NORTH CAROLINA BAR AND TAVERN ASSOCIATION; еt al. v. JOSHUA H. STEIN, in his official capacity as Governor of North Carolina
No. 126PA24
IN THE SUPREME COURT OF NORTH CAROLINA
Filed 22 August 2025
BERGER, Justice.
Stevens Martin Vaughn & Tadych, PLLC, by Michael J. Tadych, K. Matthew Vaughn, and Robert F. Orr, for plaintiff-appellees.
Jeff Jackson, Attorney General, by James W. Doggett and Nicholas S. Brod, Deputy Solicitors General, and Amar Majmundar and Matthew Tulchin, Special Deputy Attorneys General, for defendant-appellant.
BERGER, Justice.1
Plaintiffs are a group of bar owners and employees from across North Carolina who challenge a series of executive orders entered by defendant-Governor Roy Cooper. According to the trial court, Cooper‘s executive orders restricted full operation of plaintiffs’ establishments for over 400 days while permitting other businesses to reopen. Plaintiffs argue that the closure and differing treatment violated constitutional and statutory guarantees. Governor Cooper contends that the measures were based on science and data and were necessary responses to an ongoing emergency.
But even in a declared emergency, the powers of those who act on behalf of the people have limits, and the citizens of this state rejected “because I said so” governаnce long ago. However well-intentioned government actors may be, they are constrained by the enduring commands of the Constitution; and constitutional guarantees cannot be suspended in this state by executive fiat.
This Court recently confronted similar issues in Kinsley v. Ace Speedway Racing, Ltd., 386 N.C. 418, 423 (2024). There, we addressed claims that COVID regulations imposed by the Governor violated the Fruits of Labor and Equal Protection Clauses in our State Constitution. Id. at 424-29. Based on our precedent in State v. Ballance, 229 N.C. 764 (1949), we unanimously established a workable Fruits of Labor test and clarified that rational basis review is not the appropriate standard for Fruits of Labor claims. Id. at 424-26.
Plaintiffs here, like the plaintiff in Ace Speedway, have stated colorable claims under the North Carolina Constitution. But this case presents a slightly different question: whether the trial court‘s entry of summary judgment in favor of the Governor was proper. Because our Fruits of Labor test is a fact intensive inquiry, we agree with the Court of Appeals that the trial court erred when it entered summary judgment. However, the Court of Appeals incorrectly applied rational basis review to the Fruits of Labor claim. As discussed further herein, because the Court of Appeals did not have the benefit of our decision in Ace Speedway when it issued its opinion in this case, and we modify and affirm in part the vacatur of the trial court‘s order, and remand to the trial court.
Plaintiffs also advanced an Equal Protection claim pursuant
In addition, plaintiffs asserted statutory claims for violations of the Emergency Management Act and Public Records Act. For the reasons set forth herein, plaintiffs have failed to establish that they qualify for recovery under the Emergency Management Act, and they have failed to establish jurisdiction for their Public Records Act claim and associated demand for attorneys’ fees. We, therefore, affirm the Court of Appeals in affirming the trial court on these statutory claims.
I. Factual and Procedural Background
On 17 March 2020, Governor Roy Cooper issued Executive Order No. 118 entitled “Limiting Operations of Restaurants and Bars and Broadening Unemployment Insurance Benefits in Response to COVID-19.” Exec. Order No. 118, 34 N.C. Reg. 1834 (Mar. 17, 2020). This action closed bars entirely and limited food and beverage operations for restaurants. Id. Bars were defined in Executive Order No. 118 as “establishments that are not restaurants and that have a permit to sell alcoholic beverages for onsite consumption, under
A “stay at home” directive was entered in Executive Order No. 121 which closed non-essential businesses. Exec. Order No. 121, 34 N.C. Reg. 1903 (Mar. 27, 2020). Restaurants were determined to be essential by Governor Cooper and were permitted to continue limited operations while bars were to remain closed. Id. Subsequent orders extended the closure, but by May 2020, phased reopening began.
Phase 1 allowed restaurants to remain open under restrictions but continued the prohibition on operation by plaintiffs’ establishments. Exec. Order No. 138, 34 N.C. Reg. 2141 (May 5, 2020). The Phase 2 reopening plan in Executive Order No. 141 permitted restaurants, tattoo parlors, breweries, wineries, distilleries, taprooms, bars in hotels, and other establishments to reopen under capacity limitations and other prescribed rules. Exec. Order No. 141, 34 N.C. Reg. 2360 (May 20, 2020). But bars were again excluded from the reopening because they purportedly posed a greater risk of the spread of COVID when compared to other businesses. Id.
Following entry of Executive Order No. 141, Governor Cooper held a press conference in which he stated that continued restriction on bars was justified based on data, science, and daily information received from doctors and other healthcare experts.
In a sworn declaration provided to the trial court, Department of Health and Human Services Secretary Mandy Cohen justified the “dimmer switch” approach to phased reopening, stating that the “[r]isk is higher in spaces like bars, where people‘s pre-COVID learned behavior involves high-risk activities,” and that their approach was “data driven.” Secretary Cohen further stated that a leading consideration in the differing treatment was “the positive economic impact” that wineries and breweries produced, and that “the State has a strong economic interest in sustaining them.”4
Plaintiffs made a public records request seeking the information Governor Cooper had referenced in the press conference and thereafter filed suit. Plaintiffs sought an injunction which would have enabled them to
The trial court denied plaintiffs’ request for a preliminary injunction on 26 June 2020. Thereafter, Governor Cooper moved to dismiss plaintiffs’ suit for lack of personal and subject matter jurisdiction, and for failure to state a claim upon which relief can be granted. Plaintiffs subsequently moved for partial summary judgment. A hearing was held and the trial court entered an order allowing Governor Cooper‘s motion to dismiss and denying plaintiffs’ motion for partial summary judgment.
