Is the Lincoln Law Reversing Modern DEI Progress?
By Darius Spearman (africanelements)
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The United States Department of Justice is currently using an old law to change how companies hire workers. This law is the False Claims Act. People often call it the “Lincoln Law” because it started during the American Civil War. Today, the government uses this tool to investigate Diversity, Equity, and Inclusion programs. These programs are often called DEI. Many federal contractors now face questions about whether their hiring plans are legal. Workers are starting to worry that these investigations will end fair hiring practices for the Black community. It is a major shift in how the government views civil rights and corporate responsibility (blackenterprise.com).
For many years, the government encouraged companies to focus on diversity. This was done to fix old problems of unfairness in the workplace. However, the current administration under President Donald Trump has a different view. The Department of Justice now argues that some DEI programs might actually be a form of fraud. This happens if a company tells the government it follows all laws but actually uses hiring practices that discriminate. This theory of “legal falsity” has put many large corporations in the crosshairs of federal investigators. It turns a cultural debate into a massive financial risk for anyone doing business with the federal government (bakermckenzie.com, eyeonenforcement.com).
The Civil War Origins of the Lincoln Law
To understand what is happening today, one must look at the year 1863. The United States was in the middle of the Civil War. President Abraham Lincoln faced a big problem with the people selling supplies to the Union Army. Some contractors were very dishonest. They sold the government “lame horses” that could not run. They sold “sawdust-filled muskets” that would not fire. They even sold “rancid rations” that made soldiers sick. These war profiteers were stealing money while the nation was in a crisis (wikipedia.org).
Congress passed the False Claims Act on March 2, 1863, to stop this theft. The law included a special rule called “qui tam.” This rule allows a private citizen to sue a company on behalf of the government. These citizens are often called whistleblowers or “relators.” If they win the case, they get to keep a portion of the money the government recovers. This was a way to “deputize” regular people to find fraud that the government could not see on its own. It remains a very powerful tool because it rewards people for speaking up (whistleblowerlaw.com, wikipedia.org). This era of history shows that post-Civil War labor struggles have always required strong legal oversight to protect the public interest.
FCA Total Recoveries Since 1986
The financial power of the False Claims Act is growing.
From Affirmative Action to Modern DEI
The way companies hire diverse workers has changed over many decades. In 1965, President Lyndon B. Johnson signed Executive Order 11246. This order was very important for the Black community. It said that federal contractors could not discriminate against workers. It also required them to take “affirmative action” to make sure everyone had an equal chance. This was a response to the fact that Black workers fought for economic justice against many obstacles for generations (blackenterprise.com, ucla.edu).
Over time, these affirmative action plans grew into broader DEI programs. Companies began to look at culture and belonging, not just numbers. They started using things like “blind resume screenings” and “unconscious bias training.” By the 2020s, the Biden administration was encouraging these programs across all federal agencies. For nearly sixty years, companies were told that they *must* report their diversity efforts to stay in good standing with the government. Now, the rules are changing rapidly under a new political climate (thinkbrg.com, stanford.edu).
The 2025 Civil Rights Fraud Initiative
In early 2025, the Department of Justice launched a new plan called the “Civil Rights Fraud Initiative.” This initiative targets major companies like Google and Verizon. The goal is to see if these companies are committing fraud by keeping DEI programs that the government now considers illegal. This shift began with Executive Order 14173, signed by President Trump. This order aims to end what it calls “illegal discrimination” in the name of diversity (bakermckenzie.com, akingump.com).
The Department of Justice is using a specific legal theory to go after these companies. It is called “false certification.” Every time a company sends a bill to the government, they must promise they are following the law. The government now argues that if a company has an “illegal DEI” program, their promise is a lie. This means that every single invoice they sent could be considered a “false claim.” This creates a massive legal trap for companies that are still trying to follow older diversity rules (governmentcontractsnavigator.com, insidethefalseclaimsact.com). This struggle highlights the tension in federalism and the power of the national government to set the rules for all contractors.
