So how are these "private parties" homecoming and prom functions. I understand that the homecoming king and queen are elected by the students on a popularity/looks basis. (these assumptions may be based on movies) And 'prom' is a school term for a graduation function. I don't mean to be antagonistic, and merely seek some informed opinion on the subject. It's a dodge that shouldn't be legal.
Exact details vary from place to place, and I can't say anything about the specific case you mentioned in the OP, but I'll give a shot at explaining it.
In a typical American high school, there are dances. These are school functions. Common ones include Homecoming and Prom, but there may be others throughout the year.
Because they are school functions, they must follow school policies and all laws. That means, these days, they must allow white people and black people and all other races, and they can't discriminate based on religion, and all of the usual restrictions apply. Of course, it wasn't always that way. At one time, they could, and did, discriminate against black people. Then, once upon a time, judges started telling school officials that this was unacceptable. No discrimination allowed.
In areas where segregation had been normal, this caused much wailing and gnashing of teeth. A lot of white parents were distraught at the possibilities that white teenagers and black teenagers might be at the same dance. These concerned parents understood that if they were at the same dance, they might actually dance together.....and they knew where that might lead......and no way in heck were they going to allow the remotest possibility that they might have dark skinned grandchildren. Therefore, they did what every sensible group of racists would do. They cancelled dances.
But, the kids and even the parents thought the dances were a good idea, as long as they were segregated, so they started holding private parties at outside functions. Prom, in particular, which had often been held someplace more fancy than the school gym, became an invitation only private party. As others have noted, there is no law against inviting all the white people to a party and none of the black people.
Now this is where details got a little murky and varied from place to place. Some schools continued to hold Prom, but the white parents held their own invitation only private party as well. The official prom was integrated, but the private party was whites only. In practice, what that meant is that the official, school affiliated party was the "black prom", and the invitation only one was the "white prom". This varied from one place to another in details, but the pattern was basically the same. Once, there had been an official dance associated with the school. Then, when segregation was enforced, the white people started holding their own private parties with no official school involvement.
Over the years, most places gave up this practice, and just went back to having a single prom, either school affiliated or not. However, in some places, the segregation has lingered. (And, it should be noted, most places didn't ever put up a fuss in the first place. When ordered to hold integrated dances, most places held integrated dances.)
Curiously, though, we are starting to see the same phenomenon coming up again with respect to gay people. A lot of schools had a "couples only" policy for some or all dances, and when two girls showed up as a couple, some people said that wasn't what they meant and that wouldn't be allowed. I've also heard of lawsuits where schools enforced a dress code for dances, and when a girl showed up in a tuxedo, while her date wore a nice dress, there have been legal actions about whether or not the school could enforce the dress code. Meanwhile, in some communities, after being told that they couldn't forbid same sex or cross dressing couples, decided they just wouldn't hold a dance at all.......and then parents started organizing their own, private, dances.
