Hot Topics in Business Law

Oct 1, 2018 |

California Becomes First State to End Cash Bail after 40-Year Fight

According to the article, California will become the first state in the nation to abolish bail for suspects awaiting trial under a sweeping reform bill signed by Governor Jerry Brown recently.

An overhaul of the state’s bail system has been in the works for years, and became an inevitability earlier this year when a California appellate court declared the state’s cash bail system unconstitutional. The new law goes into effect in October 2019.

“Today, California reforms its bail system so that rich and poor alike are treated fairly,” Brown said in a statement, moments after signing the California Money Bail Reform Act.

The governor has waited nearly four decades to revamp the state’s cash bail system. In his 1979 State of the State Address, Brown argued the existing process was biased, favoring the wealthy who can afford to pay for their freedom, and penalizing the poor, who often are forced to remain in custody.

“Our path to a more just criminal justice system is not complete, but today it made a transformational shift away from valuing private wealth and toward protecting public safety,”

Sen. Robert Herzberg, a co-author of the bill, said in a statement. “California will continue to lead the way toward a safer and more equitable system.”

Washington, D.C., already has a cashless bail system. Other states, including New Jersey, have passed laws that reduce their reliance on money bail. And other states are considering making similar changes.

Under the California law those arrested and charged with a crime won’t be putting up money or borrowing it from a bail bond agent to obtain their release. Instead, local courts will decide who to keep in custody and whom to release while they await trial. Those decisions will be based on an algorithm created by the courts in each jurisdiction.

In most nonviolent misdemeanor cases, defendants would be released within 12 hours. In other instances, defendants will be scored on how likely they are to show up for their court date, the seriousness of their crime, and the likelihood of recidivism.

Some people could be released on other conditions, including monitoring by GPS or regular check-ins with an officer.

The goal of the legislation is to eliminate human bias in court proceedings, but critics argue the new system that will be created by the courts runs the risk of perpetuating discrimination.
Meanwhile, the American Civil Liberties Union of California, an original co-sponsor of the bill, pulled its support, arguing that last-minute changes give judges too much discretion in determining under what circumstances people will be released or kept in custody.

“We are concerned that the system that’s being put into place by this bill is too heavily weighted toward detention and does not have sufficient safeguards to ensure that racial justice is provided in the new system,” said the ACLU’s Natasha Minsker.

Raj Jayadev, co-founder of advocacy organization Silicon Valley De-Bug, said like the ACLU, his group is a former supporter of the bill. Ultimately, as it is written, he told the Sacramento Bee, the law discriminates against the poor.

“They took our rallying cry of ending money bail and used it against us to further threaten and criminalize and jail our loved ones.”

And there’s the end to the state’s bail bond industry.

“We’re gone. We’re done. As of today the bail industry will start shuttering their doors,” said Topo Padilla, President of the Golden State Bail Agents Association. That that could reportedly affect 7,000 jobs, though Jeff Clayton, president of the American Bail Coalition, said that it’s likely that the bail industry will sue, putting the law on hold.

Padilla contended the law is bad for the people of California.

The law “straps the taxpayers with funding 100 percent of all pretrial release programs,” and will lead to increasing detentions of people who otherwise would post bail, he said.

Discussion Questions

1. Describe the Due Process Clause of the United States Constitution. In your reasoned opinion, is there a Due Process Clause-related argument that supports a cashless bail system?

The Fifth Amendment to the United States Constitution mandates that “No person shall…be deprived of life, liberty, or property, without due process of law…” The Fourteenth Amendment imposes this obligation on the states, indicating that “No state shall…deprive any person of life, liberty, or property, without due process of law.”

The issue of bail is addressed in the Eighth Amendment, which states that “Excessive bail shall not be required…” The Due Process Clause-related argument that supports a cashless bail system is that any appreciable bail amount required for an indigent defendant might be “excessive.” $500 might not even appear “on the radar” for a wealthy defendant, but that amount might represent “all of the money in the world” for an indigent defendant.

2. Describe the Equal Protection Clause of the United States Constitution. In your reasoned opinion, is there an Equal Protection-clause related argument that supports a cashless bail system?

