Calif. female board member law in jeopardy
LOS ANGELES — When then-California Gov. Jerry Brown signed the nation’s first law requiring women on boards of publicly traded companies, he suggested it might not survive legal challenges.
Three years later, a judge began hearing evidence Wednesday in Los Angeles Superior Court that could undo the law credited with giving more women seats in boardrooms traditionally dominated by men. The California law has spurred other states to adopt or consider similar laws.
The conservative legal group Judicial Watch brought the lawsuit claiming it’s illegal to use taxpayer funds to enforce a law that violates the equal protection clause of the California Constitution by mandating a gender-based quota.
Another conservative legal group has filed a separate lawsuit in federal court claiming the law violates the equal protection clause of the U.S. Constitution.
Former Sen. Hannah-Beth Jackson, who authored the legislation, said the bill did not impose a quota because boards don’t need a certain percentage of women. Corporations can meet the requirement by adding women without undermining the rights of male board members.
She said the plaintiffs should be embarrassed for claiming the law is discriminatory.
The law required publicly traded companies headquartered in California to have one member who identifies as a woman on their boards of directors by the end of 2019. By January, boards with five directors must have two women and boards with six or more members must have three women.
Penalties range from $100,000 fines for companies that fail to report board compositions to the California secretary of state’s office. Companies that do not include the required number of female board members can be fined $100,000 for first violations and $300,000 for subsequent violations.
Fewer than half the nearly 650 applicable corporations in the state reported last year that they had complied. No companies have been fined, though the secretary of state can do so, said spokeswoman Jenna Dresner.