Updated August 14, 2026
Internships and Race-Based Hiring
Internships and race-based hiring practices are facing increased legal scrutiny following a lawsuit against the University of California, San Francisco. The case challenges a program that restricted internship eligibility based on race and ethnicity, raising significant concerns for private companies with similar diversity initiatives. As a matter of fact, organizations that screen candidates through demographic criteria may unknowingly violate federal and state anti-discrimination laws. This legal development signals the need for companies to review their internship programs and ensure compliance with equal protection standards to avoid costly litigation and reputational damage.
The UCSF Lawsuit: What Happened and Why It Matters
Overview of the CHAMPS Program
UCSF Benioff Children's Hospital Oakland created the Community Health and Adolescent Mentoring Program for Success (CHAMPS) in 2000. The program's stated goal centers on increasing minority representation in healthcare by recruiting high school students interested in pursuing medical careers.
The three-year internship combines multiple educational components. Students shadow doctors during clinical rotations, attend healthcare classes, and complete hands-on projects. Participants commit seven hours weekly during the school year, earning both high school credit and grades for their work. Beyond clinical exposure, the program provides college preparation support, including SAT prep and application assistance.
CHAMPS maintains highly competitive standards. Students must meet rigorous academic requirements and complete an extensive application process. However, one eligibility criterion stands apart from academic qualifications: only minority students can participate in the program. Non-minority students face explicit exclusion regardless of their academic credentials or healthcare career aspirations.
The Legal Challenge Filed by Pacific Legal Foundation
Pacific Legal Foundation filed a federal lawsuit in February 2025 challenging the program's race-based admissions policy. The case, Hooley v. Regents of the University of California and UCSF Benioff Children's Hospital Oakland, represents a high school student identified as G.H. to protect her privacy.
G.H. maintains a 4.0 GPA and developed her healthcare career interest through her aunt, who works as an assisted living nurse. She applied to CHAMPS and initially received an interview invitation. During the application process, G.H. selected "not listed" when asked to identify her race. When the interview took place on December 12, 2024, the interviewer immediately noted that G.H. had not listed her race or ethnicity in her application. The interviewer pressed G.H. to identify her race, and G.H. responded that she is white.
Five days later, G.H. received notification that she had not been selected for the internship. Pacific Legal Foundation is representing her at no charge.
Key Allegations in the Lawsuit
The lawsuit asserts that CHAMPS violates the Equal Protection Clause of the Fourteenth Amendment, which protects individuals from government discrimination based on race. According to the complaint, excluding students from a state-funded internship program because of their race directly violates this constitutional protection.
The case also alleges violations of California's Proposition 209, which bans racial preferences in public education. California voters have consistently upheld this measure, making race-based eligibility criteria in public educational programs unlawful under state law.
The complaint describes G.H. as a strong candidate whose impressive background, high GPA, and passion for helping others through healthcare made her qualified for the internship. The lawsuit claims that G.H. would have been accepted and admitted to CHAMPS but for UCSF Benioff's race-based admissions policy. The rejection left her humiliated and demoralized.
The family invested significant time and money in the application process, expecting the program could boost G.H.'s future career prospects. Instead, the racially restrictive program treated their daughter as a faceless member of her race rather than evaluating her individual merits.
The plaintiffs are asking the U.S. District Court to declare that CHAMPS violates the Fourteenth Amendment and seek unspecified compensatory damages.
Legal Framework Governing Internship Programs
Three distinct legal frameworks converge to regulate internship programs and race-based hiring practices. Understanding how these laws interact determines whether organizations face liability for their diversity initiatives.
Equal Protection Clause of the Fourteenth Amendment
Ratified in 1868 after the Civil War, the Equal Protection Clause was designed to stop states from discriminating against blacks. The text extends far beyond its original purpose. Although the Clause references "state[s]," courts have read this protection into the Fifth Amendment to prevent the federal government from discriminating as well.
The broad wording led the Supreme Court to hold that all racial discrimination qualifies as constitutionally suspect, including discrimination against whites, Hispanics, Asians, and Native Americans. Courts assess laws using "suspect classifications" under "heightened scrutiny," requiring the government to present important or compelling reasons to justify the discrimination. The discrimination must be carefully tailored to serve those reasons.
Race and national origin qualify as suspect classifications. Gender, immigration status, and wedlock status at birth also receive heightened scrutiny. In contrast, age and poverty have not been elevated to suspect classifications.
California Proposition 209
California voters approved Proposition 209 in November 1996 with 55 percent support. The measure added Section 31 to the California Constitution's Declaration of Rights, prohibiting the state from discriminating against or granting preferential treatment on the basis of race, sex, color, ethnicity, or national origin in public employment, public education, and public contracting.
