vouchers -- joint resp to emerg motion -- final (2)

8/11/2019 Vouchers -- Joint Resp to Emerg Motion -- Final (2)

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No. 304P14 TENTH DISTRICT

SUPREME COURT OF NORTH CAROLINA

*************************************************

ALICE HART, et al.

Plaintiffs-Appellees,

v.

STATE OF NORTH CAROLINA, et al.

Defendants-Appellants, and

CYNTHIA PERRY, et al.

Defendants-Intervenors-Appellants.

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From Wake County

No. 13-CVS-16771

REV. ROBERT RICHARDSON, III, et al.


v.





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From Wake CountyNo. 13-CVS-16484

*************************************************

PLAINTIFFS JOINT RESPONSE TO INTERVENORS

MOTION FOR TEMPORARY STAY

*************************************************


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- i -

INDEX

TABLE OF CASES AND AUTHORITIES ............................. ii

STATEMENT OF THE FACTS ............................................... 2

ARGUMENT ............................................................................. 7

CONCLUSION ....................................................................... 12

VERIFICATION ..................................................................... 14

CERTIFICATE OF SERVICE ................................................ 15

APPENDIX:

Letter from Kelley to Tillis and Berger,

31 March 2014 ............................................... App. pp. 1-2

Exhibit 1 to Affidavit of Joanna King ............... App. pp. 3

Exhibit 3 to Affidavit of Michael Ward ............ App. pp. 4

Affidavit of Elizabeth V. McDuffie ............... App. pp. 5-8

Exhibit 3 to Joint Motion by Richardson

and Hart Plaintiffs for Modification of

Scheduling Order .............................................. App. pp. 9


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- ii -

TABLE OF CASES AND AUTHORITIES

Constitutional Provisions:

N.C. Const. Art. IX, 6 ............................................................ 11

1868 Const. Art. IX, 4 ........................................................... 11

Statutes:

Current Operations and Capital Improvements Appropriations

Act of 2013, 2013 Session Law 360, 8.29 .............................. 2

N.C. Gen. Stat. 115C-562.7(a) .............................................. 10

Session Law 2014-100, 8.25(e) ............................................. 10

Rules:

N.C. R. App. P. 23 ...................................................................... 8

N.C. R. Civ. P. 58 ....................................................................... 8


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No. 304P14 TENTH DISTRICT

SUPREME COURT OF NORTH CAROLINA

*************************************************

ALICE HART, et al.


v.





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From Wake County

No. 13-CVS-16771

REV. ROBERT RICHARDSON, III, et al.


v.





)

)

)

)

))

)

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From Wake CountyNo. 13-CVS-16484

*************************************************

PLAINTIFFS JOINT RESPONSE TO INTERVENORS

MOTION FOR TEMPORARY STAY

*************************************************


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TheHartplaintiffs and theRichardsonplaintiffs (collectively, the

plaintiffs) submit the following joint response to defendant-intervenors

Emergency Motion for Temporary Stay, filed on 25 August 2014. Plaintiffs will

file a response to intervenors Petition for Supersedeas by no later than 5:00 p.m.

on 28 August 2014.

STATEMENT OF THE FACTS

In 2013, the General Assembly enacted legislation providing taxpayer-

funded vouchers for students to attend private elementary and secondary schools.

Current Operations and Capital Improvements Appropriations Act of 2013, 2013

Session Law 360, 8.29 (the Voucher Legislation). In December 2013, theHart

plaintiffs and theRichardsonplaintiffs filed separate actions in Wake County

Superior Court asserting that the Voucher Legislation violates several provisions of

the North Carolina Constitution (Hart v. State, 13-CVS-16771, andRichardson v.

State, 13-CVS-16484, respectively).

