Transgender org gets $300K from settlement in lawsuit against South Dakota

South Dakota issued an apology letter and a payment of $300,000 to transgender advocacy group the Transformation Project under the terms of a settlement reached last week.

Last year, the group sued Gov. Kristi Noem (R) and the head of the state’s Department of Health alleging discrimination after South Dakota ended its contract with the organization in December 2022.

Related: Trans group sues South Dakota governor over yanked grant funding

A spokesperson for Noem said the state “does not support this organization’s efforts.”

The Transformation Project’s contract with South Dakota provided $136,000 in federal funds for the group to hire a community health worker, Jack Fonder, to serve the LGBTQ+ community. After the Noem administration announced it had canceled the contract, right-wing media outlet The Daily Signal claimed she did so after its journalists questioned her about the contract. Noem’s chief of communications, Ian Fury, told the outlet, “South Dakota does not support this organization’s efforts, and state government should not be participating in them.”

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As the South Dakota Searchlight reports, the Sioux Falls-based group’s lawsuit cited Fury’s comments, as well as Noem’s attacks on the rights of transgender youth as proof of discrimination.

As part of the settlement reached last Thursday, the state agreed to pay the Transformation Project $300,000. South Dakota Department of Health secretary Melissa Magstadt also wrote an apology letter to Fonder and the organization’s executive director, Susan Williams

“On behalf of the State of South Dakota, I apologize that the Transformation Project’s contract was terminated and for treating the Transformation Project differently than other organizations awarded Community Health Worker contracts,” Magstadt wrote. “I want to emphasize that all South Dakotans are entitled to equal treatment under the law—regardless of their race, color, national origin, religion, disability, age, or sex. South Dakota is committed to ensuring that no person is excluded from participation in, denied the benefits of, or subject to discrimination under any program, activity, or service that it provides.”

“This settlement marks a significant milestone in our ongoing commitment to civil rights advocacy,” said Brendan Johnson, the former U.S. attorney for the District of South Dakota who represented the Transformation Project. “We commend the resiliency of the LGBTQ+ community and remain committed to vigorously upholding their rights.”

“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 put it simply, the government canceled our contract because of the very population we serve – the transgender community.”

In his own statement, Fonder said that the controversy surrounding the contract and his position with the Transformation Project had resulted in him being outed as a trans man. He cheered the settlement, which will allow the organization to keep on staff, as a win for South Dakota’s trans community.

“We promise to keep up the battle for transgender rights and to make sure they have access to the resources they require,” he said.

The settlement, Williams said, “sends some clear and strong messages: that discrimination against transgender people will not be tolerated in South Dakota, and that when the government discriminates against transgender people, there are consequences. We hope that this is a message that reverberates across our state.”

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