In today’s news and commentary, Texas dismantles their contracting program for minorities, NextEra settles an ERISA lawsuit, and Chipotle beats an age discrimination suit.

Texas Acting Comptroller Kelly Hancock is being sued in state court for allegedly unlawfully dismantling the Historically Underutilized Business (HUB) program, a 1990s initiative signed by former Governor George W. Bush to support minority- and women-owned contractors in state contracting. The lawsuit, filed by four minority businesses and a trade group, claims Hancock exceeded her authority by using emergency rulemaking to revoke certification for more than 15,000 Black, Hispanic, and women-owned businesses without legislative approval or public notice. The program was renamed the Veteran Heroes United in Business program, retaining about 500 disabled veteran-owned firms. Plaintiffs argue the move violates due process and equal protection under the Texas Constitution and jeopardizes millions in existing contracts. Hancock defends her decision as ensuring merit-based, race-neutral contracting, citing the Supreme Court’s ruling in SFFA and a recent executive order from Governor Greg Abbott.

NextEra, an energy company, agreed to an $8 million class action settlement to resolve claims that it mismanaged its 401(k) plan by charging excessive record keeping fees and improperly using forfeited contributions from departing employees. These excess fees are in violation of the Employee Retirement Income Security Act (ERISA). The settlement could benefit more than 21,000 plan participants and represents roughly 37% of their estimated potential damages. The company’s stock reportedly fell by 1.1% after the settlement was announced.

Chipotle beat an appeal of an age discrimination lawsuit after the Tenth Circuit affirmed a lower court’s decision ruling in the company’s favor. The case was filed by former field leader Donald Sousa, who alleged he was fired for age discrimination rather than ongoing pest and cleanliness problems at the New Mexico restaurants he oversaw. Sousa, hired in 2019 at age 54 and recognized as a top performer in early 2022, was terminated a month later after what the company described as persistent food safety and sanitation failures. He claimed younger managers were treated more favorably and filed suit under the New Mexico Human Rights Act. The appeals court found he failed to present sufficient evidence that Chipotle’s stated reasons were a pretext for age bias, emphasizing that courts do not second-guess business decisions absent proof of unlawful discrimination.