On 13 January 2014, plaintiffs filed motions for preliminary injunction. On

21 January 2014, in response to a joint request by all parties, Senior Resident

Superior Court Judge Donald W. Stephens appointed Judge Robert H. Hobgood to

preside over all proceedings in both cases, pursuant to Local Rule 2.2. On 30

January 2014, two parents applying for vouchers, Cynthia Perry and Gennell Curry


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(the parent intervenors), filed a motion to intervene as defendants, which the trial

court granted.

On 28 February 2014, after full briefing and argument by all parties, Judge

Hobgood entered orders granting plaintiffs motions for preliminary injunction and

enjoined all implementation of the voucher program. At this point, the applicant

lottery had not yet been conducted and no voucher recipients had been selected.

On 3 March 2014, the parent intervenors but not defendants State of North

Carolina, State Education Assistance Authority, and State Board of Education (the

State defendants) filed a motion to stay the preliminary injunction pending

appeal. Judge Hobgood denied the motion to stay on 12 March 2014. On 17

March 2014, the parent intervenors but not the State defendants filed a notice

of appeal of the orders granting the preliminary injunction.

In a letter to Speaker of the House of Representatives Thom Tillis and

President Pro Tempore of the Senate Phil Berger dated March 31, 2014, Chief

Deputy Attorney General Grayson G. Kelley explained why the Attorney

Generals Office elected not to appeal the preliminary injunction orders that the

trial court issued on 28 February 2014:

There are reporting and information exchange requirements that

impose responsibilities on the Authority, the Department of Public

Instruction and schools accepting students receiving scholarship

grants. These are substantial responsibilities involving personnel time


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and costs that may be wasted should the courts ultimately determine

the legislation to be unconstitutional.

We are also concerned about the potential ramifications for

parents, students and schools if the legislation is struck down. 10

million expended through an unconstitutional program could

raise significant issues, including whether scholarship funds

should be repaid.

For these reasons, we concluded that the more prudent course would

be to forgo challenging the preliminary injunctions and move forward

to defend the lawsuits on the merits.

Letter from Kelley to Tillis and Berger, 31 March 2014 (emphasis added)

(Appendix (App.) pp. 1-2).

On appeal, the parent intervenors moved the Court of Appeals for a

temporary stay of the preliminary injunction and petitioned for a writ of

supersedeas. The Court of Appeals denied the motion on 19 March 2014 and

denied the petition on 2 April 2014.

The parent intervenors filed a petition for writ of supersedeas in this Court

and a motion for temporary stay of the preliminary injunction. Six weeks later, the

Court granted the intervenors requests on 14 May 2014 in one-line orders without

addressing the merits of the case.

The parties continued proceedings in the trial court. In response to a joint

request from all parties, Judge Hobgood entered a Scheduling Order on 9 June

2014, setting a 22 August 2014 date for hearing cross motions for summary


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judgment.1 All parties requested a compressed briefing schedule for the express

purpose of facilitating consideration of the motions before the beginning of the

school year. On 23 June 2014, Speaker Tillis and President Pro Tempore Berger

moved to intervene as defendants, which the trial court granted.

From the date these actions were filed in December 2013 through the date

the trial court entered the Scheduling Order on 9 June 2014, the website of

defendant State Education Assistance Authority (SEAA) consistently stated that

19 September 2014was the date on which Funds disbursed to nonpublic schools

for the fall semester. Exhibit 1 to Affidavit of Joanna King (App. p. 3); Exhibit 3

to Affidavit of Michael Ward (App. p. 4). On 20 February 2014, the State

defendants filed the affidavit of Elizabeth V. McDuffie, the SEAA director

responsible for implementation of the voucher program. McDuffie attested: The

Authority anticipates that it will begin disbursing funds for the Opportunity

Scholarship Grants Program on September 15, 2014. Affidavit of Elizabeth V.

McDuffie, 12 (App. p. 7).

After the trial court entered its scheduling order, on 20 June 2014, the SEAA

amended the timeline on its website, changing the first date for funds delivered to

nonpublic schools to 15 August 2014, one week beforethe date set for the

1To accommodate his schedule, the court later changed the hearing date to 19

August 2014.


