New Mexico Supreme Court: State not required to compensate businesses for public health closures

Businesses that were ordered to close during the early months of the COVID-19 pandemic do not have a claim for government compensation, the New Mexico Supreme Court ruled.  

The unanimous opinion, written by Justice Shannon Bacon, states that public health orders from Gov. Michelle Lujan Grisham and the state Department of Health did not constitute either a physical or regulatory “taking” of property that would warrant compensation from the state. 

“Occupancy limits and closure of certain categories of businesses, while certainly harsh in their economic effects, are directly tied to the reasonable purpose of limiting the public’s exposure to the potentially life-threatening and communicable disease, and thus can be deemed ‘reasonably necessary,”’ Bacon wrote. 

Before Lujan Grisham’s office asked the high court to take the case, business owners who sought compensation after emergency public health orders forced them to close their doors to the public filed a number of suits around the state in lower courts. Lujan Grisham’s office asked the state supreme court to decide whether a public health order to close businesses constitutes a regulatory taking. 

Another question posed to the court was whether a portion of state law that specifically mentions compensation in public health emergencies applied to all types of businesses or just medical companies. The group of businesses seeking compensation argued that the state Public Health Emergency Response Act’s provision on compensation includes non-medical businesses with the words “any other property.” But the state supreme court seemed to agree with the governor’s office argument that ejusdem generis, or a Latin term meaning of the same kind, applied to the words “any other property,” essentially meaning any other medical or medically related company  taken by the state to help fight a public health emergency. 

“Because a public health emergency can affect the entire population, anyone and everyone could be a potential claimant under the Real Parties’ interpretation, even under far less restrictive measures than the [public health orders],” Bacon wrote. “It is simply not credible that the Legislature in enacting the PHERA intended for such a potential raid on the public wealth while simultaneously granting broad powers to protect the public health.” Further, the high court also ruled that anyone seeking compensation under PHERA has to first follow the law’s procedure for a claim, which means the claim has to first go through the state Attorney General’s Office.

NM Tax and Revenue: Lawmakers didn’t intend for cannabis tax breaks

The issue of whether taxes on medical cannabis sales in New Mexico should have been deductible prior to this year is one step closer to being heard by the state’s supreme court. 

The state Attorney General’s office filed a brief on Monday with the New Mexico Supreme Court on behalf of the New Mexico Taxation and Revenue Department that argued state lawmakers did not intend to allow gross receipts tax deductions on medical cannabis sales until this year. 

The issue stems from a request by medical cannabis producer Sacred Garden to deduct gross receipts taxes from its sales. The department denied the claim on the basis that medical cannabis is not prescribed like other medication. In New Mexico gross receipts taxes are deductible from prescription drugs and medical cannabis is not prescribed by a doctor, but instead recommended. A New Mexico Court of Appeals panel ruled in favor of Sacred Garden last January, writing that in terms of medical cannabis, the difference between a recommendation and prescription is negligible. TRD took the case to the state supreme court where it has been pending since last year.

Conflicting views on medical cannabis as a prescription

Amid a pending New Mexico Supreme Court case concerning medical cannabis taxes, one state cabinet official seems to have a different view on whether medical cannabis recommendations from medical professionals are the same as traditional prescriptions, at least when it comes to COVID-19 vaccine priority. 

According to an email from January of this year, obtained by NM Political Report through a public records request, New Mexico Department of Health Secretary Tracie Collins believed that medical cannabis dispensary workers should be viewed similarly to pharmacists and that medical providers “prescribe medical cannabis” when it came to priority for COVID-19 vaccinations. 

This view differs greatly from an argument the state’s Taxation and Revenue Department has put forward in an ongoing legal case regarding gross receipts taxes and whether they should be allowed to be deducted from medical cannabis sales. 

Collins’ apparent view that medical cannabis recommendations are essentially the same as prescriptions came up in a series of emails between Gov. Michelle Lujan Grisham’s staff and Department of Health officials regarding where medical cannabis dispensary workers fall in terms of COVID-19 vaccination priority. The department’s deputy secretary Laura Parajon  replied to the email chain with Collins’ take. 