The Toll of DEI Rollbacks (April 2025 Data)
Specific groups are losing progress as programs are dismantled.
The High Cost of Treble Damages
The reason companies are so afraid of the False Claims Act is the money. If a court finds a company guilty, they do not just pay back what they “stole.” They have to pay “treble damages.” This means they must pay three times the amount of the loss to the government. In some cases, the government argues that the entire contract was a waste because of the fraud. If a company has a one-billion-dollar contract, they could end up owing three billion dollars in penalties (jdsupra.com).
In addition to these triple damages, there are automatic fines for every single false claim. These fines are between $13,000 and $27,000 for each invoice. Large companies send thousands of invoices every year. When you add all these numbers together, the total can easily reach billions of dollars. This financial pressure is designed to make companies change their behavior quickly. It makes DEI programs look like a dangerous financial liability instead of a social good (whistleblowerfirm.com, whistleblowerlaw.com).
Why Workers Fear the Chilling Effect
While the lawyers argue over money, regular workers are feeling the pressure. Many employees fear that companies will stop all efforts to be fair to avoid a DOJ audit. This is often called a “chilling effect.” If a manager is afraid that a mentorship program for Black professionals will trigger a lawsuit, they may just cancel the program entirely. This could leave many talented people without a way to move up in their careers (blackenterprise.com, bet.com).
There is also a fear that “merit-only” hiring will be used to hide old biases. In the past, internal networks and referrals often left out Black candidates. DEI programs were meant to break those old cycles. Without them, workers worry that hiring will go back to the way it was before the Civil Rights movement. Data from 2025 already shows that Black women are losing jobs at a higher rate than other groups. This suggests that the rollback of these programs is already having a real-world impact on families (blackenterprise.com, hirebee.ai).
How a DEI Fraud Case Starts
The Legal Fight Over Vagueness
Not everyone agrees that the government has the right to use the False Claims Act this way. In February 2025, a federal court in Maryland issued a temporary stop to some of these rules. This is called a “preliminary injunction.” The judge said that the government’s definition of “illegal DEI” was too vague. If a law is not clear, companies do not know how to follow it. This can violate their rights under the Constitution (bakermckenzie.com, governmentcontractslaw.com).
This court ruling is a small victory for supporters of diversity. It means the government cannot punish companies for these certifications while the case is still in court. However, the DOJ can still investigate companies and look at their hiring data. The threat of a multi-billion dollar lawsuit is still there. Many experts believe this fight will eventually go to the Supreme Court. Until then, companies and workers remain in a state of uncertainty about the future of fair hiring in America (wilmerhale.com, seyfarth.com).
Conclusion: A New Era of Enforcement
The move to use the False Claims Act against DEI programs is a historic change. It shows how a law meant to catch war profiteers in the 1800s can be reshaped for modern political goals. The “Lincoln Law” was once a shield for the Union Army. Today, it is being used as a sword against corporate diversity policies. For the Black community, this is a concerning development that threatens decades of hard-won progress in the workplace (blackenterprise.com, insidethefalseclaimsact.com).
As the “Civil Rights Fraud Initiative” continues, the stakes remain incredibly high. Companies must decide if they will stand by their diversity goals or abandon them to avoid financial ruin. Workers must navigate a landscape where programs designed to help them are being labeled as “fraud.” The history of the False Claims Act teaches us that the government has a long memory when it comes to money. Now, that memory is being used to question the very meaning of equality and fairness in federal contracting (eyeonenforcement.com, jdsupra.com).
About the Author
Darius Spearman is a professor of Black Studies at San Diego City College, where he has been teaching for over 20 years. He is the founder of African Elements, a media platform dedicated to providing educational resources on the history and culture of the African diaspora. Through his work, Spearman aims to empower and educate by bringing historical context to contemporary issues affecting the Black community.
