Taking a broader look at what’s out there right now, it’s understandable that some companies are just hoping to not become targets.
Republican Texas legislators who sent a threatening letter to Sidley Austin last week over the law firm’s policy to pay for out-of-state abortion travel also have other Texas employers offering that benefit in their sights.
The far-right Texas Freedom Caucus’ letter to Sidley threatened the law firm with civil penalties, felony charges and disbarment for its policy. It also said lawmakers plan to introduce legislation prohibiting “any employer in Texas from paying for elective abortions or reimbursing abortion-related expenses—regardless of where the abortion occurs.”
The ride-sharing service Lyft, which has been an outspoken advocate of abortion rights, already has been a target of Texas anti-abortion lawmakers’ fury. In early May, weeks before the Supreme Court overturned Roe v. Wade, lawmakers sent a letter to CEO Logan Green chastising him for announcing that the company would pay travel costs for women who leave Texas or Oklahoma for abortions.
“Your decision to divert corporate resources to this end is unacceptable and will not be tolerated. Your responsibility as a CEO is to maximize return to the shareholders, not to divert shareholder resources toward ideological causes in an effort placate the woke liberals in your C-suite,” said the letter, which was signed by 14 lawmakers, six of them Freedom Caucus members.
Legal experts say that while Texas likely would face hurdles building a legal case restricting access to health care outside state boundaries, they say the hard-line rhetoric is giving some companies pause about adopting abortion-related benefits or publicizing them.
Michelle Browning Coughlin, of counsel at the Kentucky office of ND Galli Law, said she considers legislators’ threats “empty.” Even so, she said, as in-house counsel, “You can’t just be cavalier about advising your company to do something that could be dancing them into potentially breaking the law.”
Texas employers that previously issued promises to defend employee access to abortion are laying low. Lyft, Apple, Bumble, Comcast NBCUniversal, Dick’s Sporting Goods, HP Enterprises, Kroger, Match Group, Nike, Uber and Warner Bros. Discovery did not respond to requests for comment.
One general counsel who declined an interview said there was little benefit to standing in the spotlight on the divisive topic. “I can understand why people don’t want to go on record on this particular issue.”
Rob Chesnut, a former Airbnb general counsel and chief ethics officer, agreed.
“If you poke your head up on an issue like this, you risk becoming an enforcement target,” he said.
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Myers said the Freedom Caucus and other abortion opponents in state government “have been targeting folks who help people access abortion in Texas for years, and what they’re doing now is moving on to corporate entities rather than just focusing on nonprofit organizations who’ve been terrorized and harassed.”
Browning Coughlin said Texas authorities could face challenges building a case against companies with travel policies, in part because the evidence that an employee actually received an out-of-state abortion would be difficult to obtain.
Even so, Travis Gemoets, a Los Angeles-based partner with Jeffer Mangels Butler & Mitchell, said the fact that legislators’ threats touch on unsettled areas of the law might be enough to make companies nervous.
“To prohibit this interstate activity seems to be pushing the envelope for any state institution,” he said. “But they’re doing it, and they’re certainly going to threaten it until they’re told that they can’t do it. … We’re seeing the very, very beginning of these issues, but it’s going to take years for courts to weigh in.”
The uncertainty will create a chilling effort, he said.
“If my client received a letter like this, I would say, ‘Look, I can’t tell you you’re free and clear to do what you want. We just don’t know the landscape.’”
Walking back abortion benefits after receiving a threat, however, could result in even more threats, Gemoets said. “If Texas is finding that it’s getting headway with this approach, you’re going to see other jurisdictions, other states replicate that approach.”
We’ve discussed this before, even before the Dobbs ruling came down. The bullies and lowlifes in the deep red districts will never go away, but if Republicans underperform in the November election it will have an overall effect of cooling off the ardor for this kind of viciousness, as we saw in the 2019 legislative session. It’s a simple matter of rewards and incentives – if you engage in wild behavior and win you can keep on going nuts, but if you do so and lose you need to rein it in. I guarantee you, a lot of these affected companies are waiting to see how the wind is blowing, at least as far as speaking up is concerned. A profile in courage it ain’t, but it’s the reality we’re dealing with.
On a more specific matter, a bit of new information.
In the wake of the Supreme Court’s demolition of reproductive freedom precedent, a number of employers (including a bunch of law firms) have decided to cover the travel costs of employees, should they seek an abortion or other banned procedures in jurisdictions where they’re no longer legal. But only one — Biglaw firm Sidley Austin — received a letter from the ironically named Texas Freedom Caucus threatening a number of repercussions over the policy.
Now, as reported by Bloomberg Law, the White House has weighed in on the threatening letter, with assistant press secretary Alexandra Lamanna saying, “These punitive actions and extreme proposals from elected Republicans are exactly what the President has been warning about.”
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Although some media reports have posited that the letter from the Texas Freedom Caucus was a warning to all Texas firms, it is not, in fact addressed to all Texas firms. Just Sidley. And that’s despite numerous Biglaw firms with offices in Texas coming out and saying they’d also pay for travel costs if an employee wants abortion care. Indeed, according to the Caucus’s own website, the only threatening letter they’ve sent out — to any employer at all — has been to Sidley.
Inspired by an email from a tipster, this fact got me thinking about why Sidley was targeted. The most prestigious law firm in Texas, Vinson & Elkins, has also pledged to pay for employees’ travel expenses, but curiously, haven’t been threaten like Sidley. Kirkland & Ellis is the law firm that makes the most money and will also cover travel costs, and… no letter. Could it be, and this is speculation, that of the prestigious law firms in Texas, only a few have women leading them? Hence that letter, addressed to Sidley’s Yvette Ostolaza.
Maybe Dick’s Sporting Goods’ CEO Lauren Hobart should expect a similar letter soon.
And it turns out, the plot is still thickening.
As reported by Reuters, Cody Vasut is both of counsel at the Biglaw firm of BakerHostetler and also a Texas state representative… as well as a member of the Freedom Caucus. Now my curiosity as to why Sidley is the only employer targeted by the Freedom Caucus is REALLY piqued.
UPDATE: As noted by an eagle-eyed tipster, Vasut no longer appears on BakerHostetler’s website.
BakerHostetler Chair Paul Schmidt had this to say about Vasut’s caucus targeting a rival firm, “His affiliation with the Texas Freedom Caucus is in a personal capacity and solely related to his legislative role.”
BakerHostetler has not responded to requests to find out if the firm will, like many of its peers, offer similar coverage of travel costs. Law students, only a few weeks away from early interview week (and potential laterals), take note.
That Reuters story linked above notes that “Eleven women attorneys with BakerHostetler, including 10 partners, were signatories to an open letter first published in The American Lawyer last month decrying” the Dobbs ruling. We’re firmly in speculative territory here, but it is an interesting question: Why was this one firm, out of however many in Texas, seemingly singled out? Maybe the “Freedom Caucus” was planning to send a bunch of other letters as well but hadn’t gotten to them yet for some reason. If it all ends up with a jerk like Cody Vasut getting some unfriendly scrutiny of his own, that’s fine by me. I’ll keep an eye on this.