“Hi, sorry for yet another weighing in opinion. I consulted with Secretary Collins, and she also believes they are like pharmacists because providers do prescribe medical cannabis,” Parajon wrote. “I am adding her to the conversation.”

While the seemingly innocuous reply was in the context of vaccine priority, Collins’ reported opinion that medical professionals “prescribe” medical cannabis goes against the argument TRD has repeatedly put forth in a still pending legal case as a reason medical cannabis producers should not be allowed to deduct gross receipts taxes they paid to the state. DOH spokesman Jim Walton told NM Political Report that the context of the email conversation is important. 

“The question Deputy Secretary Parajon and Secretary Collins was asked was whether people who worked in a medical cannabis dispensary are considered to be within COVID-19 vaccination phase 1A,” Walton said.

NM Supreme Court issues official opinion on validity of state emergency health orders

The New Mexico Supreme Court on Monday issued a written opinion that explained its reasoning behind a bench ruling regarding state emergency public health orders. The high court ruled last summer that the state and the governor are legally allowed to issue emergency health orders without a formal rulemaking process. 

The court unanimously ruled that the state Department of Health and Gov. Michelle Lujan Grisham are granted, by the Legislature, the ability to issue orders limiting certain business activities. In this case, businesses were ordered to cease indoor dining during the COVID-19 pandemic. 

Last year a group of business owners challenged those orders, arguing that they were arbitrary and capricious and that the normal rulemaking process should be followed to implement such emergency orders. 

In her, likely final, written opinion, former Chief Justice Judith Nakamura said the emergency public health orders like the ones that were issued last year and have been updated since, provide the state with the ability to respond to “the swiftly changing dynamics of a novel, dangerous, and highly communicable disease.”

Justice David Thomson issued a special concurring opinion with a caveat to the unanimous decision. Thomson said he agreed that the state’s executive branch should have the flexibility to issue emergency orders, but that the governor’s office is not above scrutiny and questions regarding those decisions. 

“The majority’s holding should not communicate that executive or legislative responses to the pandemic will always receive the same level of judicial deference as when the crisis first emerged,” Thomson wrote. “In addition, I believe we must be wary of the precedent we set beyond the scope of the COVID-19 crisis.”

Monday’s written opinion is the latest in a series of decisions from the court that validated Lujan Grisham’s response to the COVID-19 pandemic. 

The state Supreme Court has yet to issue an opinion on whether ordering businesses close to the public is the same as the state taking property, which would require the state to compensate those businesses.

Lawyer for businesses ordered to close amid pandemic responds to state

A lawyer representing a group of businesses looking for compensation from the state after being ordered to shut down amid the COVID-19 pandemic, filed on Tuesday a response to a brief from the New Mexico Attorney General’s Office, filed earlier this month. 

The brief, filed by Albuquerque-based attorney Blair Dunn, is just one piece of a pending New Mexico Supreme Court Case filed by state Attorney General Hector Balderas on behalf of the state. The question facing the high court is whether businesses that were forced to close under emergency public health orders are due compensation by the state for lost business. 

Commission chooses four potential choices for state Supreme Court slot

The New Mexico Judicial Nomination Commission recommended a list of four names from which Gov. Michelle Lujan Grisham can choose a replacement for Justice Judith Nakamura, who announced she retire, effective Dec. 1. The commission chose the four applicants after interviews with each candidate on Thursday and closed-door discussion between members. The names are former 12th Judicial District Court Judge James Waylon Counts, Sixth Judicial District Court Chief Judge Jennifer Ellen DeLaney, Court of Appeals Judge Julie J. Vargas and Court of Appeals Judge Briana Hope Zamora. Lujan Grisham will choose one of the four names, and has 30 days to make her decision.

NM Supreme Court issues written opinion on state public health orders

The New Mexico Supreme Court issued a full opinion regarding a ruling they issued from the bench in August that affirmed the governor’s authority stemming from the state’s COVID-19 public health orders. 

The case was filed by a group of New Mexico business owners who argued Gov. Michelle Lujan Grisham and the state Department of Health overstepped their authority in ordering restaurants to close and, in some cases, issuing penalties to those that did not. 

