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Shareholder Voting Arrangements

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In certain situations, shareholders may find it advantageous to enter into agreements with other shareholders regarding how the company should be run or who will run the company.  These agreements, known as “shareholder agreements” or sometimes “vote pooling agreements” or “block voting arrangements” are generally permissible and can pertain to a variety of topics.  The specific rules governing shareholder agreements varies from state to state, however most states follow some version of the Revised Model Business Corporation Act (“RMBCA”).  Section 7 of the RMBCA states the rules regarding shareholder agreements.

The most common types of shareholder agreements are:

• Voting Trusts:  In a voting trust, shareholders agree to transfer their shares to a trust and to appoint a trustee who will be in charge of voting all of the shares controlled by the trust.
• Voting Agreements:  A written agreement by which each shareholder that is a party to the agreement agrees to vote his shares in a specific way.
• Management Agreements:  An agreement between shareholders to take some specific management action.

Voting Trusts

A voting trust is best understood as a group of shareholders agreeing to delegate voting authority for their shares to a third party, known as the trustee of the voting trust.  Voting trusts are written agreements in which shareholders transfer their shares to a trust in exchange for in interest in the proceeds from the trust.  Most commonly, a group of shareholders will transfer their shares to the trust in exchange for an interest in the proceeds of the trust that is proportional to the number of shares each transfers.  Because their interest in the trust is proportional to the interest of their shares, each party’s financial stake (that is, the amount of money each shareholder will receive from dividend payouts) remains unchanged.  The trustee is given the authority to vote the shares and distribute the proceeds from the trust.  Often, the trustee is also given directions regarding how to vote the shares of the trust.  For example, the trustee can be instructed to “vote the shares of the trust in favor of a member of the Smith family to become a director of the corporation if at least one member of the Smith family seeks to be a director.”  Generally, the only proceeds of the trust are the dividends paid to the shares.  Under Section 7.30 of the RMBCA, five elements must be present for a voting trust to be validly:

• Written Agreement:  All shareholders creating the trust must sign an agreement explaining the terms of the trust.  This requirement can also be satisfied if the voting trust is created by the will of a deceased party who leaves the shares to the voting trust (for no longer than the permissible time period) and designates a person or persons who shall have a right to the proceeds from the trust until the trust expires.
• Transfer of Legal Ownership:  The creation of a voting trust requires that legal title to the shares is transferred to the trust itself.  If an agreement calls for the shareholders to retain ownership of the shares, the agreement cannot qualify as a voting trust.
• Filed with the corporation:  The corporation must be given a copy of the trust agreement as well as the name and address of each party with a present beneficial interest (the parties which will receive the proceeds of the trust) in the trust.
• Ten Year Limit:  A voting trust is valid for not more than ten years.  A trust can be extended for up to ten additional years if all of the parties to the trust agree.  If the trust is extended, the new ten year limitation starts at the time of the agreement to extend rather than at the end of the current ten year period.

Voting Agreements

A voting agreement is an agreement between shareholders to vote their shares in a specific way.  Instead of delegating voting authority to a third party as is the case in a voting trust, in a voting agreement, each shareholder pledges to abide by the agreement.  If the agreement is validly executed, any party to the agreement can sue for specific performance of the agreement if another party refuses to abide by the agreement.  If a suit for specific performance is successful, the court will order the parties to vote the shares in accordance with the voting agreement.  Unlike voting trusts, voting agreements can be for any duration and do not need to be filed with the corporation.  Under Section 7.31 of the RMBCA, a voting agreement is valid if three requirements are satisfied:

• The agreement is in writing.
• The agreement is signed.
• The agreement is not subject to any contractual defenses.  Because a voting agreement is a contract between shareholders, the agreement is subject to the normal contractual defenses.  If the agreement would be void or voidable under the applicable state’s contract law, the agreement is void or voidable.

Voting agreements offer several benefits when compared to voting trusts.  First, voting agreements are easier to enter into and easier to maintain, because they do not need to be filed with the corporation and do not need to be renewed every ten years.  Additionally, voting agreements may be less expensive to implement, becauase trustees may charge a fee for their services.  Furthermore, owners are allowed to retain complete ownership of the shares under a voting agreement.

Voting agreements also have some disadvantages when compared to voting trusts.  Most notably, because a voting agreement is a contract, there is less room for the exercise of future discretion.  For example, when the future is unclear, a voting trust can lay out general decision making guidelines for a trustee to follow and have the trustee make the final decision, whereas in a voting agreement, each party will likely make their own choice, possibly defeating the purpose of the agreement. The less clear or more subjective the requirements of the agreement are, the less likely a court is to specifically enforce the agreement.  Additionally, because voting agreements can be perpetual in nature, a party that no longer wishes to be bound by a voting agreement may be bound by the agreement perpetually.

Management Agreements

Management agreements are contracts entered into by the shareholders regarding the governance of the corporation.  Management agreements can address a variety of topics, including the authorization or paying of dividends, the identity of the corporation’s directors or officers, and the powers of the board of directors.  Management agreements are so powerful they can even be used to eliminate the board of directors entirely or give a specific shareholder the power to manage the business.  Because of the enormous power of management agreements, RMBCA Section 7.32 severely limits the methods of creating a management agreement.  Under the RMBCA, a shareholder agreement can be created in two ways:

• The agreement is made a part of the corporation’s articles of incorporation or bylaws AND all of the shareholders who are shareholders at the time the agreement is made a part of the articles of incorporation or bylaws approve of the agreement.
• All shareholders agree in writing to the management agreement AND the written agreement is filed with the corporation.

Once a valid management agreement is in force, the agreement can be amended or terminated either by an agreement of all of a corporation’s then current shareholders or in accordance with any terms set forth in the agreement.  If a corporation “goes public” by listing its shares on a national exchange, any existing management agreements are automatically suspended.  RMBCA Section 1.40(18A).

Legal Disclaimer

This website provides information addressing legal topics of interest to the general reader.  You should not consider this information designed or adequate to meet any of your particular legal needs, concerns or inquiries.  You should consult with a lawyer licensed to practice law in the jurisdiction appropriate to your legal situation to assess your situation and provide you with appropriate legal advice.  A good starting point for finding a lawyer is to contact your state’s bar association.

This article is copyrighted by Knowledge Website, LLC – 2010

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The first amendment, module 13: voting rights in america.

The original Constitution did not specifically protect the right to vote—leaving the issue largely to the states. For much of American history, this right has often been granted to some, but denied to others; however, through a series of amendments to the Constitution, the right to vote has expanded over time. These amendments have protected the voting rights of new groups, including by banning discrimination at the ballot box based on race (15th Amendment) and sex (19th Amendment). They also granted Congress new power to enforce these constitutional guarantees, which Congress has used to pass landmark statutes like the Voting Rights Act of 1965. While state governments continue to play a central role in elections today, these new amendments carved out a new—and important—role for the national government in this important area.

Download all materials for this module as a PDF

Learning Objectives

• Describe what the Constitution says about voting rights.
• Identify who can vote in America during various periods in our nation’s history 
• Explore the role of federalism in the context of voting and elections in America.
• Discuss the groups that benefited from the 12th, 15th, 17th, 19th, 23rd, 24th, and 26th Amendments.
• Analyze battles at the Supreme Court over the Voting Rights Act of 1965.
• Describe the long battle over women’s suffrage, culminating in the 19th Amendment.

13.1 Activity: Voting in the Constitution

• Student Instructions
• Teacher Notes

Purpose In this activity, you will reflect on the importance of the right to vote and the value of informed voters. 

Process Review the following quote from Frances Ellen Watkins Harper, abolitionist, suffragist, poet, and writer:

“I do not think the mere extension of the ballot a panacea for all the ills of our national life. What we need to-day is not simply more voters, but better voters.” 

Women’s Political Future , 1893 by Frances Ellen Watkins Harper

View Visual Info Brief: Frances Harper Quote

After reviewing the quote, discuss with a partner the following questions:

• What is your immediate reaction to the quote? 
• Why is the right to vote important?
• What does it mean to be a “better voter?” 
• Can the right to vote address the “ills of our national life?” If so, how?
• What other actions are needed to address these ills?
• Do you agree or disagree with the quote, and why?  

Launch Present the Visual Info Brief: Frances Harper Quote on the board for the class to view. Define “panacea” for all students.

Share with the students additional information about Harper with the Info Brief: Frances Ellen Watkins Harper . Note the year of the quote. What can they say about the year in relation to voting rights in America? Understanding the social context of the time will help students explore the meaning of the quote in greater detail. Examine the importance of the year, as well as her gender and race, in understanding Harper’s quote. 

Activity Synthesis Have students share their reactions to the quote with a partner and then discuss it as a class. 

Activity Extension (optional) Invite students to review the transcript  of the longer entry of Women’s Political Future and compare it with another famous speech from earlier in Harper’s life, We are All Bound Up Together .  

13.1 Visual Info Brief: Frances Harper Quote

13.1 info brief: frances ellen watkins harper, 13.2 video: voting rights in america.

Purpose In this activity, you will learn about the amendments, laws, and Supreme Court cases that have shaped voting rights in America.

Process Watch the following video about voting rights in America.

Then, complete the Video Reflection: Voting Rights in America worksheet.

Launch Give students time to watch the video and answer the questions on the worksheet.

Activity Synthesis Have students identify the patterns they see in the history of the right to vote in America. Ask them to reflect on the role of voting in the American constitutional system, and why it is important for citizens to have the right to vote. 

Activity Extension (optional) Now that students have a better understanding of the history of voting rights in America, ask students to conduct additional research about voting rights and election practices during one of the time periods identified in the worksheet. 

13.2 Video Reflection: Voting Rights in America

13.3 activity: exploring elections and voting in the constitution.

Purpose In this activity, you will examine how the constitutional amendments have shaped elections and voting throughout American history. You will also explore the role of federalism in the context of elections and voting in America. 

Process First, begin by reading the Info Brief: Elections and Voting in the Constitution . Then in your group, read the Interactive Constitution  essay assigned to your group and take notes.

Constitutional amendments addressing election and voting rights:

• Text of the Constitution
• Common Interpretation
• Common Interpretation 

Complete the Activity Guide: Exploring Elections and Voting in the Constitution worksheet.

Finally, share with your class what you learned about your assigned amendment and how it shaped elections and voting in elections. Then, explore the following questions:

• What does the Constitution say about voting rights? What’s in there, and what isn’t?
• Who can vote in America (and when)?
• Before the Constitution, who could vote, and which governments controlled elections and voting? 
• How did Reconstruction transform voting rights in America? What were its limits?
• Which groups benefited from the 12th, 15th, 17th, 19th, 23rd, 24th, and 26th Amendments?

Launch Begin by asking students: Where in the Constitution do you see language that relates to elections and voting? 

Have the students read Info Brief: Elections and Voting in the Constitution.

Assign students one or more of the following sections of the Interactive Constitution to read:

• 12th Amendment
• 15th Amendment
• 17th Amendment
• 19th Amendment
• 23rd Amendment
• 24th Amendment
• 26th Amendment

While analyzing their assigned amendment(s), have the students complete the Activity Guide: Elections and Voting in the Constitution.

Then, have students meet in small groups to share and compare what they learned and build upon each other’s findings. 

Activity Synthesis Have students identify: 

Activity Extension (optional) Now that students have a better understanding of voting at the national level, ask the following questions:

• What is the role of the states in voting and elections? What can states control? What limits are set by the Constitution? 
• What sorts of limits were in the original Constitution? What sorts of limits were added through the constitutional amendment process? 
• How do voting requirements vary in different states? 
• Do you think that we need any other constitutional amendments concerning elections and voting? Why, or why not?

13.3 Info Brief: Elections and Voting in the Constitution

13.3 activity guide: exploring elections and voting in the constitution, 13.4 primary source readings: the supreme court and the vote.

Purpose In this activity, you will read a primary source about voting rights and then analyze two landmark Supreme Court decisions addressing the Voting Rights Act of 1965.

Process Read the Info Brief: The Supreme Court and the Vote .

The teacher will then divide your class into groups. With your group, read W.E.B. DuBois, The Souls of Black Folk (1903), and the NAACP, Platform Adopted by National Negro Committee (1909). Then, complete the relevant part of the Case Brief: The Supreme Court and the Vote worksheet, reflecting on the following questions:

• Who authored the primary source, and when?
• What is the call to action in this source? 
• Did the American people, their elected officials, and/or the Supreme Court address these concerns over time? If so, when?

