Employer Sanctions Lawsuit

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Some business groups have filed suit against the Employer Sanctions law signed by Governor Napolitano. Julie Pace, a lawyer representing the groups, talks about the reasons for the lawsuit. Also a discussion about the decision by a federal judge in Hazleton, Pennsylvania to strike down ordinances targeting undocumented immigrants.

>>Jose Cardenas:
Good evening, I'm Jose Cardenas. Thanks for joining us on Horizonte. Many business groups are speaking out against Arizona's new Employer Sanctions Law. Now a group is ready to challenge it in court. Also, some of the world's best soccer teams played in a tournament in the Valley; the effort and momentum to bring a professional soccer team to Arizona, that's all next on Horizonte.

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>>Jose Cardenas:
Governor Napolitano signed the state's employer sanctions bill last month. In an effort to stop the law from going into effect in January, business groups filed a lawsuit in federal court. Here now to talk about the lawsuit is Julie Pace, the attorney representing the groups challenging the constitutionality of the new law. Julie, welcome to Horizonte.

>>Julie Pace:
Thank you.

>>Jose Cardenas:
You know, there's been a lot in the paper about the lawsuit, about the issues that are being raised. Before we get to that, let's just talk about the environment out there, because you hear a lot of reaction, negative, positive. What's going on?

>>Julie Pace:
Oh, it's been a rather tough environment for companies and their employees, because sometimes people are driving up to the drive-thrus and making inappropriate comments against Hispanic workers, telling them to go home, saying a lot of racial slurs and companies have to protect their employees for anti-discrimination, so they're now having to put procedures in place to deal with customer complaints like that. The police have stepped up their efforts, they're doing traffic safety stops and profiling Hispanic drivers and having them be pulled over and asked questions, sometimes they're confiscating vehicles. We're getting a lot of traffic criminal tickets, even some because they don't speak English and they're driving a pick-up truck, and we've gotten some criminal tickets in that regard, so a lot of hype.

>>Jose Cardenas:
What happens there in that situation?

>>Julie Pace:
What happens is an officer sometimes out in southeast Gilbert, Mesa area, they pull over a pickup truck with a trailer that's going off to work in the morning. They decide to do a safety check on the vehicle. They issue citations for about 20 items. It's kind of like how they treated blacks in the '60's really, because the citations I have are things like a cracked windshield and these are criminal tickets, for things like not enough windshield wiper fluid. Also for not being able to speak English.

>>Jose Cardenas:
They're being cited for not being able to speak English?

>>Julie Pace:
Yes, criminal tickets under that. So it's a tough environment that's really unfortunate that it's being targeted against people, and it is part of the process with all of this.

>>Jose Cardenas:
Sheriff Joe has talked about stepping up his own enforcement. Is there anything coming out of the Sheriff's office in terms of different activities?

>>Julie Pace:
They still have the D.P.S. stops. I know he has his new hotline. I called to check it out to hear what he's saying. It is out there, although they're not, as I understand, actually following up on any of those at this time. I think there's some dispute with the federal government about what role he really can do in that and he's going beyond what they've trained D.P.S. officers to do, so I don't know how that will shake out and the role he'll play.

>>Jose Cardenas:
Let's talk now about the lawsuit, the principal issues your group is raising.

>>Julie Pace:
The lawsuit is about the unconstitutionality of Arizona's new Legal Arizona Workers Act as they call it. It has a lot of technical and substantive deficiencies. It was enacted late at the last night of the legislative session this year. It didn't have all the business and legal community out there explaining the problems with the bill. I think it was done for a symbolic message. People are frustrated with Congress and want something done. They think that if we can get each state to do some of these laws, maybe Congress then will deal with this issue on a federal level, so I understand that sentiment. Most of my employers are in the same boat and are frustrated with Congress. But when they enacted the law, what it did was it violated the U.S. Constitution, it violated our Arizona Constitution, and federal law. So it violated it a couple ways. It gets into some of the supremacy clause. The U.S. Constitution says that our federal government gets to do certain things, and the states can't, like make war, for example, and things of that nature.

>>Jose Cardenas:
On that particular issue, the proponents of the legislation and at the initiative which I want to talk about in a minute, insist that they dealt with the pre-emption question, because there is a provision in federal law that allows states to do some things and they say this is not a criminal action and therefore it's perfectly appropriate.



