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We’re shaped by our experiences. Where we end up ultimately is a matter of where we’re from.
For me, like everyone else, the journey’s been unique. Starting as a scrawny newborn in a trailer in an East Coast Navy town, I voyaged to a post-WWII tract home in another East Coast Navy town, headed off to college as a scrappy teenager, and immediately (and probably unwisely) jumped into law school. Then, I embarked on a for-profit legal career that I permanently quit after five years, started in the non-profit liberty movement in DC, and finally ended up as a (hopefully) still-scrappy adult leading the most successful public interest law firm around, in a California town dominated by a state government my firm has sued (more than a few times).
But there are specific moments—some of which may sound familiar—throughout that timeline that landed me at Pacific Legal Foundation.
For instance, in the summer of 1991, I was sponsored by American Legion Post 35 to attend Boys’ State, a summer conference where rising seniors create a state government, which was held at Liberty University in Lynchburg, Virginia. Beyond the earworm of a theme song (“It’s the Boys’ State of Vir-gin-ia that you see…”), the most poignant memories of my time were marching in formation, dressed like everyone else, barking various chants—not what I considered hallmarks of a vibrant and free society. Plus, there was backroom dealing—that’s how I became secretary of commerce—and an attempted impeachment of the governor. Returning to school in the fall, when asked to describe my experience, I quipped, as any contrarian 15-year-old boy would, that it was wonderful if you like the use of fascism to teach democracy. To me, conflating military service, which I hold in high regard, and its necessary obedience and conformity with the formation of a government whose highest duty is to protect the rights of the individual just didn’t sit right.
Throughout that last school year, I was personally introduced to the arbitrary whims of people in power. One example was my ill-fated run through what was called Homeroom Challenge, a double-elimination quiz show tournament, televised throughout the school, pitting homeroom teams of four against one another. The A homeroom—of yours truly—sailed to the finals against the M homeroom. In a heated battle, the Ms took the game. But the rules of the tournament required a rematch, because the As were formerly undefeated and the Ms came through the losers’ bracket. Yet for some reason still unknown to me, the quizmaster crowned the Ms champions and awarded them the most coveted of prizes—a dozen Krispy Kreme doughnuts. I was apoplectic that the rules could change arbitrarily and made my feelings felt across the school (the game was televised, a flag fell, and an expletive was shouted—much to the chagrin of Ms. Trapani, my Spanish teacher).
These episodes, together with others I’ve shared in this magazine, shaped my mind—including meeting an architecture major, my first days in college, who recommended The Fountainhead; accompanying my future best man to a talk he was covering for journalism class, which introduced me to the Institute for Humane Studies; and a couple summer seminars where I was immersed in classical liberal theory.
Yet, it’s not all about ideology. There are other pieces, too, that placed me where I am today. Take meeting my wife. I’d moved to DC and just started at the Institute for Justice. A fraternity brother invites me to his wedding—in Costa Rica. Given my new job, I begged off, not thinking I could vacation and pay back my student loans (this was the Bush administration, so it was up to me). Not one to relent, a few months later he made the pitch again. I ran the numbers and ended up in Tamarindo, on the Pacific Coast. The day after the wedding, post-brunch, my housemates and I hit up an establishment on the beach for some afternoon conviviality. One bit of important information: I’d chosen that day to wear my Yankees hat and a University of Virginia T-shirt. A wee bit after our arrival, in walks my now-wife, a New Jersey native and fellow Wahoo. Fast-forward a decade and it’s Lyndsay that’s sitting next to me on the couch as I receive an email from a search firm about a California-based public interest law firm in search of a president. Had I stayed in DC and not gone to the wedding, had I chosen to wear a different outfit (or, gasp, been a fan of other teams), or had I been anywhere but next to Lyndsay the moment that email arrived, I’d be somewhere else doing something else.
I could go on. But this issue is dedicated to the stories of our donors, what made them who they are, and how they, too, came to know PLF. You’ll see their treks and the distinctive lives they’ve created. Above all, you’ll get an inside look at the people we too rarely discuss in these pages—the people whose investment allows us to protect the greatest good: individual liberty.
Steven D. Anderson
President & CEO
Pulling back the spotlight
Nicole Yeatman
editorial director
AT A PACIFIC LEGAL FOUNDATION panel in May, client Wil Wilkins—who won his case against the Forest Service at the United States Supreme Court last year—thanked the PLF staff in the room. He called his lead attorney Jeff McCoy “a rock.”