Now, your teacher will assign your group one of the following Supreme Court cases. Please read the background information and case excerpt for your assigned case and reflect on how the Court interpreted Congress’s power to enforce the right to vote in each case.

• South Carolina v. Katzenbach
• Shelby County v. Holder

After you read the content of your assigned case, summarize the key arguments offered by the justices, complete the relevant part of the Case Brief: The Supreme Court and the Vote worksheet, reflecting on the following questions:

• Facts: Who are all the people (parties) associated with the case? What was the dispute between them?
• Issue: What is the issue in the case? What constitutional provision is at issue? What is the constitutional question that needs to be answered?
• How does the Court rule? What was the outcome in the case? Who won and who lost? How did the justices vote? What sort of rule does the Court come up with to resolve the issue?
• Who was the author of the majority opinion?
• Were there any concurring or dissenting opinions? Who authored them? What did they say? How would the justices who authored them have ruled in the case?
• How does the Court’s decision address voting rights?
• Were the calls to action from the NAACP committee and W.E.B. DuBois met?

Launch Give students time to read primary source documents and summarize the key arguments of the document in support of granting the right to vote. Sources: W.E.B. DuBois, The Souls of Black Folk (1903) and the NAACP, Platform Adopted by National Negro Committee (1909).

Activity Synthesis

• As a large group, discuss each source and which arguments were the most and least convincing. 
• Have students compare the arguments presented in the sources and identify similarities and differences.
• Ask the class, which, if any, of the arguments presented in the sources are still applicable today? For which groups of people? 

Next, assign each group one of the following Supreme Court cases. 

Have groups continue to build on their Case Brief: The Supreme Court and the Vote worksheet and share their findings. 

Activity Extension (optional) What about women’s suffrage? To understand some of the early debates over women’s voting rights and the Constitution, read an excerpt from the Supreme Court’s decision in Minor v. Happersett and compare it with Susan B. Anthony’s Closing Argument at her trial for election fraud in United States of America v. Susan B. Anthony . Reflect on the following questions:

• How did the Supreme Court rule? What were the Court’s key arguments?
• What were the key arguments advanced by Susan B. Anthony?
• Compare and contrast the arguments advanced by each. Who offered a more persuasive constitutional argument? Why?  

13.4 Info Brief: The Supreme Court and the Vote

13.4 case brief: the supreme court and the vote, 13.4 primary source: w.e.b. dubois, the souls of black folk (1903), 13.4 primary source: naacp, platform adopted by national negro committee (1909), 13.4 primary source: south carolina v. katzenbach (1966), 13.4 primary source: shelby county v. holder (2013), 13.5 activity: the fight for the 19th amendment.

The 19th Amendment bans discrimination at the ballot box based on sex. The battle for women’s suffrage was a long one, involving generations of brave reformers pushing for change at national, state, and local level.

To begin, read Info Brief: The Women’s Suffrage Movement .

Then, your teacher will break your class into groups. Each group should build a women’s suffrage timeline, using the info brief and the  National Constitution Center’s Drafting Table tool .

From there, use the Interactive Primary Source Tool: Historic Debates for and Against Suffrage to create a chart of the main arguments for and against women’s suffrage.

Finally, your group will share what you learned and reflect on the battle for women’s suffrage over time and what that story can teach us about the process of constitutional reform within the American constitutional system. We will return to this big question about constitutional reform in Module 15.  

To begin, have the students read Info Brief: The Women’s Suffrage Movement.

Then, break the class into groups. Each group should build a women’s suffrage timeline, using the Info Brief and the  National Constitution Center’s Drafting Table tool .

From there, each group will use the interactive Debates webpage for and against suffrage to create a chart of the main arguments for and against women’s suffrage.

Finally, as a class, each group will share what they learned and reflect on the battle for women’s suffrage over time and what that story can teach us about the process of constitutional reform within the American constitutional system. We will return to this big question about constitutional reform in Module 15.

13.5 Info Brief: The Women’s Suffrage Movement

13.6 activity: exploring the vote in your community.

Purpose In this activity, you will research how to vote where you live. You will also identify how someone can become an informed voter in your state and locality.

Process Using vote.gov , research your state-run voting website and review the process for voting in your state from start to finish. Fill out the Activity Guide: Exploring the Vote in Your Community worksheet.

Create a one-page infographic or fact sheet on voting for the eligible voters in your school and community. Ensure it has at least the following information:

• Voter eligibility
• Voter registration instructions
• Voting locations
• Election day dates and times 
• How to become an informed voter—sources of reliable information on the candidates
• Other information that you think will be helpful to get to the polls, vote by mail, or to be a “better voter”

Launch Have students discuss their experiences with the voting process from news, to going to the polls with adults in their lives. Give students time to research the process for voting in their state from start to finish.

Activity Synthesis Have students present their one-page infographic or fact sheet on voting. Display voting guides in the classroom and have students develop a plan for sharing their voting guide outside the classroom. 

13.6 Activity Guide: Exploring the Vote in Your Community

13.7 test your knowledge.

Congratulations for completing the activities in this module! Now it’s time to apply what you have learned about the basic ideas and concepts covered.

Complete the questions in the following quiz to test your knowledge.

This activity will help students determine their overall understanding of module concepts. It is recommended that questions are completed electronically so immediate feedback is provided, but a downloadable copy of the questions (with answer key) is also available.

13.7 Interactive Knowledge Check: Voting Rights in America

13.7 printable knowledge check: voting in america, previous module, module 12: slavery in america: from the founding to america’s second founding, next module, module 14: the 14th amendment: battles for freedom and equality.

The 14th Amendment wrote the Declaration of Independence's promise of freedom and equality into the Constitution. Ratified after the Civil War, this amendment transformed the Constitution forever and is at the core of a period that many scholars refer to as our nation’s “Second Founding.” Even so, the 14th Amendment remains the focus of many of today’s most important constitutional debates (and Supreme Court cases). In many ways, the history of the modern Supreme Court is largely a history of modern-day battles over the 14th Amendment's meaning. So many of t...

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About Federal Observers And Election Monitoring

Federal observers, election monitoring, how to request monitoring of an election by the civil rights division.

• Termination of Federal Observer Assignment Activity

The Civil Rights Division conducts monitoring of polling places on election day using federal observers, and as well as monitoring using Division attorneys and staff, to help assess compliance with the federal voting rights laws around the country.

The Voting Rights Act permits federal observers to monitor procedures in polling places and at sites where ballots are counted in eligible political subdivisions. The Division determines whether federal observers are needed in an eligible jurisdiction. If so, the Division notifies the Office of Personnel Management (OPM) that federal observers are needed, which OPM recruits, and then, in cooperation with Division attorneys, supervises federal observers. Federal observers write reports of the activities they witness in polling places and provide those reports to the Division.

The Voting Rights Act provides for the appointment of federal observers by order of a federal court pursuant to Section 3(a), or, (prior to the Shelby County decision) with regard to political subdivisions covered under Section 4 of the Voting Rights Act, upon the certification by the Attorney General, pursuant to Section 8 (previously Section 6).

Prior to the Shelby County decision in 2013, a total of 153 counties and parishes in 11 states were certified by the Attorney General for federal observers: Alabama (22 counties), Alaska (1) Arizona (4), Georgia (29), Louisiana (12), Mississippi (51), New York (3), North Carolina (1), South Carolina (11), South Dakota (1) and Texas (18). In light of the Shelby County decision, the Division is not relying on the Section 4(b) coverage formula as a way to identify jurisdictions for election monitoring. Hence, the Division is not relying on the AG certifications as a basis for sending federal observers to monitor elections. Please see the fact sheet here .

For historical purposes, the political subdivisions certified by the Attorney General for federal observers under the Voting Rights Act prior to the Shelby County decision were:

Pursuant to Section 3(a) of the Voting Rights Act, federal observers are currently authorized in 4 political subdivisions in 2 states by federal court order: Alaska (3) and Louisiana (1).

Political subdivisions that are eligible for federal observers as a result of court orders under the Voting Rights Act:

In light of the Shelby County decision, the Division is not relying on the Section 4(b) coverage formula as a way to identify jurisdictions for election monitoring. The Division can continue to engage OPM federal observers where there is a relevant court order. The Division also will continue to conduct its own election monitoring around the country, using its own staff, without relying on the Section 4(b) coverage formula. Please see the fact sheet here .

After the Shelby County decision, the Division can continue to engage OPM federal observers where there is a court order under Section 3(a) of the Voting Rights Act authorizing their presence. The monitoring of elections by federal observers is an important aspect of the Division's voting rights enforcement efforts. The success of the federal observer program is made possible by the long-term commitment of OPM to recruit, train, and supervise these federal observers, who serve as neutral and impartial observers of election-day procedures, and by cooperation and coordination with state and local election officials.

The Division also monitors elections in the field for compliance with the federal voting rights laws in jurisdictions not currently eligible for assignment of federal observers. Under these circumstances, one or more attorneys and staff members from the Division may be assigned to monitor the election in the field on election day and maintain contact with state and local officials.

• Contact the Voting Section at: Phone: 202-307-2767 Toll-free: 800-253-3931 Facsimile: 202-307-3961
• Any incidents of discrimination or interference with the right to vote in connection with upcoming or recent elections;
• Any complaints to local or state officials about the incidents and what, if anything, was done in response;
• Names and contact information for victims of discrimination or other violations of federal voting rights law;
• Names and contact information for any persons who have first-hand knowledge of the incidents;
• Names and contact information, if possible, for persons alleged to have engaged in discrimination or other violations of federal voting rights law;
• Locations where incidents have occurred.
• As much lead time as possible is important in order to permit pre-election investigations and to make logistical and staffing arrangements.

Termination of Federal Observer Assignment Authority

Section 13 of the Voting Rights Act sets forth the procedures by which a political subdivision where federal observers have been assigned due to certification by the Attorney General, may petition for the termination of such assignment authority. The Attorney General may terminate such assignment authority for a jurisdiction if:

• the Director of the Census has determined that more than 50% of the nonwhite persons of voting age are registered to vote and
• there is no longer reasonable cause to believe that persons will be deprived or denied the right to vote on account of race or color, or in contravention of the guarantees set forth in Section 4(f)(2) of the Voting Rights Act for language minority groups.

A political subdivision also may file an action for a declaratory judgment in the United States District Court for the District of Columbia that the federal observer assignment authority for the political subdivision should be terminated.

Any currently certified political subdivision that would like to submit a petition for termination of the federal observer assignment authority may contact the Voting Section:

You can call, toll-free, at 800/253-3931.

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Biden Assigns Harris Another Difficult Role: Protecting Voting Rights

The vice president has added another, and a politically thorny, problem to her growing portfolio.

By Katie Rogers

WASHINGTON — President Biden said on Tuesday that he had directed Vice President Kamala Harris to lead Democrats in a sweeping legislative effort to protect voting rights, an issue that is critical to his legacy but one that faces increasingly daunting odds in a divided Senate.

“Today, I’m asking Vice President Harris to help these efforts, and lead them, among her many other responsibilities,” Mr. Biden said during a trip to Tulsa, Okla. “With her leadership and your support, we’re going to overcome again, I promise you, but it’s going to take a hell of a lot of work.”

The president was in Oklahoma to commemorate the 100th anniversary of the Tulsa massacre , when a white mob destroyed a vibrant Black business district and killed as many as 300 people. The massacre was one of the worst outbreaks of racist violence in American history, and it has gone largely ignored in history books .

Mr. Biden told the crowd that he saw the protection of voting rights as one of the most fundamental — and most endangered — pathways to ensure racial equity.

But his decision to install Ms. Harris as the leader of an effort to beat back bills in states nationwide that are trying to tighten voting rules — “a truly unprecedented assault on our democracy, ” Mr. Biden told the crowd — added another politically thorny problem to the vice president’s policy portfolio.

Ms. Harris has already been tasked with leading the administration’s efforts to deter migration to the southwestern border by working to improve conditions in the Northern Triangle countries of Honduras, El Salvador and Guatemala. The vice president — who will visit Mexico and Guatemala next week — and her staff have worked to reframe expectations around her role, stressing that she will examine the root causes of migration, not single-handedly stop the flow of migrants to the United States.

Her Northern Triangle work comes in addition to a host of other engagements, including but not limited to: selling the “American Rescue Plan,” advocating Mr. Biden’s infrastructure package, representing women in the work force, highlighting the Black maternal mortality rate, assisting small businesses, assessing water policy, promoting racial equity, combating vaccine hesitancy, and fighting for a policing overhaul.