>>Julie Pace:
Right. Immigration is something that generally is in the supremacy clause left for the federal government. One phrase says except for state licensing, and what they tried to do is enact this Arizona law to say that we're just going to take away a business license if someone's found to knowingly hire an undocumented worker. The problem with that is, the only legal way they can do that under the law is to say we'll, as a state, take away the business license but only after the federal government determined under the proper procedures in the federal system, that the company has hired someone and knew that, under the knowingly standard. So they can only make that determination to revoke the license after there's a determination in the federal system. The Arizona law is trying to reverse that and say we want to be able to determine in Arizona that there is an immigration status -- or the immigration status of the individual -- and then we're going to revoke it and have procedures in the courts in Arizona which doesn't have jurisdiction to do that.

>>Jose Cardenas:
But what the proponents say is that all this does is tie into federal statutes. In fact, if you follow federal procedure with the basic pilot program to make sure you're hiring people, if they're here legally, you have nothing to fear. The governor herself said businesses if they're doing what they're supposed to do, there shouldn't be a problem. How do you respond to that?

>>Julie Pace:
There's a few things. All the legal employers get so frustrated because they want a legal system and they want a biometric electronic verification program so they don't have to worry about this issue. The basic pilot you mentioned is right now an experimental voluntary program that only about 7,000 companies nationwide are actually using. We have 130,000 businesses in Arizona alone. I mean, this is a huge difference to say it's mandatory. Congress has said it can't be mandatory yet. They've prohibited it from being mandatory, that's another pre-emption issue because Arizona's now saying it's going to be mandatory here. Now I think companies, if we had a program out there, all of them would want to use it, if we could get a safe harbor from it, if we could get protection from it, and if we could actually have somebody answer the phone at the federal government within three business days to say resolve the no match of the dispute, we don't have that and it's still premature.

>>Jose Cardenas:
Now Russell Pearce has said he's willing to fix some of these things. If he does, would your group be satisfied?

>>Julie Pace:
I would like to hear what he'd like to do to fix some of the issues we've raised. I don't know if we can, if he can fix it. I mean some of what I've heard him say is he's not going to let the Governor water down the bill and he's frustrated people will go back into special session. I don't know if he's thought through it more and there are differences there, I just don't know. Substantively even with that case that came out of Pennsylvania that helps us greatly, it's pre-empted in the immigration area, and that's been determined by another court already which is exactly our argument.

>>Jose Cardenas:
That's the Hazelton case, which Rep. Pearce dismisses as a decision by a Clinton appointee.

>>Julie Pace:
Not at all. It's a very respected judge, 200-page decision, interesting history in the appendix about immigration rights in this country, which is very interesting reading, besides all the constitutional issues that some of us might be more interested in reading than other people. But he found it on the exact right issues, exactly what we argued in our complaint, it's all laid out. It truly is pre-empted and this is going to fall right in line with what we believe.

>>Jose Cardenas:
Speaking of some additional information, that lawsuit as I understand it, they also put into the record evidence showing that these arguments about the increasing crime rate attributable to undocumented immigrants is simply not true.

>>Julie Pace:
Yes, they had a lot of things in that decision, a lot of information, they understand that this is such a national hot button issue, they put a lot of information to educate people, to have people question, look at things, and understand the judge was not just making a decision to easily say it is pre-empted and done, he tried to be fair and look at a lot of things to help people understand the issues.

>>Jose Cardenas:
Who are your current clients, who are actual parties to the lawsuit?

>>Julie Pace:
We're getting ready to amend the complaint in the next couple days, by Monday or Tuesday, and add quite a few more. We've got two on right now, the Arizona Contractors Association, Arizonans for Immigration Reform, Arizona Employers for Immigration Reform, Arizona Restaurant and Hospitality Association, Arizona Chamber of Commerce, Arizona Farm Bureau, Arizona Minority Contractors Association, Arizona Working Contractors, I'm going to forget some of them, and there's some more. So those are going to be named officially when we file it in the next day or two. Then we go forth with the motion for preliminary injunction.

>>Jose Cardenas:
Julie, not too much time left, but the initiative, there are some who say this lawsuit and other attacks on the legislation have ensured the passage of the initiative, which is much tougher. It's a death penalty immediately if you violate the law.

>>Julie Pace:
Yeah, couple things on that. First of all, the lawsuit will help answer the ballot initiative question, because the lawsuit has the same components and same pre-emption issue and the only difference is the suspension of license as a first strike instead of just a revocation of license, although it has the suspension of license as the first strike instead of just a revocation of license although suspension of license doesn't really exist. How do you take a corporation and move it off the planet for 10 days and stop healthcare benefits and wages and income all that, so it's a fiction to put in the bill. But it's the same pre-emption arguments, it'll probably take care of the ballot initiative, by the sense the court will rule and take care of both.