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summary judgment hearing. Exhibit 3 to Plaintiffs Joint Motion for Modification

of Scheduling Order (App. p. 9). The State defendants have never explained why

it was necessary to accelerate the date for disbursement of voucher funds.

After engaging in discovery, all parties filed motions for summary judgment

on 7 July 2014. In open court on 21 August 2014, Judge Hobgood orally granted

plaintiffs motions for summary judgment, denied defendants summary judgment

motions, and entered a permanent injunction barring the State defendants from any

further implementation of the voucher program, effective 10:23 a.m. As of the

issuance of the trial courts ruling, no State funds for vouchers had been disbursed.

No parent or private school has received any voucher funds.

At the conclusion of the hearing on August 21, Judge Hobgood directed

plaintiffs counsel to submit a proposed order. On 25 August 2014 at 3:00 p.m.,

plaintiffs counsel sent a 4-page proposed order to defendants counsel, requesting

their comments by noon today (August 26). Plaintiffs will submit a proposed

order to Judge Hobgood this afternoon..

Immediately after the trial court issued its ruling, parent intervenors moved

the court to stay the injunction pending appeal. The court denied that motion. On

22 August 2014, defendants filed a notice of appeal from the order and final

judgment rendered on 21 August 2014.


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On August 22, defendants also moved the Court of Appeals for a temporary

stay of the permanent injunction and petitioned for a writ of supersedeas. Because

the appeal was premature before the entry of a written order, the Court of Appeals

denied the requests on 25 August 2014 without prejudice to re-filing upon entry of

the trial courts order. Rather than re-file with the Court of Appeals, intervenors

but not the State defendants requested from this Court a temporary stay and writ

of supersedeas.

ARGUMENT

This response is limited to intervenors Motion for Temporary Stay, in

which they request an order temporarily staying enforcement of the permanent

injunction until this Court determines whether it will issue a writ of supersedeas.

(Defs. Mot. at 9.) Plaintiffs will file a response to intervenors Petition for

Supersedeas by no later than 5:00 p.m. on 28 August 2014. In that response,

plaintiffs will explain why they will succeed on appeal and why they will be

irreparably harmed if taxpayer funds are expended pursuant to the Voucher

Legislation during the appeal.

Intervenors ask this Court to enter a temporary stay even before they have

filed a proper notice of appeal,2before the Court of Appeals has ruled on their

2Defendants improperly filed a notice of appeal before a final judgment was


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supersedeas petition,3and before plaintiffs have had the opportunity to address

their petition for supersedeas. They implore the Court to put millions of taxpayer

dollars at risk by turning on the spigot of public funds almost a month before the

SEAAs long-planned disbursement schedule, nullifying a decision by a senior trial

judge entered after months of discovery and consideration of hundreds of pages of

evidence and briefs. Given the extraordinary relief requested by intervenors, they

bear the burden of producing clear, unequivocal evidence that they will suffer

imminent harm if the trial courts injunction is not immediately stayed.

Intervenors have not and cannot meet this burden.

Intervenors have produced no evidence of any prejudice that would result if

this Court waits until plaintiffs response to the supersedeas petition before

deciding whether to grant the motion. They have failed to produce evidence of a

single student who would be required to withdraw from a private school if voucher

funds are not disbursed immediately. Moreover, even if some prospective voucher

recipients would be unable to attend a private school now, continued attendance at

entered by the trial court. SeeN.C. R. Civ. P. 58 (requiring entry of judgment to be

a document signed by the judge and filed with the clerk of court). No order hasbeen filed in the trial court.

3Intervenors have not complied with Appellate Rule 23(a)(2) because the Court of

Appeals is required to decide a supersedeas petition before a party may bring the

petition before this Court. The Court of Appeals has not so decided here; it simply

deferred ruling until the trial court enters its order.


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a free public school and receipt of an equal opportunity to obtain a sound basic

education, as required by the Constitution, is not a recognized form of harm.

