California Appeals Court Upholds Injunctions against Corporate Board Quotas

This is an important victory for Judicial Watch, as well as taxpayers and stockholders.

The California Court of Appeal has upheld two injunctions against California quota requirements for corporate boards.

Earlier this year, two California trial courts had found (here and here) state quota mandates for sex, race, ethnicity, and LGBT status unconstitutional. On December 1, 2022, the California Court of Appeal denied (here and here) two separate emergency requests by the California Secretary of State to lift the injunctions.

The California courts again have upheld the core American value of equal protection under the law. Our taxpayer clients are heroes for standing up for civil rights against the Left’s pernicious efforts to undo anti-discrimination protections. Our legal team has helped protect the civil rights of every American with these successful lawsuits.
Here’s the background.

We filed a gender quota lawsuit in Los Angeles County Superior Court in 2019 on behalf of three California taxpayers. The lawsuit challenged a 2018 law, Senate Bill 826 (SB 826), which mandated that every publicly held corporation headquartered in California have at least one director “who self-identifies her gender as a woman” on its board of directors. We successfully argued that the quota for women on corporate boards violates the Equal Protection Clause of the California Constitution. In May 2022, after a 28-day trial, the Superior Court delivered its verdict finding that “S.B. 826’s goal was to achieve general equity or parity; its goal was not to boost California’s economy, not to improve opportunities for women in the workplace nor not to protect California taxpayers, public employees, pensions and retirees.”

In 2020, we filed a separate taxpayer lawsuit challenging Assembly Bill 979 (AB 979), which Governor Gavin Newsom signed into law on September 30, 2020. The bill mandated boards of directors of California-based, publicly held domestic or foreign corporations to satisfy racial, ethnicity, sexual preference and transgender status quotas.

Our lawsuit successfully asked the Superior Court to declare the diversity quota scheme unconstitutional under California’s equal protection guarantee and to permanently enjoin its enforcement. On April 1, 2022, the Superior Court issued a ruling and opinion striking down AB 979’s diversity quotas and granting a permanent injunction in favor of our taxpayer clients enjoining the state from implementing the statute.

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