Then he added: “I especially want to thank the donors: the reason we’re all here.”
PLF’s Supreme Court cases attract a media spotlight: Clients and attorneys talk to TV and newspaper reporters about what brought their case to this moment and what a victory would mean for the country. On the day of oral arguments, a photographer snaps photos of the client and legal team outside the Supreme Court, the client usually beaming with excitement. These photos line the hallway of PLF’s DC office.
But outside the spotlight shone on PLF cases is a quiet community of extraordinary men and women who fund every lawsuit. Our donors change the lives of people they will never meet. They make sure Americans don’t feel helpless or alone when going up against an overzealous county office, state regulator, or federal agency. Since the beginning of this year alone, PLF’s donors have made it possible for a ranching family to sue the Biden administration over a federal land grab; for a California woman to challenge the state’s telehealth restrictions; for a construction company to sue Seattle for blocking new housing; and so much more.
They also made it possible for California homeowner George Sheetz to triumph at the Supreme Court in an April 12 unanimous decision—PLF’s 18th Supreme Court victory.
Usually in Sword&Scales we tell our clients’ stories. For this special issue, we profiled four of our many extraordinary donors, pulling back the spotlight to show the lives connected through PLF and to bring our wider community of supporters into focus. ♦
Steve Hanleigh on family and the American Dream
STEVE HANLEIGH, now in his late seventies, has worked in California real estate for over fifty years. He lives in Monterey, California, home of Cannery Row (which John Steinbeck called “a quality of light, a tone, a habit, a nostalgia, a dream”), the legendary 1967 music festival (where Janis Joplin gave her career-making performance), the historic Pebble Beach golf links, and unrivaled natural beauty.
Everything in Steve’s life—his son and granddaughters, his successful career, his home—came close to never existing. His father’s entire family line was almost wiped from the timeline of human history before Steve was even born, simply because they were Jews living in Austria when the Nazis came to power.
For Steve to exist at all, and to find himself in California, an improbable series of events had to take place—starting with his father meeting his mother in the middle of World War II.
STEVE:
My whole family on my father’s side are 100% Ashkenazi Jew. Our family name was Hahn. My grandfather owned a business in Austria making Belgian lace—a factory for some of the royal families of Europe. It started struggling after the Great Depression.
The family business was seized in 1938, during what was called the Anschluss. It’s when the German Nazi Regime entered Austria. No war was involved. Nothing had been declared or anything. The Nazis took my grandfather’s business over. I don’t know what happened to it.
My father was a salesman for his father in the family company, and one of his brothers was a salesman as well. My father’s territory was Western Europe, and my uncle Leopold was Eastern Europe.
When the Nazis came, the family decided to get out of Austria because they saw the handwriting on the wall. My uncle’s destination was Australia, but to get to Australia, the only way you could go was through China. So he and my grandparents went to Shanghai. My dad went to London because he had contacts there.
The other members of the family got taken care of in other ways by the Nazis.
Before the Nazis came to Austria, there were almost 200,000 Jews in the country. By 1942, only about 7,000 remained.
About a year after Steve’s father arrived in England, Germany invaded Poland. England and France declared war on Germany.
STEVE:
My father spoke four or five languages. So when the war broke out, he enlisted in the British Army, and because of his language abilities, he was assigned to a unit that would do prisoner interrogations.
The Army had Steve’s father—whose name was Walter—change his last name from Hahn to Hanleigh, so that in case he was captured by the enemy, he wouldn’t be so quickly identified as an Austrian Jew.
Paris fell to the Nazis on June 14, 1940. It was, U.S. Secretary of War Henry Stimson later said, “the most shocking single event” of the war. After the French government signed an armistice with Germany, thousands of men and women across France risked their lives to aid British and American troops.
Including Steve’s mother.
STEVE:
My mom was a peasant woman in northern France living where wars have been fought for centuries, in the flat area between Belgium and France. Great for cavalry and for tanks. She was in a little town called Rincq, in a three-bedroom, one-bath home. She was one of 12 children.
She spent the first three or four years of the war helping to feed downed pilots from the Battle of Britain and other missions. People in the town would hide the pilots and my mom would take food from the family farm, like eggs and potatoes, and give it to them.
I’m so proud of my parents. I wish they were still alive.
On June 6, 1944, Allied forces took the beaches of Normandy, the first step in the liberation of France.