For her part, Ms. Harris embraced the assignment in a statement issued shortly after Mr. Biden’s announcement in Tulsa.

“In the days and weeks ahead, I will engage the American people, and I will work with voting rights organizations, community organizations, and the private sector to help strengthen and uplift efforts on voting rights nationwide,” the vice president said. “And we will also work with members of Congress to help advance these bills.”

Mr. Biden has focused on issues related to voting rights for much of his career, but the Senate now bears little resemblance to the deal-making chamber he remembers. He faces especially wrenching decisions when it comes to the voting rights legislation he has asked Ms. Harris to help shepherd through Congress.

Known as the “For the People Act,” the bill is the professed No. 1 priority of Democrats this year. It would overhaul the nation’s elections system, rein in campaign donations and limit partisan gerrymandering. But after passing the House , it hit a wall of Republican opposition in the Senate.

One option for Democrats would be to ram the bill through on a partisan vote by further rolling back one of the foundations of Senate tradition: the filibuster. But at least one Democrat, Senator Joe Manchin III of West Virginia, remains opposed to the idea, potentially scuttling it.

In Tulsa, Mr. Biden seemed to express open frustration at the odds facing the bill — and at the Democratic lawmakers who may stand in the way of its success.

“I hear all the folks on TV saying, ‘Why doesn’t Biden get this done’?” the president said. “Well, because Biden only has a majority of effectively four votes in the House and a tie in the Senate, with two members of the Senate who vote more with my Republican friends,” a likely swipe at Mr. Manchin and Senator Kyrsten Sinema of Arizona, another moderate Democrat.

Katie Rogers is a White House correspondent, covering life in the Biden administration, Washington culture and domestic policy. She joined The Times in 2014. More about Katie Rogers

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Voting rights: overview.

• U.S. Constitution Annotated

Fourteenth Amendment , Section 1:

All persons born or naturalized in the United States, and subject to the jurisdiction thereof, are citizens of the United States and of the State wherein they reside. No State shall make or enforce any law which shall abridge the privileges or immunities of citizens of the United States; nor shall any State deprive any person of life, liberty, or property, without due process of law; nor deny to any person within its jurisdiction the equal protection of the laws.

Although, of course, the denial of the franchise on the basis of race or color violates the Fifteenth Amendment and a series of implementing statutes enacted by Congress, 1 Footnote See “Federal Remedial Legislation,” infra . the administration of election statutes so as to treat white and black voters or candidates differently can constitute a denial of equal protection as well. 2 Footnote E.g. , Hadnott v. Amos, 394 U.S. 358 (1971) ; Hunter v. Underwood, 471 U.S. 222 (1985) (disenfranchisement for crimes involving moral turpitude adopted for purpose of racial discrimination). Additionally, cases of gerrymandering of electoral districts and the creation or maintenance of electoral practices that dilute and weaken black and other minority voting strength is subject to Fourteenth and Fifteenth Amendment and statutory attack. 3 Footnote E.g. , Gomillion v. Lightfoot, 364 U.S. 339 (1960) ; United Jewish Orgs. v. Carey, 430 U.S. 144 (1977) ; Rogers v. Lodge, 458 U.S. 613 (1982) .

Fundamental Interests: The Political Process

“The States have long been held to have broad powers to determine the conditions under which the right of suffrage may be exercised . . . , absent of course the discrimination which the Constitution condemns.” 4 Footnote Lassiter v. Northampton County Bd. of Elections, 360 U.S. 45, 50–51 (1959) . The Constitution provides that the qualifications of electors in congressional elections are to be determined by reference to the qualifications prescribed in the states for the electors of the most numerous branch of the legislature, and the states are authorized to determine the manner in which presidential electors are selected. 5 Footnote Article I, § 2, cl. 1 (House of Representatives); Seventeenth Amendment (Senators); Article II, § 1, cl. 2 (presidential electors); Article I, § 4, cl. 1 (times, places, and manner of holding elections). The second section of the Fourteenth Amendment provides for a proportionate reduction in a state’s representation in the House when it denies the franchise to its qualified male citizens 6 Footnote Fourteenth Amendment , § 2. Justice Harlan argued that the inclusion of this provision impliedly permitted the states to discriminate with only the prescribed penalty in consequence and that therefore the equal protection clause was wholly inapplicable to state election laws. Reynolds v. Sims, 377 U.S. 533, 589 (1964) (dissenting); Carrington v. Rash, 380 U.S. 89, 97 (1965) (dissenting); Oregon v. Mitchell, 400 U.S. 112, 152 (1970) (concurring and dissenting). Justice Brennan undertook a rebuttal of this position in Oregon v. Mitchell , 400 U.S. at 229, 250 (concurring and dissenting). But see Richardson v. Ramirez, 418 U.S. 24 (1974) , where § 2 was relevant in precluding an equal protection challenge. and specific discriminations on the basis of race, sex, and age are addressed in other Amendments. “We do not suggest that any standards which a State desires to adopt may be required of voters. But there is wide scope for exercise of its jurisdiction. Residence requirements, age, previous criminal record . . . are obvious examples indicating factors which a state may take into consideration in determining the qualification of voters. The ability to read and write likewise has some relation to standards designed to promote intelligent use of the ballot.” 7 Footnote Lassiter v. Northampton County Bd. of Elections, 360 U.S. 45, 51 (1959) .

The perspective of this 1959 opinion by Justice Douglas has now been revolutionized. “Undoubtedly, the right of suffrage is a fundamental matter in a free and democratic society. Especially since the right to exercise the franchise in a free and unimpaired manner is preservative of other basic civil and political rights, any alleged infringement of the rights of citizens to vote must be carefully and meticulously scrutinized.” 8 Footnote Reynolds v. Sims, 377 U.S. 533, 561–62 (1964) . “Any unjustified discrimination in determining who may participate in political affairs or in the selection of public officials undermines the legitimacy of representative government. . . . Statutes granting the franchise to residents on a selective basis always pose the danger of denying some citizens any effective voice in the governmental affairs which substantially affect their lives. Therefore, if a challenged state statute grants the right to vote to some bona fide residents of requisite age and citizenship and denies the franchise to others, the Court must determine whether the exclusions are necessary to promote a compelling state interest.”

“And, for these reasons, the deference usually given to the judgment of legislators does not extend to decisions concerning which resident citizens may participate in the election of legislators and other public officials. . . . [W]hen we are reviewing statutes which deny some residents the right to vote, the general presumption of constitutionality afforded state statutes and the traditional approval given state classifications if the Court can conceive of a ‘rational basis’ for the distinctions made are not applicable.” 9 Footnote Kramer v. Union Free School Dist., 395 U.S. 621, 626–28 (1969) . See also Hill v. Stone, 421 U.S. 289, 297 (1975) . But cf. Holt Civic Club v. City of Tuscaloosa, 439 U.S. 60 (1978) . Using this analytical approach, the Court has established a regime of close review of a vast range of state restrictions on the eligibility to vote, on access to the ballot by candidates and parties, and on the weighing of votes cast through the devices of apportionment and districting. Changes in Court membership over the years has led to some relaxation in the application of principles, but even as the Court has drawn back in other areas it has tended to preserve, both doctrinally and in fact, the election cases. 10 Footnote Thus, in San Antonio School Dist. v. Rodriguez, 411 U.S. 1, 34–35 nn.74 & 78 (1973) , a major doctrinal effort to curb the “fundamental interest” side of the “new” equal protection, the Court acknowledged that the right to vote did not come within its prescription that rights to be deemed fundamental must be explicitly or implicitly guaranteed in the Constitution. Nonetheless, citizens have a “constitutionally protected right to participate in elections,” which is protected by the Equal Protection Clause. Dunn v. Blumstein, 405 U.S. 330, 336 (1972) . The franchise is the guardian of all other rights. Reynolds v. Sims, 377 U.S. 533, 562 (1964) .

The following state regulations pages link to this page.

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Statement from Vice President Kamala   Harris on Administration’s Voting Rights   Efforts

Every American has a right to have their voice heard at the ballot box, and no American should be kept from voting early, voting by mail, or voting at all. Our democracy is strongest when everyone participates, and it is weaker when people are left out. Throughout the arc of our nation’s history, many have worked—and many have died—to ensure that all Americans can cast a ballot and have their vote counted. Today, that hard-won progress is under assault. In the last election, more people voted than ever before. Since then, more than 380 bills have been introduced across the country that would make it harder for Americans to vote. These bills seek to restrict the options that make voting more convenient and accessible, including early voting and vote by mail. Our Administration will not stand by when confronted with any effort that keeps Americans from voting.  We must protect the fundamental right to vote for all Americans regardless of where they live. There are two important bills in Congress that would do just that. The For the People Act would provide all Americans with fair and accessible voting options, and the John Lewis Voting Rights Advancement Act would prevent discriminatory changes to voting laws and procedures.  President Joe Biden asked me to help lead our Administration’s effort to protect the fundamental right to vote for all Americans. In the days and weeks ahead, I will engage the American people, and I will work with voting rights organizations, community organizations, and the private sector to help strengthen and uplift efforts on voting rights nationwide. And we will also work with members of Congress to help advance these bills. The work ahead of us is to make voting accessible to all American voters, and to make sure every vote is counted through a free, fair, and transparent process. This is the work of democracy.

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Assignment of Membership Interest: The Ultimate Guide for Your LLC

LegalGPS : November 30, 2023 at 8:16 AM

As a business owner, there may come a time when you need to transfer ownership of your company or acquire additional members. In these situations, an assignment of membership interest is a critical step in the process. This blog post aims to provide you with a comprehensive guide on everything you need to know about the assignment of membership interest and how to navigate the procedure efficiently. So, let's dive into the world of LLC membership interest transfers and learn how to secure your business!

What is an Assignment of Membership Interest?

An assignment of membership interest is a document that allows a member of an LLC to transfer their ownership share in the company to another person or entity. This can be done in the form of a sale or gift, which are two different scenarios that generally require different types of paperwork. An assignment is typically signed by the parties involved and delivered to the Secretary of State's office for filing. However, this process can vary depending on where you live and whether your LLC has members other than yourself as well as additional documents required by state law.

Necessary Approvals and Consent

Before initiating the assignment process, it's essential to review the operating agreement of your LLC, as it may contain specific guidelines on how to assign membership interests.

Often, these agreements require the express consent of the other LLC members before any assignment can take place. To avoid any potential disputes down the line, always seek the required approvals before moving forward with the assignment process.

Impact on Ownership, Voting, and Profit Rights

It's essential to understand that assigning membership interests can affect various aspects of the LLC, including ownership, voting rights, and profit distribution. A complete assignment transfers all ownership rights and obligations to the new member, effectively removing the original member from the LLC. For example, if a member assigns his or her interest, the new member inherits all ownership rights and obligations associated with that interest. This includes any contractual obligations that may be attached to the membership interest (e.g., a mortgage). If there is no assignment of interests clause in your operating agreement, then you will need to get approval from all other members for an assignment to take place.

On the other hand, a partial assignment permits the original member to retain some ownership rights while transferring a portion of their interest to another party. To avoid unintended consequences, it's crucial to clearly define the rights and responsibilities of each party during the assignment process.

Types of Membership Interest Transfers

Membership interest transfers can be either complete or partial, depending on the desired outcome. Understanding the differences between these two types of transfers is crucial in making informed decisions about your LLC.

Complete Assignment

A complete assignment occurs when a member transfers their entire interest in the LLC to another party, effectively relinquishing all ownership rights and obligations. This type of transfer is often used when a member exits the business or when a new individual or entity acquires the LLC.

For example, a member may sell their interest to another party that is interested in purchasing their share of the business. Complete assignment is also used when an individual or entity wants to purchase all of the interests in an LLC. In this case, the seller must receive unanimous approval from the other members before they can transfer their entire interest.

Partial Assignment

Unlike a complete assignment, a partial assignment involves transferring only a portion of a member's interest to another party. This type of assignment enables the member to retain some ownership in the business, sharing rights, and responsibilities proportionately with the new assignee. Partial assignments are often used when adding new members to an LLC or when existing members need to redistribute their interests.

A common real-world example is when a member receives an offer from another company to purchase their interest in the LLC. They might want to keep some ownership so that they can continue to receive profits from the business, but they also may want out of some of the responsibilities. By transferring only a partial interest in their membership share, both parties can benefit: The seller receives a lump sum payment for their share of the LLC and is no longer liable for certain financial obligations or other tasks.

