UPDATE, 6/28, 3pm: "AZ AG Mayes Dismisses Opioid Settlement Case; Governor, Legislature Demand A Second Sweep... For Attorneys' Fees"
Attorney General Kris Mayes officially threw in the towel on her legal effort to prevent the Legislature from sweeping $115M of opioid settlement monies from the AG's Office into the General Fund. However, legislative leaders and Governor Katie Hobbs are not quite done, asking the judge to award them attorneys' fees - in effect, a second sweep.
Judge John Hannah's ruling dissolving the TRO that the AG had previously obtained is now in Minute Entry form (below), and we can see that it is a bit more nuanced than previously believed. Hannah relied on a distinction between the appropriations process and how the funds are then spent. It would appear that because the settlement monies were not in a segregated fund (under the AG's control), the Legislature has the right to appropriate them as Arizona's revenues.
The judge then notes "If the money is (mis)spent, there is a recourse." ("mis" added)
The lawmakers and Hobbs cite an Arizona statute that makes an award to a prevailing governmental entity mandatory in a suit brought by another governmental entity. (A.R.S. §12-348.01) In this case, the outside counsel retained by the lawmakers (Snell & Wilmer) and the Department of Administration (Coppersmith Brockelman) will be paid out of the AG's budget.
The voluntary dismissal ensures that there will be no last-second appeals that could throw the last-minute budget deal into chaos as the fiscal year is ending.
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Original article, 6/21; "BREAKING: Arizona Budget Partners - Hobbs, Toma, Petersen - Lawyer Up and Strike Back vs. Attorney General Over Opioid Settlement Monies"
The legal battle over whether Arizona budget partners - Governor Katie Hobbs and the Legislature - could sweep $115M of opioid settlement monies from the Attorney General office - heated up this afternoon, with allegations of misleading the Court filed.
Attorney General Kris Mayes obtained a Temporary Restraining Order ("TRO") yesterday to prevent the budget sweep from happening. To get that Order signed (by a Court Commissioner) without a hearing or response ("ex parte"), they needed to represent that it was such an emergency that it needed to be signed before giving notice, or that they had given notice.
Today, Governor Katie Hobbs - through the Department of Administration and its Executive Deputy Director - retained outside counsel (Andy Gaona at Coppersmith Brockelman). They filed a Motion to move up the hearing set for next Thursday, and explain that the notice was only given to the Department of Administration's Executive Deputy Director's assistant (that is also in a separate legal dispute) after the pleadings had been filed (but before Commissioner Cronin was reading and considering them).
The AG's Motion stated that "Plaintiff is notifying the Arizona Department of Administration of this motion and papers via email and contacting it by phone upon their filing." Hobbs' Motion today states "this is simply not the way we practice law in Arizona.
...“notice” was provided by email and a single phone call to the ADOA Executive Deputy Director’s assistant after counsel filed those pleadings and while they were awaiting assignment to a judge to present them. Twenty-four minutes later, the Attorney General’s counsel emailed ADOA’s in-house counsel to inform it that Commissioner Cronin “is reading the papers now” and that counsel was “in her waiting room.” And by the time undersigned counsel was able to look briefly at the Complaint and speak for just a moment with ADOA’s in-house counsel, Commissioner Cronin had already granted the Attorney General her requested TRO and set the matter for an order to show cause hearing on June 27 before Judge Minder.
Meanwhile, House Speaker Ben Toma and Senate President Warren Petersen retained Brett Johnson and team (Snell & Wilmer) to file Motions to Intervene and to Dissolve the TRO.
This article was reported by AZ Law founder Paul Weich.
"AZ Law" includes articles, commentaries and updates about opinions from the Arizona Supreme Court, U.S. Supreme Court, as well as trial and appellate courts, etc. AZ Law is founded by Phoenix attorney Paul Weich, and joins Arizona's Politics on the internet.
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