In reaching its decision on the Governor‘s motiоn to dismiss, the trial court indicated that it considered evidence and information outside of the pleadings. With regard to plaintiffs’ state constitutional claims under the Fruits of Labor and Equal Protection Clauses, the trial court analyzed whether Governor Cooper “acted with a proper government purpose” and “whether [those] actions were reasonable.” The trial court determined that because the executive orders were based on scientific data and learned professional commentary, and because plaintiffs had not demonstrated that Governor Cooper‘s use of the police powers was unreasonable, plaintiffs could not proceed with their Corum claim. As a result, the trial court dismissed plaintiffs’ constitutional claims and denied plaintiffs’ motion for partial summary judgment.
On the statutory claims, the trial court dismissed the Emergency Management Act claim because there was “no evidentiary or legal basis to conclude that [plaintiffs‘] interests were ‘commandeered, seized, taken, condemned, or otherwise used in coping with an emergency’ within the statute‘s scope.”
In considering the Public Records Act claim, the trial court found that plaintiffs had satisfied jurisdictional concerns by requesting mediation pursuant to
On the state constitutional claims, the Court of Appeals determined that the trial court had converted defendant‘s motion into one for summary judgment because it considered evidentiary materials beyond the pleadings. N. Carolina Bar & Tavern Ass‘n v. Cooper, 293 N.C. App. 402, 409 (2024). The Court of Appeals concluded that the trial court erred in entering summary judgment, vacated the order, and remanded the matter to the trial court. Id. at 423. Although not explicitly stated, the Court of Appeals implied that genuine issues of material fact existed because the “articles and data submitted by [d]efendant entirely fail to address any differences in the risk of spread of COVID-19 between the bars he allowed to reopen and [p]laintiffs’ bars which remained closed.” Id. at 423.
The Court of Appeals’ reasoning on these claims was somewhat intertwined and overlapping. Concerning the Fruits of Labor claim, the Court of Appeals stated that it applied rational basis review and determined that because the record lacked scientific evidence to support the proposition that bars posed a greater of a risk than other establishments, “the unequal treatment of [p]laintiffs . . . was illogical and not rationally related
In coming to this conclusion, the Court of Appeals found the record did “not reveal the existence of any scientific evidence demonstrating [p]laintiffs’ bars, as opposed to the bars located in other establishments serving alcohol, posed a heightened risk at the time Executive Order No. 141 was issued.” Id. at 421. Thus, the lower court reasoned that the Governor‘s actions had the effect of denying plaintiffs the fundamental right to earn a living. Id. at 426-27.
On plaintiffs’ Equal Protection claim, the Court of Appeals applied strict scrutiny and concluded that Executive Order No. 141 was underinclusive because it excluded bars from the phased reopening when restaurants and other seemingly similar businesses that served alcohol were allowed to reopen. Id. at 427. This unequal treatment, according to the Court of Appeals, was an “illogical and arbitrary [] attempt to achieve [d]efendant‘s stated health outcomes by applying different reopening standards to similarly situated businesses that could have complied with those standards.” Id.
The Court of Appeals affirmed the trial court on plaintiffs’ remaining claims. Id. Under the Emergency Management Act, the lower court determined that plaintiffs could not prevail under the plain language of the Act because Governor Cooper did not “take or otherwise use [p]laintiffs’ land during a declared state of emergency.” Id. at 413 (emphasis omitted). In addition, the Court of Appeals determined that the trial court erred when it concluded that it had jurisdiction over plaintiffs’ Public Records Act claim because plaintiffs failed to comply with mediation as required by the Act. Id. at 425-26.
Governor Cooper filed a petition for discretionary review with this Court on plaintiffs’ Fruits of Labor and Equal Protection claims. We allowed review, and he argues that (1) sovereign immunity precludes plaintiffs’ claims because damages are not the least intrusive remedy and allowing plaintiffs’ Corum claim to proceed violates Washington v. Cline, 385 N.C. 824 (2024); (2) the plaintiffs failed to state a colorable constitutional claim under Deminski v. State Bd. of Educ., 377 N.C. 406 (2021); and (3) the Court of Appeals erred in applying strict scrutiny to plaintiffs’ Fruits of Labor and Equal Protection claims.
Factually, Governor Cooper asserts that public health concerns provided sufficient cause to justify the governmental action. He argues that the means used—targeted, phased reopening—were reasonable in light of the science and data available. He argues that second-guessing his decisions would inhibit the State‘s ability to act in future emergencies. In addition, Governor Cooper contends that his phased reopening plan was rationally related to reducing aggregate transmission risk because private bars typically involve closer social interaction, louder environments, and later hours, contributing to higher transmission risk. The unequal regulatory treatment, he argues, was grounded in public health data and expert opinions.
Plaintiffs filed, in response, a conditional request for discretionary review of the lower court‘s decision concerning their Emergency Management Act and Public Records Act claims. We allowed review on each issue.
II. Discussion
A. State Constitutional Claims
Plaintiffs assert that Governor Cooper‘s executive orders violated their rights under the Fruits of Labor and Equal Protection Clauses. The Governor‘s actions, they contend, deprived them of the right to earn a living in a lawful occupation without sufficient justification. Plaintiffs have specifically alleged that they were arbitrarily singled out for closure while seemingly indistinguishable businesses were allowed to reopen and that
Governor Cooper contends that sovereign immunity precludes plaintiffs’ claims because damages are not the least intrusive remedy and allowing plaintiffs’ Corum claim to proceed violates Washington v. Cline, 385 N.C. 824 (2024).
We note that many of the issues presented here are similar to those recently addressed in Ace Speedway. There, this Court expressly held that “the State cannot assert sovereign immunity as a defense to a valid Corum claim.” Ace Speedway, 386 N.C. at 423. ”Corum claims are constitutional claims for damages directly against the State,” and the underlying justification for these claims is the theory that where there is a violation of a right, there should be some cоrresponding remedy.
