Threat to divest city funds from a Koch-owned LA Times likely unconstitutional
“The government generally can’t discriminate against government contractors based on the content or viewpoint of the contractors’ speech,” University of California Los Angeles law professor Eugene Volokh said in an email to the Washington Free Beacon.
“I think that principle would apply here,” Volokh explained. “The city might choose its investment firms for various reasons, but it can’t choose them because the firms sell their assets to speakers whose speech the city dislikes.”
Rosendahl’s motion, which was cosponsored by two other councilmembers, including mayoral candidate Eric Garcetti, may also violate laws governing pension administration, experts say.
“The law is very clear: Pension funds must be invested so as to maximize their value and provide a secure financial foundation for retired public servants,” said Allen Dickerson, legal director at the Center for Competitive Politics.