How to Draft an Assignment of Membership Interest Agreement

A well-drafted assignment of membership interest agreement can help ensure a smooth and legally compliant transfer process. Here is a breakdown of the key elements to include in your agreement, followed by a step-by-step guide on drafting the document.

Key elements to include:

The names of the assignor (the person transferring their interest) and assignee (the person receiving the interest)

The name of your LLC and the state where it was formed

A description of the membership interest being transferred (percentage, rights, and obligations)

Any required approvals or consents from other LLC members

Effective date of the assignment

Signatures of all parties involved, including any relevant witnesses or notary public

Step 1: Gather Relevant Information

Before you begin drafting the agreement, gather all pertinent data about the parties involved and the membership interest being transferred. You'll need information such as:

The names and contact information of the assignor (the person transferring their interest) and assignee (the person receiving the interest)

The name and formation details of your LLC, including the state where it was registered

The percentage and value of the membership interest being transferred

Any specific rights and obligations associated with the membership interest

Step 2: Review the LLC's Operating Agreement

Examine your LLC's operating agreement to ensure you adhere to any predetermined guidelines on assigning membership interests. The operating agreement may outline specific procedures, required approvals, or additional documentation necessary to complete the assignment process.

If your LLC doesn't have an operating agreement or if it's silent on this matter, follow your state's default LLC rules and regulations.

Step 3: Obtain Necessary Approvals and Consents

Before drafting the assignment agreement, obtain any necessary approvals or consents from other LLC members as required by the operating agreement or state law. You may need to hold a members' meeting to discuss the proposed assignment and document members' consent in the form of a written resolution.

Step 4: Outline the Membership Interest Being Transferred

Detail the membership interest being transferred in the Assignment of Membership Interest Agreement. Specify whether the transfer is complete or partial, and include:

The percentage of ownership interest being assigned

Allocated profits and losses, if applicable

Voting rights associated with the transferred interest

The assignor's rights and obligations that are being transferred and retained

Any capital contribution requirements

Step 5: Determine the Effective Date of the Assignment

Set an effective date for the assignment, which is when the rights and obligations associated with the membership interest will transfer from the assignor to the assignee.

This date is crucial for legal and tax purposes and helps both parties plan for the transition. If you don’t specify an effective date in the assignment agreement, your state's law may determine when the transfer takes effect.

Step 6: Specify Conditions and Representations

In the agreement, outline any conditions that must be met before the assignment becomes effective. These could include obtaining certain regulatory approvals, fulfilling specific obligations, or making required capital contributions.

Additionally, you may include representations from the assignor attesting that they have the legal authority to execute the assignment. Doing this is important because it can prevent a third party from challenging the assignment on grounds of lack of authority. If the assignor is an LLC or corporation, be sure to specify that it must be in good standing with all necessary state and federal regulatory agencies.

Step 7: Address Tax and Liability Issues

Clearly state that the assignee will assume responsibility for any taxes, liabilities, and obligations attributable to the membership interest being transferred from the effective date of the assignment. You may also include indemnification provisions that protect each party from any potential claims arising from the other party's actions.

For example, you can include a provision that provides the assignor with protection against any claims arising from the transfer of membership interests. This is especially important if your LLC has been sued by a member, visitor, or third party while it was operating under its current management structure.

Step 8: Draft the Entire Agreement and Governing Law Clauses

In the closing sections of the assignment agreement, include clauses stating that the agreement represents the entire understanding between the parties concerning the assignment and supersedes any previous agreements or negotiations. Specify that any modifications to the agreement must be made in writing and signed by both parties. Finally, identify the governing law that will apply to the agreement, which is generally the state law where your LLC is registered.

This would look like this:

Step 9: Review and Sign the Assignment Agreement

Once you've drafted the Assignment of Membership Interest Agreement, ensure that all parties carefully review the document to verify its accuracy and completeness. Request a legal review by an attorney, if necessary. Gather the assignor, assignee, and any necessary witnesses or notary public to sign the agreement, making it legally binding.

Sometimes the assignor and assignee will sign the document at different times. If this is the case, then you should specify when each party must sign in your Assignment Agreement.

Importance of a Professionally-drafted Contract Template

To ensure a smooth and error-free assignment process, it's highly recommended to use a professionally-drafted contract template. While DIY options might seem tempting, utilizing an expertly-crafted template provides several distinct advantages.

Advantages of using a professionally-created template:

Accuracy and Compliance: Professionally-drafted templates are designed with state-specific regulations in mind, ensuring that your agreement complies with all necessary legal requirements.

Time and Cost Savings: With a pre-written template, you save valuable time and resources that can be better spent growing your business.

Reduced Legal Risk: Legal templates created by experienced professionals significantly reduce the likelihood of errors and omissions that could lead to disputes or litigations down the road.

How our contract templates stand out from the rest:

We understand the unique needs of entrepreneurs and business owners. Our contract templates are designed to provide a straightforward, user-friendly experience that empowers you with the knowledge and tools you need to navigate complex legal processes with ease. By choosing our Assignment of Membership Interest Agreement template, you can rest assured that your business is in safe hands. Click here to get started!

Frequently Asked Questions (FAQs) about Assignment of Membership Interest

As you embark on the journey of assigning membership interest in your LLC, here are some frequently asked questions to help address any concerns you may have:

Is an assignment of membership interest the same as a sale of an LLC? No. While both processes involve transferring interests or assets, a sale of an LLC typically entails the sale of the entire business, whereas an assignment of membership interest relates to the transfer of some or all membership interests between parties.

Do I need an attorney to help draft my assignment of membership interest agreement? While not mandatory, seeking legal advice ensures that your agreement complies with all relevant regulations, minimizing potential legal risks. If you prefer a more cost-effective solution, consider using a professionally-drafted contract template like the ones we offer at [Your Company Name].

Can I assign my membership interest without the approval of other LLC members? This depends on your LLC's operating agreement and state laws. It's essential to review these regulations and obtain any necessary approvals or consents before proceeding with the assignment process.

Do you need a lawyer for this?

The biggest question now is, "Do you need to hire a lawyer for help?" Sometimes, yes ( especially if you have multiple owners ). But often for single-owner businesses, you don't   need a lawyer to start your business .

Many business owners instead use tools like  Legal GPS for Business , which includes a step-by-step, interactive platform and 100+ contract templates to help you start and grow your company.

We hope this guide provides valuable insight into the process of assigning membership interest in your LLC. By understanding the legal requirements, implications, and steps involved, you can navigate this essential task with confidence. Ready to secure your business with a professionally-drafted contract template? Visit our website to purchase the reliable and user-friendly Assignment of Membership Interest Agreement template that enables your business success.

Courts Disagree Whether Section 510(a) Allows Subordination Agreement to Assign Voting Rights in Chapter 11

by Matthew Gensburg | Feb 23, 2022 | GCK on Law

This was the conclusion reached in In re Fencepost Productions, Inc. , 629 B.R. 289 (Bankr.D.Kan.2021), which found the LaSalle Street analysis of Section 1126(a) persuasive.  Section 1126(a) of the Bankruptcy Code provides that “[t]he holder of a claim” may vote to accept or reject a plan, and found that none of the arguments submitted by the senior lender there justified deviation from the statute’s plain language.  It noted that LaSalle Street held that the fact that the junior lender agreed that the senior lender could vote on its behalf was not controlling because “[i]t is generally understood that prebankruptcy agreements do not override contrary provisions of the Bankruptcy Code.”  Second, it held that Section 510(a), providing for the enforcement of subordination agreements, does not allow for waiver of voting rights under Section 1126(a) because subordination affects the priority of payment of claims in bankruptcy, not voting rights.

In Fencepost , the court found that agreement between the junior and senior lenders, allowing the senior lender to vote on behalf of the junior lender, did not appoint the senior lender the junior lender’s agent.  “Unlike an agent, who has fiduciary duty to act at the direction of the principal, Associated would be acting for its own benefit, contrary to the wishes of the BMS Group.” Id. at 295.  The court concluded that “subordination merely reorders priorities among creditors.  Unlike the circumstance where a claim is assigned to another party, subordination does not involve transfer of the subordinated creditor’s legal interest.”

Notwithstanding the fact that Fencepost found the subordination agreement ineffective in transferring voting rights to the senior lender, it also found that the junior lender did not have “prudential standing” to participate in the confirmation process, or raise objections to the debtor’s plan.  The court reached this conclusion by finding that there were no circumstances under which the junior lender (BMS Group) had any financial stake in the outcome of the confirmation process because it subordinated its claim, and there were insufficient funds or assets to pay it anything after the senior lender.  The court stated:

In this case, the BMS Group, if permitted to participate in the Plan confirmation proceedings, would be litigating issues affecting the rights of third parties, not itself. As noted above, there is no scenario under which the BMS Group will receive any direct financial benefit.  If the Plan were amended to provide larger payment to Class 5A, the subordinated BMS Group claims, Associated could benefit financially, but other unsecured creditors would likely receive less.  The BMS Group seeks to vote against confirmation to force Debtors to satisfy the § 1129(b) requirements of cram down.  But the BMS Group would not benefit from enforcement of the requirements that the Debtors’ plan not discriminate, be fair and equitable to impaired classes, and satisfy the absolute priority rule.  It is other creditors, Associated in particular, who have a financial stake in these matters.  This case therefore fits with the circumstance of special concern to the Second Circuit, quoted above, when a “constituency seeks to disturb a plan of reorganization” though asserting rights other than its own.

Id. at 299-300.

A contrary conclusion was reached in Blue Ridge Investors, II, LP v. Wachovia Bank (In re Aerosol Packaging, LLC) , 362 B.R. 43 (Bankr.N.D.Ga.2006).  This court found that “[t]he express terms of the Subordination Agreement * * * compel the conclusion that the right to vote any claim of Blue Ridge in Debtor’s bankruptcy was assigned by Blue Ridge to Wachovia,” making Wachovia the “duly authorized agent of Blue Ridge.”  It reasoned that the subordination agreement appeared to be enforceable under applicable state law, and rejected the reasoning of LaSalle finding that although Section 1129(a) grants a right to vote to a holder of claim, it does not expressly or implicitly prevent that right from being delegated or bargained away by the holder of the claim. Additional cases support enforcement.

In In re MPM Silicones, L.L.C. , 2019 WL 121003 (S.D.N.Y.2019 ) , the court approached the issue from a different perspective.  Here, the first lienholders pleaded that the second lienholders breached an intercreditor agreement (“ICA”) by entering the Restructuring Support Agreement and voting to approve the Chapter 11 Plan over the first’s objections, and which ultimately paid the firsts less than payment in full, in cash, of their liened securities.  The relevant clauses in the intercreditor agreement provided:

will take any action that would hinder any exercise of remedies undertaken by the [firsts] with respect to the Common Collateral * * * including any sale, lease, exchange, transfer or other disposition of the Common Collateral, whether by foreclosure or otherwise

It also provides that each second:

waives any and all rights it * * * may have as a junior lien creditor or otherwise to object to the manner in which the [Seniors] seek to enforce or collect the Senior Lender Claims or the Liens granted in any of the Senior Lender Collateral

Finally, the intercreditor agreement also provided as follows:

Notwithstanding anything to the contrary in this Agreement, the [seconds] may exercise rights and remedies as an unsecured creditor against the Company or any subsidiary.* * * * Nothing in this Agreement shall prohibit the receipt by any … of the required payments of interest and principal so long as such receipt is not the direct or indirect result of the exercise by any [second] of rights or remedies as a secured creditor in respect of Common Collateral

The court ruled that the prohibition on hindering the firsts’ remedies was not intended to mean that the seconds were waiving all the voting rights that they are otherwise entitled to under bankruptcy law.  The court noted that those agreements that have been enforced contained specific waivers, assignment of rights, or express agreements that the juniors would be “silent seconds.” Id . at *11.  It stated that “the case law, equities, economics, and practicalities of this case favor a reading of the ICA that does not write an express waiver of voting rights into the general language and does not nullify entire provisions of the agreement, such as Section 5.4.” Id.  Therefore, absent “express constraints or waivers in the ICA” an effort to strip the seconds of their voting rights would not be allowed.  Id . at *12.

