August 8, 2023

Good morning, Broadsheet readers! The first pill to fight postpartum depression was approved by the FDA, pregnant workers will soon see expanded accommodations, and a lawsuit against a small VC fund has big implications. Have a thoughtful Tuesday.

– Delay and distract. Last week, a conservative activist group behind the Supreme Court case that limited affirmative action in higher education sued early-stage venture capital fund Fearless Fund for racial discrimination. Atlanta-based Fearless Fund, led by general partners Arian Simone and Ayana Parsons, backs women of color entrepreneurs.

When the Supreme Court issued its affirmative action decision in June, diversity and inclusion experts warned that the corporate world could soon see similar challenges come its way. “Everyone’s been waiting for the other shoe to drop,” says Susan Lyne, managing partner at BBG Ventures, another early-stage fund that invests in diverse founders. Now, it has.

Fearless Fund is somewhat of an underdog target—perhaps an intentional strategy. Its largest checks are around $2.5 million. The grant program specifically targeted by this lawsuit awards $20,000 to Black women entrepreneurs—a small effort to mitigate the reality that Black women founders receive less than 1% of U.S. VC funding. In its suit, the American Alliance for Equal Rights, founded by anti-affirmative action activist Edward Blum, alleges that Fearless violates the Civil Rights Act prohibiting racial bias in private contracts by only awarding grants to Black women. The fund has so far declined to comment on the suit.

Arian Simone, left, presents a Fearless Fund grant in 2022. Paras Griffin/Getty Images for Essence The outcome of this case could have implications far beyond one small Atlanta-based fund, from larger VC firms that explicitly invest in diverse founders to diversity and inclusion efforts among the behemoths of corporate America.

“I anticipated this and knew this would happen,” says Brittany Hale, an attorney currently serving as the interim CEO of digitalundivided, the organization that supports and tracks data about Black and Latinx women founders and entrepreneurs. “Attempts like this lawsuit only work to distract and delay from the important progress that needs to be made.”

While Fearless is relatively small, larger organizations are likely to come to the fund’s aid. Hale expects “strange bedfellows” to file amicus briefs in this case given the potential implications of the outcome. Mastercard has partnered with the fund on its grant program, for example, and other investors in the fund include Bank of America and Costco.

Lyne of BBG Ventures isn’t too worried about the potential fallout at her own fund. BBG Ventures’ investment thesis is to back teams with at least one diverse founder. “I could defend very strongly that this is based on our best assessment of the investment opportunity,” she says. “But I do think there will be suits brought against funds that are focused on diverse founders or female founders.”

Hale understands why founders who often receive this kind of funding might be nervous. But she reminds them: “They are innovators, they are powerful, they are successful. And they have succeeded in climates worse than this and will continue to succeed and prevail in climates better than this.”

Emma Hinchliffe
emma.hinchliffe@fortune.com
@_emmahinchliffe

The Broadsheet is Fortune’s newsletter for and about the world’s most powerful women. Today’s edition was curated by Joseph Abrams. Subscribe here.

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ALSO IN THE HEADLINES

- Groundbreaking treatment. The first pill specifically designed for postpartum depression has been approved by the FDA, and medical professionals hope that the non-intensive medication will combat stigma and deliver the help new mothers need. The pill, which starts working much faster than traditional antidepressants and is only meant to be taken for two weeks, will likely be available after a 90-day review. New York Times

- Workplace relief. The Pregnant Workers Fairness Act has gone from legislation to implementation. The Equal Employment Opportunity Commission outlined a plan to allow pregnant workers to to seek job restructuring, change their work schedules, take more breaks, and work from home without retaliation. Bloomberg Law

- Honest work. In 2018, Lina Hidalgo, then in her 20s, shook up Texas politics when she ousted an incumbent to become Harris County judge, an influential post. Now she's combatting political stereotypes another way: by being honest about her mental health. Hidalgo announced that she has taken a leave of of absence to treat clinical depression. Houston Landing

- Tragedy in Italy. Bloomsbury Publishing USA president Adrienne Vaughan has died at the age of 45 after a boating accident in Italy. The publishing industry veteran was a board member of the Association of American Publishers and on its diversity, equity, and inclusion committee. Publishers Weekly

MOVERS AND SHAKERS: Angela Ahrendts, former Apple SVP of retail, will join Kim Kardashian's SKKY Partners as senior operating adviser. Rebecca Kramer Rosengard has been named senior vice president of marketing at My Code. Pilar Manchón has been appointed to the board of directors at Eventbrite. Stephanie Fowler has been appointed as president of capital access at the Institute for Entrepreneurial Learning, and Gina Nisbeth has been appointed as chair of the Institute for Entrepreneurial Learning board of directors.

IN CASE YOU MISSED IT

- Supporting role. Tirana Hassan, executive director of Human Rights Watch, has spent decades in the aftermath of some of the world’s worst human rights offenses and campaigns. Now, she’s speaking out about the mental trauma and self-medication in human rights workers and the importance of support. Financial Times

- On trend. Social media disrupted traditional fashion magazines. Now some former fashion journalists are reviving highly-curated fashion and beauty recommendations in Substack newsletters and Facebook groups, building affiliate-based communities with tens of thousands of followers. New York Times

- Judges like us. A panel of three retired female high court judges in India will oversee investigations into sexual violence, among other concerns, that occurred during a period of unrest in the state of Manipur. Survivors of sexual violence in Manipur claim that local authorities failed to protect vulnerable women from attacks. Bloomberg

- Telling her story. Viola Fletcher was just 7 years old when her neighborhood of Tulsa, Oklahoma was burned down by a racist mob. She's now the oldest known living survivor of the Tulsa Massacre, and Fletcher’s new book, Don’t Let Them Bury My Story, has made her the oldest woman in the world to release a memoir. The 19th

ON MY RADAR

The protests inside Iran’s girls’ schools The New Yorker

The NBA player who might see his mom at union meetings New York Times

This festival is Coachella for Black influencers. Brands want in Washington Post