Washington, 385 N.C. at 825 (2024).
For a Corum claim to survive, a plaintiff must satisfy three criteria: (1) allege that “a state actor . . . violated . . . constitutional rights,” (2) present a colorable claim, and (3) “there must be no adequate state remedy.” Deminski, 377 N.C. at 413. When all three are met, “sovereign immunity does not bar the claim and the trial court must deny a motion to dismiss based on sovereign immunity.” Ace Speedway, 386 N.C. at 423 (cleaned up).
To be colorable, a plaintiff must “present facts sufficient to support an alleged violation of a right protected by the State Constitution.” Ace Speedway, 386 N.C. at 423 (quoting Deminski, 377 N.C. at 413 (2021)). These “allegations are treated as true and the Court examines whether the allegations, if proven, constitute a violation of a right protected by the North Carolina Constitution.” Id. at 424 (cleaned up).
The third Deminski prong concerns the existence of an adequate alternative state remedy. This consideration takes place in the Deminski analysis because it “is effectively ‘an element’ of the constitutional claim.” Ace Speedway, 386 N.C. at 429 (citing Askew v. City of Kinston, 386 N.C. 286, 300 (2024)) (cleaned up).
There is a difference, however, in an ex ante determination as to the existence of an adequate state remedy to establish a Corum claim and fashioning a remedy once a violation has been proven at trial. On the front end, we simply ask whether another established route to court exists to address purported violations of constitutional rights.
The Governor‘s Washington v. Cline argument fails on this point. In that case, we held that plaintiffs’ claim for damages could not proceed because, not only was there an established route to vindicate the constitutional violation there—dismissal of criminal charges—but the plаintiff had already received the existing remedy. Washington, 385 N.C. at 830-31. The ex ante determination there was dispositive.
But on the back end, when a plaintiff has successfully proven a constitutional violation at trial, courts must “bow to established claims and remedies where these provide an alternative to the extraordinary exercise of its inherent constitutional power.” Ace Speedway, 386 N.C. at 429 (quoting Corum v. University of North Carolina, 330 N.C. 761, 784 (1992)). When not so constrained, courts are required to “minimize the encroachment upon other branches of government.” Id. This minimal intrusion is accomplished through the least intrusive common law “remedy available and necessary to right the wrong.” Id.
Put another way, when the law already provides a legal pathway to vindicate a constitutional violation, judges serve a gatekeeping function by precluding Corum claims that intrude upon the State‘s sovereign immunity. But when constitutional claims are proven at trial, in the absence of established claims and remedies, judges exercise inherent authority in crafting a meaningful remedy. See Washington, 385 N.C. at 830. A meaningful remedy is not necessarily one that makes plaintiff whole, and even when a claimant specifically seeks money damages, a trial court may need to fashion
We are concerned here with Deminski‘s ex ante determination as to the existence of an adequate state remedy for both state constitutional claims. As in Ace Speedway, plaintiffs have “no adequate alternative remedy because there is no other forum in which it could seek relief for these constitutional violations.” Ace Speedway, 386 N.C. at 423.
The Governor argues that there was an adequate alternative rеmedy under the third Deminski prong because plaintiffs could have rushed to court and sought a preliminary injunction to stop the emergency orders from taking effect. This is a circular argument, because the only available cause of action in which to seek that preliminary injunction would have been the Corum claims at issue here, meaning there was no adequate alternative remedy. Thus, Governor Cooper‘s argument is not one concerning the availability of a remedy other than these Corum claims, but instead an argument about whether the remedies sought in these Corum claims are the least-intrusive ones. As noted above, that least-intrusive remedy analysis “arises after the claimant proves a constitutional violation.” Ace Speedway, 386 N.C. at 429 (emphasis removed). Thus, the issue is “not ripe” for adjudication. Id. at 430.
1. Fruits of Labor
Our State Constitution provides explicit protections for the first principles of freedom: “We hold it to be self-evident that all persons are created equal; that they are endowed by their Creator with certain inalienable rights; that among these are life, liberty, the enjoyment of the fruits of their own labor, and the pursuit of happiness.”
Our Fruits of Labor jurisprudence was recently addressed in Ace Speedway, where we unanimously reaffirmed that the Clause “bars state action burdening [economic] activities unless the promotion or protection of the public health, morals, order, or safety, or the general welfare makes it reasonably necessary.” Ace Speedway, 386 N.C. at 424 (cleaned up) (emphasis added). Under our precedent, the challenged government action “must be reasonably necessary to promote the accomplishment of a public good, or to prevent the infliction of a public harm.” Id. (quoting Ballance, 229 N.C. at 770).
The inquiry here requires the government to satisfy the two-pronged Fruits of Labor test enunciated in Ace Speedway. Courts must first determine whether there is a “proper governmental purpose” for the challenged action. Id. In answering this question, we initially look at the actual purpose proffered by the government for the interference with economic activity, mindful that this “may not always be the purpose initially put forward by the State.” Id. at 425. Plaintiffs, therefore, “may rebut that assertion with evidence demonstrating that the State‘s asserted purpose is not the true one, and instead the State is pursuing a different, unstated purpose.” Id.
We then consider if the actual purpose is a proper governmental purpose. Id. A proper purpose is one that “addresses the public interest” and “promote[s] the accomplishment of a public good, or . prevent[s] the infliction of a public harm.” Id. (cleaned up).