Matthew T. Gensburg [email protected]

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On March 31, 2021, the U.S. Bankruptcy Court for the District of Kansas held in  In re Fencepost Productions Inc.  that even though an assignment of voting rights provision in a subordination agreement was not enforceable in a bankruptcy proceeding, a subordinated creditor nevertheless was barred from participating in proceedings related to a chapter 11 plan and disclosure statement on the basis that the subordinated creditor lacked prudential standing. 1   On the one hand, the decision calls into question the enforceability in bankruptcy proceedings of voting assignment provisions agreed upon in prepetition contractual agreements, and, on the other, affirms the enforceability of prepetition contractual provisions that may alter the priorities set forth in the Bankruptcy Code.  If followed by other courts, the decision raises the possibility that definitively “out of the money” creditors may not have standing to object to or participate in plan confirmation.

Factual Background

Fencepost Productions and its debtor affiliates (the “ Debtors ”) entered chapter 11 bankruptcy with a capital structure that consisted of a $14 million loan (the “ Senior Loan ,” and the lender, the “ Senior Lender ”), which was secured by a lien on the Debtors’ personal property. 2   In addition to the Senior Loan, the Debtors’ capital structure also included a $5.3 million junior loan (the “ Junior Loan ,” and the lenders, the “ Junior Lenders ”).

Prior to the bankruptcy, the Senior Lender and Junior Lenders had executed a subordination agreement (the “ Subordination Agreement ”), which provided that payment of “all Junior Liabilities shall be postponed and subordinated to the payment in full in cash of all obligations of all Senior Liabilities.” 3   The Subordination Agreement further provided that in any bankruptcy proceeding:  (i) any distributions that otherwise would be made to the Junior Lenders were required to be made directly to the Senior Lender; (ii) the Senior Lender would have the right to vote the Junior Lenders’ claims with respect to any chapter 11 plan; and (iii) the Junior Lenders were prohibited from filing any pleadings or taking any other action that would be contrary to the priorities set forth in the Subordination Agreement. 4

The Debtors ultimately filed a plan of reorganization, which provided that the Senior Lender’s claim would be bifurcated into a secured claim and unsecured claim.  Unsecured claims—including the Senior Lender’s unsecured claim—would receive a 15 percent recovery under the plan. 5   The Junior Lenders’ claims were separately classified from other unsecured claims (including the unsecured portion of the Senior Lender’s bifurcated claim), and on account of such Junior Loan claims, the Senior Lender would receive $120,000. 6   Finally, under the Debtors’ plan, equity was entitled to retain ownership.

The Junior Lenders filed an objection to the plan and disclosure statement, and cast their own votes against the plan.  Pursuant to the rights believed afforded to it under the Subordination Agreement, the Senior Lender meanwhile had cast ballots on account of the Junior Loan claims voting in favor of the plan.  Finally, the Debtors filed objections to the proofs of claim filed by the Junior Lenders on the grounds that under the Subordination Agreement, all rights to payment and to vote were vested in the Senior Lender.

The Court’s Decision

In connection with the Junior Lenders’ plan objection and their votes against the plan, the Debtors contended that the Junior Lenders were barred from participating in the plan confirmation process because the Subordination Agreement assigned the Junior Lenders’ voting rights to the Senior Lender.  The Debtors also argued that as a consequence of the Senior Lender’s payment priority over the Junior Lenders, the Junior Lenders had no standing to object to the plan of reorganization and also had no claim to assert within the bankruptcy proceeding.  The Junior Lenders argued, however, that the voting rights assignment provision was unenforceable under section 510(a) of the Bankruptcy Code and that the subordination of their claims did not transfer their legal interests to the Senior Lender.

The Court ruled in favor of the Junior Lenders on a number of issues, including with respect to the Debtors’ objections to the Junior Lenders’ proofs of claim and the enforceability of assignment of voting rights provisions.  However, the Court ultimately held that as result of the subordination provisions in the Subordination Agreement and their definitively “out of the money” status, the Junior Lenders lacked prudential standing to object to the plan or disclosure statement.

Assignment of Voting Rights

The Court first addressed whether the Subordination Agreement’s provisions that purported to assign the Junior Lender’s voting rights were enforceable in the chapter 11 case.  The Court held that such provisions were not enforceable.  The Court acknowledged that courts are divided on whether Bankruptcy Code section 510(a) requires the enforcement of assignment of voting rights provisions.  Section 510(a) of the Bankruptcy Code provides that a “subordination agreement is enforceable in a case under this title to the same extent that such agreement is enforceable under applicable nonbankruptcy law.” 7   Some courts have held that such assignment of voting rights provisions are indeed enforceable under section 510(a) of the Bankruptcy Code to the extent that such provisions are included within a subordination agreement. 8   These courts finding in favor of enforceability have reasoned that while the Bankruptcy Code grants creditors the right to vote on a plan, nothing in the Bankruptcy Code expressly precludes a creditor from delegating or assigning away its rights to vote on a plan. 9   Therefore, since there is no conflict between such a provision and the language of the Bankruptcy Code, provisions whereby creditors have agreed to assign such rights to other creditors should be upheld as enforceable according to these courts.  However, other courts have held that vote assignment provisions are not enforceable in bankruptcy because section 510(a) of the Bankruptcy Code expressly upholds only provisions that alter payment or lien priorities in bankruptcy, and not other contractual provisions. 10   Therefore, these courts are of the view that since there is nothing in the Bankruptcy Code that expressly permits one creditor to vote on behalf of another with respect to a plan, such arrangements should not be upheld as permissible.  In short, because the assignment of voting rights is not a concept specifically addressed in the Bankruptcy Code, the divergence in views appears to stem from some courts focusing on what the Bankruptcy Code expressly allows, while others focus on what the Bankruptcy Code expressly prohibits.

In  Fencepost Productions , the Court ultimately held that provisions that modified or assigned the Junior Lenders’ voting rights were not enforceable.  In so ruling, the Court agreed with other court decisions that held that Bankruptcy Code section 510(a) protects contractual provisions that alter priorities, and not any other provisions. 11   The Court further noted that the Subordination Agreement at issue did not purport to appoint the Senior Lender as the agent for the Junior Lenders, and thus the Senior Lender was not in a position to act as a fiduciary to the Junior Lenders. 12   In other words, the Senior Lender was acting to further its own interests and not acting on behalf of the interests of the Junior Lenders.

Proof of Claim Objections

The Court overruled the Debtors’ objections to the Junior Lenders’ proofs of claim, which, as noted above, the Debtors had objected to on the basis that under the Subordination Agreement, all rights to payment and to vote were vested in the Senior Lender.  The Court held that “subordination merely reorders priorities among creditors,” but that does not transfer the subordinated creditor’s legal interest. 13   Consequently, the Court rejected the Debtors’ arguments that the Junior Lenders had no claims to assert within the bankruptcy proceeding.  In support of this conclusion, the Court noted that section 1129(b) of the Bankruptcy Code (which sets forth the statutory requirements for plan confirmation) expressly provides that a plan may be crammed down “notwithstanding section 510(a).”  Bankruptcy Code section 1129(b) requires, among other things, that a chapter 11 plan not unfairly discriminate against claims and interests, including fully subordinated claims.  Thus, the “notwithstanding section 510(a)” language in section 1129(b) led the Court to the conclusion that Congress intended for fully subordinated unsecured claims to be legally protected in a cramdown scenario notwithstanding a subordination agreement.  Thus, it follows that even subordinated claims have certain protections afforded by the Bankruptcy Code in a bankruptcy case that cannot be assigned to another creditor—and asserting proofs of claim is one of them.

Junior Lenders Lack Standing to Object to Plan

Despite being found permitted to assert proofs of claim, the Court ultimately held, however, that the Junior Lenders lacked prudential standing to object to the plan and disclosure statement.  As a preliminary matter, all creditors and parties in interest generally have statutory standing under section 1109(b) of the Bankruptcy Code to appear and be heard in chapter 11 proceedings, including to object to a plan. 14   However, section 1109(b) does not override the prudential standing doctrine, which includes a “general prohibition on a litigant’s raising of another person’s legal rights.” 15   Prudential standing concerns are especially acute within the bankruptcy context because bankruptcy proceedings often involve numerous constituencies and “one constituency . . . [may seek] to disturb a plan of reorganization based on the rights of third parties who apparently favor the plan.” 16

The Court noted that the Junior Lenders—if permitted to object to the plan—would be litigating the rights affecting third parties, but not the Junior Lenders’ own interests. 17   The Court found that there was no scenario in which the Junior Lenders would receive any direct benefit or otherwise had any financial stake in objecting to the plan.  This is because, as the Court noted, under the Subordination Agreement all payments made to the Junior Lenders were required to be turned over to the Senior Lender until the Senior Loan had been satisfied in full. 18   Further, under the proposed plan, the unsecured portion of the Senior Loan would receive only a 15 percent recovery.  Thus, there was no circumstance in which the Senior Loan would be paid in full, and the Junior Lenders would be required to turn over any distributions to the Senior Lender. 19

Accordingly, the Court held that the Junior Lenders would not benefit from objecting to or voting against the plan, including through any unfair discrimination or cramdown objection to the plan.  Further, the Court noted that the plan and disclosure statement made clear that unsecured creditors would receive nothing in a chapter 7 liquidation.  Consequently, the Court concluded that only the Senior Lender had a financial stake in the confirmation of the plan of reorganization based on the prepetition contractual arrangement made between the Junior Lenders and the Senior Lender in the Subordination Agreement.  The Court therefore held that the Junior Lenders would be litigating the rights of the Senior Lender if they were permitted to vote or object to the plan, which was not permissible under the prudential standing doctrine.

The  Fencepost  decision calls into question the enforceability of provisions in subordination agreements that otherwise are unrelated to the subordination of one creditor’s claim vis-à-vis another ( i.e ., an agreement as to the priority of the respective creditors’ claims) and that otherwise impinge on a right under the Bankruptcy Code.  Some courts—including the  Fencepost  court—have concluded that section 510(a) of the Bankruptcy Code protects only the enforceability of provisions that alter priorities, and not other provisions.  A growing number of courts following this reasoning thus have concluded that voting assignment provisions in subordination agreements are not enforceable under section 510(a) because they are not subordination provisions.  Senior creditors therefore should be mindful that not every provision within a subordination agreement may be enforceable in a bankruptcy proceeding, including such voting assignment provisions.

However, where, as in the  Fencepost  decision, a junior creditor is out of the money and the senior creditor will not receive a full recovery, the junior creditor may be barred from participating in plan confirmation proceedings under the prudential standing doctrine.  Junior creditors thus should be mindful that when a subordination agreement contains a turnover provision and otherwise subordinates the junior creditor’s claims to those of the senior creditor, those provisions effectively may bar the junior creditor from blocking a plan of reorganization, perhaps even notwithstanding whether or not the subordination agreement at issue contains an express bar on the junior creditor from voting on or objecting to a bankruptcy plan.

1     See In re Fencepost Productions Inc. , Case No. 19-41545, ECF No. 396 (Bankr. D. Ks. Mar. 31, 2021).

2     Id.  at 3.

3     Id.  at 3-4.

4     Id.  at 4.

6     Id.  at 5.

7    11 U.S.C. § 510(a).

8     See In re Aerosol Packaging , 362 B.R. 43 (Bankr. N.D. Ga. 2006);  In re Curtis Ctr. Ltd. P’ship , 192 B.R. 648 (Bankr. E.D. Pa. 1996).

9     In re Aerosol P ackaging , 362 B.R. at 47 (“Section 1126(a) grants a right to vote to a holder of a claim, but does not expressly or implicitly prevent that right from being delegated or bargained away by such holder.”)

10   See In re 203 N. LaSalle P’ship , 246 B.R. 325 (Bankr. N.D. Ill. 2000) (“Subordination thus affects the order of priority of payment of claims in bankruptcy, but not the transfer of voting rights.”);  see also   In re Hart Ski Mfg. Co. , 5 B.R. 734 (Bankr. D. Minn. 1980) (“There is no indication that Congress intended to allow creditors to alter, by a subordination agreement, the bankruptcy laws unrelated to distribution of assets.”).

11   See In re 203 N. LaSalle P’ship , 246 B.R. 325 (Bankr. N.D. Ill. 2000).

12  Slip. op. at 13.

13   Id.  at 14.

14   See   id.  at 18 (citing 11 U.S.C. § 1109(b)).

15   Lexmark Int’l Inc. v. Static Control Components Inc. , 572 U.S. 118 (2014).

16   Kane v. Johns-Manville Corp. , 843 F.2d 636, 644 (2d. Cir. 1988).

17  Slip. Op. at 22.

18   Id.  at 16-17.

19   Id.  at 17.

Current Legal Analysis

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This article describes how the CVRA generally disfavors at-large voting systems for school districts in California, and concludes that, in the face of litigation, school boards save considerable resources and better serve their constituents by early adoption of by-district voting.

