Keith Bishop on Diversity

Intentionally Discriminatory Public Offering Stalled At The SEC

In this February post, I pondered the question of whether an issuer could allocate shares on the basis of race, gender or ethnicity. That post was inspired by the case of Glennon v. Johnson, U.S. Dist. Ct. Case No....more

4/7/2025 / Affirmative Action , Constitutional Challenges , Discrimination , Diversity , Fourteenth Amendment , Gender Discrimination , Initial Public Offering (IPO) , Race Discrimination , Securities and Exchange Commission (SEC) , Securities Regulation

Does The Stock Market Believe That California's Board Diversity Mandates Enhance Firm Value?

In 2018 and 2020, California enacted laws mandating that publicly held corporations (as defined) having their principal executive offices in California have specified minimum numbers of directors who are female and from...more

2/14/2025 / Board of Directors , California , Constitutional Challenges , Corporate Governance , Corporations Code , Diversity , Investors , Publicly-Traded Companies , Regulatory Reform , Securities Regulation , Shareholders

Does Chicago's Municipal Code Make Everyone A Minority?

Recent posts have discussed a registration statement filed Bally's Chicago, Inc. for an offering that would impose a stockholder qualification based on race, gender and ethnic status. This qualification requirement is...more

2/13/2025 / Affirmative Action , Anti-Discrimination Policies , Civil Rights Act , Discrimination , Diversity , Diversity and Inclusion Standards (D&I) , Equal Employment Opportunity Commission (EEOC) , Equal Protection , Race Discrimination

Race/Gender/Ethnicity Based Share Restrictions

Yesterday's post took note of a proposed initial public offering by Bally's Chicago, Inc. that would impose a stockholder qualification based on race, gender and ethnic status. This qualification requirement is intended to...more

2/12/2025 / Constitutional Challenges , Corporate Governance , Delaware General Corporation Law , Diversity , Equal Protection , Gambling , Initial Public Offering (IPO) , Race Discrimination , Shareholders

Diversity May Be Hard To Find When It Comes To LLCs

Professor Eugene Volokh recently highlighted a decision by U.S. District Judge Brian Cogan taking a plaintiff to task for inadequately pleading diversity jurisdiction when the defendant is a limited liability company. ...more

11/19/2024 / California , Corporate Governance , Corporations Code , Diversity , Diversity and Inclusion Standards (D&I) , Limited Liability Company (LLC) , Statement of Information

Mum's The Word At California's Civil Rights Department Regarding Fair Investment Practices By Investment Advisers Law (AKA SB 54)

I wrote about a bill, SB 54, that would have required institutional investors, securities and real estate brokers, and others to report on the diversity status of "founding teams". At the time, I criticized the bill as being...more

3/14/2024 / Broker-Dealer , California , Dealers , Diversity , Investment , Investment Adviser , Investors , Real Estate Brokers , Reporting Requirements

California's Inept Attempt To Define Who Is A "Founding Team Member"

Last week, I reported that Governor Newsom had signed SB 54 (Skinner) even while acknowledging in his signing message that it contained "problematic provisions". SB 54 requires "venture capital companies", as defined, to...more

10/18/2023 / California , Corporate Governance , Diversity , Founding Members , Investors , New Legislation , Reporting Requirements , Venture Capital

Nonsensical Bill Requiring Founding Team Diversity Reports Advances

In April, I reported on SB 54 (Skinner), a bill that would have required institutional Investors, securities and real estate brokers, and others to report on the diversity status of "founding teams". At the time, I...more

7/28/2023 / Department of Financial Protection and Innovation (DFPI) , Disclosure , Diversity , Diversity and Inclusion Standards (D&I) , Founding Members , Investment Adviser , Investment Advisers Act of 1940 , Investors , Proposed Legislation , Venture Capital

Are All Lawsuits Against "Woke" Directors "Nonstarters"?

In a recent post, UCLA Professor Stephen Bainbridge concludes: "And the law is that suits claiming woke directors breached their fiduciary duties by their decisions about how the corporation behaves in the political arena are...more

7/13/2023 / Board of Directors , Corporate Governance , Delaware General Corporation Law , Diversity , Fiduciary Duty , Gender Equity , Publicly-Traded Companies , Shareholders

Federal Court Rules California Board Quota Law Unconstitutional

A little over a year ago, I wrote that California Superior Court Judge Terry Green had found that AB 979 facially violates the Equal Protection Clause of the California Constitution, Cal. Const. Art. I, § 7. Crest v....more

5/18/2023 / Board of Directors , Corporate Governance , Diversity , Gender Equity , Publicly-Traded Companies , Quotas , Secretary of State , State Constitutions

California Bill Would Require Some Advisers To Venture Capital Firms To File Diversity Reports, But What About Preemption?

As I discussed in this post from earlier this month, SB 54 would have required institutional investors, securities and real estate brokers, and others to report diversity status of startup founding teams. The bill has since...more

4/28/2023 / California , Department of Financial Protection and Innovation (DFPI) , Diversity , Diversity and Inclusion Standards (D&I) , First Amendment , Investment Adviser , Investment Advisers Act of 1940 , Venture Capital

Will Corporate DEI Efforts Engender Caremark Claims?

