ProgressOhio.org, Inc. v. JobsOhio (Slip Opinion)

[Until this opinion appears in the Ohio Official Reports advance sheets, it may be cited as

ProgressOhio.org, Inc. v. JobsOhio, Slip Opinion No. 2014-Ohio-2382.]

NOTICE

This slip opinion is subject to formal revision before it is published in

an advance sheet of the Ohio Official Reports. Readers are requested

to promptly notify the Reporter of Decisions, Supreme Court of Ohio,

65 South Front Street, Columbus, Ohio 43215, of any typographical

or other formal errors in the opinion, in order that corrections may be

made before the opinion is published.

SLIP OPINION No. 2014-Ohio-2382

PROGRESSOHIO.ORG, INC., ET AL., APPELLANTS, v. JOBSOHIO ET AL.,

APPELLEES.

[Until this opinion appears in the Ohio Official Reports advance sheets,

it may be cited as ProgressOhio.org, Inc. v. JobsOhio,

Slip Opinion No. 2014-Ohio-2382.]

Standing—Constitutionality of JobsOhio Act—R.C. 187.01 et seq. and 4313.01 et

seq.—Plaintiffs failed to show that they have a personal stake in the

outcome of the litigation or a cognizable basis for statutory standing.

(No. 2012-1272—Submitted November 6, 2013—Decided June 10, 2014.)

APPEAL from the Court of Appeals for Franklin County, No. 11AP-1136,

2012-Ohio-2655.

____________________

FRENCH, J.

{¶ 1} In this appeal, we consider whether appellants, ProgressOhio.org,

Inc., Michael J. Skindell, and Dennis E. Murray Jr., have standing to challenge the

JobsOhio Act, R.C. 187.01 et seq. and 4313.01 et seq. We have long held that a

party wishing to sue must have a direct, personal stake in the outcome of his or

her case; ideological opposition to a program or legislative enactment is not

enough. Applying that precedent here, we conclude that appellants have failed to

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show that they have any personal stake in the outcome of this litigation. They

therefore lack the direct injury required for common-law standing. Appellants

similarly fail to allege a cognizable basis for statutory standing. Accordingly, we

conclude that appellants are not proper parties to challenge the constitutionality of

the JobsOhio legislation.

Facts and Procedural History

{¶ 2} This case concerns appellants’ constitutional challenge to the

JobsOhio Act. The act authorized the creation of a nonprofit corporation,

JobsOhio, for “the purposes of promoting economic development, job creation,

job retention, job training, and the recruitment of business” to Ohio. R.C. 187.01.

An appropriation from the Department of Development initially funded and

established JobsOhio. 2011 Am.Sub.H.B. No. 1, Section 5. Thereafter, JobsOhio

was given the right to purchase the state’s liquor distribution and merchandising

operations and to operate from revenues of the liquor enterprise. R.C.

4313.02(A).

{¶ 3} Appellant, ProgressOhio.org, Inc., is an entity organized under 26

U.S.C. 501(c)(4). It was “created to provide a progressive voice for Ohio

citizens[,] * * * to inform and educate the public about progressive ideals, values

and politics [and] to ensure that the government follows the dictates of the U.S.

and Ohio Constitutions.” Joining ProgressOhio as appellants are Michael J.

Skindell, a member of the Ohio Senate, and Dennis E. Murray, a former member

of the Ohio House of Representatives.

{¶ 4} Appellants filed this action for declaratory and injunctive relief in

the Franklin County Common Pleas Court. Appellants sought a declaration that

the act violated the Ohio Constitution and an injunction prohibiting the formation

and continued operation of JobsOhio. Appellants primarily claimed that

JobsOhio violated constitutional prohibitions on spending, corporate creation, and

corporate investment.

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{¶ 5} The trial court dismissed the case, finding that appellants lacked

standing to sue. The Tenth District Court of Appeals agreed. It held that

appellants lacked the personal stake and direct injury necessary for standing.

