“Federal contractors have an obligation to ensure that their hiring practices and policies are free of all forms of discrimination,” Patricia Shiu, director of the DOL’s Office of Federal Contract Compliance Programs, said in a statement. “Our nation’s taxpayers deserve to know that companies employed with public funds are providing equal opportunity for job seekers.”

Rose Darling, a spokeswoman for the DOL’s office in San Francisco, said the investigation was initiated after Palantir was selected from a random audit of government contractors. She noted that in addition to cancellation of government contracts, the suit could result in Palantir being barred from consideration from future ones for a period to be determined by the judge.