When the government satisfies the first prong of the Fruits оf Labor test, it must then show that “the means chosen to effect that purpose [are] reasonable.” Id. at 426 (cleaned up). This is a question of fact, and we balance at this second
Applying this test, we turn to the Court of Appeals’ decision. The Court of Appeals below vacated the trial court‘s entry of summary judgment and remanded for reconsideration in light of their constitutional analysis. Bar and Tavern, 293 N.C. App. at 423. That analysis concluded that the Governor “failed to present any ‘data and science’ tending to show a rational basis for allowing some types of bars to resume operations while keeping other bars closed.” Id. (emphasis added). Thus, the Court of Appeals held that “continued closure of [p]laintiffs’ bars while permitting other similar establishments to reopen under certain conditions violated [p]laintiffs’ right to enjoy the fruits of their own labor from the operation of their respective businesses.” Id.
This analysis used the wrong legal standard because, as explained above, the legal standard for a claim under the Fruits of Labor Clause is not rational basis. Ace Speedway, 386 N.C. at 425. To be fair, though, the Court of Appeals did not have the benefit of our decision in Ace Speedway when it decided this case. Neither did the trial court, nor the parties during fact discovery.
“When this Court implements a new analysis to be used in future cases,” our approach has been to remand pending cases raising that same legal issue so that the lower courts and the parties may “apply that analysis.” N.C. Farm Bureau Mut. Ins. Co. v. Cully‘s Motorcross Park, Inc., 366 N.C. 505, 514 (2013). Remand is particularly appropriate in a case like this one, where the parties “did not have the benefit of the precise formulation of the doctrine” when engaging in fact discovery. Whitacre P‘ship v. Biosignia, Inc., 358 N.C. 1, 39 (2004). Without knowing the proper constitutional test that must be satisfied, the parties cannot be expected to use the tools of discovery to obtain the information needed to prove their claims.
Accordingly, plaintiffs sufficiently alleged a Fruits of Labor Clause violation that satisfies Deminski, and we agree with the Court of Appeals that the trial court‘s summary judgment order must be vacated and the case remanded for further proceedings. However, some of the reasoning in the Court of Appeals’ opinion cannot be squared with our decision in Ace Speedway. Therefore, the parties, on remand, are entitled to reopen fact discovеry in light of our decision today. The decision of the Court of Appeals on this issue is modified and affirmed, and remanded for further proceedings.
But before leaving our Fruits of Labor discussion, we think it important to address two items in the dissent. First, the dissent claims that this opinion “significantly expands (and misstates)” the legal protections of the Fruits of Labor Clause “by saying that all that is necessary is ‘mere interference‘—rather than arbitrary interference—with the right to conduct a lawful business or to earn a livelihood.” The dissent insists that this “interference” standard is wrong and “majority seems to be hellbent on dramatically reshaping—in record time—the law” in this area.
But bizarre and angry rhetoric has become a staple of our dissenting colleagues’ opinions, used to mask the weakness in their underlying reasoning. So it is here. As frustrating as this is for the dissent, for nearly a century, this Court has recognized a Fruits of Labor Clause claim when the state unconstitutionally interferes with the right to conduct a lawful business. See, e.g., State v. Harris, 216 N.C. 746, 753 (1940);
State v. Ballance, 229 N.C. 764, 768 (1949); Roller v. Allen, 245 N.C. 516, 521-23 (1957).
In
None of these cases involved laws prohibiting business activity entirely. They all involved “mere interference” with the right to conduct a lawful business. When state interference fails to satisfy the constitutional test for the Fruits of Labor Clause, the interference is unconstitutional. Here, as explained above, Plaintiffs sufficiently alleged unconstitutional interference, and thus have a right to seek discovery to prove those allegations are true.
The dissent also complains that we are permitting the court system to “Monday morning quarterback” the decisions of the Governor and his cabinet members. Not so. Under the test in Ace Speedway, the Governor‘s actions will be judged on the information available at the time, not on what we know in hindsight. Ace Speedway, 386 N.C. at 424-25 and 427. We emphasized this in our discussion above. Once again, the dissent‘s rhetoric about Monday morning quarterbacking is simply sophistry. What frustrates the dissent is not that Governor Cooper and his public health officials are being held to account through the lens of hindsight; it is that they
are being held to account at all.
2. Equal Protection
“Generally speаking, this rationality test is the appropriate standard to apply to purely economic regulations.” Id. This includes equal protection claims concerning the right to earn a living or engage in a lawful occupation. Duggins v. North Carolina State Bd. of Certified Pub. Acct. Examiners, 294 N.C. 120, 131 (1978). In this “area of economics,” the State does not violate the Equal Protection Clause because its chosen classification “is not made with mathematical nicety or because in practice it
results in some inequality.” Powe v. Odell, 312 N.C. 410, 412–13 (1984).
Here, the trial court applied a rational basis test and determined that exempting plaintiffs from reopening could be justified by scientific studies and professional commentary suggesting that there was a need for greater regulation of private bars than other businesses which served alcohol and facilitated public gathering. The Court of Appeals applied strict scrutiny to the Equal Protection claim, arguing that because the fundamental right to earn a living was implicated, precedent required heightened scrutiny. But this cuts to the problem with the Court of Appeals intermingling of its analysis of the Fruits of Labor and Equal Protection claims.
The constitution indeed protects individual rights, but it also enables the state to exercise police powers regulating health, safety, welfare, and morals. As this Court‘s precedent cited above illustrates, state action in this sphere often impacts the right to earn a living, and economic line drawing is what governments do. Whilе we may disagree with the approach taken by state actors, on an
Such is the case here. Plaintiffs’ directly advanced a Fruits of Labor claim concerning closure of their businesses and the Governor‘s justification as it related to other similar businesses. This is separate and distinct from their claim that the line drawing in exercise of the state‘s police powers was impermissible, and the failure to distinguish the claims subsumes the Equal Protection analysis.
Because there is at least some conceivable basis for the government‘s action here, we reverse the Court of Appeals.6 See White v. Pate, 308 N.C. 759, 766–767 (1983) (“The rational basis standard merely requires that the governmental classification bear some rational relationship to a conceivable legitimate interest of government.” (cleaned up)).
