Last Friday, the Los Angeles Superior Court in Crest et al. v. Padilla (“Crest”) held that Senate Bill 826 (“SB 826”), also known as the “Women on Boards” law, is unconstitutional. The lawsuit challenging the law was brought by DC-based nonprofit Judicial Watch on behalf of California taxpayers. Earlier this week, the state announced that it would appeal the decision.
SB 826, which Governor Jerry Brown signed in 2018, mandates that publicly held corporations headquartered in California (even if incorporated elsewhere) have a minimum number of female directors on their Boards of Directors, with at least three female directors if the corporation has at least six directors in total. While violations of this law are punishable by fines of up to $300,000, the state has not fined a company under this law.
In Crest, the Court found that SB 826 violates the state constitution’s Equal Protection Clause by treating groups of people differently based on sex. Because the California state constitution requires that laws that differentiate based on sex must survive “strict scrutiny” review, the challenged law must not only serve a compelling government interest but also be “narrowly tailored” to that interest. This means that the state must show that there is no way to achieve its stated goals without differentiating based on suspect classifications.
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