2012-Ohio-2655, 973 N.E.2d 307, ¶ 19 (10th Dist.). It also held that appellants

did not present an issue of public interest great enough to otherwise warrant

standing under State ex rel. Ohio Academy of Trial Lawyers v. Sheward, 86 Ohio

St.3d 451, 715 N.E.2d 1062 (1999). 2012-Ohio-2655, 973 N.E.2d 307, at ¶ 32.

{¶ 6} This court accepted appellants’ discretionary appeal. The only issue

before us is whether appellants have standing to bring this action.

Analysis

{¶ 7} “Before an Ohio court can consider the merits of a legal claim, the

person or entity seeking relief must establish standing to sue.” Ohio Pyro, Inc. v.

Ohio Dept. of Commerce, Div. of State Fire Marshal, 115 Ohio St.3d 375, 2007-

Ohio-5024, 875 N.E.2d 550, ¶ 27. Traditional standing principles require litigants

to show, at a minimum, that they have suffered “(1) an injury that is (2) fairly

traceable to the defendant’s allegedly unlawful conduct, and (3) likely to be

redressed by the requested relief.” Moore v. Middletown, 133 Ohio St.3d 55,

2012-Ohio-3897, 975 N.E.2d 977, ¶ 22. Standing does not depend on the merits

of the plaintiff’s claim. Id. at ¶ 23. Rather, standing depends on whether the

plaintiffs have alleged such a personal stake in the outcome of the controversy

that they are entitled to have a court hear their case. Clifton v. Blanchester, 131

Ohio St.3d 287, 2012-Ohio-780, 964 N.E.2d 414, ¶ 15; State ex rel. Dallman v.

Franklin Cty. Court of Common Pleas, 35 Ohio St.2d 176, 178-179, 298 N.E.2d

515 (1973).

{¶ 8} Appellants concede that they have no personal stake in the outcome

of this litigation. Consequently, they are admittedly unable to meet the

requirements to establish traditional standing. Instead, appellants claim that they

possess standing through four alternative means: (1) the public-right doctrine, (2)

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taxpayer standing, (3) statutory standing under a portion of the Declaratory

Judgment Act, R.C. 2721.03(A), and (4) statutory standing under a portion of the

JobsOhio Act, R.C. 187.09. We disagree on all counts, which we address in turn.

I. The Public-Right Doctrine

{¶ 9} First, appellants claim that they have standing under the public-right

doctrine outlined in Sheward, 86 Ohio St.3d 451, 715 N.E.2d 1062. The public-

right doctrine represents “an exception to the personal-injury requirement of

standing.” Id. at 503. The doctrine provides that “when the issues sought to be

litigated are of great importance and interest to the public, they may be resolved

in a form of action that involves no rights or obligations peculiar to named

parties.” Id. at 471. To succeed in bringing a public-right case, a litigant must

allege “rare and extraordinary” issues that threaten serious public injury.

(Emphasis deleted.) Id. at 504. Not all allegedly illegal or unconstitutional

government actions rise to this level of importance. Id. at 503.

{¶ 10} Appellants do not have standing under the public-right doctrine.

As Sheward makes clear, the public-right doctrine applies only to original actions

in mandamus and/or prohibition. Id. at paragraph one of the syllabus (“Where the

object of an action in mandamus and/or prohibition is to procure the enforcement

or protection of a public right, the relator need not show any legal or special

individual interest in the result * * *” [emphasis added]). It does not apply to

declaratory-judgment actions filed in common pleas courts, and we have never

used the doctrine in such a case.

{¶ 11} Nor could we. The Ohio Constitution expressly requires standing

for cases filed in common pleas courts. Article IV, Section 4(B) provides that the

courts of common pleas “shall have such original jurisdiction over all justiciable

matters.” (Emphasis added.) A matter is justiciable only if the complaining party

has standing to sue. Fed. Home Loan Mtge. Corp. v. Schwartzwald, 134 Ohio

St.3d 13, 2012-Ohio-5017, 979 N.E.2d 1214, ¶ 41 (“It is fundamental that a party

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commencing litigation must have standing to sue in order to present a justiciable

controversy”). Indeed, for a cause to be justiciable, it must present issues that

have a “direct and immediate” impact on the plaintiffs. Burger Brewing Co. v.