The Fourteenth Amendment to the United States Constitution proclaims that “No state shall…deny to any person within its jurisdiction the equal protection of the laws.” If a wealthy defendant is easily able to post $10,000 in bail but an indigent defendant is not, resulting in the wealthy defendant being free pending trial while the indigent defendant languishes behind bars, that is arguably a violation of equal protection.

3. As the article indicates, ending the cash bail system in California will affect 7,000 jobs in the “Golden State.” In your reasoned opinion, is this an important factor in deciding whether to implement a cashless bail system? Explain your response.

Although student opinions may vary in response to this question, in your author’s opinion, job preservation and creation in the criminal justice system should not be a consideration in crafting government policy and law.

More Hotels to Provide Employees with Alert Devices

According to the article, more hotel companies have pledged to equip their employees with personal safety devices they can use to get help if they feel they are in danger.

G6 Hospitality, parent company of Motel 6 and Studio 6, has promised to provide the devices to all its employees at its corporate-owned and managed hotels by the end of March 2019. The company will begin distributing the devices this fall.

The devices will emit a dual-siren alarm when activated. Employees can use them if they or any guests they encounter feel they are being sexually harassed or assaulted in any way.

G6 is the first company in the economy lodging sector to sign on to a pledge by the American Hotel and Lodging Association to enhance policies, training and resources to improve safety, including preventing sexual harassment and assault. The lobbying group for the industry last week announced its 5-Star Promise, which also includes providing hotel employees across the USA with employee safety devices by 2020.

Hilton, Hyatt, InterContinental Hotels Group, Marriott International and Wyndham Hotels and Resorts also signed onto the pledge.

“People are the heart of this business and the single greatest asset to G6 Hospitality. That is why we are committed to the well-being, peace of mind and safety of our team members and guests, and we continue to take steps to improve that experience,” says Rob Palleschi, CEO of G6 Hospitality.

Hotel companies in several cities such as New York, Washington D.C., Chicago, and Seattle already provide such devices to employees.

The hotel industry is responding to the current climate that is recognizing sexual harassment as a larger issue in the wake of the #MeToo movement. The industry is also acknowledging other human rights issues such as human trafficking.

G6 Hospitality has also introduced anti-human trafficking training to all its employees.
Note: In addition to the article, please also see the accompanying video included at the above-referenced internet address.

Discussion Questions

1. Define negligence.

Negligence is defined as the failure to do what a reasonable person would do under the same or similar circumstances. In order to prove negligence, a plaintiff in a civil action must prove, by the greater weight of the evidence, that: a) the defendant owed a duty to the plaintiff; b) the defendant breached the duty of care owed to the plaintiff; c) the defendant caused the plaintiff harm; and d) the plaintiff experienced damages as a result.

2. In light of the growing number of hotels providing employees alert devices, would not offering alert devices constitute negligence? Why or why not?

Compliance with an industry standard is compelling evidence of due care, while not meeting industry standard is compelling evidence of negligence. The more that competitor hotels provide employees with alert devices, the more likely such a practice will be recognized legally as an industry standard.

3. In terms of the duty of care owed by a business, is there a difference between the duty of care owed an employee and the duty of care owed a customer? Explain your response.

Businesses owe a substantial duty of care to both employees and customers. For employees, the Occupational Safety and Health Act (OSHA) mandates that employers provide them with a safe work environment (This is known as the “general duty” standard). In terms of liability for an employee who has been sexually harassed, if an employer maintains a work environment that facilitates such harassment, the employer can be held liable. For customers, anyone who comes on to business property for a business purpose is known as an “invitee.” In terms of premises liability, a business is liable for harm that results to a customer due to the business’s failure to make the property reasonably safe for the customer’s visit. This liability is premised on negligence law.

The Executive Runs Amok

Note: The following is an opinion piece written by Jibran Khan, the Thomas L. Rhodes Journalism Fellow at the National Review Institute. The National Review is a self-described conservative magazine and website. Although the article is politically charged (such is the current nature of our sociocultural environment), your author encourages you to use it as a vehicle to discuss with your students, as apolitically as possible, the always-salient and topical issues of international trade and trade restrictions (for example, tariffs). It is not your author’s intent to either endorse or indict the sitting president.

In characteristic fashion, President Trump proclaimed his new tariff package via Twitter. He boasted of the “massive Tariffs we may be imposing on China,” and then noted that they may cause Apple products’ prices to rise. One wonders why the latter part didn’t set off an alarm bell.