Passed in 2001, the CVRA seeks to address at-large voting systems in local government agencies including school districts, wherever there is evidence of a history of “racially polarized voting” and/or vote dilution of members of “a protected class” (i.e. members of a racial or ethnic minority). This can be shown if the following elements are present: 1) a voting bloc of protected class members; 2) a bloc of voters outside of the protected class; and 3) candidates favored by the protected class voters that have historically not been elected. In theory, transitioning from an at-large to a by-district election system not only increases the strength of the minority vote, but also lowers the barrier for entry to run for a seat.

The switch to by-district elections has two major components that school boards may be resistant to: First, new geographic lines must be drawn that fairly divide the jurisdiction, and second, only candidates who live in a subdistrict are eligible to run for that spot on the board. The demographic survey requires some expenditures and public hearings and also may create some chaos in districts that have staggered elections. Where board election rules are set in the city charter, for example, the change may also require a citywide vote. In those jurisdictions, the school district counsel and the city attorney should meet to explore their options.

In a lawsuit alleging a CVRA violation, plaintiffs have the advantage that they will be awarded attorneys’ fees and associated expenses, including expert witness fees, if they prevail. In many situations, this can mean hundreds of thousands of dollars or more are on the line. Notably, prevailing defendants are not entitled to recover attorneys’ fees. More notably, no defendant government agency has yet to prevail in such a lawsuit. This has resulted in a small industry of plaintiff’s lawyers and civil rights organizations sending demand letters to agencies regardless of whether someone from the community brings up the concern

This year alone, the Santa Cruz City Schools Board of Education has been in the news because of its decision to voluntarily shift to by-district elections after the district received a demand letter from attorneys on behalf of area residents and in coordination with the California Voting Rights Project. The district is pursuing changes that would require each of the seven board members to live in — and be elected solely by the residents of — distinct geographical areas. The new rules will apply as each board seat comes up for re-election, starting in 2020.

The City of Santa Clara chose to litigate the issue last year and was found by the court to be in violation of the state voting rights law. As a result, it was ordered to adopt district elections. An appeal is ongoing, and Santa Clara is allegedly on the hook for millions of dollars in legal fees.

This February, a Statement of Decision was issued in the case of Pico Neighborhood Association v. the City of Santa Monica . After a six-week trial handled by a highly respected defense firm, the court ruled that the defendant’s at-large election system violated both the CVRA and the Equal Protection Clause of the California Constitution. The court ordered the defendant to implement district-based elections for its city council in accordance with a seven-district map. (View the ruling at bit.ly/2SIb98a .)

Assembly Bill 350 (2016) (Elections Code §10010) amended the CVRA to provide a safe harbor provision for local government agencies with at-large election systems that receive communications demanding that the local agency transition to by-district elections. Under AB 350, in order to recover attorneys’ fees, the potential plaintiff must provide written notice to the local agency; the local agency then has 45 days from the date of receipt of the letter to adopt a resolution of intent to transition to by-district elections. If the agency then voluntarily makes the transition to by-district election under these circumstances and within a set timeline, attorneys’ fees for the plaintiff are capped at $30,000.

Resolution of intent:

Once a demand from potential plaintiffs is received, the local agency has 45 days to pass a resolution of intent, stating its intent to move to a by-district system and outlining specific steps and an estimated time frame for doing so. If the agency passes a resolution of intent, no CVRA lawsuit can be filed for the following 90 days.

Before drawing maps:

The local agency must hold at least two public hearings within a 30-day period “at which the public is invited to provide input regarding the composition of the districts.”

• AB 350 provides that, “[b]efore these hearings, the political subdivision may conduct outreach to the public, including to non-English speaking communities, to explain the districting process and to encourage public participation.”

Process of drawing maps:

The process of drawing maps is undertaken by a demographer who will have to ensure a balanced population among the districts drawn, among many other factors.

After drawing maps:

The local agency must “[p]ublish and ‘make available for release’ at least one draft map” at least seven days before the first hearing at which draft maps are considered.

• The notice for the meeting must also include the potential sequence of elections if elections will happen at different times for staggered terms.
• Hold at least two hearings within a 45-day period “at which the public is invited to provide input regarding the content of the draft map or maps and the proposed sequence of elections, if applicable.”
• Publish and make available to the public any revised maps for at least seven days before any meeting at which such revised maps are adopted.

If this process is followed and the local agency adopts an ordinance to transition to a by-district election system, the potential plaintiff who sent the demand letter has the right to demand attorneys’ fees up to 30 days after the ordinance is adopted. Again, fees are capped at $30,000.

On Sept. 6, 2018, Gov. Jerry Brown signed AB 2123, which added a provision allowing political subdivisions to enter into agreements with prospective plaintiffs that extend these timelines to permit a process of public engagement to occur over a slightly longer timeframe.

Several school districts have asked what other local agencies in the state are doing. While the majority (about 58 percent) of districts and cities in California continue under at-large systems, many have adopted by-district systems or are currently considering or proceeding with the transition.

Additionally, a number of CSBA’s member boards have received demand letters threatening litigation. More are expected in light of the above-described rulings. Private attorneys and nonprofits involved in sending demand letters to cities and other local agencies in recent years have signaled an intent to remain active in CVRA litigation.

It bears repeating that, as of now, no city or district has prevailed in defending its at-large voting system in a CVRA lawsuit.

Each school district must decide for itself whether, on balance, the risk of receiving a demand letter is so high that voluntarily undertaking a conversion to by-district elections is worthwhile. Many districts have decided to adopt a “wait-and-see” approach to conversion; this is, in our view, riskier for the larger jurisdictions (which attract more attention and have more discrete minority communities within their jurisdictions that may be deprived of voting power by at-large election systems), particularly when the city or town with which the school district shares territory has received a demand.

If you wish to receive more specific advice regarding the CVRA and your district’s particular circumstances, please contact your legal representative.

Kathryn Meola is General Counsel for CSBA

Some material for this article was reproduced with permission from the San Mateo County Counsel’s Office.

The information provided here by CSBA is for informational purposes and is not legal advice. Please contact your district or county office of education’s legal counsel for legal questions related to this information.

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Language Requirements for Election Materials

Language requirements for election materials are governed under the federal Voting Rights Act and the state Elections Code.

Section 203 of the Voting Rights Act requires that in certain situations (counties where more than 10,000 or 5% of all total voting-age citizens who are members of a single language minority group, have depressed literacy rates, and do not speak English very well) election materials that are available in English must also be made available in the language of particular minority group.  Section 203 targets those language minorities that have suffered a history of exclusion from the political process:  Spanish-heritage, Asian, Native American, and Alaskan Native.

The U.S. Census Bureau identifies the specific language groups for states and county jurisdictions, based on census information, every 5 years. The latest Section 203 determination was December 8, 2021.  The next determination is expected in December 2026.

For more information on Section 203, please visit the Department of Justice’s website: https://www.justice.gov/crt/about-language-minority-voting-rights .

California Elections Code section 14201 further requires that county elections officials provide a translated facsimile ballot and related instructions in a conspicuous location in precincts where 3% or more of the voting-age residents are members of a single language minority and lack sufficient skills in English to vote without assistance.  The Secretary of State is required to make these Section 14201 determinations by January 1 of each year in which the governor is elected. 

Pursuant to Elections Code section 14201(b)(1), the Secretary of State has reinstated prior precinct minority language determinations in addition to the designations made on December 31, 2021, see CCROV#22039 . These language determinations shall be effective for elections conducted on June 7, 2022, and thereafter and shall remain in effect until further notice.

For more information on Section 14201: https://leginfo.legislature.ca.gov/faces/codes_displaySection.xhtml?lawCode=ELEC&sectionNum=14201 .

The chart below identifies the language requirements for each county under Section 203 of the federal Voting Rights Act and Elections Code section 14201.  Please note that this chart is based upon 2016 and 2020 precinct information and data, as previously provided by the California Statewide Database at U.C. Berkeley.  The requirements provided in the chart will remain in place through December 31, 2025.  The next determinations will be issued by January 1, 2026.  

For additional translation resources, please see our website at:  https://www.sos.ca.gov/elections/voting-resources/voting-california .

Past Determinations

• CCROV #22039  Reinstated Languages Required under California Elections Code section 14201, Language Minority Determinations
• CCROV #21221  Language Requirements: 14201, Language Minority Determinations
• CCROV #21204  Language Requirements: Voting Rights Act, Section 203 Language Minority Determinations
• CCROV #20096 Additional Languages Required under California Elections Code section 14201, Language Minority Determinations
• CCROV #17148 Language Requirements: 14201, Language Minority Determinations
• CCROV #16333 Language Requirements: Voting Rights Act, Section 203 Language Minority Determinations

Requesting Additional Languages

California Elections Code sections 12303 and 14201 allows elections officials the discretion to provide additional language assistance not required by Section 14201 when petitioned by interested citizens or organizations. If any interested party would like to petition for a new language, please contact Reina Miller at [email protected] . Examples of data that can be submitted with your petition can be found below:

[add Lisa’s draft info here]

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Voting rights are under attack nationwide - The Excerpt

On a special episode (first released on March 31, 2024) of The Excerpt podcast:

At the State of the Union, President Biden called on Congress to pass the John Lewis Voting Rights Advancement Act. This bill would update the Voting Rights Act of 1965, strengthening legal protections against discriminatory voting policies and practices. The act has since been hampered by Supreme Court cases that removed pre-clearance provisions and made it harder to sue to stop discriminatory practices. Marc Elias, an attorney with Elias Law Group and an outspoken advocate of voter protection and fair elections, joins The Excerpt to talk about the challenges voters across the country are facing and describe his efforts to guarantee equal access to the ballot.

Hit play on the player below to hear the podcast and follow along with the transcript beneath it.  This transcript was automatically generated, and then edited for clarity in its current form. There may be some differences between the audio and the text.

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President Biden:

Prep for the polls: See who is running for president and compare where they stand on key issues in our Voter Guide

But 59 years later, the force has taken us back in time, voter suppression, election subversion, unlimited dark money, extreme gerrymandering. John Lewis was a great friend to many of us here, but if you truly want to honor him and all the heroes that marched with him, then it's time to do more than talk. Pass the Freedom to Vote Act, the John Lewis Voting Right Act.

Dana Taylor:

Hello and welcome to The Excerpt. I'm Dana Taylor. At the State of the Union, President Biden called on Congress to pass the John Lewis Voting Rights Advancement Act. This bill would update the Voting Rights Act of 1965, strengthening legal protections against discriminatory voting policies and practices. It's since been hampered by Supreme Court cases in 2013 and 2021 that removed preclearance provisions and made it harder to sue to stop discriminatory practices.

An outspoken advocate of voter protection and fair elections, Marc Elias joins The Excerpt to talk about the challenges voters across the country are facing and describe his efforts to guarantee equal access to the ballot. Thanks for joining us, Marc.

Marc Elias:

Thank you for having me.

Why is the John Lewis Voting Rights Advancement Act so important and where does its passage stand?

It's a critical piece of legislation. There is a reason why in the last few Congresses, it has been among the most furiously anticipated and fought over provision. It would restore the Voting Rights Act to its place as the crown jewel of American democracy. For decades, Democratic and Republican administrations recognized the centrality of the Voting Rights Act to ensuring a more perfect union, a more inclusive and effective democracy. Unfortunately, that bipartisan consensus broke down sometime in the last 10 years or so, and the courts have whittled it away.

And what we are left with is a voting rights act now that neither has all of the protections that it should, nor has it been updated to meet the challenges of 2023 and 2024 and 2025 and 2026. So we desperately need this law. In the last Congress, it passed out of the House with unanimous democratic support and no Republican support in the House of Representatives. In the Senate, it wound up bogging down with unable to break the filibuster, but obviously President Biden said he would sign it.

So where it stands now is we will wait and see next year when Congress reconvenes in 2025 to see whether or not after the presidential election there is appetite in Congress to do what must be done, which is to restore the Voting Rights Act to its full place in our democracy.

Preclearance provisions are a big part of the new act. What are they and what regulations are being proposed?