No prejudice would result from following the ordinary appellate process.

The SEAA originally intended to disburse voucher funds in mid-September 2014.

All private schools enrolling voucher recipients presumably found the SEAAs

original disbursement schedule acceptable, and thus would have no reason to

remove a voucher recipient from its program if the trial courts injunction remains

in place for several more days. And all private schools have been aware that the

Voucher Legislation faces a constitutional challenge that could result in a halt to

the disbursement of voucher funds. Intervenors have produced no evidence

demonstrating why allowing the normal appellate process to proceed which

would permit a decision on the supersedeas petition well before the original

disbursement date would now result in imminent harm sufficient to justify the

extraordinary relief they seek from this Court.

Any possible prejudice from the timing of the trial courts injunction is due

to the parent intervenors decision to seek a stay of the preliminary injunction. The

trial court entered a preliminary injunction on 28 February 2014. While the

Attorney Generals Office was properly concerned about the consequences for

students, parents, schools, and taxpayers if the OSP were implemented before a


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final judgment on the merits, and thus did not appeal the interlocutory order, the

intervenors had no such concerns. Any uncertainty due to imposition of the

permanent injunction on 21 August 2014 would have been avoided if the

preliminary injunction had been left in place.

Intervenors contend that the Courts prior ruling granting the request to stay

the preliminary injunction somehow determines the merits of these cases. (Defs.

Mot. at 5.) The Courts orders, however, did not decide the merits of the

constitutional claims or the propriety of staying the permanent injunction. Issuing

a stay of the preliminary injunction was simply a determination that the voucher

program should proceed until a final judgment on the merits, based on the evidence

obtained in discovery.4 Now that the trial court has considered the evidence and

granted plaintiffs motions for summary judgment on all their constitutional

claims, a permanent injunction is necessary and proper.

This case raises profoundly important questions of constitutional law. Since

1868, when our Constitution first declared that state funds for education shall be

4Plaintiffs lawsuits are based on multiple provisions of the State Constitution

Article I, Sections 15 and 19; Article V, Section 2; and Article IX, Sections 2, 5,and 6. The trial courts preliminary injunction order was based solely on plaintiffs

claims under Article IX, Section 6. The General Assembly itself recognized that

the original legislation was constitutionally suspect and recently repealed the

provision (N.C. Gen. Stat. 115C-562.7(a)) that required deductions from public

school district funding to account for voucher awards, mooting one of plaintiffs

claims under Article IX, Section 6. Session Law 2014-100, 8.25(e).


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faithfully appropriated to support a system of Free Public Schools and for no

other purposes or uses whatsoever, 1868 Const. Art. IX, 4,5the State has abided

by that command and prohibition. From 1868until it enacted the Voucher

Legislation in 2013, the General Assembly complied with the public purpose

clause, and never appropriated taxpayer funds to unaccountable private schools.

Judge Hobgood, one of the most experienced and respected judges in North

Carolina, considered hundreds of pages of evidence and briefs, followed by three

and a half hours of oral argument. The only court to have fully explored and

decided these issues concluded that the Voucher Legislation violates the North

Carolina Constitution beyond a reasonable doubt. This Court should not nullify

the trial courts injunction without allowing the Court of Appeals to first consider

the issues. At the very least, this Court should not stay the injunction until it fully

considers the issues after receipt of plaintiffs prompt response to the supersedeas

petition.

5Carrying forward the same prohibition, current Article IX, Section 6

provides that such funds shall be faithfully appropriated and used

exclusively for establishing and maintaining a uniform system of free public

schools.


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CONCLUSION

For the foregoing reasons, plaintiffs respectfully request that defendants

motion for temporary stay be denied.

Respectfully submitted, this 26th day of August, 2014.