Tariffs, after all, are a tax imposed on American buyers and manufacturers, not “on China,” and the price rises they cause won’t be limited to Apple products, but instead will be seen through the economy as a whole, including on products from industries that source their parts domestically.

Where the previous sets of tariffs targeted wide swathes of products and parts, the new tariff program will hit all imports from China. Trump has promised $200 billion that are ready to go, and explained that “behind that, there’s another $267 billion ready to go on short notice if I want. That totally changes the equation.”

Indeed it does. The Chinese have signaled that they are going to retaliate, so American manufacturers and farmers who just received subsidies for their government-induced losses will likely to have their export markets damaged even further. No amount of subsidization is going to make up for the precipitous drop in sales.

What’s more, the scope of the hike will incentivize cronyism, as well-connected companies seek (and receive) arbitrary exceptions. That private actors will seek relief is understandable, and yet the arbitrary application that will result underscores one of the core problems with Trump’s approach: That, in truth, these tariffs are not “policy” in the traditional sense of that word — that is, an idea that is discussed, developed, and debated by a legislative body before being passed — but the capricious impulses of one man. (The legislation that the president has used to levy tariffs is not new; it dates to 1962, however its very name — the “Trade Expansion Act” — shows that the Trump tariffs are not in keeping with its intentions.)

Only Congress can change this state of affairs. The Framers placed in Article I of the Constitution the origination clause, which states that “All Bills for raising Revenue shall originate in the House of Representatives,” and they followed it with “The Congress shall have Power to lay and collect Taxes, Duties, Imposts and Excises.” They did this for a reason: Namely, that the House of Representatives was the closest branch to the people who would face the brunt of taxation — in contrast to the Senate, which represented states, and in even starker contrast to the executive, which was most distant of all. Today, though, the president has been empowered to impose taxes whenever he sees fit (an odd state for a nation founded in opposition to ‘Taxation without Representation”). Whether this is legal or not (I am sympathetic to the view, expressed by George Will and Brooklyn Law School’s Rebecca Kysar, that despite legislation that purports to do so, the legislative branch cannot constitutionally delegate its powers to the executive), it represents an inversion of our constitutional order.

Many weeks of debate (and years of research) preceded Congress’s passage of last year’s tax bill. The president’s tariff hike, which dwarfs that legislation in size, is being debated on Twitter. Something has gone wrong here.

Discussion Questions

1. Define tariff.

A tariff is a tax on imports or exports. Money collected under a tariff is called a duty or customs duty. Tariffs are used by governments to generate revenue and/or to protect domestic industries.

2. In your reasoned opinion, as between the executive and the legislative branches of government, which branch should have the power to impose trade restrictions? Explain your response.

Article I, Section 8 of the United States specifically indicates that “The Congress shall have the power… (t)o lay and collect taxes, duties, imposts and excises…” Congress delegated some of its authority to the president pursuant to the Trade Expansion Act of 1962, which states that if the Secretary of Commerce “finds that an article is being imported into the United States in such quantities or under such circumstances as to threaten to impair the national security,” then the president is authorized to take “such other actions as the President deems necessary to adjust the imports of such article so that such imports will not threaten to impair the national security.”

In your author’s opinion, any attempted resolution of this fascinating “balance of power” issue depends on answering the following questions:

a) What trade situation specifically triggers presidential authority to protect “national security” (for example, would simply a trade deficit or balance of payment deficit with another country constitute a national security issue, and if so, how much?); and

b) Is Congress is willing to assert its constitutional authority to regulate tariffs, as delegated specifically and exclusively in Article I, Section 8 of the United States Constitution?

3. Comment on the view of George Will and Rebecca Kysar that the legislative branch of government cannot constitutionally delegate its power(s) to the executive branch. Do you support or oppose this view?

This is an opinion question, so student responses may vary. Those who support such delegation might make a general “delegation of authority” argument similar to what they might learn in a basic “Principles of Management” course, while those who oppose such delegation might contend that constitutional delegation of authority, specifically by our Founding Fathers to Congress in Article I, Section 8 of the United States Constitution, represents not only a congressional privilege, but a solemn congressional responsibility consistent with how the framers viewed the proper structure of our government and the appropriate balance of power between the various branches of government.