B. Statutory Claims
1. Emergency Management Act
Turning to the plaintiffs’ statutory claims, the Emergency Management Act, among other things, grants the Governor the ability to impose significant restrictions or prohibitions on otherwise permissible activity during states of emergency, should the Governor determine that local control of the emergency is insufficiеnt to ensure adequate protection of lives and property. See
Relevant to the restrictions set forth in the Executive Orders here, the Emergency Management Act allows the Governor to restrict “the operation of offices, business establishments, and other places to or from which people may travel or at which they may congregate” or “to maintain order and protect lives or property during the state of emergency.”7
Compensation is available under the Emergency Management Act only when property is “commandeered, seized, taken, condemned, or otherwise used in coping with an emergency and this action was ordered by the Governor.”
As we have stated, “[t]he primary rule of construction of a statute is to ascertain the intent of the legislature and to carry out such intention to the fullest extent.” Burgess v. Your House of Raleigh, Inc., 326 N.C. 205, 209 (1990). When construing a statute, “words must be given their common and ordinary meaning, nothing else appearing.” In re Clayton-Marcus Co., Inc., 286 N.C. 215, 219 (1974). As nothing else appears in the statute, the common and ordinary meanings of the terms commandeered, seized, taken, condemned, and otherwise usеd must be applied when interpreting the Emergency Management Act.
Thus, the State must provide compensation when the Governor uses power under the Emergency Management Act to commandeer, condemn, seize, take, or otherwise use property.
Contrary to plaintiffs’ arguments,
In crafting the Emergency Management Act, the General Assembly clearly contemplated situations under which affected persons could receive compensation. But the General Assembly did not authorize compensation when a governor exercises his or her power under
2. Public Records Act
Plaintiffs argue that the Court of Appeals erred in holding that the trial court erroneously concluded it had jurisdiction to hear the Public Records Act claim. We disagree.
The Public Records Act states that a person who has been denied access to, or copies of, public records “may apply to the appropriate division of the General Court of Justice for an order compelling disclosure or copying, and the court shall have jurisdiction to issue such orders if the person has complied with” the mediation requirements set forth in section 7A-38.3E.
After initiating a suit under the Public Records Act, the parties may select an agreed upon mediator.
Plaintiffs, in their Second Amended Complaint, made a request for the “initiation of mediation of this dispute pursuant to
As explained above, mediation is a requirement for the trial court to have jurisdiction to hear the Public Records Act claim. Because mediation was never completed, not only did the trial court not have jurisdiction to decide the merits of the Public Records Act claim, but plaintiffs also could not have substantially prevailed in their Public Records Act claim such that attorneys’ fees were appropriate. We therefore affirm the decision of the Court of Appeals on this issue.
III. Conclusion
On the Fruits of Labor claim, we modify and affirm in part the decision of the Court of Appeals and remand this matter to the trial court to reopen factual discovery and provide a new discovery schedule for the parties. We reverse the Court of Appeals on
MODIFIED AND AFFIRMED IN PART, REVERSED IN PART.
Justice RIGGS concurring in part and dissenting in part.
The Corum claim of the North Carolina Bar and Tavern Association (the Association) under the Fruits of Their Own Labor Clause should be barred on the basis of sovereign immunity because the members of the Association have an adequate alternate remedy under the law, a claim for compensation under the North Carolina Emergency Management Act. Thus, I would conclude that the trial court properly entered judgment in favor of the Governor on his motion to dismiss the Fruits of Their Own Labor claim.
Even if the claim was not barred on the basis of sovereign immunity—and it should be—the Association did not, in its motion for summary judgment, establish a disputed issue of material fact in its Fruits of Their Own Labor claim. Even under the heightened scrutiny of governmental actions challenged under our State Constitution‘s Fruits of Their Own Labor Clause, as laid out in Kinsley v. Ace Speedway Racing, Ltd., 386 N.C. 418, 424 (2024). Although the Association claimed otherwise in its complaint, it put on no competent evidence in seeking summary judgment that the Governor‘s stated purpose for entering Executive Order 141—slowing the spread of COVID-19 to save lives—was an improper purpose or that the Governor‘s actual purpose was something different. The Association further failed to forecast any disputed facts regarding the means chosen to effectuate the purpose, and specifically that the means were not reasonable. For these reasons, I respectfully dissent.
I concur with the majority‘s conclusion that the Association has not substantially prevailed in seeking disclosure of documents under the Public Records Act,
I. Factual Background
The executive orders at dispute in this case were issued by then-Governor Cooper in response to the “high public health threat posed by COVID-19 globally and in the United States.” On 10 March 2020, with the required concurrence of the duly-elected bipartisan Council of Stаte, the Governor declared a state of emergency as he was authorized to do by
Two months later, on 5 May 2020, the Governor began the process of slowly reopening businesses in phases. In Executive Order 138 (Phase 1 Order), restaurants, defined as permitted food establishments under
Two weeks later, the Governor continued the process of reopening businesses. The Governor issued Executive Order No. 141, “Easing Restrictions on Travel, Business Operations, and Mass Gatherings: Phase 2.” (Phase 2 Order) In this Phase 2 Order, the Governor allowed eating establishments to open for on-premises consumption of food
In a contemporaneous press conference to update the public on the state‘s response to the pandemic, the Governor noted that the state was experiencing a record high number of hospitalizations and deaths related to COVID-19. PBS North Carolina: Coronavirus Briefing: NC Gov. Roy Cooper, (YouTube, May 28, 2020), https://www.youtube.com/watch?reload=9&app=desktop&v=9WqTv5idkDk. The Governor emphasized that the “health and safety of North Carolinians [i]s our number one priority” and that the decisions to reopen businesses were difficult but were being “made with daily briefings from doctors and health care experts.” Id. at 15:00-17:00. The Governor explained that he employed a phased or “dimmer-switch” approach to the reopening of places where people congregate. Id. at 18:00-19:00. The dimmer-switch approach worked by opening some categories of businesses, waiting to ensure that any spike in COVID-19 cases did not overwhelm the hospitals, and then opening more categories of businesses. Department of Health and Human Services Secretary Mandy K. Cohen, M.D., M.P.H, stressed the need to “take modest steps forward” in reopening businesses to avoid “overwhelm[ing] the health care system” because the state was experiencing a high number of COVID-19 hospitalizations and positive test results. Id. at 22:20.
