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The Defense Department has reached a sweeping settlement with tens of thousands of people who were dismissed from military service because of their sexual identity, potentially paving the way for veterans to upgrade their discharge status and receive a range of benefits they had been denied.
The settlement, which the Pentagon agreed to late last week and was filed on Monday in Federal District Court in Northern California, must still be approved by a judge. It applies to a group of more than 30,000 veterans who received less-than-honorable discharges or whose discharge status lists their sexuality.
Those who leave the military with less-than-honorable discharges usually do not receive all of the benefits they would have been eligible for through the Veterans Affairs Department, including health care from the V.A.’s hospitals and clinics, educational benefits and access to job networks.
While the Defense Department has taken steps under the Biden administration to upgrade discharges and restore benefits for L.G.B.T.Q. veterans, the settlement is expected to make the process much easier.
It would also help former service members remove references to their sexuality from their discharge paperwork. If a federal judge approves the settlement, it will be binding by law.
When reached for comment, the Pentagon referred to the Justice Department, which declined to comment.
Sherrill Farrell, 63, a Navy veteran who is the lead plaintiff in the lawsuit, said in an interview that news of the settlement was “overwhelming.”
Ms. Farrell, who is lesbian, enlisted in the Navy in 1985. She was outed by a bunkmate and kicked out of training after only 10 months as a fireman apprentice. Her dreams of following the footsteps of her father and grandfather by serving in the military were crushed, and she never applied for benefits.
After the class-action lawsuit was initially filed in August 2023, the Defense Department began what it called a proactive review of service members who were discharged during the era of “don’t ask, don’t tell.”
That review concluded in October, and more than 800 service members who were kicked out had their discharges upgraded to honorable. It was the first time that the department had systematically reviewed discharges related to sexual identity.
But the settlement that the Pentagon agreed to on Friday would go even further, creating a streamlined process that would apply to more people in a larger time frame.
The settlement is one of several steps that the Biden administration has taken to remedy the effects of policies felt by L.G.B.T.Q. service members for decades. In June, President Biden offered clemency to some 2,000 veterans who were convicted of engaging in gay sex, which was outlawed by the military for more than 60 years, in order to address what he called a “historic wrong.”
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