STEVE:
My dad came into the Normandy area about two weeks after the invasion, after the Allies had territory. He would interview captured Germans for information.
As the Allies pushed north up towards Belgium and Germany—this was late 1944—he meets my mother in this small town in northern France that had maybe 300 people. She’s about 20, probably 21 at the time, and he was about 32 or 33. They met and dated for a while.
But my dad has to keep on going because he’s got this job to do. He finally got to Berlin. He gets shipped back to England and discharged from the army. This is in mid-1945, after the war. So he goes back to France to try and find my mother. And he does.
PLF:
Did he just go back to that small town?
STEVE:
She was still there. He finds her and takes her back to London, and London is just totally ruined.
That’s where Steve was born: in the ruins of London after the war. The couple, with their new baby, made their way to Australia and met up with the other Hahns—who all ended up changing their last names to either Hanleigh or Hanley.
Steve spent his early childhood growing up in Australia. But when he was in elementary school, his father died.
STEVE:
My mom was devastated. But she was real strong country stock, self-willed and accountable. She opened a little store, became very successful, and then met this guy who was a vice president of Sears and Roebuck. They fell in love, got married, and the decision was made to move to United States, to Chicago, Illinois. And that’s how I got to this country. I was an eighth grader.
They were briefly living on an estate in Naperville, a well-heeled Chicago suburb. But Steve’s new stepfather was abusive.
STEVE:
My mother leaves. Packs me up one night, takes my dad’s ten thousand pounds of war separation money, hops in the car, and drives off, not telling her second husband where we were going.
She was an incredible woman.
We lived in a one-bedroom apartment for about three or four months, with sleeping bags and no refrigerator. We had a cooler. She got her license to practice as a beautician in Illinois and supported and mentored me. She was a pretty dynamic lady.
They stayed in Illinois for a couple years. During the summers, Steve started earning money.
STEVE:
We were broke. We had my father’s ten thousand pounds, but that was all we had to live on.
I started picking strawberries in local small farms. They would charge me 15 cents for a box. I had a little red wagon, and I’d fill it with strawberry boxes and knock on doors. I’d sell them for 40 cents a box. They were all sold. Then I’d bring the money home and my mom would let me keep most of it. But if she needed money, we had a little bit extra. That’s when money had value.
Another summer I got a job selling popsicles, peddling around a tricycle with a big box on it that you’d put dry ice in to keep everything frozen. Met all kinds of girls.
After Steve got through his first year of high school, his mother packed up the car again and they drove across the country to San Francisco, where old friends of Steve’s father from Austria were living.
STEVE:
They put us up for six months while my mom got her California beautician’s license. Then my mom started a business, cutting hair.
Steve earned his degree in economics at the University of California, Santa Barbara, married immediately after graduating, and went into real estate on the advice of his now-ex father-in-law. He helped his mom invest her money in real estate and securities.
His mom had never gone to college. But she was “wily,” Steve says. By the time she died, she was worth around $3 million.
STEVE:
Yeah, my mother, she just had more common sense than anybody I think I’ve ever met. She was also a spectacularly good-looking woman. But she never got married again. She refused to.
When Steve started out as a real estate broker in the early seventies, he worked out of a red Volkswagen camper van and sold small houses in the San Jose area to young families, including veterans returning from the Vietnam War. He also sold to Vietnamese refugees, who created their own banks by pooling money from several families to afford first one downpayment, then another. Steve sold 10-12 houses to a group of Vietnamese families this way. They were hardworking and smart, he says; by working together, they were able to buy property in an area that was rapidly growing.
STEVE:
San Jose was beginning to boom. That’s the birthplace of the electronics business. Hewlett-Packard, Memorex, Intel, IBM—they were all hiring these young guys out of ‘Nam and college graduates.
When young buyers were ready to trade up to a bigger house, Steve would sometimes buy their starter house from them. He built up a franchise operation with 85 agents working for him, selling and buying homes.
PLF:
Was it the tech industry that made you confident about investing in San Jose real estate?
STEVE:
I don’t think I had a specific reason why I should buy, other than they don’t make dirt anymore.
This country is about the only country on earth where you can buy, sell, lease, rent, build, remodel, do whatever you can with your property within reason and it’s constitutionally guaranteed. There’s no other place on earth where you can do that.
Frankly, part of my dedication to PLF and to the real estate industry is because the government has become so invasive and so intransigent, and very few people are speaking out against it other than PLF, Californians for Homeownership, National Association of Realtors, and advocates for property rights.