NM GOP files two legal actions a week before election, state Supreme Court rejects one

A week before Election Day and days before the end of early in-person voting, the Republican Party of New Mexico filed two different legal actions against the New Mexico Secretary of State and two separate county clerk’s offices, regarding poll watching and ballot drop-boxes. 

On Monday, the Republican Party of New Mexico filed a petition with the New Mexico Supreme Court asking for an emergency hearing for clarification on what personal identifiers poll watchers are allowed to review, compared to county clerk employees. That petition was denied by the high court Tuesday afternoon. 

And on Tuesday morning, the state’s Republican Party filed a lawsuit against Secretary of State Maggie Toulouse Oliver and the Taos and Guadalupe County Clerks’ offices, claiming that absentee ballot dropboxes in those two counties are not being monitored according to state election law.    

The two legal challenges are the latest in a series of lawsuits filed by the Republican Party across the U.S., many involving absentee voting. Absentee Ballot clarification denied

The petition filed with the New Mexico Supreme Court sought clarification from the high court and to challenge practices the state GOP said some counties were taking part in. 

The petition alleges that at least some county clerks’ offices were not allowing volunteer poll watchers to adequately verify voter identifiers, in this case the voters’ last four digits of their respective Social Security number and their signatures. 

According to the petition, volunteer poll watchers were only being allowed to verify ballots that were missing those two personal identifiers and not verify those identifiers “against a database for accuracy.” 

Without naming them, the petition cites two “large counties” that initially allowed poll challengers to take part in the initial identification verification, but recently stopped “presumably in response to [Toulouse Oliver’s] directives.”

“In order to give effect to all these provisions without creating conflicts or nullities, presiding and election judges and challengers must be permitted to compare ballots with a roster containing the correct SSN digits, and they must be allowed to reject ballots and interpose challenges on the basis of incorrect voter identification information — not merely the complete absence of any numbers in the appropriate field,” the petition argued. The petition argued that the issue is “compounded” partially because of a new wave of younger poll workers, which was encouraged by Gov. Lujan Grisham and other elected officials in order to protect older poll workers who might be at higher risk of contracting COVID-19. 

After the petition was filed, New Mexico Republican Party Chairman Steve Pearce released a statement hinting that county clerks who have not been allowing poll challengers to cross check Social Security numbers may be hiding something. 

“County Clerks are elected by the people to work for the people – and now some are working in the shadows, denying the public access to ensuring we have an honest election,” Pearce said in a statement. 

On Tuesday afternoon the New Mexico Supreme Court issued an order denying the Republican Party’s petition, with three of the five justices concurring, including the lone Republican justice Judith Nakamura. The denial did not offer any explanation for denying the petition.

Reactions from New Mexico officials to U.S. Supreme Court Justice Ruth Bader Ginsburg’s death

U.S. Supreme Court Justice Ruth Bader Ginsburg died Friday. She was 87. The vacancy her seat creates will now give Republicans the opportunity to try to place another conservative justice to the bench. President Donald Trump, reacting to two Supreme Court decisions in June that he didn’t like, tweeted that he would have a new list of conservatives to appoint to the bench by September 1. Within just a few hours of the announcement of Ginsburg’s death, U.S. Senate Majority Leader Mitch McConnell said he would not wait to bring to a vote for a Trump appointee this election year, according to multiple media sources.

NM Supreme Court: State has authority to limit indoor dining

Once again, the state Supreme Court ruled unanimously in favor of the state when it came to upholding and enforcing the state public health order, this time saying not only does the state Department of Health have the authority to close or restrict indoor dining at restaurants, but that their decision to do so was not arbitrary and capricious, as argued by some restaurants. “It is the policy of courts to uphold regulations intended to protect public health unless it is plain they have no real relation to the object to which they were enacted,” Justice Judith Nakamura said in announcing the decision. Citing a 1939 decision, State v. Old Abe, Nakamura said, “Only agency action that is willful and unreasoning and done without consideration and in disregard to the facts and circumstances can be deemed arbitrary and capricious.”

The court will issue a written order at a later date. Chief Justice Michael Vigil recused himself from the case. Nakamura also said the court ordered the lower court that issued a temporary restraining order that allowed indoor dining to resume—which itself was stayed by the Supreme Court to allow the ban on indoor dining to continue—to vacate that order.