PATTERSON HARKAVY LLP

Electronically submitted

Burton Craige

NC Bar No. 9180

1312 Annapolis Dr., Suite 103

Raleigh, NC 27607

Tel: 919-755-1812

Fax: 919-942-5256

Email: [email protected]

N.C. R. App. P. 33(b) Certification: I certify that all of the attorneys listed below

have authorized me to list their names on this document as if they had personally

signed it.

Narendra K. Ghosh

NC Bar No. 37649

PATTERSON HARKAVY LLP

100 Europa Dr., Suite 250

Chapel Hill, NC 27517

Tel: 919-942-5200Fax: 919-942-5256


Christine Bischoff

NC Bar No. 41792

Carlene McNulty

Robert F. Orr

N.C. State Bar No. 6798

[email protected]

Edwin M. Speas, Jr.


[email protected] V. McMillan


[email protected]

POYNER SPRUILL LLP

P.O. Box 1801

Raleigh, NC 27602-1801


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NC Bar No. 12488

NORTH CAROLINA JUSTICE CENTER

224 South Dawson Street

Raleigh, NC 27601

Tel: 919.856.3195

Tel: 919.856.2161

Fax: 919.856.2175



Counsel for Hart Plaintiffs

Telephone: 919.783.6400

Facsimile: 919.783.1075

Counsel for all Richardson

Plaintiffs, except Chatham County

Board of Education, Nash-Rocky

Mount Board of Education, Board

of Trustees for Roanoke Rapids

Graded School District, and

Granville County Board of

Education

Deborah R. StagnerN.C. State Bar No. 24543

[email protected]

Kenneth A. Soo


[email protected]

P.O. Box 1151

Raleigh, NC 27602

Telephone: 919.821.4711

Facsimile: 919.829.1583

Counsel for Chatham County

Board of Education, Nash-Rocky

Mount Board of Education, Board

of Trustees for Roanoke Rapids

Graded School District, and

Granville County Board of

Education


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CERTIFICATE OF SERVICE

The undersigned counsel for the plaintiffs hereby certifies that a copy of

Plaintiffs Response to Motion for Temporary Stay was sent via first class mail,

postage prepaid, addressed as follows:

Lauren M. Clemmons

Special Deputy Attorney General

NORTH CAROLINA DEPARTMENT OF

JUSTICE

P.O. Box 629


Laura Crumpler



JUSTICE

114 W. Edenton Street

P.O. Box 629


Melissa L. Trippe



JUSTICE

P.O. Box 629


Tiffany Y. Lucas

Assistant Attorney General


JUSTICE

P.O. Box 629


Attorneys for all State Defendants Attorneys for the North Carolina.

State Board of EducationRobert T. Numbers, II

WOMBLE CARLYLE SANDRIDGE &RICE

P.O. Box 831

Raleigh, NC 27602

Noah H. Huffstetler III

Stephen D. Martin

Nelson Mulls Riley & Scarborough

4140 Parklake Ave., Suite 200

Raleigh, NC 27612

Richard D. Komer

Rene Flaherty

INSTITUTE FOR JUSTICE

901 N. Glebe Road, Suite 900

Arlington, VA 22203

Attorneys for Officer Intervenors

Attorneys for Parent Intervenors

This the 26th day of August, 2014.

Electronically submitted

Burton Craige


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CONTENTS OF APPENDIX

Letter from Kelley to Tillis and Berger, 31 March 2014....App. pp. 1-2

Exhibit 1 to Affidavit of Joanna King

..

...

.

.

...App. p. 3

Exhibit 3 to Affidavit of Michael Ward...... App. p. 4

Affidavit of Elizabeth V. McDuffie...App. pp. 5-8

Exhibit 3 to Joint Motion by Richardson and Hart

Plaintiffs for Modification of Scheduling Order...........App p. 9


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HC Y

C J )PEH

i\TTC)RNEY

GENEfV\L

VI H ND DELIVERY

The Honorable Thom Tillis

Speaker of the House

State of

North Carolina

Department

of Justice

PO

Box 629

Raleigh

Nortl1

Carolina

27602

March 31, 2014

North Carolina House of Representatives

16

W. Jones Street, Room 2304

Raleigh, North Carolina 27601-1096

The Honorable Phil Berger

President Pro Tempore

North Carolina Senate

16

W. Jones Street, Room 2008

Raleigh, North Carolina 27601-2808

Re:

