State AGs warn retail giant Costco for doubling down on 'discriminatory' DEI

Attorneys general in 19 states are warning Costco "to end all unlawful discrimination imposed by the company through diversity, equity, and inclusion" policies to reflect President Donald Trump's recent executive order booting DEI out of federal agencies and warning private sectors to do the same.

"Racial discrimination is both immoral and illegal. Race-based employment hiring violates state and federal law, and as the chief law enforcement officer of Kansas, I intend to enforce the law vigorously," Kansas Attorney General Kris Kobach told Fox News Digital in a statement. 

Trump's executive order, signed during his first week in office, will task the attorneys general with rooting out sectors and organizations that allegedly engage in discriminatory DEI practices. Recommendations will be made for potential lawsuits against violators.

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The order encourages private-sector entities to align with federal civil rights laws and discontinue "discriminatory" practices. Publicly traded companies, large nonprofits, foundations with significant assets, bar and medical associations and higher education institutions with substantial endowments are potential targets for DEI investigations.

Trump also dissolved all DEI within the federal government. While big companies like Target, McDonald's and Walmart backed off from their DEI policies, Costco shareholders voted last week to reject an anti-DEI proposal brought by activist shareholder group National Center for Public Policy Research. The measure would have required the wholesale grocery chain to issue a report on the risks associated with their DEI policies. 

The Costco board said its "commitment to an enterprise rooted in respect and inclusion is appropriate and necessary. The report requested by this proposal would not provide meaningful additional information," according to reports.

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"It’s time to ditch DEI. While other companies right the ship and abandon their illegal, woke policies, Costco has doubled down," Iowa Attorney General Brenna Bird told Fox News Digital in a statement. "I’m putting Costco on notice to do the right thing and eliminate discriminatory DEI. No American should be denied an opportunity because they don’t fit the woke mold." 

The Rev. Al Sharpton led a "buy in" at the Harlem Costco in support of the company rejecting a bid that challenged their corporate DEI policies. The MSNBC host said that he and 100 members of his National Action Network shopped at the store Sunday.

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"Race-neutral practices, on the other hand, honor the founding ideals of this country," reads the letter sent to Costco CEO Ron Vachris by the 19 attorneys general. "Now, the federal government is also focusing on ensuring invidious racebased discrimination no longer finds a home in woke corporations."

The attorneys general want a response within the next 30 days to "either notify us that Costco has repealed its DEI policies or explain why Costco has failed to do so."

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Attorneys general from Alabama, Arkansas, Georgia, Idaho, Kentucky, Ohio, Oklahoma, South Carolina, South Dakota, Tennessee, Texas, Virginia, Louisiana, Missouri, Montana, Nebraska and North Dakota also signed the letter.

Fox News Digital reached out to Costco but did not hear back by the time of publication.

Fox News Digital's David Spector contributed to this report.