That’s why I love you guys. You do what I believe in and successfully. I’m a strong proponent of litigation. If you can’t sell it at a compromise table and it’s not fair, go to court.
Real estate is a different business now than it was in the seventies. For one, today’s brokers are focused on marketing themselves. No one is selling houses over a little folding table in the back of a Volkswagen camper anymore.
Also, there’s the housing crisis. But Steve has a bold solution for that.
STEVE:
I think the greatest thing the American government ever did for its citizens was when they created the Homestead Act back in 1880. And the government gave away land and what happened? All these people had dreams of owning something, got their wagons, and they went and staked out 40 acres.
I see no reason why the United States couldn’t do that again. The federal government is the biggest landowner in the country. State governments own tremendous amounts of land. The only way you’re going to get reduced values and affordable housing that’s meaningful, that isn’t an 800-square-foot three bedroom on the 15th floor of a suburb of DC, is to create new cities and new opportunities. That’s the only solution. That’s been the only solution since Adam and Eve. Look at them, they lost their first home, got kicked out of a garden and had to go live who knows where. If you go look back on history, that’s what’s formed wealth. I’m sounding like a philosopher now.
At this point in his life, Steve doesn’t personally represent buyers and sellers anymore. He doesn’t collect commissions.
STEVE:
But I can remember there was no better sense of value, personally anyway, than handing over a set of keys to a young family for their first house. The anticipation and the wonderment and the pride that that young family has is just amazing. Because it’s still the American dream. ♦
Bob Spaulding on the lessons of economics
BOB SPAULDING was 42 years old and teaching economics at San Diego State University when he decided to spend a summer bicycling across the country. It took 18 days; he averaged 100 miles per day.
BOB:
It was mainly an endurance thing.
The hardest part of the trip was going from Mesquite, Nevada, through St. George into Cedar City, Utah.
BOB:
The maps show you the distance, but they don’t tell you the elevation change. There were steep hills going from an elevation of about 2,000 feet to 6,000 feet, which really wiped me out!
That was back when people biked across country. They just don’t do it anymore. There’s no sense of adventure. I think we’ve really lost our ambition, the youth today.
Bob is 81 now. For about 25 years he was an adjunct professor in San Diego (mostly at San Diego State), teaching introductory economics to freshmen while developing real estate and managing rental properties. (Real estate was more profitable than adjunct teaching.)
When Bob was in college in the 1960s, he, like most of his peers, held progressive beliefs. But as he learned about economics and started teaching, he became more conservative.
BOB:
Econ tends to do that to somebody. You become aware of the inefficiencies of government. You’re aware of how free enterprise creates wealth, not just for the upper echelons but for the poor. The poor people in capitalist countries are far better off than in other systems.
Have you heard of the essay “I, Pencil”?
PLF:
Of course! I love “I, Pencil.”
BOB:
That really nailed it on the head. It shows how capitalism responds to consumer needs, consumer demands.
Being a landlord also changed Bob’s outlook.
BOB:
You live by your wits. You need an ability to judge people. You have to use the law sometimes to get rid of bad actors. You must take care of your property. Every property I’ve owned, I’ve improved in one way or another. Pretty proud of that. I rather enjoyed making the improvements and keeping the tenants happy. That’s a big part of our philosophy.
It’s hard to be popular if somebody has to write you a check every month. Renters tend to demonize landlords, and there are some bad landlords. But it’s stupid to be a bad landlord. You want to attract good people and you want to hold onto them. Nothing is more costly than having a vacancy, or having a tenant that trashes your place and you have to kick them out. You’ve got to be careful whom you pick. And you have to demand the rent on time and charge a late fee if it’s late.
Landlords are never going to be popular, but I think it’d be a great revelation for a tenant if he suddenly became a landlord. That would quickly change his point of view.
Bob invested in both residential and commercial properties. For a while, he bought in an up-and-coming neighborhood called Golden Hill, about a mile from Downtown San Diego. Each building he bought, he improved—sometimes gutting and rebuilding it—which increased the value of the whole neighborhood.
BOB:
I owned a half block of commercial properties. As things went up in value, I would refinance and pull money out and buy more property.
Bob isn’t in California anymore. He and his wife, Carol—a retired librarian—left San Diego three and a half years ago. They now live in Southwestern Utah, near the Arizona border, only 20 minutes from their son and his family.