The California Supreme Court clarified that "discrimination" means "to make distinctions in treatment; show partiality (in favor of) or prejudice (against)" and "preferential" means "a giving of priority or advantage to one person over others". Proposition 209 banned affirmative action involving race-based or sex-based preferences in California.
On November 3, 2020, voters rejected Proposition 16, which would have repealed Proposition 209, by a margin of 57.23% to 42.77%.
Title VII of the Civil Rights Act of 1964
Title VII protects employees against discrimination based on race, color, national origin, sex, and religion. The law applies to employers in both private and public sectors that have 15 or more employees. It also covers federal government agencies, employment agencies, and labor organizations.
Federal courts consistently found that compensation serves as the first test for determining employee status under Title VII. Unpaid interns generally do not receive workplace discrimination protection under federal law. This creates a significant gap since unpaid interns occupy vulnerable positions at the bottom of workplace hierarchies.
Several states closed this protection gap. Maryland extended protections to unpaid interns in 2015 through Senate Bill 604, applying to employers with 15 or more employees. California, Illinois, New York, Oregon, and Washington D.C. enacted similar protections for unpaid interns.
How These Laws Apply to Private Companies
The Fourteenth Amendment's Equal Protection Clause binds government entities and public institutions receiving state funding. Private companies face different constraints. Title VII governs private employers with 15 or more employees, prohibiting discrimination in recruiting, hiring, promoting, transferring, training, and other employment decisions.
Private companies operating in California must navigate both Title VII requirements and state-specific protections for interns. Organizations partnering with public institutions or receiving government contracts may face additional scrutiny under the Equal Protection Clause and Proposition 209.
How Companies Outsource Race-Based Hiring Through Third Parties
Large law firms route their diversity hiring through nonprofit intermediaries to access pre-screened candidates while maintaining distance from race-based selection criteria. This model creates a buffer between employers and potentially discriminatory screening processes.
The SEO Law Firm Pipeline Model
Sponsors for Educational Opportunity launched its Law Fellowship Program in 1986. The program identifies, trains, and develops Black, Hispanic, and Native American law students for summer internships at premier law firms. Among its earliest partners were Fried, Frank, Harris, Shriver & Jacobson LLP; Skadden, Arps, Slate, Meagher & Flom LLP; and Simpson Thacher & Bartlett LLP.
The program expanded substantially. SEO now partners with 34 corporate law firms, including 31 represented in the AmLaw 100, participating in 12 cities across the United States. Each year, the organization selects approximately 100 incoming law students from over 1,300 applicants. Selected fellows attend institutions including Harvard Law School, Columbia Law School, NYU, University of Chicago, Yale, and Stanford.
Before starting their internships, fellows complete a two-week Law Institute. The training covers legal writing, case briefing, rule synthesis, outline preparation, legal analysis, and memoranda drafting. Law school professors conduct lectures and administer simulated exams. Partner firms provide additional workshops on summer assignments, communication etiquette, networking, and relationship building.
Why Organizations Use Intermediary Nonprofits
Participating law firms receive multiple benefits from this arrangement. They access accomplished students who arrive prepared through intensive training. Firms receive a book of résumés for all students in the class and opportunities to host events for the entire cohort throughout the summer. Historically, a majority of fellows receive offers to become summer associates after their first year of law school.
The structure allows sponsor firms to pursue racial quotas while describing their efforts as diversity "targets". Organizations believe partnering with intermediary nonprofits provides legal insulation from discrimination claims.
Legal Risks of Outsourcing Screening Processes
Americans for Equal Opportunity filed an EEOC complaint in May challenging the SEO program as "the largest racially discriminatory hiring pipeline program in the legal field". The complaint represents three members who believe they were excluded because they are not Black, Hispanic, or Native American. The complaint alleges that sponsor firms seek to fulfill racial quotas by prioritizing candidates from preferred races or ethnicities.
A July 2024 decision from the Northern District of California established that outsourcing hiring to third-party vendors does not absolve employers of legal responsibility. Federal law makes clear that employers remain accountable for compliance with the ADEA, Title VII, and other antidiscrimination statutes. Even if vendors face liability, employers stay on the hook for hiring decisions that result in unlawful bias.
Warning Signs Your Internship Program May Be at Risk
Companies face exposure when their programs contain specific markers that courts and agencies identify as discriminatory. Recognizing these patterns allows organizations to correct course before complaints materialize.
Race or Ethnicity Restrictions in Eligibility Requirements
Explicit racial classifications constitute the clearest form of direct evidence of discriminatory intent. When programs condition participation on race, color, or national origin, they establish an express classification that violates anti-discrimination principles. Recruiting exclusively through sources likely to produce applicants of a particular race also raises red flags. Even seemingly neutral language can signal problems. Job advertisements or program descriptions that discourage certain groups through coded terminology create legal vulnerability.
