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The state of Missouri filed a lawsuit against Starbucks on Tuesday, accusing the coffee giant of using its diversity, equity, and inclusion (DEI) initiatives to engage in systematic discrimination based on race, gender, and sexual orientation.
Filed in federal court in St. Louis, the lawsuit alleges that Starbucks linked executive pay to meeting racial and gender-based hiring quotas. It also claims the company favored certain groups for training and advancement opportunities and maintained a quota system to diversify its board of directors.
“All of this is unlawful,” Missouri’s Republican Attorney General Andrew Bailey said in the complaint, arguing that the policies violate federal and state civil rights laws.
Bailey also alleged that Missouri consumers face higher prices and longer wait times at Starbucks because the company prioritizes diversity over hiring the most qualified workers.
Starbucks responds
Unsurprisingly, Starbucks rejected the accusations, calling them inaccurate.
“We are deeply committed to creating opportunity for every single one of our partners (employees). Our programs and benefits are open to everyone and lawful,” the company said in a statement.
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The lawsuit targets policies adopted by Starbucks following the 2020 murder of George Floyd, which prompted many corporations to reevaluate their employment practices. It seeks to end alleged discrimination, require Starbucks to rehire affected employees, rescind disciplinary actions, and pay unspecified damages.
DEI policy changes
The lawsuit comes as amid intense Government scrutiny over DEI practices. Buoyed by right-wing voices and corporations willing to buckle under pressure from social media commentators, Donald Trump has actively opposed DEI initiatives, leading some companies to reassess their policies.
The complaint cited Starbucks CEO Brian Niccol’s history of supporting environmental, social, and governance (ESG) goals, suggesting that his leadership influenced the company’s diversity strategies. Niccol previously led Chipotle, where he promoted similar initiatives.
Previous Starbucks rulings
It is not the first legal challenge to Starbucks’ DEI policies. In August 2023, a federal judge in Spokane, Washington, dismissed a shareholder lawsuit challenging Starbucks’ diversity policies.
The judge ruled that the case involved public policy issues better addressed by lawmakers and companies, not the courts.
Missouri’s lawsuit seeks to halt alleged discrimination at Starbucks, require corrective actions, and impose damages. While the Government is able to control Federal policy, which has seen the cancellation of DEI programs across Government departments, the outcome of this lawsuit could have implications for private corporate diversity practices nationwide and crank up the political pressure on businesses to reverse aspects of their hiring strategies.