BOB:
We really wanted to get out of California. We could see the direction it was going. We had moved there in ’75, and Pete Wilson, the Republican, was the mayor of San Diego. He later became governor. It was the golden state in those days. And everybody aspired to go there.
Now California’s policies are driving out good people. Here in Utah we get a lot of what I call refugees from California.
It’s really sad, because California is a beautiful place. But the government is worse and worse. I think they’re going to have a rude awakening at some point.
Bob and Carol are originally from Minnesota. Bob graduated college in the middle of the Vietnam War.
BOB:
I knew I was going to be drafted, so I volunteered for the Army. I went and served in Germany. Never went to Vietnam, but it was always kind of hanging over my head. Would my unit ever be sent to Vietnam? We never knew.
He met Carol a few weeks after getting out of the Army and fell in love. Before moving to California in 1975, the couple lived in St. Joseph, Missouri—a town that, ironically, is tied up in California history. St. Joseph was the starting point of the Pony Express, the 1860 mail route that, for the first time, allowed the rest of the country to regularly communicate with the booming population in California. It took 10 days for 80 riders to bring mail on the backs of 400 horses from St. Joseph to Sacramento. The Civil War and the transcontinental telegram killed the route not long after it began; but for a brief time, when California was still the Wild West, the Pony Express was what connected California to the rest of America. It’s baked into California lore about the early, hardscrabble days of the state, and there’s still a Pony Express National Museum in St. Joseph.
When Bob was in St. Joseph, he taught upper-level economics classes. But after moving to California, he switched to introductory economics, which he liked: It meant he was talking to students from different disciplines, some of whom knew absolutely nothing about economics.
BOB:
Economics scares people and it shouldn’t. I had a lot of non-majors: In other words, they were perhaps in journalism or education or engineering. They were required to take a social science course, and many chose principles of economics. They came in with preconceived ideas. I could give them a better understanding and appreciation of how the economy works and how capitalism rewards people, including the poor. And that was a surprise to them.
By the way, my weakest students were often journalism majors. My best students were in engineering. The journalism majors couldn’t write worth a darn, and the engineers were always precise and gave backup data.
PLF:
If there was one economic lesson that you could make everyone in the country understand, what would it be?
BOB:
TANSTAAFL. You know where I’m going?
PLF:
Oh! I know it from Robert Heinlein’s The Moon Is a Harsh Mistress. “There ain’t no such thing as a free lunch,” right?
BOB:
There ain’t no such thing as a free lunch. In other words: Opportunity costs. When you make a decision, you may be gaining something, but you also may be giving up something.
PLF:
Is there anything the government’s done recently—maybe student loan forgiveness—that made you think, “Wow, they really don’t understand opportunity costs”?
BOB:
You just mentioned it. Forgiving student loans is an abomination. You’re giving free money. You’re buying votes of indebted college students and you’re paying their debts. Meanwhile there are people who never went to college, or people who struggled to get through college on their own income and had to work through college. You couldn’t find a more idiotic policy.
I hope people see through the blatant hypocrisy of it all.
Bob and Carol are happy in Utah. They get to babysit their grandkids, for one. But they also love the area.
BOB:
People really take care of their property here, no matter how modest it may be. The mountains are beautiful. Kevin Costner has done some movies in the area.
Bob isn’t teaching economics anymore. But he still sees the country—and the government’s mistakes—through the eyes of an economics professor.
BOB:
There’s so much the government does that is counterproductive and hurts the very people that seek to help. Government takes so much of our income and does so many stupid things, and we suffer for that. But I think people are becoming more aware of the value of entrepreneurship, and how dangerous rogue government policies can be. ♦
Jim Krasno on the bizarre world of an entrepreneurial pathologist
EARLY IN DR. JIM KRASNO’S autobiographical book, I’d Rather Do an Autopsy, there’s a scene where he arrives at a prison for the first time. Jim was a pathologist for over forty years in the Bay Area. Pathology is an investigative form of medicine: You’re using the human body to unlock secrets about death and disease.
Jim’s stories about his career read like scenes from a Raymond Chandler novel: He conducted autopsies on murder victims, testified in court, and spent seven years overseeing lab work on prisoners. He also managed rental properties and developed a line of Mortuwear clothing on the side. (“Clothing designed for the morgue, now available for the street.”)
The scene in his book where he arrives at prison captures Jim’s dry sense of humor. As he waits in a long line to enter, a prison guard shouts to him, “You can’t go in dressed like that.” Jim is confused—he’s wearing normal clothes—until the guard explains, “You can’t wear anything blue. In a lockdown, we shoot at anything blue. Only the prisoners wear blue.”
