Contact us with your California corporate & securities law questions (949) 353-6347 or Contact us here

Secretary Of State Declares Enforcement of Gender Quota Law To Be "Entirely Speculative" And Casts Doubt On Rulemaking

In August, I reported on the filing of a taxpayer challenge to California's Board Gender Quota Law.  California's Secretary of State, Alex Padilla, was named as the defendant in his official capacity.  The plaintiffs allege that the law (SB 826) violates Articles 7 and 31 of the California Constitution.  Late last month, Secretary Padilla filed a demurrer to the suit, arguing that the plaintiffs lack standing and that the action is not ripe.

California confers standing on taxpayers pursuant to Section 526a of the California Code of Civil Procedure.  However, Secretary Padilla faults the plaintiffs with failing to plead specific facts alleging illegal expenditures.  Although Corporations Code Section 301.3(e) authorizes the Secretary of State to adopt regulations and impose fines, the Secretary of State argues that it is "entirely speculative to assert that the Secretary of State will draft regulations or impose fines".  He doubles down on this assertion, claiming:

"Because of the discretion afforded to the Secretary of State by Corporations Code section 301.3, it is 'sheer guesswork' to conclude that the Secretary of State will undertake regulations to enforce SB 826, that the Secretary of State will impose fines pursuant to SB 826, or that any corporation would even fail to be in compliance with the statute."

These claims may come as a surprise to the proponents of SB 826 who most likely expect that the Secretary of State will implement and enforce the statute as authorized.  In fact, the California Constitution does not allow an agency to refuse to enforce a statute on the grounds that it is unconstitutional.  See Can The Secretary Of State Refuse To Enforce California's Board Gender Quota Law?

The Secretary of State's claims about enforcement activity may be belied, moreover, if the Secretary of State's proposed budget includes expenditures related to either of these activities.  A hearing on the demurrer is not scheduled until next March.

Share on:

ANY QUESTIONS REGARDING CALIFORNIA CORPORATE AND SECURITIES LAW? CONTACT US DIRECTLY

We offer expert advice with the intricacies of California law.

Our years of experience and expertise allow us to help clients navigate the business laws in California.

CONTACT US

ABOUT OUR AUTHOR

30172DBAB0084D3A8F39D7AF0A8E79BC.ashx Keith Paul Bishop
Partner at Allen Matkins
(949) 353-6328
 Contact me
Learn More About Keith

RECOGNITION
JD Supra Readers Choice Top Author 2020

NationalLawReview



nominee-badge

Get the latest news and analysis about California Corporate & Securities law. Subscribe to our newsletter today!

We respect your email privacy

CATEGORIES

see all

YOUTUBE

FACEBOOK