discrimination, this initial step required an extra showing of “background circumstances to support the suspicion that the defendant is that unusual employer who discriminates against the majority.”

Ames did not meet the “background circumstances” requirement. The two employment decision makers who denied Ames a promotion and demoted her were not gay. And there was no evidence that her employer had a pattern of discriminating against heterosexual employees.

Ames appealed to the U.S. Supreme Court. While five of the federal circuit courts (covering about 20 states) use the extra “background circumstances” test for reverse discrimination claims, the other seven federal circuit courts do not. The Supreme Court agreed to take Ames’s case to resolve this conflict. Oral arguments are scheduled for February 26, 2025. A decision is expected by the end of June.

What’s at Stake for Corporate DEI Programs

Ames is not directly challenging an employer’s diversity, equity, and inclusion program. Ames is just arguing that her employer individually discriminated against her because she is heterosexual, by selecting gay workers for the two positions she wanted. So what does this case have to do with corporate DEI?

The outcome in Ames matters because DEI critics increasingly have been using reverse discrimination claims to challenge DEI initiatives.

This trend accelerated after the Supreme Court struck down race-based affirmative action in higher education in SFFA v. Harvard College in 2023. America First Legal issued a statement after the SFFA decision asserting that “all DEI programs” were now “illegal.” America First Legal is led by Stephen Miller, a first-term Trump advisor who is slated to serve as deputy chief of staff and homeland security advisor in Trump’s second term.

Legal experts were quick to respond that SFFA did not involve a Title VII discrimination claim, and its ruling does not apply to private sector employers. “This is politics, folks; don’t mistake it for law,” said Joan C. Williams, law professor at the University of California College of the Law, San Francisco, in a 2023 response titled, “No, SCOTUS Did Not Make Your Company’s DEI Programs Illegal.”

To date, reverse discrimination claims targeting well-designed corporate DEI programs have been largely unsuccessful. However, if the Supreme Court sides with Ames and strikes down the “background circumstances” requirement, it may make it easier for employees to meet the initial evidentiary hurdle in reverse discrimination claims in states currently using that test. Lawsuits attempting to challenge DEI may increase as a result.

“It’s a case that people are expecting will open the courthouse doors to more reverse discrimination suits,” said Jason Schwartz, co-chair of Gibson Dunn’s labor and employment practice group, in an email response. Although Ames involves sexual orientation, its decision should apply to reverse discrimination claims involving all Title VII categories, including race, color, religion, sex, and national origin.

An uptick in reverse discrimination claims is also predicted by Alyesha Asghar, shareholder and co-chair of Littler’s EEO & Diversity Practice Group, and Julian Wolfson, associate at Littler, in a 2024 bulletin on the Ames case.

“If the Supreme Court eliminates the background circumstances requirement, it will be easier for plaintiffs from historically majority communities to pursue reverse discrimination claims,” explained Asghar and Wolfson, at least in the five circuits that currently use this test.

“It is relatively common for employers to rely on that principle to defend against challenges to diversity initiatives under Title VII,” said Asghar and Wolfson. “If employers in those circuits are no longer able to assert this argument, it will likely become easier for plaintiffs from historically majority communities to assail DEI initiatives.”

Just because employees file more reverse discrimination claims challenging corporate DEI programs, however, does not necessarily mean that those claims are more likely to succeed. Many legal experts predict that well-designed DEI programs should remain legal under Title VII, regardless of the outcome in Ames.

Well-Designed DEI Programs May Not Face Greater Legal Risk

“While the Ames case may contribute to an already growing swell of majority group discrimination claims, it should not fundamentally alter the risk profile of these matters,” said Victoria Slade, counsel with Davis Wright Tremaine LLP, and Alysa Mo, associate at DWT, in a 2024 bulletin on the Ames case.

“Changing the test for majority group discrimination claims does not change the law around DEI,” said Slade and Mo. “Properly executed DEI programs are not unlawful, under any application of Title VII.”

First, even if the Supreme Court accepts Ames’s position and strikes down the “background circumstances” requirement in reverse discrimination claims, that would only affect cases in the five federal circuits that currently use this rule. Nothing would change in the seven federal circuits that currently do not require a showing of “background circumstances” in reverse discrimination claims.

Second, the “background circumstances” requirement only relates to the threshold evidentiary showing that employees must meet to have their reverse discrimination cases move forward. As with all Title VII claims, employers can still defend the case by showing a legitimate, nondiscriminatory reason for the employment decision.

Schwartz sees a potentially larger impact on reverse discrimination claims challenging DEI programs if the Supreme Court rules for Ames. “I do think many (not all) of those challenges will be successful,” said Schwartz, “but there is room for a thoughtful, practical, and legally defensible approach to corporate diversity programs.”

Advice for Employers on DEI in 2025

Employers can reduce the risk of all discrimination claims by focusing on bias reduction measures and thoughtfully designing their diversity initiatives. “As always, an employer’s best risk mitigation strategy is to make fair and well-reasoned employment decisions, without regard to the protected classes of the affected employees,” said Slade and Mo.

Best practices for bias reduction include using objective evaluation criteria, documenting performance-based reasons for managerial decisions, conducting internal audits on diversity outcomes, and educating decision makers about the sources of bias.

Employers should focus on designing diversity initiatives that ensure equal employment opportunities by building more inclusive workplaces. “Most corporate DEI programs are aimed at reducing discrimination, which is consistent with the law of Title VII and should be defended on that ground,” said Tristin Green, law professor at Loyola Law School, who responded via email.

These initiatives may include workplace training on bias reduction, allyship, and inclusive leadership. Employers may broaden recruiting outreach to attract more diverse candidate pools. And employers may invest in more inclusive employee benefits, such as paid parental leave, childcare, and reproductive and maternal health care.

In contrast, using a protected status for a hiring quota, as a tiebreaker criteria, or as the basis for a tangible workplace advantage has always been unlawful under Title VII. The Ames case will not change that regardless of its outcome.

Even after sustained attacks on corporate DEI, employers invested more in diversity programs in 2024 than in 2023, according to Paradigm data from its platform users. Overall, 73% of companies surveyed had incorporated a DEI commitment into their company values. In 2024, 66% of the companies had a DEI budget—up 12 percentage points from 2023. And in 2024, 60% of the companies had an explicit DEI strategy—up 9 percentage points from 2024.

Companies should continue to audit the design of their DEI programs as they enter 2025. Regardless of how the Supreme Court decides the Ames case, corporate leaders should expect increased scrutiny on DEI under Trump’s second administration.

Note: This article does not constitute legal advice.