Conservative Group Sues CA To Overturn Diversity Hiring Law

CALIFORNIA — A conservative shareholder group filed a lawsuit the week challenging a state law that requires California's public corporations to appoint people of color or LGBTQ community members to their boards of directors, according to documents filed Wednesday.

The complaint was filed by the National Center for Public Policy Research Tuesday and alleges that "diversity quotas injure Plaintiff’s right to vote for the candidate of its choice, free of a government-imposed race, sex, and sexual orientation quotas," according to the complaint.

"The state of California is intruding into corporate affairs to impose quotas based on race and sex and they don’t have a good justification for doing so," Daniel Ortner, an attorney with the Pacific Legal Foundation, told the Sacramento Bee. "Companies are already diversifying, without the need of the state of California forcing the matter. And doing so through a quota, in particular, is discriminatory and unlawful."

In the complaint, the shareholder organization said it invests in 14 Golden State corporations that would be affected by the law, including Facebook, Tesla and Apple.

"National Center supports diversity of thought and experience on corporate boards and believes that quotas based on immutable characteristics are offensive and contrary to this goal, as well as to the Constitution," the complaint details. "It believes that shareholders should vote for board members based on their individual talents, capacities, and other characteristics, and that it should be able to vote free of government compelled discrimination."

Assembly Bill 979 was signed by Gov. Gavin Newsom last year.

"It is not a surprise that those who oppose racial equity are using the legal system in their desperate attempt to hold on to the status quo," said the bill's author, Assemblymember Chris Holden, in a statement, according to the Sacramento Bee.

The organization also filed a similar lawsuit in 2019 against Senate Bill 826, which requires California companies to appoint women to their boards of directors, the Sacramento Bee also reported.