Justia Corporate Compliance Opinion Summaries

Articles Posted in US Court of Appeals for the Ninth Circuit
by
California Senate Bill 826 requires all corporations headquartered in California to have a minimum number of females on their boards of directors. Corporations that do not comply with SB 826 may be subject to monetary penalties. The shareholders of OSI, a corporation covered by SB 826, elect members of the board of directors. One shareholder of OSI challenged the constitutionality of SB 826 on the ground that it requires shareholders to discriminate on the basis of sex when exercising their voting rights, in violation of the Fourteenth Amendment.The Ninth Circuit reversed the dismissal of the suit for lack of standing. The plaintiff plausibly alleged that SB 826 requires or encourages him to discriminate based on sex and, therefore, adequately alleged an injury-in-fact, the only Article III standing element at issue. Plaintiff’s alleged injury was also distinct from any injury to the corporation, so he could bring his own Fourteenth Amendment challenge and had prudential standing to challenge SB 826. The injury was ongoing and neither speculative nor hypothetical, and the district court could grant meaningful relief. The case was therefore ripe and not moot. View "Meland v. Weber" on Justia Law

by
Bio-Rad and its CEO appealed a jury verdict in favor of the company's former general counsel finding that defendants violated the Sarbanes-Oxley Act (SOX), the Dodd-Frank Act, and California public policy by terminating general counsel's employment in retaliation. General counsel produced an internal report that he believed Bio-Rad had engaged in serious and prolonged violations of the Foreign Corrupt Practices Act (FCPA) in China.The Ninth Circuit vacated in part and held that the district court erred by instructing the jury that statutory provisions of the FCPA constitute rules or regulations of the SEC for purposes of whether general counsel engaged in protected activity under section 806 of the SOX. However, the panel rejected Bio-Rad's argument that no properly instructed jury could return a SOX verdict in favor of general counsel. The panel held that the district court's SOX instructional error was harmless and affirmed as to the California public policy claim. The panel remanded for further consideration. View "Wadler v. Bio-Rad Laboratories, Inc." on Justia Law