>>Jose Cardenas:
You're confident about the outcome?

>>Julie Pace:
Very confident on this one.

>>Jose Cardenas:
Julie Pace, thanks for joining us.

>>Julie Pace:
Thank you, Jose.

>>Jose Cardenas:
Many of the world's most popular soccer teams went head to head in a week-long tournament last month in Glendale called the Copa PanAmericana. Marcos Najera reports on the growing popularity of the sport here in Arizona.

>>Marcos Najera:
The cup for the Copa PanAmericana was up for grabs recently. Big name teams from Mexico, Argentina, and several other Latin American countries took the field at the University of Phoenix stadium. In their respective countries, all the teams are very popular, and promoters had hoped that the popularity of the marquis groups would help fill the seats. But that never really happened. Tournament promoter Albino Valentini explains.

>>Albino Valentini:
(speaking Spanish) It's not a problem. We'll continue promoting this tournament. This time around, he says, people probably couldn't get out of work early enough, since it was during the week.

>>Marcos Najera:
Promoters say games later in the week drew several thousand people, which was a significant leap from the mere hundreds of fans that showed up earlier at the start of the tournament. Many fans who showed up were asked to sit together on one side of the stadium so the stands looked full on television. But it was clear that fans had fun during the week-long series despite the low turnout.

>>Carlos Tinajero, Sr.:
We don't have these kind of games very often. The teams are top teams. Six of the top ones, it's unbelievable to see them play here.

>>(Fans chanting):
America! America!

>>Jose De Leon:
Two down already. We're winning 2-0 already. There's no chance, no chance. And we don't have the main player right now anyway.

>>Marcos Najera:
Isn't that a bad thing that the main players aren't here tonight?

>> Jose De Leon:
No, most of them are, but there are some that just came from South America playing the Copa America, so they have to have their rest too.

>>Marcos Najera:
Earlier this year a sellout fan base packed this stadium for a match-up between U.S.A. and Mexico. Organizers had hoped the Copa Panamericana could have done the same.

>>Elsa De Leon:
It's a Wednesday, people work, and there wasn't much advertisement for this tournament.

>>Jose De Leon:
Not much advertisement. I think that's the main thing, not much advertisement. We just heard from friends, but we're here.

>> Carlos Tinajero, Sr.:
We get to know about the games barely by the last weekend. If we know that, with the advantage of time, we can invite somebody out or the people who know that they're playing here, they can come and see the games.

>>Marcos Najera:
Die-hard fans think people in Arizona who didn't come buy a ticket to the Copa Panamericana simply missed out on a high-end tournament with top international players. But fans also say they think the sport could easily catch on here in the state, even by people who don't follow the sport.



>>Fan:
They got to get more like knowledgeable about the game to get to know it better and maybe they'll start liking it.

>>Jose Cardenas:
Here now to talk about the possibility of a professional soccer league coming to Arizona is Dana Gagnon, President of Phoenix Soccer Development. Also here's Scott Sifferman, East Valley chapter director with MLS Phoenix Rising, an organization aiming to get fans interested in the sport of soccer. Gentlemen, thanks for joining us on Horizonte. Dana, let's start with you. What is Phoenix Soccer Development?

>>Dana Gagnon:
It's a group of professionals who have come together to bring our expertise to the effort of bringing an MLS team to Phoenix.

>>Jose Cardenas:
And your expertise deals directly with MLS.

>>Dana Gagnon:
I was the manager of finance for the league for three years.

>>Jose Cardenas:
And right now you're devoting yourself full-time to bringing soccer to Phoenix?

>>Dana Gagnon:
Correct. I resigned my position in March and have been here working on the effort here.

>>Jose Cardenas:
What will it take to get a soccer team in Phoenix, Arizona?

>>Dana Gagnon:
It's really two things, and they're two big things, so it's a lot of pieces that build up to the two things. But the two pieces are you have a soccer specific stadium, and then the right investor group.

>>Jose Cardenas:
What about the level of enthusiasm? You saw the video package we had. There are some enthusiastic fans but there weren't very many of them for what some thought was one of the premier soccer events in this arena.