One of the geniuses of 1965 Voting Rights Act was this notion of preclearance, which was that if you wait until states have violated the civil rights and the voting rights of Black or other minority voters and only then bring litigation, you wind up in a circumstance that we too often see in which those minority communities suffer the indignities of those voter suppression or vote dilution efforts while those cases work through court. What the Congress did in 1965, which was like I said genius, was it said, look, if you are a jurisdiction, if you are a state or a county or a city with a history, a proven history of racial discrimination in voting before you can change your voting laws, before you can enact new restrictions on voting, those have to be reviewed what is called pre-cleared either by the Department of Justice in Washington, DC or by a federal court.

Either one can preclear them and if they don't retrogress the voting rights of minority voters, in other words, they don't make voting worse for them, then your change goes into effect. And most changes that were proposed got precleared. It was not a burdensome process. But if the changes you want to make are going to make voting harder, are going to retrogress the voting rights of the minority communities in your jurisdiction, then we're going to say no, and we're not going to preclear it.

Now, you could always still go to court and try to challenge the denial of preclearance, so the states were not powerless in this process. But what it meant was that we did not have the circumstance that we have seen in all too many states in recent years since those court decisions where the voting situation becomes much, much worse for Black voters in the South or Hispanic voters in the Southwest, and it takes years for the courts to catch up. And by then it's great that the courts have caught up, but the voters have been harmed.

Redistricting has been an issue disenfranchising voters from representation in minority groups for decades. Some states and organizations are combating this while others won't touch it. How is this affecting inclusion and equity in voting?

So look, there's no better place to see why we need changes and strengthening of our federal voting rights laws, including the John Lewis Voting Rights Advancement Act, than in the area of redistricting. I mean, my legal team sued Alabama, Louisiana and Georgia for violating the remaining provisions of the Voting Rights Act. Okay, section two of the Voting Rights Act. And we brought that litigation shortly after the new maps were put in place or were passed into law by those states in 2021, and we won in each of those places, which means in plain English that Black voters suffered under illegal maps.

They were forced to vote in 2022 under maps that violated their federal voting rights. Okay? That is an indignity that no American should have to suffer. No American should have to participate in elections that federal courts have declared violate your civil and voting rights. But because we don't have preclearance anymore, each of those states would've been a preclearance state. The courts, we moved as quick as we could, the courts, the Alabama case went all the way to Supreme Court. The Louisiana case went to Supreme Court.

Finally, those states yielded and did the right thing. So in 2024, Black voters in each of those states will now have fair districts for them. In Alabama and Louisiana, that means an additional Black opportunity district that they were denied, that they were entitled to. In Georgia, similarly, also state legislative maps have been struck down under this. But I am proud of the work we've done. I'm proud of the fact that we are helping bring fair results and legal maps into place for 2024, but it shows how much more work there is to do.

That in 2021, you still had these states passing laws violating the voting rights of Black voters and that it took so long for the courts to catch up.

In 2013, SCOTUS put down part of the Voting Rights Act saying the legal protections against discrimination were no longer necessary. However, studies on this say otherwise. Marc, what's the latest here?

The fact that the Supreme Court in 2013 said that it thought that times had changed, which was the phrase that he used, one need to only look at those cases I just mentioned in Alabama and Louisiana to realize times really haven't changed. The fact is those state legislatures had in front of them the census data and the other demographic data that clearly indicated that there needed to in each of those states be two rather than one Black Opportunity District. And in both of those states, white majorities denied Black citizens of their state their rights under the federal voting rights law.

So the fact is times hadn't changed. And then to make matters worse, we saw that even after the federal courts had struck down those maps, those states appealed to the US Supreme Court. Even after the US Supreme Court upheld the map in Alabama, the state of Alabama refused to comply with the court order and refused to draw a compliant map and forced the federal court to draw the map. The state of Alabama in 2013 still stood proverbially in front of the schoolhouse doors with its arms crossed saying, we are not going to comply unless the federal courts do it themselves.

So the fact is times haven't changed, and so the Shelby County decision in 2013 was a disaster for our democracy. It was a disaster for Black voters and other minority voters. But let's be clear, a democracy that does not include full voting rights for all of its citizens is not a democracy. So it is something that we all need to be committed to as we move forward.

The Pew Charitable Trusts, an independent nonprofit, reports that Americans approve of pro-voting policies and are against most restrictions of voting rights. What are some recent examples and where are they being used?

I mean, I wish I could say that there are only a few examples. Unfortunately, since 2021, after the events of January 6th after the former President Trump's efforts to overturn the election in court that failed, Republican legislatures rather than looking at this and saying, you know what, we need to be more responsive to the people, instead they engaged in a systematic series of laws to make voting harder. So we saw in Georgia, for example, laws that ban providing food and water to voters waiting in line.

The evidence, the data and statistical evidence in Georgia shows that the people waiting in line are overwhelmingly Black voters. And so denying food and water to people waiting in line is a way of punishing Black voters for already being subject to fewer polling places and not enough equipment in many areas. We saw a war on drop boxes and mail-in voting generally. You have seen throughout this country legislatures repeal drop boxes and make it more difficult for people to apply for and receive vote by mail ballots.

We have seen an increase in laws allowing private citizens to challenge the eligibility of others to vote. These mass voter challenges in which spreadsheets are generated out of computer AI programs challenging the rights of people to participate who they have never met, but just are names on a list. We've seen all kinds of these challenges, and I wish I could say it's getting better, but it's not. It's getting worse.

Political violence has been an issue since the last election and some election and poll workers have been targeted. There have recently even been calls for their protection. Is the election process still safe?

Look, my message to everyone is it is still safe. So everyone should feel confident that they should be able to vote and they'll vote safely. People who have time and have interest to be part of the machinery of elections, volunteering to be poll workers or even to volunteer on a part-time basis of your local county or municipal election office, you should feel safe about it. Not only should you feel safe, you should know you're doing a civic good. So yes, I think things will be safe.

That said, there's no question that we have seen an uptick in the threats and harassment targeting the people who are in charge of running our elections. We saw recently some pretty outrageous behavior in Maricopa County that was widely reported upon, but not just in Maricopa County, Arizona. Around the country, we have seen an increase in the intimidation aimed at these poll workers, and it's important that we all speak clearly and with one voice denouncing it because there is no place in threatening or harassing the people who are simply trying to do the job of democracy.

They are simply trying to make our local elections work for the citizens in their communities. We have elections that are run at the local level, and these are neighbors making sure their neighbors could vote. And so I would hope that with all of the partisan divide in this country, we should all be able to say, let's let the election officials do their job. Let's let the secretaries of state issue their guidance. Let's let county election officials make sure ballots are counted.

But it's also important that we remain vigilant that those processes do go forward and can remain safe.

Marc, in addition to the rights of voters, there have been concerns over government leaders powers with regards to elections. What are some cases and concerns over what they should and shouldn't be allowed to do?

We have seen a number of cases that have come up in what I call the election subversion bucket. This is the after the voter has voted. This is the counting and certification process. And we used to agree that whoever got the most votes, they got certified the winner. Unfortunately, in 2022, my team and others had to sue counties like Cochise County, Arizona, like some counties in Pennsylvania because those counties were simply refusing to certify the accurate results of elections. We saw the former president encouraged that in 2020 in Michigan.

You may remember that there was an effort by the president and his team at that time to encourage the Wayne County Board of Canvassers, which is composed of four people, two Democrats, two Republicans. Normally, they're just adding stamps and ribbons to calligraphy certificates saying who won by tabulating up the votes. Well, President Trump asked the two Republicans there not to certify the election results coming out of Detroit. Well, we know if you don't certify the election results coming out of Detroit, you've disenfranchised the biggest city in the state and also a large number of Black voters.

So ultimately that failed, and then they tried to get the state canvassing board, again a bipartisan body, tried to get the Republicans not to certify the election results. We have seen an uptick in litigation around this certification process. It shouldn't be necessary, but it is. And the message should be clear to all election officials, you have to do your job. We need to give you the safe place to do it. But if you're not going to do your job, you're going to get sued and you're going to lose.

Marc, you touched on this earlier, but I want to circle back. Part of the issue of voters' rights is oversight of roles and maintenance of electorate records. Why is that a concern and what's being done to try and maintain consistency?

Oh boy. I mean you've really put your finger on what one of the big hot button issues going on right now. Just in the last few weeks, we have seen a wave of lawsuits brought by conservative outfits and also by the Republican National Committee to force states to engage in voter purges. There's no other way to put it. They want them to purge the rolls, and you have to look at this against both a historical backdrop in which the Republican Party had a history of illegal purges aimed at Black voters. That was a tactic that they used to disenfranchise Black voters.

Now, they got themselves in a whole lot of trouble around it, and they were forced out of that business by a court order for many, many decades, and Congress toughened the laws to make it harder to conduct these purges. But here we are, we're back with the Republican Party and others, again, pushing these purges at the same time, I might add, that they have tried to pull states that they can out of a interstate compact. This is quite wonky, but it's important. An interstate compact between states called ERC, which your newspaper has reported on and others, is a confederation of states that basically share information about when voters have moved between states so that they can remove voters who have moved out of their states from the rolls.

There's been an effort by conservatives to pull states out of that at the same time that they're pushing these voter purges. So I don't think that the Republicans and these conservatives are going to succeed, but it's a shame that in 2024, we are again seeing the ugliness of efforts to force states to remove lawful voters from the rolls.

Colorado was recently in the news because the Supreme Court ruled that Trump could stay on the ballot there. There is also a controversy in the state surrounding signature matching with ballots. Can you help explain the rights and abilities states have to affect voting versus the federal government?

I was very critical of the Supreme Court's decision in Colorado. The Constitution with respect to federal elections. Let's just talk about since we're in a federal election year. The constitution gives states the primary job of setting the time, place, and manner of elections, which is the reason why in Colorado they can have vote by mail, and in New Hampshire they have in-person polling places at a very local level. States are allowed in the first instance to set the time, place and manner of elections subject only to congressional override.

So Congress is overridden in some areas. For example, Congress set a uniform election day. It's the Tuesday following the first Monday in November. So notwithstanding the fact that the Constitution says states can set the time of elections, Congress has overridden that and set it. So that's the balance of power, though. The question is how should that balance operate in reality, and I think that the 14th Amendment section three, which says that people who have taken an oath of office who engage in conduct overturn or insurrection against the United States are not eligible for federal office.

I think that that is a power enjoyed by the states. Obviously, the nine justices Supreme Court disagreed with that, but I think it was a real mistake. I think it was a mistake. I think that the court bowed to what they thought was a way out of a conflict with the Trump forces. I think Justice Comey Barrett actually said in a concurrence what I think most of them were thinking, which is let's take the temperature down. Well, sometimes the role of the court is not to take the temperature down, it's to apply the Constitution in the way it's been written.

So I think that was a mistake with respect to signature matching. Again, it's a very detailed thing about how states validate mail-in ballots. I'll just say this, we have seen a lot of states reject a whole lot of ballots for mismatched signatures when it turns out those voters signatures were not mismatched. Both blue states like Colorado and Washington and red States have to take a real hard look at whether they have struck the right balance of voter access versus security in a world in which more people are voting by mail and people's signatures vary more than they used to.

Let's be honest, when I was 20-years-old, you signed credit card slips and the credit card companies match them against the one on file. They match checks. Nowadays, a 20-year-old registering to vote register signs on a tablet. That doesn't necessarily match the signature that they would use with an ink pen. So I think signature matching is probably something that has to be revisited more broadly, but certainly in the near term states needs to do more to disenfranchise fewer voters by using it.

You created the Democracy Docket in 2020 to focus on voting rights and election litigation in the US. Why was this necessary then and how is the organization continuing its mission today?

Yeah. So I began Democracy Docket really for two reasons. One was I thought that there ought to be a place in a very crowded media landscape where there were always a lot of things going on around democracy and around elections. I thought there ought to be a place where people could go to get just the news of what's happening about elections in court. Just that one slice of it, just what's happening in the back and forth with all of the lawsuits being filed, a place where you would go and just understand that.

And I think it's actually been very successful at that. The second thing I thought we would achieve, I think we've been less successful at candidly, which is I wanted to create a place that ordinary citizens could go and read court cases for themselves. There was so much misinformation about what was happening in these cases. Was Donald Trump given a fair shake? Did the court, did a judge really say this? That I thought we could organize these pleadings and put them in an accessible way online so that people wouldn't have to take my word for it or your word for it about what happened in a case.

They could go read the cases themselves. That part, I think the media spends a lot of time looking at the cases. I do. Lawyers do. I'm not sure it has solved the disinformation campaign problem. I think people who want to lie about what the courts have been doing are still lying, but Democracy Docket is going strong. There's more than 180,000 daily subscribers. We send out newsletters every day. We launched a premium service, and I think it's still meeting its fundamental mission of giving people good access to information about every day, what's happening to democracy in courts.