It’s a moment teetering on the edge of danger, and it’s typical of Jim’s career experiences. He has worked hard at living an interesting life, preferring risky opportunities to boredom. He calls himself a medical entrepreneur.
He likely inherited the entrepreneurial spirit from his family—but they encouraged him to pursue medicine.
JIM:
I grew up in Whitefish Bay, Wisconsin. In a Jewish family in Wisconsin, you wanted your son to be a doctor.
My grandparents on both sides came over from Eastern Europe at the turn of last century. And my father’s father was in manufacturing. He started a clothing factory in Milwaukee.
My grandfather loved the idea of his grandson being a doctor.
Jim was pre-med at Yale University. Still, he wouldn’t have gone to medical school right away were it not for the Vietnam War: The threat of the draft loomed over his graduating class.
JIM:
I had a recent luncheon with 25 of my classmates, and they all said the Vietnam War changed their careers.
He attended Johns Hopkins University School of Medicine, trained as a pathologist at UNC Chapel Hill and UC San Diego, then moved to San Francisco in 1973.
JIM:
When I grew up, I knew I wanted to be where more was going on. San Francisco was the place to go. It was beautiful. You could go anywhere, do anything.
He initially took a normal pathology job.
JIM:
I worked for several years sitting at a microscope looking at slides in hospitals. I decided that wasn’t quite right. I wanted to go out on my own. I wanted to be independent.
He started marketing his own pathology practice. He took contracts for pathology at hospitals, coroners’ offices, and outside laboratories. He was good at his job. At one point, a big Sacramento laboratory hired Jim to take over as director of pathology—and Jim discovered the lab had a contract to provide a pathologist to the nearby prison hospital.
JIM:
As the head of pathology, I was responsible for covering the practice at the prison. None of the other pathologists would do it. They all said they’d quit if they had to go to the prison. So I did it. This was a great opportunity.
I took a lot of borderline things that paid off.
Jim has seen the best and worst of California. He and his wife Leena had a beautiful home in San Fransisco, with a bay window overlooking the Pacific. Meanwhile, Jim would spend hours in a prison or testifying about a homicide that took place at a seedy motel. He found himself in tough positions most people can’t imagine. He once had to do an autopsy on a person he knew, a colleague who was only in his forties when he died. Another time, while his own wife was pregnant, Jim had to do an autopsy on a baby who had died of the mysterious sudden infant death syndrome (SIDS). Once Jim’s daughter was born, he woke up often at night to check her breathing.
At one point, he was in a group of three pathologists doing autopsies for Napa, Sonoma, and Contra Costa County coroners’ offices. The pathologists called their small group “Casks and Caskets.” Jim would drive an hour and a half through scenic wine country—an area that looks like paradise—to arrive at a small funeral parlor where a body waited for him.
He saw corruption and incompetence in the medical industry: Some doctors were more concerned with building their own fiefdoms and reputations than treating patients. Once, when he did an autopsy on a patient who’d died at a small county hospital, several doctors called Jim to try to influence his findings.
JIM:
No one seemed at all concerned that an error in diagnosis might have led to a death that could have been avoided with proper treatment. They just didn’t want to look foolish or stupid in front of their peer group.
Another time, Jim’s aunt phoned him, desperate because her daughter had recently delivered a baby by Caesarean section at a small Bay Area hospital and the incision was infected. The doctor said he’d done everything he could, but she might die.
Jim called the hospital’s pathologist, who looked at the young woman’s file and told Jim she needed to see the hospital’s infectious disease expert. The obstetrician hadn’t called the expert because they were political enemies. Jim had his aunt ask for a consultation with the infectious disease expert. The young woman survived.
Jim had ignored normal hospital procedure and hierarchy by calling the pathologist. But it was the right thing to do.
JIM:
It just shows, so much of life is like that. You have these rules, but sometimes bad people are making them.
The government has too heavy a hand in the medical industry, Jim says.
JIM:
I think the government—not just with regulating what doctors can do, but by regulating billing and everything else—has really deteriorated the abilities of doctors to get things done. When I started out, I could have my own practice. I could make calls on businesses. And I’ve said that my practice was the last bastion of free enterprise. And it was. It’s gone. I could not do that today. I would have to get a salaried job somewhere and follow a lot of regulations. The government is overregulating. There’s no question that it’s getting much, much worse.