>>Dana Gagnon:
And I see why people would think it was the premier, but actually it was really a pre-season play. There were second and third string teams, for the most part, playing. And the ticket prices were listed at the highest levels. The top ticket prices were $70. And most people aren't going to pay $70 to see a pre-season game. And then really on the other side overall, why the numbers didn't come out was the promoter that was brought in didn't really understand how to market soccer in the U.S. Marketing soccer in the U.S. is different than anywhere else in the world and the promoter really failed to grasp that.

>>Jose Cardenas:
So what would it take to promote an event like that successfully? You had 60,000 fans to watch the U.S. play Mexico. What generates that kind of enthusiasm?

>>Dana Gagnon:
Well, U.S.-Mexico is really a beast unto itself.

>>Jose Cardenas:
Because of the intense national rivalry?

>>Dana Gagnon:
Exactly, huge rivalry between the two. But really, U.S. soccer was the promoter of that and they do know the business of soccer here in the U.S. And really in the U.S., which is different from everywhere else in the world, soccer as a business is targeted towards a fragmented audience, where everywhere else in the world it's a homogenous audience, so you have to apply much more sophisticated market techniques to be able to deliver a good crowd.

>>Jose Cardenas:
What are the fragments of the audience that you're talking about?

>>Dana Gagnon:
Some language based, some nationality based, some socioeconomic based, and it's really many different gradations in all those different groups that make it very difficult to understand how to properly reach those audiences, where in Argentina, for example, you don't have to worry about that.

>>Jose Cardenas:
Regardless of background, everybody is a soccer fan, same thing in Europe?

>>Dana Gagnon:
Exactly. Exactly.

>>Jose Cardenas:
Now, what would it take right now, where do you stand, rather, in terms of getting a soccer team here in Arizona?

>>Dana Gagnon:
Well, I feel confident. I feel confident that the efforts that we've put forth over the last three to four months have really started to come together.

>>Jose Cardenas:
Got an investor group lined up?

>>Dana Gagnon:
We've got some seed funding in the door. We're working on finalizing the full investor group. And we're actually very close to signing deals with two secondary tenants which will help basically fill the business model on the stadium.

>>Jose Cardenas:
Secondary tenants for the state?

>>Dana Gagnon:
Yes, for the state.

>>Jose Cardenas:
I want to come back to discuss some details, but before I do, Scott, what is MLS Rising?

>>Scott Sifferman:
MLS Phoenix Rising is a grassroots fan-based organization that came together in early March on the heels of the big Mexico-United States soccer match at the University of Phoenix stadium. And we're completely separate from Phoenix Soccer Development, but we're obviously very supportive of their efforts because without them we don't have a team to support.

>>Jose Cardenas:
What about other cities, in this area, have they done the same kind of things, organized groups such as yours?

>> Scott Sifferman:
Only very recently. There's a group in Philadelphia, called the Sons of Ben, which is very similar to us. They really want a team to come to Philadelphia and I think there is a group over there that's also working on business issues, but the Sons of Ben are a fan-based group, just like MLS Phoenix Rising.

>>Jose Cardenas:
In what way do groups such as yours actually create an environment that would be conducive to getting pro-soccer in the Valley?

>> Scott Sifferman:
Well, so far we're just trying to put the word out there that we desire a major league soccer team here in Phoenix. Both to let the local community here know and to let the major league soccer offices back in New York know that there's a fan base here. You know, we're trying to just drum up support all over the Valley.

>>Jose Cardenas:
What kind of response are you getting?


>> Scott Sifferman:
Right now we have over 1,200 people signed up through e-mail to hear about different events we have. We get together for viewing parties, for the U.S.-Mexico Gold Cup final match, the Argentina-United States Copa America match, which were both last month. We have meetings to kind of organize the group and to, you know, just create a fan base for when the major league soccer team finally arrives.

>>Jose Cardenas:
Dana, how important is that?

>>Dana Gagnon:
I think it's extremely important. The folks at MLS Phoenix Rising have done a great job to really activate the voice of the fan here in the market. I really think they're just getting started, but they've done a fantastic job in a very short period of time with zero money, just on pure effort alone. Getting 1,200 people to come together and sign up and say I want MLS here, and that speaks to people back at the league office and it speaks to potential investors to say, okay, well, we have a base of fans that can be season ticket holders.

>>Jose Cardenas:
Is Phoenix in competition? When I say Phoenix, I mean the Greater Phoenix area. Are we in competition with other cities to get the next franchise?

