US judge denies injunction of sex quota on boards law

US judge denies injunction of sex quota on boards law

A federal judge denied a preliminary injunction to plaintiffs seeking to overturn SB 826, a state law requiring a certain number of women on corporate boards.

In his order issued Monday, U.S. District Judge John A. Mendez in Sacramento wrote that plaintiff Creighton Meland Jr. "may ultimately prevail" in his constitutional challenge against the law signed in 2018. "But that ultimate question of SB 826's constitutionality is not before the court today," Mendez wrote. "Rather, a much narrower question is presented: Has plaintiff carried his burden to show he is entitled to a preliminary injunction? ... Because plaintiff has failed to demonstrate a likelihood of success on the merits, the court need not consider the remaining elements."

Backed by attorneys with the Pacific Legal Foundation, Meland argued SB 826 violates his equal protection rights under the 14th Amendment to vote for the board members of his choosing as a shareholder in Hawthorne-based OSI Systems Inc. Meland v. Weber, 2:19-cv-02288-JAM-AC (E.D. Cal., filed Nov. 13, 2019).

In a lengthy analysis, Mendez found the state has sufficiently shown there is a long history of discrimination against women in board appointments, and the Legislature may be within its rights to address the issue. He added, "This area of equal protection law is unsettled."

SB 826 faces multiple lawsuits, but has proved more resilient than critics predicted. Last week, Mendez ordered another case against the law be consolidated in his court. That case also challenges AB 976, a 2020 law requiring "underrepresented communities" be reflected in boards of corporations headquartered in California. National Center for Public Policy Research v. Weber, 2:21-cv-02168-JAM-AC (E.D. Cal., filed Nov. 22, 2021).

Two similar state court cases are pending in Los Angeles.

-- Malcolm Machlachlan