If someone I knew was always making racist comments that were offensive to me then I'd probably not try to be around them often. If it was an occasional comment I may make a small, quick response about it not being nice/appropriate and try to change the topic of conversation. Ultimately I can't change someone elses opinion or attitude to things. If I can't look past it then yes, I may try not to associate myself with that person, but if I appreciate all te good things about that person more I'd probably just look past it. I understand that you don't want your daughter to think this way, but in my opinion, she will hear these comments during her lifetime whether you keep her away from them now or not. When my DD is eventually exposed to things like this I'll probably try to talk to her about why I feel it is not appropriate and hope she takes on that same attitude. Ultimately I can't control her thoughts either...