Pacific Legal Foundation now represents several doctors in a lawsuit challenging telehealth restrictions, which make it impossible for patients in states like California and New Jersey to be treated by out-of-state specialists. PLF also successfully challenged a certificate-of-need law that blocked a medical transport company from operating in Kentucky. The government shouldn’t block qualified medical entrepreneurs from meeting demand.
Jim was an entrepreneur in two industries: While working as a pathologist, he was also a landlord—which brought its own eccentricities and struggles.
JIM:
In the early ’70s, my father and I started a real estate business in Los Angeles, owning and managing apartment buildings. I still run that.
Now we’re being creamed by the government. The L.A. Board of Supervisors and state legislators come up with the craziest things and some get passed. It’s ruining private property.
Rent control is a serious problem. I feel that things I own are going to be worthless when I die.
If his daughter and grandchildren didn’t live in California, he and his wife likely would have left the state by now. As it is, they’re leaving San Fransisco to move closer to them in Santa Barbara.
Jim is ready to leave San Fransisco. It’s not like it used to be.
JIM:
People were friendly back then. You could safely walk at night by yourself and it was just like a big playground. And now we feel marooned in our house because we don’t feel safe. And none of our friends do either.
Physically California is still beautiful, but the way it’s run, it’s terrible.
He supports PLF because he believes our cases set crucial precedents for individual rights.
JIM:
A lot of places I’ve supported have great ideas and great talk, but nothing much ever comes of it, as far as I can tell. They talk a good talk, but it’s hard to say what they accomplished.
I think that’s why I came to the conclusion that suing for people’s rights was where I wanted to be. ♦
Jay Dauphinais on being a landlord to small businesses
JAY DAUPHINAIS OWNS commercial industrial centers in the Bay Area, leasing space to businesses. Most of his tenants aren’t big firms. They’re lean, service-oriented companies in their earliest days, when they’re still figuring their business out.
JAY:
I call it incubator space. It’s entry-level commercial. They’re home-based businesses that finally go out and lease something because they get tired of running the business out of their home, and they need some place to store supplies, or they need some place to take deliveries.
It’s management intensive. We deal with a lot of startups. There’s always stuff going on.
When there are larger businesses in one of Jay’s office parks, it’s usually because they started leasing from Jay years ago and stayed as the business grew. One tenant was with Jay for about 18 years.
JAY:
He started in one suite, and when he left he was in six suites.
The dynamics of Jay’s business are fascinating: Because he’s leasing to entry-level businesses, every lease agreement is essentially a calculated bet on the success of that business. He has to evaluate each tenant’s business plans and think about whether they’ll still be able to pay rent a year or two down the line. If he doesn’t think a business has long-term potential, he doesn’t rent to them: It’s too risky.
JAY:
A lot of people—they can be great contractors, they can be great mechanics, but they might not be the greatest businesspeople.
It means Jay has a front-row seat to the entrepreneurial ambitions and efforts of all his tenants.
JAY:
I’ve said many times, I live vicariously through the success of these small businesspeople. I’ve counseled many of them. Even counseled them when they sell their businesses: “Hey, you need to do this, you need to do that.”
He generally takes a hard line with rent. But during the early days of the COVID-19 pandemic, when California imposed strict lockdown regulations, Jay offered rent deferrals. He also tried to help tenants figure out how to continue doing business.
JAY:
We had a gym, and they really struggled. We tried to bring some of the gym stuff outside, and we had an agreement for how rent would be structured.
But we were blessed during the pandemic, primarily because of the size of the tenants—meaning they didn’t have a huge operation.
The tech industry has brought an influx of ambitious, hardworking people to the Bay Area and pushed commercial activity out to the suburbs, where Jay is.
JAY:
Tech has brought in a lot of very bright people from other countries. A ton of small businesspeople. And I think that’s fabulous. Those that are entrepreneurs, that can fend for themselves—it’s a blessing that they want to come here and start their businesses.
Jay’s originally from Illinois. Neither of his parents had college degrees.
JAY:
My dad was a carpenter. He was self-employed. He had his own business. Then he went to work for the Chicago Fire Department and became a full-time fireman. My mom had secretarial jobs.
Jay put himself through college, got a business degree in finance, and was in a PhD program for economics. But he decided against finishing his PhD.
JAY:
It was like, “I want to go out and do stuff.” I worked all my life. And I was always an entrepreneur.
