In Holman v. Vilsack, the U.S. Court of Appeals for the Sixth Circuit had a split decision on whether the federal government was justified in defending race-based debt relief for socially disadvantaged farmers and ranchers under the American Rescue Plan Act. The issue was important because prevailing plaintiffs are not eligible for attorney fees if the government’s position was considered “substantially justified.” Judge Stranch, in the majority opinion, stated that the government’s defense of the program’s race-based classifications was justified due to evidence of intentional discrimination against socially disadvantaged farmers and ranchers. On the other hand, Judge Larsen dissented, arguing that the government failed to show past intentional discrimination against all groups included in the program, making their position not substantially justified. Ultimately, the court did not definitively rule on whether Holman was a prevailing party under the Equal Access to Justice Act. According to Vitolo, a policy is not considered narrowly tailored if it is either too broad or not inclusive enough in its use of racial classifications. In this case, the program offering debt relief to farmers and ranchers includes groups that have not been shown to have faced discrimination. Providing debt relief to Native Hawaiian farmers and ranchers does not address past discrimination against Black farmers and ranchers, creating a significant disparity between the intended goal and the means to achieve it. This mismatch is too great for strict scrutiny to overlook, as stated in Students for Fair Admissions, Inc. v. President and Fellows of Harvard Coll.
The Government’s argument that they were not required to provide specific examples of intentional discrimination against every racial category included in their program at the preliminary injunction stage is not supported by the Supreme Court. To justify race-based government action, specific instances of past discrimination must be remedied, as emphasized in Students for Fair Admission, Inc. The government cannot show a compelling interest in providing benefits to a particular racial group without evidence of intentional discrimination against that group. Without such evidence, there is no basis for the government’s position that § 1005 should not be preliminarily enjoined.
The government’s arguments were found to be in conflict with established case law, making their position not substantially justified. Therefore, Holman is entitled to fees and costs as a prevailing party, with no special circumstances warranting an unjust outcome. In conclusion, the dissenting opinion holds that the government’s position was not justified, and Holman should be awarded fees and costs.
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