California Boardroom Diversity Law Suit Lawsuit – FindLaw

CEO gives peptalk to business people at meeting in big conference room

California Gov. Gavin Newsom recently signed a bill requiring companies to have members from underrepresented communities on their boards of directors. On Monday, the conservative legal group Judichal Watch Announce plans to sue On the grounds that the law is unconstitutional. What are the grounds for such a lawsuit, and who is likely to be in the lead?

Not the first rodeo in California

The new law states that by the end of 2021, boards of directors of corporations headquartered in California must have at least one member. Who identifies himself as Black, African American, Hispanic, Latino, Asian, Pacific Islander, Native American, Native Hawaiian, Alaskan Native, or self-identify as gay, or gay , Bisexual, or transgender people. “

Depending on the size of the board of directors, the share of underrepresented directors will increase in subsequent years. This law is not without a precedent: in 2018, California enacted a similar law It required boards of directors to appoint women as members.

the challenge

Affirmative action type policies have long been the subject of legal debate. The Fourteenth Amendment The US Constitution guarantees equal rights and protections to all citizens. Supreme Court decisions have interpreted this in a number of ways, either by banning any kind of “discriminatory” practices altogether or permitting policies that have historically permitted the granting of underrepresented groups certain special considerations.

However, two Supreme Court cases indicate that there may be problems in the future with the new California legislation. in a Graz vs Bollinger (2003), the court held that race was an acceptable factor in college admissions when used to admit students from more underrepresented groups. However, it was said that strict diversity quota regimes were not permitted.

The origin of this argument is derived from the Fourteenth Amendment. While race can be a consideration of employment or admission, courts have generally taken the position that granting or denying a person a position solely on the basis of race is unconstitutional discrimination.

More support for this point comes from another Supreme Court case, Fisher v. The University of Texas at Austin (2013). The court annulled an admission system that awarded minorities 20 “points” toward the admission threshold. When exact numbers and quotas enter the picture, the diversity initiative becomes more likely to be considered unconstitutional – causing a spelling problem for new California laws.

Whatever the courts decide, the ruling is sure to set an interesting precedent for the future of diversity movements in the workforce.

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