California judge declares state’s corporate board diversity mandate unconstitutional

In a serious blow to Democrats, a judge in California last week struck down a state law requiring corporate boards to include members of particular races, ethnicities, and sexual/gender identity orientations, according to the Associated Press.

The ruling granting summary judgment to opponents of the measure came in response to a lawsuit filed by conservative advocacy organization Judicial Watch, a group which requested permanent injunctive relief blocking the implementation of the mandate signed into law last year by Democrat Gov. Gavin Newsom.

Diversity rule, explained

Though the ruling itself did not offer specific reasoning for the outcome, its effect is to toss the law’s requirement that boards of publicly traded companies based in California seat at least one member of an “underrepresented community” by the end of 2021 to remain in compliance.

The law further required that by the conclusion of 2022, enterprises with boards comprised of between 4 and 9 directors would need to have at least two minority directors, and boards with 9 or more seats would need to include no fewer than three directors from the aforementioned groups.

Companies that did not meet the new diversity requirements were poised to face costly fines of up to $100,000 for their first offense, with the penalty rising to $300,000 for repeated non-compliance, according to the AP.

Categories from which such a member were to be recruited included, according to the AP, the Black, Asian, Latino, Native American, Pacific Islander, or LGBT communities.

Judicial Watch prevails

The lawsuit in opposition to the law was filed by Judicial Watch in late 2020, and the group argued that the practice of using taxpayer funds to enforce “[l]aws that explicitly distinguish between individuals on racial or ethnic, sexual preference, and transgender status grounds fall within the core of the prohibition of the equal protection clause,” as the Daily Wire noted.

Though in court filings, the state contended that the law did not “discriminate against, or grant preferential treatment to, any individual or group on the basis of race, sex, color, ethnicity, or national origin in the operation of public employment, public education, or public contracting,” as Fox News indicated, the court was not persuaded to allow it to remain in place.

In the wake of the court’s ruling, Tom Fitton, president of Judicial Watch, hailed the outcome, saying in a press release, “This historic California court decision declared unconstitutional one of the most blatant and significant attacks in the modern era on constitutional prohibitions on discrimination.”

“In its ruling today, the court upheld the core American value of equal protection under the law. Judicial Watch’s taxpayer clients are heroes for standing up for civil rights against the Left’s pernicious efforts to undo anti-discrimination protections, Fitton added.

Quota battles persist

As pleased as Fitton is about the result in this particular case, that is not to say that his group’s battles in California are at an end, as Judicial Watch recently concluded a trial in another lawsuit fighting against implementation of a 2018 law mandating that publicly-traded corporations headquartered in the state have at least one board director who “self-identifies her gender as a woman” by the end of 2019.

The ultimate fate of that law remains up in the air, as does that of a proposed Securities and Exchange Commission rule implementing race and gender board quotas for companies listed on the Nasdaq exchange – also formally opposed by Judicial Watch – but hopefully, Fitton’s winning streak in the battle for fairness will be extended in California and beyond.

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