North Carolina Supreme Court says bar owners’ COVID-19 lawsuits can continue

RALEIGH, N.C. (AP) — The North Carolina Supreme Court issued favorable rulings Friday for bars and their operators in litigation seeking monetary compensation from the state for COVID-19 restrictions first issued by then-Gov. Roy Cooper that shuttered their doors and, in their view, treated them unfairly compared to the way restaurants were regulated.

The majority decisions by the justices mean a pair of lawsuits — one filed by several North Carolina bars and their operators and the second by the North Carolina Bar and Tavern Association and other private bars — remain alive, and future court orders directing the state pay them financial damages are possible.

As a way to ease the spread of coronavirus, Cooper — a Democrat who left office last December and is now running for U.S. Senate — issued a series of executive orders that closed bars starting in March 2020. By that summer, bars still had to remain closed, but restaurants and breweries could serve alcohol during certain hours. Later in 2020, bars could serve alcoholic drinks in outdoor seating, with time limits later added, but the plaintiffs said it was unprofitable to operate. All temporary restrictions on bars were lifted in May 2021.

Lawyers defending Cooper have said the orders in the ninth-largest state were based on the most current scientific studies and public health data available at a time when thousands were ill and dying and vaccines weren’t widely available.

On Friday, the court’s five Republican justices in one lawsuit agreed it could continue to trial, rejecting arguments from state attorneys that the litigation must be halted based on a legal doctrine that exempts state government from most lawsuits. That decision largely upheld a Court of Appeals decision from two years ago that had affirmed a trial judge’s order to allow the action filed by Tiffany Howell, seven other individuals and nine businesses to be heard.

“We acknowledge that the COVID-19 pandemic was a chaotic period of time,” Chief Justice Paul Newby wrote in the prevailing opinion. “It is important to remember, however, that the Governor was not the only person facing uncertainty. Small business owners across the state dutifully shuttered their doors and scaled back operations without knowing exactly when they could open or operate fully again.”

A broader group of plaintiffs — the North Carolina Bar and Tavern Association and private bars — that sued separately but made similar claims received a favorable ruling last year from a Court of Appeals panel that reversed a trial judge’s decision to dismiss the lawsuit.

Friday, the same five justices ruled that the Court of Appeals shouldn’t have allowed the association to sue based on claims its members’ constitutional rights for equal treatment were violated.

But the plaintiffs can return to a trial judge now and present evidence on the claim that their right under the state constitution to earn a living was violated, Associate Justice Phil Berger Jr. wrote in the majority opinion. A trial judge had previously dismissed the case.

The association and the private bars “sufficiently alleged unconstitutional interference, and thus have a right to seek discovery to prove those allegations are true,” Berger wrote.

The Supreme Court’s two Democratic justices opposed decisions made by the majority in both cases and said the lawsuits should be dismissed. Associate Justice Allison Riggs wrote that the Bar and Tavern Association failed to signal it had evidence of a more reasonable plan to contain the virus’ impact than what Cooper chose.

Writing the dissent in the Howell case, Associate Justice Anita Earls said the majority “grants itself a roving license to second-guess policy choices, reweigh trade-offs, and displace decisions appropriately made by the political branches.”

The state Attorney General’s Office, which represented Cooper in both cases, said Friday it was reviewing the decisions. Through a spokesperson, Cooper’s Senate campaign declined to comment.

The Bar and Tavern Association called the decision in its case a “major victory” because the lawsuit can proceed on so-called “fruits of their own labor” claims in the state constitution. ”From the beginning, we never asked for special treatment, only equal treatment,” association President Zack Medford said.

Chuck Kitchen, a lawyer representing plaintiffs in the Howell case, also praised the ruling in their litigation.