News

The state Supreme Court has decided not to take up an appeal of a lower court ruling that Malibu can’t limit chain stores or force major development projects to be put to a vote of the people. The determination filed late Wednesday appeared to mark the end of the road for the beach city’s Measure R ballot measure limiting development, handing a major victory to developers and for a project that would bring a Whole Foods store to the city.

California officials are notorious for ladling on one environmental regulation after another, forcing developers to spend years or even decades producing waist-deep environmental-impact reports and dealing with endless regulatory hassles and litigation. The main tool environmentalists use to stop growth is the 1970s-era California Environmental Quality Act (CEQA). It’s the equivalent of placing a “sue me” sign on every job site. . . . CEQA also remains uncorrected because of a disturbing double standard. Whenever there’s a big publicly funded project backed by prominent lawmakers, the first thing backers do is to exempt it from the act’s requirements. Why reform a poorly functioning law when it can be used to stop projects you don’t like, but never inhibits the ones you do like?

As if businesses were not troubled enough by substantial penalties tied to minor labor law infractions when private attorneys take on lawsuits under the Private Attorney General Act (PAGA), a California Supreme Court ruling has opened the door for more business burdens when confronting PAGA lawsuits. In a recent unanimous decision in Williams v. Marshalls the court ruled that plaintiffs attorneys have the right in discovery to examine all of a company’s employee records—whether employees worked at the site the alleged infraction took place or not. The plaintiff does not need to show good cause that the company had a statewide policy that violated labor laws before businesses are required to produce the information.

Under “workers’ compensation,” enacted in 1914, workers would give up their right to sue employers for injuries and in return, employers would be obligated to pay for medical care and provide cash benefits while disabled employees recuperated. Today, work comp, as it’s dubbed, is a huge program – well over $20 billion a year – whose operating rules are a source of perennial political jousting. . . . However, it still left California employers with – by far – the nation’s highest work comp burden. The 2016 annual survey of costs by the Oregon Department of Consumer and Business Services kept California in the No. 1 spot with an average cost of 3.24 percent of payroll for work comp insurance, 76 percent above the national average. Obviously, working in California is not inherently more dangerous than in other states, and cash benefits to disabled California workers are not out of line, so the enormous cost differential must be rooted in the system itself, which explains why its rules are the subject of constant political infighting. One factor in those costs is what officials say is an enormous amount of fraud, concentrated in Southern California. Last year, the Center for Investigative Reporting reviewed work comp fraud cases that had been prosecuted and reported that they totaled more than $1 billion. But authorities believe that prosecutions merely are the tip of the iceberg.

A recent action by one of nation’s largest public-employee unions illustrates the importance of an Illinois case that might make its way to the U.S. Supreme Court sometime next year. The technical dispute involves the complex process by which public-sector unions assess dues to those who don’t want to be members. But the real issue is more fundamental to a free society: Should people be forced to fund groups they find offensive? The Service Employees International Union Local 1000, which represents 95,000 California state employees, earlier this month increased the dues assessed on those employees who are known as “non-germane objectors,” or NGOs. These are people who have opted out of paying for the union’s political activities. Because of a 1977 U.S. Supreme Court decision, they are still required to pay for expenses related to collective bargaining. Last year, the SEIU local spent $13.7 million as part of a bargaining process to hike members’ wages. “The union members who voted on the contract favored it by a 90 percent margin,” according to a Sacramento Bee report, “but aspects of the deal were unpopular among some workers.” To pay those costs, the union hiked dues on these NGOs by 6 percent, thus pushing dues payments for nonmembers to 73 percent of the full amount paid by full-fledged members of the union.

A class-action lawsuit against CalPERS filed on behalf of more than 130,000 California government workers and retirees can move forward to trial, a Los Angeles judge has ruled. The lawsuit challenges a sharp increase in fees that the California Public Employees’ Retirement System levied on people who bought insurance for long-term health care through the pension fund. It argues that the rate hike was different in scale and purpose than any previous fee increase on those policy holders.

Oklahoma Attorney General Mike Hunter and fellow Republican attorneys general in 11 other states want to stop an effort by a California regulator to get insurance companies operating in that state to divest from coal and disclose their fossil fuel investments. Hunter and the attorneys general — as well as one governor — sent a letter Monday to California Insurance Commissioner Dave Jones accusing him of trying to “publicly shame those who invest in American energy.” The letter threatens legal action if Jones doesn’t revise his policies.

Attorney General Jeff Sessions has ordered prosecutors to stop settling corporate wrongdoing cases by requiring companies to make donations to third-party groups, a feature of some Obama-era bank settlements that congressional Republicans had opposed.

In a brief, one-page memo dated Monday and released on Wednesday, Mr. Sessions told Justice Department officials they could no longer include any provision in a civil or criminal settlement “that directs or provides for a payment or loan to any non-governmental person or entity that is not a party to the dispute.”

The misuse of settlement slush funds was one of the Obama Administration’s worst practices, which it used to end run Congress’s constitutional spending power. After the GOP took the House and tried to cut spending for liberal interest groups, the Obama Justice Department began to force corporate defendants to allocate a chunk of their financial penalties to those same groups. 

I had no idea what the Private Attorney General Act (PAGA) was, and I wondered what we could have possibly done wrong when it comes to our employees.  As I spent time researching PAGA law I soon realized that this lawsuit could potentially cost the company millions of dollars. From what I understand, PAGA was originally designed to protect the employee; but unfortunately the pendulum has swung too far in the opposite direction and these days many ambulance-chasing attorneys open unfair litigation against good companies in California chasing that easy dollar.

The 3rd District Court of Appeal in Sacramento rejected that argument. The decision has caused new consternation at the chamber, which said in its appeal that the court risks “putting no limits on what money can be exacted and providing a road map for the evasion of Proposition 13’s limits” on increasing taxes.

The problem of PAGA lawsuits threatening small businesses is growing and solutions to deal with incidental violations are obvious. The legislature, to show its support for the state’s valuable small businesses, should create legislation giving small businesses the right to cure minor problems instead of putting businesses at risk for financial ruin.

The Los Angeles City Council took a step Tuesday toward borrowing up to $60 million to pay for legal payouts and court judgments despite a warning by City Controller Ron Galperin that the borrowing proposal is costly and unnecessary.

The University of California, Berkeley, will cut off public access to tens of thousands of video lectures and podcasts in response to a U.S. Justice Department order that it make the educational content accessible to people with disabilities.

Overhauling the environmental law, the California Environmental Quality Act, is a perennial issue at the Capitol, and the measure benefiting the Warriors arena was one of the most high-profile CEQA reforms in recent years. But the failure of the 2011 legislation to meet its stated goals reveals the difficulty lawmakers have had in making meaningful changes to the law.