Richardson t al v North Carolina

Hart t al v North Carolina

Dear Speaker Tillis and President Pro Tempore Berger:

REPLY

TO: Grayson

G

Kelley

(919) 716-6400

FAX: (919) 716-0135

The Attorney General has asked me to respond to your letter dated March 28, 2014

expressing your views that

an

appeal should be taken from the preliminary injunctions

entered in the above referenced cases. We are mindful of the General Assembly's

interests and the importance

of

our duty to defend the constitutionality of enacted

legislation. For these reasons, litigation decisions in these cases have been made only

after careful consideration.

As you are aware, the Opportunity Scholarships established by Section 18.29(a) of

Session Law 2013-360 are required to be administered by the State Educational

Assistance Authority which

is

authorized to spend up to 400,000 annually for

administrative costs. The Authority is directed to award 1

O

million

in

scholarships for the

2014-15 fiscal year through

an

application and lottery process. Rules and regulations are

required to be established for the lottery and for verification ofapplicant information. There

are reporting and information exchange requirements that impose responsibilities on the

Authority, the Department of Public Instruction and schools accepting students receiving

scholarship grants. These are substantial responsibilities involving personnel time and

Appendix Page 1


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Honorable Thom Tillis

Honorable Phil Berger

March 31

2014

Page 2

costs that may be wasted should the courts ultimately determine the legislation to be

unconstitutional.

We are also concerned about the potential ramifications for parents, students and

schools ifth legislation is struck down. 10 million expended through an unconstitutional

program could raise significant issues, including whether scholarship funds should be

repaid.

For these reasons, we concluded the more prudent course to follow in this litigation

would be to forgo challenging the preliminary injunctions and move forward to defend the

lawsuits on the merits. If the courts ultimately uphold the legislation the program can move

forward. While your concern about delay

is

understandable, we believe the consequences

if the law is not upheld should be considered.

Our attorneys will continue to defend these lawsuits to the best of their ability

through our Special Litigation Division and will keep you advised as the cases move

through the courts.

Appendix Page 2


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Appendix Page 3


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Opportunity Scholarship Program Timeline subject to change

1 13 2014

January 10 2014

January 21, 2014

February 1

2014

February 25 2014

March 3 2014

March 10, 2014

March 18 2014

May 1 2014

March-June

July 15 2014

Ju ly 22 2014

Nonpublic school registration opens

Nonpublic school training webinar (recorded

for

future viewing)

Student application opens

Student application priority deadline

Selection notificat ions to applicants

Notification

of

lottery results to nonpublic schools

Program

Rules

published on the Scholarship webpage

Target date

for

all participating schools to complete registration

Verification

of

information for selected applicants

Deadline for applicants to inform

SEAA

of the nonpublic school in which

students wil l enroll (if unknown at time

of

application)

Nonpublic schools must report the annual

tuition

fees expense

for

each

recipient attending their schools

August

1

2014 Fall Semester parent endorsement forms provided to each school

August 21, 2014 Parent endorsement forms returned to SEAA

for

September disbursement

September 19 2014 Funds disbursed to nonpublic schools for the fall semester

December 1, 2014 Spring semester parent endorsement forms provided to each school

December 19 2014 Spring semester parent endorsement forms returned to SEAA

January 16, 2015 Funds disbursed to the nonpublic schools

for

the spring semester

f ~ ~ ~ t i ,

.

~ ; ~ ~ < - : } : ~ ~

.

>t

.

Appendix Page 4


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Appendix Page 5


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Appendix Page 6


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Appendix Page 7


27/28

Appendix Page 8


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Appendix Page 9

vouchers -- joint resp to emerg motion -- final (2)

Documents