Posts Tagged ‘California’

Unions exploit California environmental law for leverage

The California Environmental Quality Act (CEQA) and other California laws are notorious for delaying and driving up the cost of building projects. Aside from their uses for neighbors pursuing Not In My Back Yard (NIMBY) goals, the environmental laws are also employed for leverage by labor unions who threaten to invoke them “to stop new construction unless they get a cut of the action. One developer is fighting back.” [Scott Shackford, earlier on CEQA]

California AG: it’s illegal to possess secret list of convicted cops

By filing routine public records requests, reporters obtained a hitherto unreleased list of thousands of California law enforcement officers convicted of crimes over the past decade. “But when [California Attorney General Xavier] Becerra’s office learned about the disclosure, it threatened the reporters with legal action unless they destroyed the records, insisting they are confidential under state law and were released inadvertently. The two journalism organizations have rejected Becerra’s demands.” The list includes “cops who stole money from their departments and even one who robbed a bank wearing a fake beard. Some sexually assaulted suspects. Others took bribes, filed false reports and committed perjury.” [Robert Lewis and Jason Paladino, East Bay Times]

Wage and hour roundup

  • Decision time coming up for administration on whether to reverse one of Obama’s worst initiatives, overtime for junior managers [Veronique de Rugy; Robin Shea]
  • California observes different rule on overtime for offshore oil workers than does federal government, exposing employers to huge retroactive back pay liability [Washington Legal Foundation, Supreme Court granted certiorari last month in Newton v. Parker Drilling]
  • Today in bad ideas: Philadelphia becomes latest jurisdiction to regulate shifts and scheduling in retail, hospitality [Juliana Feliciano Reyes, Philadelphia Inquirer/WHYY, Drinker Biddle/National Law Review, Max Marin/BillyPenn]
  • “I’m a restaurant employee in a city with a $15 minimum wage; here’s how it’s hurt me” [Simone Barron, Washington Examiner] Virginia could wind up with a $15 minimum law before long, tough luck for rural parts of state [Hans Bader]
  • “Nurses allege Corona, Calif. underpaid them, rounding down their time to the nearest quarter hour. Ninth Circuit: This can proceed as a class action. Five judges, dissenting from denial of en banc review: The only evidence in support of the nurses’ claim is a declaration from plaintiffs’ lawyers’ paralegal, which is plainly not admissible. ‘This doesn’t pass the straight-face test.'” [Short Circuit on Sali v. Corona Regional Medical Center, Ninth Circuit panel, denial of en banc rehearing]
  • “The Impact of The New German Minimum Wage” [Ryan Bourne]

Bans on Independent-Contractor Status Hurt Workers (Again)

In April of last year the California Supreme Court ruled that a large class of service workers historically categorized as independent contractors, those who are under contract with a host enterprise that performs the same kind of service they do, have to be treated as employees and brought under the full range of employment laws. Some labor advocates cheered, but many California workers did not. “I lost my entire staff,” said owner Anthony Giannotti of downtown Sacramento’s Bottle and Barlow barber shop. All seven of his barbers quit, he said. The ruling is expected to disrupt the marketplace for cosmetologists and tattoo artists, yoga and Pilates instructors, and even FedEx delivery personnel. [Angela Greenwood, CBS Sacramento in September]

California moves to curb slack-fill litigation

We’ve posted often about lawyer-driven slack-fill lawsuits, in which class action filers claim that food, cosmetic, and other products sold by weight have excessive empty space in their packaging. (Laws governing food packaging allow for empty space that serves a function such as protecting the product from damage or shoplifting, but there is room for much disagreement on what is or is not needed for functionality.) The suits’ outcomes can seem random if not whimsical: Ferrara Candy recently agreed to pay $2.5 million to settle claims [Douglas Yu, Confectionery News] while the makers of Fannie May and Junior Mints successfully obtained dismissal of suits against them in federal courts [Scott Holland, Cook County Record; Bloomberg]

California has been a hotspot of slack-fill litigation, but now the California legislature has passed a bill, signed into law by Gov. Jerry Brown in September, expanding the list of safe-harbor defenses that manufacturers (prospectively, in future suits) can assert against slack-fill claims. While the changes are limited in scope and will still allow many suits to go forward, it is noteworthy for California’s legislature to take even symbolic steps against the state’s busy class action industry. [Sarah L. Brew, Tyler A. Young, Emily R. Bodtke and Rita Mansuryan, The Recorder; Robert Niemann and Jill Mahoney, Washington Legal Foundation]