Speaking of law cases, your law firm is in the midst of 52 legal cases across 19 states in an effort for free and fair elections. What are the most pivotal cases that we should know about?

First of all, the fact that we have to be involved in 52 cases across 19 states. Even hearing it makes me sigh. I hope to get to a place where in our democracy, we come to a place where we have the John R. Lewis Voting Rights Advancement Act enacted. We have Freedom to Vote Act, and we're able to all agree that the rules of voting should promote accessibility over everything else. That said, there are a couple of hotspots that I would point people to. The first is, we talked earlier about redistricting.

The fact is Black voters in too many parts in this country are still being denied the voting rights that they were promised in 1965. I'm not talking about something they were promised last week. This was a promise America made to Black voters in 1965. It is something that Ronald Reagan in 1982 reauthorized, calling it the crown jewel of American democracy. It is a law that was reauthorized in 2006, 98 to zero in the US Senate signed by George Bush, a conservative president. Walmart and the business round table lobbied for passage of this.

And yet here we are and we are finding ourselves in court more and more enforcing the portions of the Voting Rights Act that are left. And so there are a handful of those cases that are still going on that are critically important for people to be paying attention to. The other cases I think that I would follow are the ones that are going on in some of the swing states. There are big fights in Arizona right now, for example, about whether or not the election denier crazies, frankly, in that state are going to be able to undermine the ability to vote by mail in what will be a critical state in the 2024 election.

There are a cluster of important cases in Wisconsin also about vote by mail that I would encourage everyone to pay attention to. I wish I could say that those were it, but there's a reason why there are 50 plus of them going on in 19 states.

Marc, thank you so much for being on The Excerpt.

Thank you very much.

Thanks for our senior producers Shannon Ray Green and Bradley Glantzrock for their production assistance. Our executive producer is Laura Beatty. Let us know what you think of this episode by sending a note to [email protected]. Thanks for listening. I'm Dana Taylor. Taylor Wilson will be back tomorrow morning with another episode of The Excerpt.

Minnesota Supreme Court hears arguments in felon voting case

(KSTP) – The Minnesota Supreme Court on Monday heard arguments in a lawsuit about whether to uphold voting rights for 55,000 felons, a key ruling ahead of the 2024 general election.

The American Civil Liberties Union of Minnesota urged the court to preserve voting rights for people who already have voted in primaries and elections for nearly a year.

Meanwhile, the conservative group Minnesota Voters Alliance is asking the court to rule that a law passed last year that restores felons’ right to vote when they leave prison is unconstitutional.

RELATED:  Group files lawsuit seeking to reverse Minnesota law that restores voting rights to some felons

As previously reported by 5 EYEWITNESS NEWS , Gov. Tim Walz signed the law last March.

The bill is written as an exception to the state’s constitution, which states that a felon cannot vote unless “restored to civil rights.”

RELATED:  New state law means those with felony records can vote as soon as they’re released from prison

Prior rulings by lower courts didn’t make a final judgment on that core constitutional question.

However, the ACLU attorneys intervened in the lawsuit on behalf of two people who say they fought for years to regain the right to vote and were among the first in the state to register when voting became legal for them last year.

5 EYEWITNESS NEWS spoke to Antonio Williams, from St. Paul, last November  before that election.

RELATED:  Formerly incarcerated Minnesotans preparing to vote for the first time

Williams, who was released from prison in 2020 after serving a 13-year sentence on aiding and abetting homicide charge, says it felt like the future.

“For the first time, I had a voice to put the power,” said Williams. “It was like, oh wait, this is my democracy, this is mine. I actually care about this. This means something to me. I feel included.”

The court will hand down its ruling at a later time.

RELATED:  Minnesota Supreme Court denies lawsuit to restore felons’ right to vote

RELATED COVERAGE:

• Minnesota high court agrees to hear challenge to law that allows some felons to vote
• Minnesota Voters Alliance to appeal dismissal of their challenge to Restore the Vote Act
• Judge dismisses challenge to Minnesota law that allows some felons to vote
• Minnesota appeals court rules Mille Lacs County judge can’t stop felons from voting
• AG Ellison, Secretary Simon discuss judge’s orders that stripped felons of voting rights
• Ellison, Simon decry orders by Mille Lacs County judge stripping felons of voting rights

Here's what to know as voting begins in New York's presidential primary

Polls will be open 6 a.m. to 9 p.m. Tuesday for voting in the presidential primaries. Above, early voting last week at the Williston Park American Legion post. Credit: Debbie Egan-Chin

Polls will be open 6 a.m. to 9 p.m. on Tuesday for the presidential primaries.

Registered Republicans and Democrats are allowed to vote in their respective primaries.

A voter can determine their polling place through the state’s voter lookup at voterlookup.elections.ny.gov .

Nassau County voters can contact the Board of Elections at nassaucountyny.gov/agencies/BOE/index.html or call 516-571-VOTE.

The Suffolk County Board of Elections can be contacted at suffolkcountyny.gov/Departments/BOE or at 631-852-4500.

Vera Chinese covers Suffolk County government and politics. She joined Newsday in 2017 after working as an editor for the East End lifestyle publication northforker and a general assignment reporter for the New York Daily News.

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New York inmates are suing to watch the solar eclipse after state orders prisons locked down

FILE - In this image made available by NASA, the International Space Station is silhouetted against the sun during a solar eclipse Monday, Aug. 21, 2017, as seen from Ross Lake, Northern Cascades National Park in Washington state. Inmates in New York are suing the state corrections department over the decision to lock down prisons during the total solar eclipse, Monday, April 8, 2024. (Bill Ingalls/NASA via AP, File)

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NEW YORK (AP) — Inmates in New York are suing the state corrections department over the decision to lock down prisons during next Monday’s total solar eclipse .

The suit filed Friday in federal court in upstate New York argues that the April 8 lockdown violates inmates’ constitutional rights to practice their faiths by preventing them from taking part in a religiously significant event.

The plaintiffs are six men with varying religious backgrounds who are incarcerated at the Woodbourne Correctional Facility in Woodbourne. They include a Baptist, a Muslim, a Seventh-Day Adventist and two practitioners of Santeria, as well as an atheist.

“A solar eclipse is a rare, natural phenomenon with great religious significance to many,” the complaint reads, noting that Bible passages describe an eclipse-like phenomenon during Jesus’ crucifixion while sacred Islamic works describes a similar event when the Prophet Muhammad’s son died.

The celestial event, which was last visible in the U.S. in 2017 and won’t be seen in the country again until 2044, “warrant gathering, celebration, worship, and prayer,” the complaint reads.

The lawsuit states that one of the named plaintiffs, an atheist, received special permission last month to view the eclipse using glasses that would be provided by the state, but that was before the system-wide lockdown was issued.

Four of the other plaintiffs subsequently sought permission but were denied by officials who ruled the solar eclipse is not listed as a holy day for their religions, the lawsuit states. The sixth inmate said he never received a response.

Thomas Mailey, a corrections department spokesperson, said the agency doesn’t comment on pending litigation, but takes all requests for religious accommodations under consideration. He said those related to viewing the eclipse are currently under review.

Daniel Martuscello III, the department’s acting commissioner, issued a memo March 11 announcing that all state correctional facilities will operate on a holiday schedule next Monday.

That means incarcerated individuals will remain in their housing units except for emergency situations from 2 p.m. to 5 p.m., which are generally the normal hours for outdoor recreation in prisons, according to the lawsuit.

There will also be no visitation at nearly two dozen prisons in the path of totality next Monday, while visitation at other correctional facilities will end at 2 p.m.

Martuscello said the department will distribute solar eclipse safety glasses for staff and incarcerated individuals at prisons in the path of totality so they can view the eclipse from their assigned work location or housing units.

Communities in western and northern reaches of the state are expected to have the best viewing of the total eclipse, including Buffalo, Rochester, Syracuse, Lake Placid and Plattsburgh.

The total eclipse is expected to be seen in those parts of New York around 3:15 p.m. and last mere minutes as the moon passes between the Earth and the sun, temporarily blocking the sun and turning day into night.

StarTribune

Twin cities tourism business braces for impact of uber departure.

Visitors who pour by the thousands into Minneapolis-St. Paul International Airport have long been able to take for granted that fleets of rideshare drivers will be ready to pick them up at the flick of a smartphone and ferry them around the Twin Cities.

In a month's time, that option could disappear. It's got local tourism industry leaders more than a little nervous.

"It's just crazy to think about," said Angie Whitcomb, CEO of Hospitality Minnesota, a nonprofit group that represents restaurants, lodging and resorts throughout the state.

Minneapolis hospitality and tourism agencies are anxiously contemplating a future without rideshare services, even as they remain hopeful for a resolution to the dispute between the Minneapolis City Council and two rideshare giants over driver pay that has Uber and Lyft vowing a May 1 departure from Minneapolis.

That would leave a big hole in the local transportation system and inflict even more harm on an already struggling hospitality industry, especially hotels, said Adam Duininck, president and CEO of the Downtown Council and Downtown Improvement District.

"We need to build up businesses and not lose more businesses," he said. "We need to look for more ways to move people around downtown, not less."

In 2023, there were nearly 1.9 million stays at Minneapolis hotels, an increase of 15% over the year prior, according to Meet Minneapolis. This year is off to a busy start for travel, with 49,190 people passing through Transportation Security Administration checkpoints on March 21 — the second-busiest day at MSP since the start of the pandemic. The busiest day in that period was during MEA week last fall.

The hospitality industry itself is supported by many workers who rely on rideshare access to get to and from work after late shifts. "Our businesses operate on extended hours and at 2 in the morning you can't be guaranteed there's going to be public transportation at the front door of your place of business to get you safely home," Whitcomb said.

Many of Lyft's top pickup and drop-off locations are hospitality and tourism locations like Hilton Minneapolis, the Minneapolis Convention Center, Hyatt Regency-Minneapolis, and the Hewing Hotel, according to data shared by the rideshare company. While Lyft says it intends to only depart the Minneapolis market, Uber says it will pull out of the Twin Cities entirely.

Duininck decried the Minneapolis City Council's decision without a plan in place if Uber and Lyft follow through on the promises to leave.

"That is like if the airport shut down Delta and said we can find you rides on American or Spirit," he said. "It's irresponsible and it will affect our city, events and tourism."

Large-scale events rely on ridesharing options for attendees. Ensuring seamless transportation is essential to enhance participants' overall experience and make Minnesota a premier travel destination, Lauren Bennett McGinty, executive director of Explore Minnesota, said in a statement.

"Ensuring a diverse range of transportation choices is paramount for Minnesota to remain competitive, particularly in major metropolitan areas like Minneapolis," she said.

A lack of options could potentially jeopardize the millions of dollars the state has invested in the revitalization of downtown Minneapolis post-pandemic and post-George Floyd's murder, just as some momentum is building toward recovery, Whitcomb said.

"We're finally having meeting planners from across the country really look at Minneapolis for their events and conventions, but they're looking at the cost from a holistic perspective," Whitcomb said. "And if rideshare's going to be hard to get, or it's going to be the most expensive in the country ... that's going to impact their decision to come here."

Hope for statewide rideshare plan

Still, industry leaders are holding out hope for fair wages and assurances that travelers and industry workers will have transportation options that meet their needs.

"We are hopeful that a solution can be found so that any impact to rideshare users — including out-of-town visitors, convention attendees and tourism and hospitality workers — is negligible," Kathy McCarthy, a Meet Minneapolis spokesperson, said in a statement.

The hospitality industry will never be on the wrong side of wanting people to have the ability to make a living wage and take care of their families, Whitcomb said: "It's just unfathomable to imagine that we're solving a problem we think we're solving and OK with causing so many other problems."

Whitcomb and Duininck said they are hopeful the Legislature and Gov. Tim Walz can solve the dilemma and keep Uber and Lyft running. Duininck said it's a truly open question how people, and especially visitors with little knowledge of local routes and regions, will get around efficiently.

"We need to solve this issue," Duininck said. "It is not good for our city."

Zoë Jackson is a general assignment reporter for the Star Tribune. She previously covered race and equity, St. Paul neighborhoods and young voters on the politics team.

Tim Harlow covers traffic and transportation issues in the Minneapolis-St. Paul area, and likes to get out of the office, even during rush hour. He also covers the suburbs in northern Hennepin and all of Anoka counties, plus breaking news and weather. 

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