PLF:
Did you always have the same view of government power, property, and freedom?
JAY:
I always believed the government should let entrepreneurs do what they do without too much red tape. And being in economics, that capitalist system is the best system in the world. It’s provided the best standard of living for all classes. In particular, we have a middle class. Most countries don’t have a middle class. You’re either poor or the elite and there’s not much in the middle. The United States has got the largest middle class by far, and that came about through capitalism. Here, you can create a business providing a service to other people.
He’s been working in California real estate since 1976—the same year, incidentally, the state legislature made the California Coastal Commission a permanent agency, giving it extraordinary power to regulate and block development of 1.5 million acres of land.
JAY:
The California Coastal Commission became a big gorilla. They were anti-doing anything. You couldn’t build a garage on your property. It would take you forever to get a permit. If you had land on the coast, you had to go through huge hurdles to get anything done.
He married his wife in 1979 and got her into real estate too. To Jay, real estate just makes sense.
JAY:
Property ownership and property rights have been at the forefront of my thinking since the ’70s.
It’s real basic. Land is a fixed commodity, and inflation always exists to a greater or lesser degree. Coming from the hyperinflation of the late ’70s and ’80s, it was clear from the get-go that real estate would be a long-term, good place to invest.
In fact, I used to have a motto very early when clients would ask me about owning real estate is, I earn more money buying real estate than selling real estate as a broker. And that’s forever been true.
Because he was in California, things didn’t always go smoothly. In the 1980s, Jay and his wife tried to develop a piece of property on a main drag next to a freeway. They had a tenant lined up. But the city wouldn’t approve their project.
JAY:
Everything was right. The zoning was right. But the newfound city had recently adopted a redevelopment plan.
And so they didn’t have their legs yet, and they thought, “This is suburbia.” Nobody did any economic analysis of it. These are planners, right? These are supposed to be idea people.
And so we spent a lot of money, at least 30 to 40 grand, which was a lot of money back then. With the tenant in hand, we couldn’t build.
I understood how unfair a de facto taking could be
He used to manage residential properties, but California has made it increasingly difficult to be a residential landlord. For one, evicting a residential tenant is near-impossible—which means choosing the wrong tenant can ruin you.
JAY:
One developed an attitude that it’s better to leave a suite or a house vacant than to put in any remotely questionable tenant.
California’s very anti-landlord. It’s probably one of the most anti-landlord places other than New York City. With all the new legislation they pass every year, California has gotten to the point where it’s controlling so many parts of residential property management.
My wife and I used to have a lot of residential properties. And I’m glad we’ve been out of it for a number of years.
Starting this July, residential landlords will have an even tougher time: California passed a new law that caps residential security deposits at only one month of rent.
To Jay, it’s clear what that means.
JAY:
Every tenant in the world is going to get down to the end and say, “Well, use my deposit for the last month’s rent.” If there’s damage, you have nothing. It shouldn’t be that way.
The new law is especially bad because California also restricts how much information landlords can get on prospective tenants’ histories. PLF tried to bring this issue before the Supreme Court earlier this year, in a case challenging a Seattle ordinance that forbids property owners from considering tenants’ criminal histories. The ordinance “threatens the safety of rental owners, their families, and tenants by depriving owners of their right to exclude dangerous ex-convicts from occupying their homes and sharing intimate spaces,” PLF’s cert petition argued. The Supreme Court declined to hear the case.
Jay brought up another PLF case in Alameda County, California, in which property owners Sheanna and Karl Rogers got stuck with a violent tenant who threatened them and other tenants. Alameda County’s eviction moratorium prevented Sheanna and Karl from evicting the tenant. It’s a property owner’s nightmare, fueled by restrictions on what landlords can know and do. What happened to Sheanna and Karl struck Jay as deeply unfair.
JAY:
You can’t see tenants’ previous evictions anymore. You can’t figure out whether the prospect has a criminal record. Well, if you’re managing an apartment building, you certainly would like to know if this guy beat up his wife or has some felonies against him. You’ve got to know that. Because you as an owner or manager are responsible. How can you be expected to put this guy into your property?
That’s government intervention. I think that’s absurd. It’s interfering with business, the normal course of prudent business.
Jay started giving to PLF after learning about the firm in the mid to late ’90s.
JAY:
Once I knew about PLF and their litigation against the overreach of government on private property rights, I was determined to support them.
I’m thrilled with the work that PLF does for the defense of property owners and property rights. ♦
