Supreme Court Upholds Prop. 209 Against Federal Challenge

The Supreme Court has held, in Coral Construction, Inc. v. City and County of San Francisco (here), that Prop. 209's ban on racial preferences does not violate the Equal Protection Clause. The Court held that the "political structure" doctrine, as applied in cases like Hunter v. Erickson and Washington v. Seattle School District No. 1, does not apply to bans on racially preferential treatment. However, the Court left the door open for San Francisco to try and prove that its affirmative action policy was required, not just permitted, by federal law.

Walgreen's States Equal Protection Claim

San Francisco prohibits pharmacies such as Walgreen's from selling cigarettes, but not grocery stores or big box stores even if they contain licensed pharmacies. Walgreen's sued contending that this distinction lacked a rational basis. The Superior Court agreed, but the Court of Appeal held that Walgreen's could state a cause of action (here). The court held that the City's rationale for the ordinance--that cigarettes should not be sold in retail establishments such as pharmacies that are identified in the public mind with health--did not apply to chain stores like Walgreen's, that typically sell products that are largely indistinguishable from those sold in grocery stores. The court also held that the city could not defend its disparate treatment of pharmacies and grocery stores by the need to keep supermarkets in San Francisco.

I think this case has a shot at Supreme Court review. The court's opinion is certainly less deferential to the city that courts usually are in evaluating legislation under the rational basis test.

Court Grants Review Of Line-Item Veto Case

The Supreme Court granted review Wednesday in St. John's Well Child and Family Center v. Schwarzenegger. which poses the question of whether the Governor has the power to veto a legislative reduction of a previously-enacted budget appropriation. The Court of Appeal opinion is here. Given the fact that all seven Justices voted to grant, my guess is that they took the case because it's important, not because they necessarily disagreed with the Court of Appeal's opinion. Stayed tuned.

Secret Ballot Not Required In Fee Elections Under Prop. 218

In Greene v. Marin County Flood Control and Water Conservation District (here), the Supreme Court held that a Article II, Section 7, which requires that Article II, Section 7, which provides that "voting shall be secret," does not require a totally secret ballot on fee elections under Prop. 218 (which requires an election on property-related fees except for water, sewer and garbage service). The Court relied on the provision in Article XIII D. Section 6(c), which provides that an agency may adopt procedures for fee elections that are similar to those compelled for assessment elections by Article XIII D, Section 4. Since that provision does not require secret ballots--indeed, it provides for weighted voting that requires that a voter's identity be known--neither does Article XIII D, Section 6(b). Because the agency in this case provided for a high degree of secrecy--ballots could only be inspected after the tabulation and then only by court order--the court found no constitutional violation. However, the court left open the possibility that lesser degree of secrecy might violate the constitution.

Congratulations to Mike Colantuono, who successfully represented the public agency defendant.

Park Assessment Fails To Comply With Prop. 218

In Beutz v. County of Riverside (here), the Court of Appeal held that a park assessment failed to comply with the requirements of Article XIII D, Section 4, part of Proposition 218. The court first held that the county had failed to separate the general benefit from the special benefit provided by the improvements in question (park landscaping) and also failed to spread the special benefit proportionately among the assessees (all of whom paid an equal assessment). In short, the opinion gives teeth to the requirements of Prop. 218, insofar as they relate to assessments.

SLAPPing "Mixed" Causes Of Action

What happens when only a small part of a cause of action is subject to strike under the anti-SLAPP statute? That's the question underlying the debate in Haight-Ashbury Free Clinics, Inc. v. Happening House Ventures (here). The plaintiff alleged a claim for breach of fiduciary duty, based on sixteen acts, two of which were found protected under the anti-SLAPP statute. The majority opinion dismissed the whole cause of action, because the plaintiff had failed to show that it could succeed on any part of its claim, whether based on protected or unprotected activity. The concurring and dissenting opinion would have dismissed only the portion of the claim based on protected activity, which seems right to me.

Arbitration Clause Not Enforceable On Homeowners' Association

In Villa Vicenza Homeowners Ass'n v. Nobel Court Development, LLC (here), the Court of Appeal held that an arbitration clause recorded in CC&Rs was not enforceable in a suit brought by a homeowners' association against a developer. Because the clause was subject to the Federal Arbitration Act, the court was not bound by the holdings in Grafton Partners v. Superior Court (in which we represented the petitioner), which holds that predispute jury waivers are unenforceable except as specifically authorized by the Legislature, or Treo @ Kettner Homeowners Assn. v. Superior Court, which held that a homeowners association was not bound by a judicial reference agreement contained in CC&Rs. Nevertheless, the court held that both federal law and state law refuse to enforce arbitration clauses against non-signatories, and the homeowners association had never agreed to arbitrate a dispute against the developer.