In a stunning twist, a federal appeals court in the U.S. has blocked the Fearless Fund from awarding grants to Black women entrepreneurs. The latest injunction comes less than two weeks after a U.S. court allowed the organization to offer its Fearless Strivers Grant to the underrepresented group.

The American Alliance for Equal Rights, a conservative organization run by anti-affirmative action activist Edward Blum, was granted victory by the 11th Circuit Court of Appeals in a 2-1 verdict.

The justices who endorsed the injunction, judges Robert Luck and Andrew Brasher, were appointed by former President Donald Trump. Conversely, Judge Charles Wilson, appointed by former President Bill Clinton, resisted the injunction.

Fearless Fund is a venture capital fund focused on providing capital and support to businesses founded by women of colour. The fund was established by Arian Simone and Keshia Knight Pulliam in 2019. Its primary mission is to address the significant funding gap for women of colour entrepreneurs in the U.S., its website reads.

Moreover, it aims to invest in and support early-stage startups led by women of colour in various industries, including technology, consumer products, and more. In addition to financial investments, the fund provides mentorship, networking opportunities, and resources to help these entrepreneurs grow and scale their businesses.

The decision stops the grant application process until an independent panel of judges determines whether the Strivers Grant can be used while the case is being litigated in district courts.

Last week, Senior U.S. Judge Thomas Thrash denied a preliminary injunction that would’ve stopped grants distributed by the Atlanta-based Fearless Fund.

Alphonso David, Fearless Fund’s legal counsel and CEO of the Global Black Economic Forum, released a statement following the decision, saying the fund and its legal team “respectfully disagree with this Court’s decision, appreciate the important points raised by the dissent, and look forward to further appellate review.”

The website to apply for the Fearless Strivers Grant was taken down as of Saturday, according to TechCrunch.

At a time when less than one per cent of venture capital funding goes toward Black women entrepreneurs, Thomas Dorwart, founder of his law firm, Thomas C. Dorwart Law, said he was dumbfounded by the decision, according to TechCrunch.

He said that after the civil war and reconstruction, Section 1981 of the Civil Rights Act was designed to shield Black Americans from economic inequality and discrimination while allowing them to enter into contracts with white Americans.

“The whole purpose of the statute is turned on its head by the argument of the plaintiff, and it is a perversion, the Justice says, to apply it this way because it’s actually supposed to do what Fearless Fund is doing, which is to provide economic opportunity for Black Americans,” he told TechCrunch.

While Dorwart said he’s doubtful the Fearless Fund can win in the 11th Circuit Court, which is conservative-leaning, the Supreme Court is likely the organization’s last hope. However, he added that only a handful of moderate judges are there. Six Republican judges sit on the U.S. Supreme Court, according to its website.