Texas Attorney General Ken Paxton (R) has sent a letter to CVS Health warning the company that its Diversity, Equity, and Inclusion (DEI) policies may violate state and federal civil rights laws.
According to the Office of the Attorney General, the letter specifically targets CVS's Supplier Diversity Program, which reserves portions of company contracts for suppliers that meet demographic qualifications established by the company.
Public statements from CVS indicate that eligible suppliers include minority-owned businesses, women-owned enterprises, and businesses owned by individuals who identify with the LGBTQ+ community.
"People must be judged on the basis of merit, not the color of their skin," said Paxton. "My office will stand firmly against racist DEI policies. Whether it is found in hiring processes or contract determinations, I will take a sledgehammer to any radical DEI policies that discriminate against Americans."
The attorney general's office stated that discriminatory supplier diversity programs could potentially violate federal law and referenced a legal opinion issued earlier this year outlining possible liabilities tied to DEI-related practices.
The letter also cites President Donald Trump's Executive Order 14173, which prohibits federal contractors and subcontractors from considering race, color, sex, sexual preference, religion, or national origin in ways that conflict with civil rights protections.
According to the letter, CVS could face significant liability under the Texas Health Care Program Fraud Prevention Act (THFPA) if its practices are found to violate anti-discrimination laws. As a Medicaid pharmacy provider, CVS is required to comply with applicable state and federal civil rights laws while receiving public funding.
The attorney general's office argued that companies receiving taxpayer funds must ensure their policies and programs do not discriminate through what it described as "woke DEI frameworks."
Paxton's warning to CVS marks the latest escalation in Texas officials' broader push against DEI policies in both public and private institutions.