Banking and finance roundup

  • Gov. Jerry Brown signs into law California bill imposing minimum quota for women on corporate boards: “it’s very hard to see how this law could be upheld” [Emily Gold Waldman, PrawfsBlawg, earlier, more: Alison Somin, Federalist Society] “The passage of this law resulted in a significant decline in shareholder value for firms headquartered in California.” [Hwang et al. via Bainbridge]
  • Martin Act, part umpteen: “New York Attorney General Overreaches in Climate-Change Complaint Against Exxon” [Merritt B. Fox, Columbia Blue Sky Blog]
  • “Now he tells us! You’d think that maybe Bharara would have publicly acknowledged this ambiguity and haziness [in insider trading law] before bringing a series of cases that destroyed careers and imposed huge costs on the individuals who were accused.” [Ira Stoll]
  • “Because [Florida agriculture commissioner-elect Nikki Fried] took donations from the medical marijuana industry, Wells Fargo and BB&T banks closed her campaign accounts briefly, citing policies against serving businesses related to marijuana, which is still prohibited under federal law.” [Lori Rozsa, Washington Post, Erin Dunne, Washington Examiner (“fix the marijuana banking mess”)]
  • Survey: “Average cost of a settled merger-objection claim has increased 63% to $4.5 million over four years, with little benefit to shareholders” [Chubb] “Time for Another Round of Securities Class Action Litigation Reform?” [Kevin LaCroix, D&O Diary on U.S. Chamber paper, and more on trends in Australia]
  • “Congress Can’t Create an Independent and Unaccountable New Branch of Government” [Ilya Shapiro on Cato cert amicus in State National Bank of Big Spring v. Mnuchin, on constitutionality of Consumer Financial Protection Bureau (CFPB)]

California: “Lawyer, wife convicted in extortion plot against businesses”

“A California attorney and his wife were convicted of engaging in a scheme to extort minority, immigrant-owned businesses.” [Associated Press] “[Rogelio] Morales and [Mireya] Arias engaged in a scheme in 2016 to file ‘meritless gender discrimination lawsuits to pressure minority business owners into giving them thousands of dollars in alleged “settlements,”‘ a prosecution trial brief said. Prosecutors said Morales and Arias would obtain services from the small businesses they targeted — salons or dry cleaners — and if they were charged differently for the same service, they would file a lawsuit claiming a violation of a California anti-discrimination law, prosecutors said.” [Richard K. De Atley, Press-Enterprise (Riverside, Calif.)]

California’s rent control temptation

Even if California voters defeat Proposition 10 on Nov. 6, battles over rent control are likely to continue, I write in my new Cato post:

Though once favored in voter surveys, Proposition 10 has sagged lately, well behind in one poll and ahead in a second by only 41-38 with 21 percent undecided. But advocates of liberty (and all who prize the lessons of Economics 101) shouldn’t get complacent. …

It’s true that many California localities, the Bay Area especially, are experiencing skyrocketing housing costs. That has a lot to do with intense demand to live and work in places like Silicon Valley and San Francisco, and even more to do with the tight regulatory lid on new residential construction that artificially suppresses the supply of dwellings in the state generally and especially in desirable communities and near the coast. By shifting the blame for the resulting situation to owners of existing rental units, rent control would make it even less likely that Bay Area and coastal governments will take the one measure that would be effective against spiraling housing costs, namely legalizing much more new construction.

Whole thing here. Related: “What does economic evidence tell us about the effects of rent control?” [Rebecca Diamond, Brookings]

Labor roundup

  • Great moments in public employee unionism, cont’d: D.C. Metro track inspector charged after derailment with falsifying records wins reinstatement and back pay in arbitration [Max Smith, WTOP, earlier here (similar after fatal smoke incident) and here] Could be permanent? “Bus drivers’ union threatens strike over driverless buses” [Jason Aubry, WCMH (Columbus, Ohio)]
  • Letting guests skip housekeeping = grievance: “Union Threatens Strike over Marriott’s Green Initiative” [Darrell VanDeusen, Kollman & Saucier]
  • Stephen Bainbridge series on what’s wrong with Sen. Elizabeth Warren’s proposals [earlier, etc.] continues with a post on labor co-determination and employee involvement in corporate governance;
  • “Public Sector Unions Win Big at the California Supreme Court: California citizens must now meet and confer with union bosses before qualifying any compensation-related initiatives for the ballot.” [Steven Greenhut, Reason]
  • My Frederick News Post letter to the editor opposing Question D (mandatory binding arbitration and collective bargaining for career firefighters). More on mandatory binding arbitration in the public sector: Ivan Osorio et al on California, for Cato (see pp. 12 et seq.); Steve Eide, Public Sector Inc., 2013.
  • “Waikiki, Hawaii hotel workers decline to join union; the union demands they pay full dues anyway, starts process to garnish their wages. Does the union’s conduct amount to an unfair labor practice? NLRB: No, the union made an honest mistake. D.C. Circuit: That ‘makes no sense.’ The union never apologized or said it made a mistake. Its message to the workers was, ‘We can do this the easy way, or we can do this the hard way.'” [John Kenneth Ross, IJ “Short Circuit”]