Nasdaq Diversity Rule Challenge Puts Conservatives on Defense (1)

Conservative groups faced a skeptical panel of Fifth Circuit judges over their legal challenge to the SEC’s backing of Nasdaq rules aimed at putting more women and minorities on corporate boards.

“You have to be able to say it’s arbitrary,” Judge Stephen Higginson of the US Court of Appeals for the Fifth Circuit said during oral arguments Monday, referring to the Security and Exchange Commission’s approval of the rules.

The Nasdaq Inc. rules require companies listed on the exchange to have at least one female board member and at least one who identifies as an underrepresented minority or LGBTQ—or explain ...