In a posting on the Business Law Prof Blog, Professor Stefan J. Padfield recently highlighted a complaint filed by America First Legal Foundation with the U.S. Equal Employment Opportunity Commission. The complaint alleges...more

4/12/2023 / Caremark claim , Corporate Governance , Derivative Suit , Diversity , Diversity and Inclusion Standards (D&I) , Employer Liability Issues , Human Resources Professionals , McDonalds , Unfair Labor Practices

Court Of Appeal Declines To "Sit On" Board Diversity Judgment

In July, California Secretary of State Shirley Weber filed a petition for a writ of supersedeas in the California Court of Appeal with respect to the trial court's judgment in Crest v. Padilla. In that case, the trial court...more

12/2/2022 / Board of Directors , California , Corporate Governance , Corporations Code , Directors , Diversity , Publicly-Traded Companies , Quotas

Does Your Surname Define Your Cultural Ancestry?

In a recent paper, four authors attempt to assess board cultural diversity and firm performance under competitive pressures. The authors conclude that "culturally diverse boards are associated with superior performance for...more

10/7/2022 / Corporate Culture , Corporate Governance , Diversity , Diversity and Inclusion Standards (D&I) , Surnames

The Verdict Is In On California's Female Director Quota Law

As I noted yesterday, Los Angeles Superior Court Judge Maureen Duffy-Lewis has found California's female director quota law, SB 826, to violate the Equal Protection clause of the California Constitution (A person may not be ....more

5/17/2022 / Board of Directors , California , Corporate Counsel , Corporate Governance , Diversity , Gender Equity , Publicly-Traded Companies , Quotas , Woman Board Members

Judge Finds California Female Director Quota Law To Be Unconstitutional

Following a lengthy trial, Los Angeles Superior Court Judge Maureen Duffy-Lewis has found that California's female director quota law violates the Equal Protection Clause of the California Constitution...more

5/16/2022 / Board of Directors , California , Corporate Counsel , Corporate Governance , Diversity , Gender Equity , Quotas , Shareholders , Woman Board Members

More On Board Nominations

Yesterday's discussion of an amicus brief filed by 17 law professors in a case challenging SB 826, California's female director quota mandate, reminded me of a related question that I raised a few years ago...more

4/13/2022 / Board of Directors , California , Corporate Governance , Diversity , Gender Equity , Quotas , Shareholders , Woman Board Members

17 Law Professors File Amicus Brief Assailing Corporate Democracy

Earlier this year, the trial of one of the challenges to SB 826, California's female director quota law, concluded but Los Angeles Superior Court Judge Maureen Duffy-Lewis has yet to release her decision. Crest v. Weber,...more

4/12/2022 / Board of Directors , California , Corporate Governance , Diversity , Gender Equity , Publicly-Traded Companies , Quotas , Woman Board Members

Judge Green Explains Why AB 979 Violates The Constitution

When I reported last Friday that Los Angeles Superior Court Judge Terry Green had ruled in favor of the plaintiffs in their challenge to California's board quota law, AB 979, all I had was a brief minute order from the...more

4/5/2022 / Board of Directors , California , Corporate Governance , Diversity , Gender Equity , Publicly-Traded Companies , Quotas , Shareholders , Woman Board Members

Plaintiffs Prevail In Constitutional Challenge To California Board Quota Law

This afternoon, Judge Terry Green granted the plaintiff's summary judgment motion in a case challenging the constitutionality of AB 979. Crest v. Padilla, LA Super. Ct. Case No. 20STCV37513...more

4/4/2022 / Board of Directors , California , Corporate Governance , Diversity , Gender Equity , Publicly-Traded Companies , Quotas , Secretary of State , Shareholders , State and Local Government , Woman Board Members

Does Improving CalPERS' Returns Justify State Mandated Discrimination?

We may learn as early as today whether a pending constitutional challenge to AB 979 will be going to trial in May. AB 979 is California's law requiring publicly held domestic and foreign corporations having their principal...more

4/1/2022 / Board of Directors , California , CalPERS , Corporate Governance , Directors , Diversity , Principal Executive Officer , Secretary of State , Woman Board Members

Legislator Proposes To Expand Definition of "Director From An Underrepresented Community"

Enacted in 2020, AB 979 requires publicly held domestic or foreign corporations having their principal executive offices in California to have specified minimum numbers of directors from "underrepresented communities". Cal....more

3/31/2022 / Board of Directors , Business Formation , California , Corporate Governance , Directors , Diversity , Publicly-Traded Companies , Shareholders

Judge Weighs Challenge To California Board Quota Law

On Monday, Los Angeles Superior Court Judge Terry Green heard arguments on opposing motions for summary judgment in a case challenging the constitutionality of AB 979. Crest v. Padilla, L.A. Super. Ct. Case No....more

3/16/2022 / Board of Directors , California , Chief Compliance Officers , Compliance , Corporate Counsel , Corporate Governance , Diversity , Quotas , Shareholders

Appearances Matter According To ISS' Proxy Voting Guidelines

Last month, Institutional Shareholder Services published its Americas 2022 Proxy Voting Guidelines. As part of its updated guidelines, ISS has removed the "grace" period for board diversity so that its policy now reads as...more

1/18/2022 / Board of Directors , California , Corporate Counsel , Corporate Governance , Diversity , Institutional Shareholder Services (ISS) , Proxy Voting Guidelines

What Is And Is Not Mandatory With Respect To California's Female Director Quota Law

On Monday, I noted that because California's female director quota law uses the word "shall", it is mandatory. Confused? Here's how I break down the law...more

12/10/2021 / Board of Directors , California , Corporate Governance , Diversity , Gender Equity , Publicly-Traded Companies , Quotas , Secretary of State , Shareholders , State and Local Government , Woman Board Members

Keith Bishop

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