Lower Standards for Preferred Groups
Different procedural processes or substantive standards for minorities and non-minorities may raise an inference of discriminatory intent, particularly when non-minority applicants receive less favorable treatment. The SEO program demonstrates this risk. When law firms make return offers contingent upon first-year grades, the minimum required GPA for Fellows remains lower than the required GPA for students from non-preferred races and ethnicities. Setting arbitrary requirements not essential for the position can be discriminatory if these criteria disproportionately exclude certain groups.
Partnership Programs That Screen Based on Demographics
Organizations that conduct hiring on behalf of employers can engage in discriminatory practices. Employers may be held liable if they knowingly use agencies that employ unlawful screening methods or discriminatory criteria. Most firms that receive interns through SEO let the group conduct all aspects of the vetting process, including interviews, and take whatever interns the nonprofit sends their way.
Client Pressure to Meet Diversity Quotas
Major clients create demand for demographically targeted programs through financial incentives. Microsoft's law firm diversity program has provided extra compensation to its attorneys at Cooley, Morgan Lewis, White & Case, and Latham & Watkins, all of which receive interns through SEO. This pressure from major clients has created demand for a staffing agency like SEO.
Documentation That Reveals Discriminatory Intent
Internal documents and public statements provide evidence of program intent. A LinkedIn profile for the director of SEO San Francisco describes the group's programs as "tailored for underrepresented minorities". The organization's official X account states that the program is for "incoming law students from underrepresented backgrounds". Isolated comments may constitute direct evidence of discrimination if they are contemporaneous with the adverse action or causally related to the decision making process.
Steps to Create Legally Compliant Internship Programs
Rebuilding internship programs to meet legal standards requires deliberate action across multiple operational areas. Organizations must address eligibility requirements, selection processes, training protocols, and vendor relationships to eliminate discrimination risks.
Review and Remove Race-Based Eligibility Criteria
PwC scrapped eligibility criteria blocking white students from applying for internships after becoming embroiled in a discrimination row. The firm removed race-based restrictions on internship and fellowship schemes designed to help students prepare for their accounting exams. Programs previously open to applications only from ethnic minority students now accept all qualified candidates.
Establish Merit-Based Selection Standards
Federal Pathways Programs require agencies to provide equal employment opportunity without regard to race, ethnicity, color, religion, sex, national origin, age, disability, sexual orientation, genetic information, or any other non-merit-based factor. Selection must be based solely on job-related criteria. Develop clear, consistent criteria for assessing candidates' qualifications, skills, and experience using objective measures such as work samples or performance tests.
Train Hiring Teams on Anti-Discrimination Laws
Provide training on how to identify and avoid unconscious bias and how to apply objective criteria for screening. Before each interview, remind interviewers not to solicit questions concerning any protected class, including well-intentioned questions about applicants' spouse, family, religious or political affiliations.
Audit Third-Party Partnerships and Vendors
Third-party vendors can create compliance risks such as improperly storing customer data or engaging in illegal business practices. Federal contracts now require counterparties to certify that they do not operate any programs promoting DEI that violate any applicable federal anti-discrimination laws.
Document Your Non-Discriminatory Selection Process
Conduct interviews via a panel of at least two persons using a scored standard questionnaire narrowly tailored to the job description. Take objective notes and score all candidates.
Create Equal Access Pathways for All Applicants
Advertise in a wide variety of sources rather than only one forum to avoid excluding certain candidate groups. Cast a wide net across college campuses, trade magazines, general internet job sites, and state-specific job forums.
Conclusion
The UCSF lawsuit demonstrates that race-based internship programs face serious legal challenges under federal and state anti-discrimination laws. Companies can no longer rely on intermediary nonprofits to shield them from liability, as shown by recent court decisions holding employers accountable for outsourced screening processes.
Your organization should conduct an immediate audit of internship eligibility requirements, partnership agreements, and selection processes. Without reservation, programs containing racial restrictions or dual standards for different demographic groups create costly exposure to litigation and reputational damage.
By the time complaints reach federal agencies, the damage is already done. Shift to merit-based selection criteria now to protect your company while building genuinely inclusive pathways for talented candidates.
References
[1] – https://www.courthousenews.com/berkeley-family-sues-uc-system-claims-daughter-was-rejected-from-internship-because-she-is-white/
[2] – https://finance.yahoo.com/news/race-row-forces-pwc-let-122332073.html
[3] – https://www.americanbar.org/groups/litigation/resources/newsletters/diversity-inclusion/how-seo-law-provides-a-path-for-underrepresented-students-into-corporate-law/
[4] – https://www.justice.gov/crt/fcs/T6Manual6
[5] – https://www.justiceatwork.com/signs-of-discrimination-in-the-hiring-process/
[6] – https://www.whitehouse.gov/presidential-actions/2025/01/ending-illegal-discrimination-and-restoring-merit-based-opportunity/
Call Setyan Law at (213)-618-3655 to schedule a free consultation.
