Bank to Face Bias Claims based on Ceremonial Use of Controlled Substance
A judge in the Western District of Wisconsin recently held that a Native American organization can prosecute its discrimination claims under state and federal laws based on the ceremonial use of peyote.
The Native American organization sued a Wisconsin bank for race discrimination under federal law and religious discrimination under Wisconsin law. The organization alleges that the bank denied its application for a commercial checking account because of its ceremonial use of peyote. As part of its application, the organization included documents referencing its Native American membership, religious affiliation, and ceremonial peyote use. According to the organization, a branch manager and a branch supervisor stated that the application has been denied because peyote was illegal under Wisconsin law. Sometime after, the bank’s CEO cited other reasons unrelated to the organization’s ceremonial peyote use, including underwriting risks.
On a motion to dismiss, the judge rejected the bank’s arguments that the organization had not plausibly pled its race discrimination claims because peyote use was unrelated to Native American identity. The judge found that the organization had plausibly alleged that the bank had intentionally discriminated against it because of race. Specifically, the judge found that the organization had pled that its membership was solely Native American; that it operated for spiritual and religious purposes; that its application was denied because of its ceremonial peyote use; and that there was a close relationship between ceremonial peyote use and Native American identity. The judge also found that the organization had plausibly pled that the reasons cited by the bank’s CEO were illegitimate and pretextual, in part, because of the bank’s failure to cite specific laws or regulations supporting those reasons. For similar reasons, the judge also found that the organization had plausibly pled its religious discrimination claims.