Almost immediately, on 4 June 2020, the Assоciation filed a complaint challenging Executive Order 141 and sought injunctive relief to reopen bars for onsite beverage consumption. The Association alleged violations of the Association‘s rights under the Fruits of Their Own Labor Clause and Equal Protection Clause of the North Carolina Constitution and requested compensation under the Emergency Management Act.
II. Adequate State Remedy under the Emergency Management Act
It is well established under North Carolina common law that the “doctrine of sovereign immunity . . . prevents a claim for relief against the State except where the State has consented or waived its immunity.” State ex rel. Stein v. Kinston Charter Acad., 379 N.C. 560, 570 (2021) (quoting Harwood v. Johnson, 326 N.C. 231, 238 (1990)). However, the state may waive sovereign immunity by its conduct, including by enacting statutes that require government agencies to compensate parties for injury. See, e.g., Nello L. Teer Co. v. N.C. State Highway Comm‘n, 265 N.C. 1, 9 (1965) (recognizing that state agencies may be subject to suit as expressly provided by statute). Because the state may waive sovereign immunity by statute, Corum claims, i.e., direct claims against the state for remedy of a constitutional violation, are only available “in the absence of an adequate state remedy.” Corum v. Univ. of N.C., 330 N.C. 761, 782 (1992); see also Deminski ex rel. C.E.D. v. State Bd. of Educ., 377 N.C. 406, 413 (2021). For example, in the context of eminent domain, the General Assembly has long provided an established remedy for when private property is taken for a public purpose. See, e.g., Ferrell v. Dept. of Transp., 334 N.C. 650, 654 (1993) (recognizing that the North Carolina General Assembly may implicitly waive sovereign immunity by obligating a [state agency] to pay compensation to an injured party). Similarly, here the General Assembly has provided a mechanism for an injured party to seek relief and compensation in a court of law under the Emergency Management Act.
The Phase 2 Order, which placed restrictions on the members of the Association‘s
The Emergency Management Act grants the Governor and state agencies the authority to impose “prohibitions and restrictions in the emergency area,” that “in the Governor‘s discretion” are appropriate to deal with the emergency.
To advance the goal of encouraging cooperation and coordination between the state and private organizations, the Emergency Management Act provides for compensation “for services or for the taking or use of property . . . to the extent that legal obligations of individual citizens are exceeded.”
The majority reads the statutory language for conduct requiring compensation far too narrowly and fails to give meaning to every word in the statute. In the majority‘s view, the Association‘s members do not “qualify for compensation” under this statute because the language in the statute requires “some affirmative appropriation or possession of private property during the stated emergency.” I disagree and find it curious that the majority is willing to rewrite a statute by adding requirements, by judicial fiat, to reach the constitutional question and broadly expand this Court‘s jurisprudence under the Fruits of Their Own Labor Clause.
A fundamental principle of statutory interpretation is that courts prеsume that when the “legislature enacts a statute, it intentionally includes and gives meaning to every word therein.” Happel v. Guilford Cnty. Bd. of Educ., 387 N.C. 186, 207 (2025). “Since a legislative body is presumed not to have used superfluous words, our courts must accord meaning, if possible, to every word in a statute.” C Investments 2, LLC v. Auger, 383 N.C. 1, 12 (2022) (quoting N.C. Bd. of Exam‘rs for Speech & Language Pathologists & Audiologists v. N.C. State Bd. of Educ., 122 N.C. App. 15, 21 (1996)). Thus, to properly interpret the statute, each term the General Assembly included in the statute must have meaning: “commandeered, seized, taken, condemned, or otherwise used property” to “cop[e] with an emergency.”
While I agree that the verbs commandeered and seized do, by their plain meaning, suggest an affirmative appropriation or possession, the verbs or phrases “taken” and “otherwise used” do not imply anything other than what they say, and imposing an additional affirmative state action is not justified. See
Here, the Phase 2 Order used the closure of bars to limit the spread of COVID-19, avoid overwhelming North Carolina‘s medical infrastructure, and minimize the number of COVID-related deaths in North Carolina. At the time the Governor entered the Phase 2 Order, the spread of COVID-19 had overwhelmed the medical infrastructures and killed thousands of people, both in foreign countries like Italy and large cities in the United States, such as New York City.
It seems strange to conclude that placing limitations and restrictions on businesses that result in restricting the operation of some businesses to protect public safety is not a statutory “tak[ing]” or “other use” under the Emergency Management Act, and at the same time, claim that those same restrictions and limitations infringe on an entity‘s constitutional rights to under the Fruits of Their Own Labor Clause. To be clear, no one is arguing that people and businesses that make sacrifices for the public good, due to a hurricane or a pandemic or any other such emergency, should lose their businesses because of that. Indeed, foreseeing the need for such equitable state action, when the General Assembly, by statute, required businesses to cooperate, coordinate, and contribute to the emergency response even in ways that significantly impacts businesses for the purpose of protecting the public welfare, the legislature put in place a means of incentivizing or compensating the businesses for that contribution to the greater good. The General Assembly has done this by authorizing compensation under the Emergency Management Act.
