California Court To Decide On Law Requiring Women On Corporate Boards
Flag of California, California, USA - stock photo.
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A California court is set to begin hearing arguments Wednesday on a California law that mandated that corporations put women on their executive boards.

The lawsuit, brought by Judicial Watch, will be heard in the Los Angeles Superior Court. The suit claims that the law violates the equal protection clause of the California state constitution by mandating a gender quota and that using taxpayer funds to enforce the law is illegal. The suit comes nearly three years after the law was initially signed, The Associated Press reported.

“They are creating a classification that either prefers or discriminates against one class or in preference of another,” Judicial Watch attorney Robert Patrick Sticht said, adding that California did not have a compelling interest in imposing the mandate.

Another conservative legal group, the Pacific Legal Foundation, is levying another challenge in federal court, arguing that the law violates the equal protection clause of the U.S. Constitution. Their lawsuit was originally dismissed in federal court, but was revived by the 9th Circuit Court of Appeals, the AP reported.

The law, passed and signed by Governor Jerry Brown in 2018, required that publicly traded companies whose headquarters are located in California have at least one member of their board of directors who identifies as a woman by 2019. By January of this year, companies with boards comprised of five members must have two women, and boards with six or more members must have three. Companies that do not report the gender composition of their boards face fines of $100,000. Companies that do not comply with the gender composition mandates face fines of $100,000 for a first offense and $300,000 for subsequent offenses.

Fewer than half of the 650 corporations that fall under the scope of the mandate reported to the state that they were in compliance. More than half did not even report their compliance status to the state. No companies have been fined yet, but the secretary of state can do so, a spokesperson told the AP.

The California State Assembly noted in an analysis during the legislative process that “[t]he use of a quota-like system, as proposed by this bill, to remedy past discrimination and differences in opportunity may be difficult to defend.”

Brown concurred, writing in a letter after the bill was passed: “I don’t minimize the potential flaws that indeed may prove fatal to its ultimate implementation.”

“Nevertheless, recent events … make it crystal clear that many are not getting the message,” he added.

The law has inspired similar legislation in several other states. Washington State passed a similar bill earlier this year, and Massachusetts, New Jersey, and Hawaii have proposed similar laws. The SEC also approved a Nasdaq proposal mandating that the 3,000+ companies on the index have at least one woman on their boards of directors, as well as a member from an ethnic minority group or who identifies as transgender. California also passed a similar law, which Judicial Watch is also challenging in court, according to U.S. News and World Report.

Elsewhere in the U.S., a federal jury recently awarded a North Carolina marketing executive more than $10 million after he was fired for being a white male. The Daily Wire reported that the executive, David Duvall, sued the health care company he worked for after their diversity initiative led him to be fired because of his race and gender.

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