>>Dana Gagnon:
Absolutely. MLS is a really hot ticket right now in the sports world. Most other major markets have the big teams out there, really most if they don't have one sport, it's usually MLS. And so MLS is expanding and people see that while for soccer, people might say approximately 30 million, which seems to be the public figure now, might be a lot of money to purchase a team, compared to what an NFL team or an NBA team would cost, if you could even convince the league to expand. The numbers are extremely different. And people see, especially savvy business people see the massive up side to an investment in soccer that right now in my mind I equate it to investing in the NFL in the 1970's.

>>Jose Cardenas:
Now, what kind of impact have additions such as David Beckham made to the enthusiasm for soccer in the United States?

>>Dana Gagnon:
I think it has hit enthusiasm on all kinds of levels, from the core fans who are somewhat skeptical because they're not quite sure, you know, David Beckham, to the casual fan who all of a sudden now is watching soccer where they weren't before. But I also think you see the impact on the field as well. I think the players, now that they know there's more attention on them playing all these different games, they're putting forth more effort from what I've seen, than I've seen in the past, even for games that are friendlies, even for games that aren't meaningful competition, there's more effort put forth because people are watching and people care more in this country than they have before.

>>Jose Cardenas:
Before we come back to Phoenix specific questions, let's talk about the league, 14 teams as I understand, and some real differences in terms of how revenues are shared as compared to some other major sports.

>>Dana Gagnon:
Yes, the business structure is significantly different from any other professional league here, or any other major professional leagues here in the U.S. MLS is a single entity structure. Basically that means the teams are actually not franchises. The teams are actually teams, the owners own an equity share in the league itself and there are certain revenue shares and costs mitigated risks and so ultimately risks are then mitigated across the league by sharing of revenues and expenses. Although it's not wholesale sharing, it's partial sharing.

>>Jose Cardenas:
Now, from some of the material I was given before going on air, I understand that by and large major league soccer has been a financial loss, $350 million, as of 2004 overall. So what do you tell investors as you try to get them interested in a team in Phoenix?

>>Dana Gagnon:
I can't talk to the number because I don't know how accurate that figure is. But what I do know is that most of those losses, if that is the right number, came before MLS really discovered the soccer-specific stadium. And it was tried for the first time in 1999 in Columbus. Mr. Lamar Hunt made the investment out of his own pocket to build that stadium to prove that soccer could succeed here. In its own stadium, a soccer team is now a viable business entity.

>>Jose Cardenas:
What do we mean by a soccer-specific stadium, how does that differ from let's say, Cardinals Stadium.

>>Dana Gagnon:
It ultimately means a multi-purpose large field, mid-sized stadium that has MLS team as its primary tenant.

>>Jose Cardenas:
Approximately how many in terms of seating capacity?

>>Dana Gagnon:
About 25,000.



>>Jose Cardenas:
To make it work, though, you also have to book other events there. What kind of events would be suitable for a stadium of that size?

>>Dana Gagnon:
All other kinds of sporting events, collegiate events, it could be any sport that requires a large field, so you're talking about American football, rugby, possibly lacrosse. Then it could be on a club level, on a U.S. level - the U.S. rugby team could play a game there. Also collegiate sports, high school sports can be played in that stadium.

>>Jose Cardenas:
Now, you have some ties to the Valley, so it makes sense that you would come back here to try to get a team here, but what does Phoenix offer that other sites don't, if there's an advantage that Phoenix has?

>>Dana Gagnon:
I think on the overall image of Phoenix, Phoenix is quickly becoming an international city, and really though to break it down to specific target markets, Phoenix has very significant populations in the two target markets. One target market is the suburban soccer family and the other target market is the Hispanics. And those different groups really make up the two primary markets that MLS targets.

>>Jose Cardenas:
Dana, we're just about out of time, only a few seconds, final thoughts?

>>Dana Gagnon:
Final thoughts: Well, I believe Phoenix has everything it takes, it's the top market MLS isn't currently in from a potential standpoint.

>>Jose Cardenas:
We'll be keeping an eye on you, and Scott, good luck to you as well.

>> Scott Sifferman:
Thank you.

>>Jose Cardenas:
For information on our show, go to our Web site, azpbs.org, just click on the word ‘Horizonte' in the middle of the page. That's our show for tonight. Thanks for watching us. I'm Jose Cardenas. Due to special programming on Eight, we will be back in two weeks to talk about issues affecting the Latino community. Have a good evening.

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