A strategy used by Wal-Mart to pressure cities in the Golden State into sidestepping environmental restrictions and approving their superstores was soundly rejected by a three-judge California appellate panel.

The Arkansas-based retailer bankrolled five petition drives in California last year that, if approved by voters, would have qualified the company to bypass the landmark California Environmental Quality Act (CEQA). Once the company gathered the 15% of signatures necessary to qualify the measure for the ballot, Wal-Mart would offer a deal.

The cities could approve the petition themselves or face a costly election battle. The strategy worked. Four cities enacted the Wal-Mart petition in 2011 without an election, saving one of them, San Diego, an estimated $3.4 million in voting costs.

“They circumvented the system and blackmailed the town,” Apple Valley Councilman Rick Roelle told California Watch last year after Wal-Mart pushed through a superstore proposal there. “We’ve had controversial projects, but we were never bullied like Wal-Mart.”

The fifth city, Menifee, held the election. It cost taxpayers $79,000 and the measure failed badly.

Last month, the appellate court ruled that a city signing off on a petition is not the same as voter approval, and compliance with environmental laws is still required. The court reasoned that signatures by 15% of residents is not the same as a vote of the electorate, and cities could not assume the outcome of an election.

“Developers’ strategy of obtaining project approvals without environmental review and without elections threatens both to defeat CEQA’s important statutory objectives and to subvert the constitutional goals of the initiative process.”

CEQA requires state and local agencies to identify the significant environmental impacts of their actions and to avoid or mitigate those impacts, if possible. Most large-scale projects require the ubiquitous Environmental Impact Reports (EIR).    

Although the three-judge panel removed one tool from the Wal-Mart workbench, the company can still use the courts to beat back efforts to organize workers in its stores.

A week before labor activists plan to build on months of organizing efforts in Wal-Mart stores by leading a Black Friday strike, the biggest private employer in the world—with more than 2 million employees—filed unfair labor practice charges against the United Food and Commercial Workers International Union.

The complaint to the National Labor Relations Board alleged the union is leading unlawful attempts to disrupt its business. In a letter to the union warning it to back off, Wal-Mart said, “We are prepared to and will take all appropriate legal actions to enforce our property rights, protect our business, and ensure the safety of our customers and associates, on Black Friday and in the future.”

–Ken Broder

To Learn More:

Win for Environmental Law Is Loss for Wal-Mart (by Will Evans, California Watch)

Wal-Mart Ramps up Ballot Threats to Speed New Stores (by Will Evans, California Watch)

Wal-Mart Files Unfair US Labor Practice Charge over Protests (by Jessica Wohl, Reuters)

Toulumne Jobs & Small Business Alliance v. Wal-Mart Stores Inc. (California Court of Appeal Fifth District) (pdf)