The General Assembly established a route for the Association‘s members to receive compensation for the closures applied to establishments that are not eating establishments. See Deminski, 377 N.C. at 413-14 (recognizing that “a plaintiff must have at least the opportunity to enter the courthouse doors and present his claim“). The Governor acted within the discretion afforded him under the Emergency Management Act and that Act also provides the Association with a means to request compensation for the effect of the action on their businesses. The proper action, then, is to remand for reconsideration of claims under this Emergency Management Act. Any common law claim under Corum should fail because there is an adequate state remedy. Even if the compensation available through the Emergency Management Act does not necessarily make the plaintiffs whole, the Act nonetheless provides an adequate remedy. Washington v. Cline, 385 N.C. 824, 829 (2024) (confirming that an “adequate remedy is a meaningful one, though not necessarily the one the plaintiff might prefer“). For these reasons, I would dismiss the Corum claim and remand for consideration
III. Fruits of Their Own Labor claim
Even if there were no other adequate state remedy, I would conclude that the trial court did not err by entering summary judgment in favor of the Governor because the Association did not forecast evidence to establish a disputed issue of material fact for its Fruits of Their Own Labor claim even under the generous standard set forth in Kinsley v. Ace Speedway Racing, Ltd., 386 N.C. 418, 425 (2024). To establish a claim under the Fruits of Their Own Labor Clause, a plaintiff must shоw that the challenged state action was not for a “proper governmental purpose,” of “promot[ing] the accomplishment of a public good[ ], or . . . prevent[ing] the infliction of a public harm. Id. at 425 (first quoting Poor Richard‘s Inc. v. Stone, 322 N.C. 61, 64 (1988); and then quoting State v. Ballance, 229 N.C. 764, 770 (1949)). Under the two-prong test outlined there, “[i]f the reviewing court determines that the challenged state action serves a proper government purpose,” then the plaintiff must show that the means chosen to effectuate that purpose were not reasonable. Id. at 426.2 “The means used must be measured by balancing the public good likely to result from their utilization against the burdens resulting to the businesses being regulated.” Poor Richard‘s, 322 N.C. at 66 (citing In re Certificate of Need for Aston Park Hospital, Inc., 282 N.C. 542, 550 (1973)).
In Ace Speedway, this Court established that the test for assessing a challenge to a governmental action under a Fruits of Their Own Labor claim is more stringent than the rational basis test; we called it a reasonable basis test. To be sure, I do not understand such claims to be evaluated under a strict scrutiny standard, but this reasonable basis standard is more stringent than a rational basis standard. For a Fruits of Their Own Labor claim, a reviewing court looks to “identify the State‘s actual purpose for the constraint on private business activity.” Ace Speedway, 386 N.C. at 424. As we explained in Ace Speedway, a plaintiff may rebut the State‘s asserted purpose “with evidence demonstrating that the State‘s asserted purpose is not a true one, and instead the State is pursuing a different unstated purpose.”
Importantly, of course, at the procedural posture in Ace Speedway, a motion to dismiss, the court considers whether the parties had “sufficiently allege[d]” a claim under the Fruits of Their Own Labor Clause. Id. at 422–23; see also Deminski, 377 N.C. at 412. When considering a complaint dismissed under Rule 12(b)(6), “we treat plaintiff‘s factual allegations as true.” State ex rel. Cooper v. Ridgeway Brands Mfg., LLC., 362 N.C. 431, 442 (2008) (quoting Stein v. Asheville City Bd. of Educ., 360 N.C. 321, 325 (2006)). Because the plaintiff in Ace Speedway had alleged an improper purpose, at that procedural posture, we accepted as true and thus that the plaintiff met the standard of showing an improper purpose. Ace Speedway, 386 N.C. at 426–27.
We review de novo the trial court‘s decision to enter summary judgment in favor of the Governor. Forbis v. Neal, 361 N.C. 519, 524 (2007). At summary judgment, we assess the merits of a claim under the Fruits of Their Own Labor Clause to determine whether the Association established a disputed issue of matеrial fact such that summary judgment in favor of the State was improper. “Summary judgment in favor of the non-movant is appropriate when the evidence presented demonstrates that no material issues of fact are in dispute, and the non-movant is entitled to entry of judgment as a matter of law.” A-S-P Assocs. v. City of Raleigh, 298 N.C. 207, 212 (1979). The Association had the burden of showing “a genuine issue” of material fact, and because the record does not show a factual dispute the Governor is entitled to summary judgment.
First, the Association did not forecast evidence rebutting the Governor‘s stated purpose in entering the order. The Phase 2 Order states that “slowing and controlling community spread of COVID-19 is critical to ensuring that the [S]tate‘s healthcare facilities remain able to accommodate those who require medical assistance” and “the continued community spread” with more than twenty thousand confirmed cases and hundreds of deaths “requires the [S]tate to continue measures to slow the spread of this virus.”
At summary judgment, the Association must forecast evidence that the means chosen to effectuate that purpose were not reasonable. See Ace Speedway, 386 N.C. at 426 (“If the reviewing court determines that the challenged state action serves a proper governmental purpose, the inquiry then reaches the second stage: ‘are the means chosen to effect that purpose reasonable?’ “)(quoting Poor Richard‘s, 322 N.C. at 64). The reviewing court balances the public good likely to result from the government action “against the burden resulting to the business being regulated.” Id. The Association provided affidavits that document the burden to their businesses. However, the Association does not even attempt to show that the means employed by the Phase 2 Order to effectuate its proper purposes were unreasonable to “slow the
In contrast, the Governor forecasted evidence that the means employed for a phased reoрening of business—in a manner that controlled the spread of COVID-19 and protected the lives of North Carolinians—were reasonable. The Governor provided the affidavit of Elizabeth Cuervo Tilson, M.D., M.P.H., the Chief Medical Officer for the North Carolina Department of Health and Human Services. Dr. Tilson attested that the individuals developing the policy recommendations were reviewing and considering “the most recent data and studies from scientific publications and the Centers for Disease Control and Prevention (CDC), as well as experiences from other countries and states.” Specifically, the medical and public health team constantly evaluated “scientific literature, current studies, media reports, and any related data that speaks to the risks of transmission of the virus and the effectiveness of mitigation measures that counties, states, and localities have put in place to minimize transmission of the virus.” In her affidavit, Dr. Tilson explains what was known about how COVID-19 is transmitted and why the nature of bars makes them more conducive to the transmission of COVID-19. The Association did not forecast evidence that the analytical approach to the phased reopening employed by the Governor was not reasonable.
