Transgender advocacy group sues South Dakota for discrimination – and wins $300,000

In a blow for Republican governor Kristi Noem, the state of South Dakota has been forced to issue an apology letter and a $300,000 payment to transgender advocacy group The Transformation Project, following the abrupt cancellation of a Department of Health contract in 2022, reports RawStory.

The contract, funded by federal resources, aimed to fund a community health worker position for the LGBTQ+ community from the group’s Sioux Falls headquarters.

On their website, The Transformation Project says “our mission is to support and empower transgender individuals and their families while educating communities in South Dakota and the surrounding region about gender identity and expression.”

The contract cancellation occurred on Dec. 16, 2022, after a conservative news outlet questioned Republican Gov. Kristi Noem about the $136,000 contract.

Gov. Noem is well known for her anti-LGBTQ+ stance, and once managed to avoid discussing LGBTQ+ rights with a star of HBO’s We’re Here by allegedly hiding away in her office.

Speaking about the cancellation at the time, Susan Williams, executive director of the Transformation Project, said in a statement that the cancellation of the contract and national media attention on the group had been “overwhelming and difficult,” adding that the organisation came under intense scrutiny from publications that “peddle falsehoods about transgender people and perpetuate harm and discriminate against them.”

The lawsuit by the Transformation Project argued that the contract cancellation was a discriminatory decision.

The lawsuit cited Gov. Noem’s public comments on transgender individuals and her response through spokesperson Ian Fury as evidence of discriminatory intent. Fury claimed that the contract was signed without Gov. Noem’s knowledge or approval.

The state countered by listing alleged failures by The Transformation Project as reasons for the cancellation, but the lawsuit contended that these were attempts to legitimise what was, essentially, a discriminatory action.

Jack Fonder, the community health worker hired through the contract, joined The Transformation Project in filing the lawsuit. As part of the settlement, the current Department of Health secretary, Melissa Magstadt, issued an apology letter to executive director Susan Williams on Jan. 17, acknowledging the unequal treatment of The Transformation Project.

“On behalf of the State of South Dakota, I apologise that the Transformation Project’s contract was terminated and for treating the Transformation Project differently than other organisations awarded Community Health Worker contracts,” the letter read.

The letter goes on to “emphasise that all South Dakotans are entitled to equal treatment under the law — regardless of their race, colour, national origin, religion, disability, age, or sex.”

The settlement includes a $300,000 payment, more than double the contract amount, covering attorney fees. The state also had to commit not to discriminate against The Transformation Project in violation of state or federal law in any services, programs, or activities.

“We are vindicated as the government has acknowledged what we knew the very day we learned of our contract’s cancellation: that we did not break any procedures and we did not fail to meet the terms of the CHW contract in any way,” Williams said in a statement to South Dakota Searchlight. “To put it simply, the government canceled our contract because of the very population we serve – the transgender community.”

The settlement also enables The Transformation Project to retain Jack Fonder as a community health worker, and the group says that they intend to continue applying for future contracts with the state.

Gov. Noem’s spokesperson, Ian Fury, did not respond to requests from RawStory for comment.