City, County respond in fight over I-976

If not for the preliminary injunction imposed by King County Superior Court Judge Marshall Ferguson last week, Initiative 976 would go into effect on Thursday. But as SCC Insight reported last night, the state Attorney General’s office has filed a motion with the state Supreme Court to stay that injunction pending further review. This afternoon, the City of Seattle, King County, and the other plaintiffs filed their response.

An appeals court can stay a lower-court decision on an emergency basis pending a more complete review, but in deciding whether to do so the rules say it must:

  1. “consider whether the moving party can demonstrate that debatable issues are presented on appeal;” and
  2.  “compare the injury that would be suffered by the moving party if a stay were not imposed with the injury that would be sufferend by the nonmoving party if a stay were imposed.”

In its motion yesterday, the state argued that there are obviously debatable issues, as Judge Ferguson made clear in his ruling, because there are plausible arguments on both sides as to whether I-976 has a false and/or misleading title.  But in today’s filing the plaintiffs argue that the state is arguing the wrong debatable issues: for the purposes of asking an appeals court to issue a stay, the question is only whether Judge Ferguson abused his discretion in issuing the preliminary injunction. According to binding case law, the standard of review for abuse of discretion is whether the judge made his decision (both to issue the injunction, and also its terms) “based on untenable grounds” or for an “untenable reason,” or if the decision is “manifestly unreasonable.” If the state is going to argue that there are debatable issues, the plaintiffs claim, those issues need to be related to that.

As far as the debate over whether the initiative’s title is misleading, Judge Ferguson didn’t need to make a definitive ruling; he simply needed to find that the plaintiffs were “likely to succeed on the merits.” Which he did.

Both sides continue the argument over harms: harms to taxpayers for having to continue to pay the tax that might one day be refunded if I-976 is upheld, versus harms to governments for not being able to collect a tax that can’t be collected after-the-fact if I-976 is struck down. The state also argues that there is no immediate harm since the local governments have other revenue sources and financial reserves; while the local governments argue that there is no legal requirement for the harm to be immediate, and that shifting revenue sources to cover the lost tax revenues just shifts the harm somewhere else. The plaintiffs also point to case law from the U.S. Supreme Court finding that over-collecting taxes and then refunding them later is not an irreparable harm.

The plaintiffs also threw in an insurance policy in their brief today: rather than just focus on the one issue Judge Ferguson chose to base his decision on (the alleged false/misleading ballot title), they recounted all of the constitutional issues that they had raised with I-976 and encouraged the Court to evaluate any or all of them as alternative grounds for finding that they were likely to succeed on the merits of their claim.

The plaintiffs also raised a stink about the accelerated timeframe for a decision, with the state filing its motion late Monday afternoon, the plaintiffs having less than 24 hours to write their reply, and then the Court having about 24 hours to decide whether to grant a stay before I-976 goes into effect Thursday morning. They also note that stays are usually granted to “preserve the status quo” while the case proceeds, and in this case the status quo is the state of things before I-976 takes effect, not after; the preliminary injunction is actually preserving the status quo, they argue, and thus should be left in place.

Another strange thing about the state’s motion for a stay is that it isn’t actually attached to an appeal of Judge Ferguson’s ruling. Appeals courts generally don’t stay a lower-court ruling except in advance of a more substantive review. Technically that’s ok; a party can ask for an emergency stay in advance of filing an appeal, but in this case appealing the preliminary injunction will extend the length of the case for months. So while the state is arguing that it wants to resolve the case on an expedited schedule, its actions will actually delay the ultimate resolution.

We should hear one way or another from the state Supreme Court tomorrow as to whether it will allow I-976 to take effect on Thursday.