The majority significantly expands (and misstates) the standard for a state action to violate the Fruits of Their Own Labor Clause by saying that all that is necessary is “mere interference“—rather than arbitrary interference—with the right to сonduct a lawful business or to earn a livelihood. The cases that the majority rely upon confirm that the proper standard is arbitrary interference. This Court has long recognized “that the police power of the State may be exercised to enact laws, within constitutional limits, to protect or promote the health, morals, order, safety, and general welfare of society.” King v. Town of Chapel Hill, 367 N.C. 400, 406 (2014) (cleaned up) (quoting Standley v. Town of Woodfin, 362 N.C. 328, 333 (2008)). An “exertion of the police power inevitably results in a limitation of personal liberty, and legislation in this field is justified on the theory that the social interest is paramount.” Id. at 406 (cleaned up) (quoting Ballance, 229 N.C. at 769). The
The cases the majority cite do not overturn statutes for “mere interference“; rather the Court looked for arbitrary interference without a proper relation to the health, morals, order, safety, and general welfare of society. First in State v. Harris, this Court concluded a statute violated the
Similarly, in Ballance, this Court recognized that the statute at issue, regulating photography, exceeded the police power of the state because it was not reasonably necessary to “promot[e] or protect[] the public health, morals order or safety, or the general welfare.” Ballance, 229 N.C. at 770. Legitimate state action, the Court recognized, must have a rational, real, or substantial relation to public health, moral order, safety, or general welfare. Id. Then in Roller, this Court invalidated a test for ceramic tile installers because the licensing board which promulgated the test had the power to create a monopoly out of the ceramic tile industry. Id. at 523. The Court acknowledged that a “state cannot under the guise of protecting the public, arbitrarily interfere with private business . . . .” Id. at 525.
Here, the
Implicitly acknowledging that the Association did not meet the burden established by 85 years of caselaw and most recently explained in Ace Speedway, the majority reopens discovery and lets the Association try again. This approach affords special treatment to the Association that other litigants have not been granted by this Court when it changes the standard for assessing constitutional violations. See, e.g., Community Success Initiative v. Moore, 384 N.C. 194, 232-33, 240 (2023) (changing the standard for review оf a statute that limits the right to vote from strict scrutiny to rational basis after plaintiffs won partial summary judgment and then remanding the case to the trial court for dismissal with prejudice, without a second chance to reopen discovery); Holmes v. Moore, 384 N.C. 426, 441, (2023) (changing the standard for a facial challenge to a state statute under the Equal Protection Clause and then remanding to the trial court not to reopen discovery but rather to dismiss the plaintiffs claims with prejudice).
Even though the Association did not forecast evidence that the Phase 2 Order arbitrarily interfered with the businesses without a rational, real, and substantial relation to health and safety, the majority reads significantly more protection into our State Constitution for businesses than for the people of our state. Unfortunately, the majority seems to be hellbent on dramatically reshaping—in record time—the law as it relates to any economic regulation, even in the public health realm. Additionally, the majority seems to suggest that partisanship is at play in this dissent when it states: “What frustrates the dissent is not that Governor Cooper and his public health officials are being held to account through the lens of hindsight; it is that they are being held to account at all.” Not so. Perhaps when one views the world and law through a partisan lens, that lens distorts one‘s appreciation of recent history and facts. The signatories to this dissent just last year joined a unanimous opinion ruling against the Governor and his public health officiаls and articulating a test for liability under the Fruits of Their Own Labor clause. Ace Speedway, 386 N.C. at 429. And this very dissent rejects arguments made by the Governor with respect to the potential availability of remedies under the Emergency Management Act.
At the end of the day, this Court is charged with the important duty to assess, under the standard from Ace Speedway, the relative benefit of economic regulations to the social interest based upon the evidence presented by a party seeking summary judgment for claims under the
In
To protect lives, the Governor had to act based on the science that was available at the time. As discussed above, the affidavit from Dr. Tilson establishes the scientific evidence that the Governor and public health officials were considering at the time. And with respect to which businesses opened under which phases, the Governor employed business classifications, designated by statute, allowing eating establishments to be open for on-site consumption but restricting non-eating establishments. See Poor Richard‘s, 322 N.C. at 65 (recognizing that this Court has upheld regulatory business legislation so long аs it was based on some distinguishing feature of the business itself). The Phase 2 Order allowed restaurants to open for “on-premises consumption of food and beverages” with limitations on the number of people that could be in the establishment and how close they could sit to one another.
Science does not always graft on perfectly to how regulatory lines are drawn in an emergency. Thus, because the Association did not forecast any evidence to suggest that there was, at the time, a more reasonable means of trying to contain the devastation wrought by the COVID pandemic and the Governor introduced competent evidence to support the reasonableness of the executive orders, the Association does not satisfy the second prong of the Ace Speedway test and summary judgment was properly entered for the Governor. See A-S-P Assocs., 298 N.C. at 214 (“When the most that can be said against [a state action] is that whether it was an unreasonable, arbitrary or unequal exercise of power is fairly debatable, the courts will not interfere. In such circumstances the settled rule seems to be that the court will not substitute its judgment for that of the legislative body charged with the primary duty and responsibility of determining whether its action is in the interest of the public health, safety, morals or general welfare.” (cleaned up)).
In sum, I would dismiss the Association‘s Corum claim because there is an adequate alternate remedy in the
Justice EARLS joins in this concurring in part and dissenting in part opinion.