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Mid-America Milling Case Update

A significant preliminary ruling was issued in 2024 by a federal district court in the Sixth Circuit in a case involving the presumption of disadvantage applied by the U.S. Department of Transportation in administering its Disadvantaged Business Enterprise (DBE) Program. That case was recently dismissed, however, precluding any final ruling on the merits – meaning that the ultimate legality of the presumption will not be decided by the court.

In Mid-America Milling Co., LLC v. USDOT, the court issued a preliminary injunction in favor of two non-minority owned companies that regularly bid on federal highway projects who claimed that presuming disadvantage based on race/ethnicity or gender violates the constitutional rights of non-minorities.

Applying the strict scrutiny standard (under City of Richmond v. J.A. Croson Co.), the district court preliminarily ruled that USDOT did not adequately meet either prong of the standard. With respect to the “compelling state interest” requirement, the court reasoned that the nationwide statistical proof and anecdotal evidence offered was too “general” to meet the standard. In so doing, however, the court expressly recognized that the Sixth Circuit views the factual predicate requirement in a manner different from, or inconsistent with, other federal circuit courts in addressing federal programs.

The court also reasoned that the presumption of disadvantage was not narrowly tailored to remedy any disparities shown in the statistical proffer, because the government did not satisfactorily show that race-neutral efforts at remediation had been meaningfully tried, and also because the program had no logical “end date” when the presumption would no longer be applied/necessary. Based on these findings, the court issued a preliminary injunction in favor of the plaintiffs in states in which they typically bid for federal highway projects.

The case was thereafter set for a trial on the merits, wherein plaintiffs would seek a permanent injunction against the practice/program.

There will not be a final ruling on the merits of plaintiffs’ constitutional claim, however, because the court recently dismissed the case in its entirety as moot. Specifically, the court ruled that the Interim Final Rule (IFR) promulgated by USDOT in October 2025 effectively provided plaintiffs with all of the relief that they sought in the lawsuit – as the IFR eliminated the presumption of disadvantage that plaintiffs claimed was unconstitutional and should not be applied to DOT contracts. Accordingly, the court dissolved the preliminary injunction previously issued, denied all pending matters in the case as moot, and dismissed/closed the case.

Thus, the possibility that other courts might adopt the reasoning supporting the prior preliminary injunction in Mid-America Milling remains, but no final ruling on the ultimate merits will be reached in the case, limiting its significance as precedent.



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