Liquor Control Comm., Dept. of Liquor Control, 34 Ohio St.2d 93, 97-98, 296

N.E.2d 261 (1973). Thus, if a common pleas court proceeds in an action in which

the plaintiff lacks standing, the court violates Article IV of the Ohio Constitution.

Article IV requires justiciability, and justiciability requires standing. These

constitutional requirements cannot be bent to accommodate Sheward.

{¶ 12} Even assuming that Sheward could apply to common-pleas

actions, it would not apply in this case. Appellants make little effort to present a

rare and extraordinary public issue. Instead, they assert that citizens should be

able to challenge any alleged constitutional violations, regardless of rarity or

magnitude. Appellants’ position is incompatible with Sheward, which clearly

states that not all allegations of constitutional harm warrant an exception to the

personal-stake requirement of standing. 86 Ohio St.3d at 503, 715 N.E.2d 1062;

see also State ex rel. Leslie v. Ohio Hous. Fin. Agency, 105 Ohio St.3d 261, 2005-

Ohio-1508, 824 N.E.2d 990, quoting Sheward at 504 (constitutional challenge to

state spending measures was “not a ‘rare and extraordinary case’ warranting

invocation of the public-right exception to the personal-stake requirement of

standing”). Thus, another reason that appellants’ Sheward argument fails is that

they do not show the type of rare and extraordinary public-interest issue required

by Sheward. Accordingly, we find that appellants cannot establish standing under

the public-right doctrine.

{¶ 13} We recognize that this case presents broader concerns about the

overall validity of Sheward and the public-right doctrine. Sheward was a deeply

divided, four-to-three decision, and it remains controversial today. JobsOhio and

its amici criticize Sheward heavily, urging that we take this opportunity to

overrule Sheward and settle the law of standing in Ohio. Nevertheless, given our

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holding today, we must decline JobsOhio’s invitation to reevaluate Sheward.

Sheward does not apply in this common-pleas action, and thus we express no

opinion as to Sheward’s continued vitality.

II. Taxpayer Standing

{¶ 14} Next, appellants argue that they have common-law taxpayer

standing to challenge the JobsOhio Act. We conclude, however, that appellants

have waived any claim to taxpayer standing by failing to raise the issue in the

lower courts.

{¶ 15} The trial court made two rulings on the issue of taxpayer standing:

(1) that appellants never asserted taxpayer standing in their complaint, and (2)

that, regardless, appellants failed to qualify for taxpayer standing. Appellants did

not appeal that holding, and they did not brief or argue the issue of taxpayer

standing in the court of appeals. Instead, appellants’ assignments of error focused

only on the public-right doctrine, legislative standing, and statutory standing

under R.C. 187.09.

{¶ 16} Appellants maintain that they have not waived the issue of

taxpayer standing because their broad proposition of law (“Plaintiffs have

standing to bring this action”) allows them to assert all possible bases for

standing. Even if we were to agree that appellants’ proposition of law is broad

enough to encompass the issue of taxpayer standing, appellants still waived that

claim by not raising and arguing it in the court of appeals. See State ex rel. E.

Cleveland Fire Fighters’ Assn., Loc. 500, Internatl. Assn. of Fire Fighters v.

Jenkins, 96 Ohio St.3d 68, 2002-Ohio-3527, 771 N.E.2d 251, ¶ 12 (holding that

appellant waived a claim of standing by failing to raise it in the court of appeals).

Accordingly, we reject appellants’ purported taxpayer standing.

III. Standing Under the Declaratory Judgment Act

{¶ 17} In addition to standing authorized by common law, standing may

also be conferred by statute. Middletown v. Ferguson, 25 Ohio St.3d 71, 75, 495

6

January Term, 2014

N.E.2d 380 (1986). To that end, appellants assert that they have standing under

R.C. 2721.03, a portion of the Declaratory Judgment Act. We conclude that

appellants have similarly waived any claim to standing under R.C. 2721.03.

{¶ 18} Appellants raised no claim of standing under R.C. 2721.03 in the

lower courts. They argue, however, that they must be able to raise the issue now

because of developments in the law—specifically, this court’s decision in Moore,

133 Ohio St.3d 55, 2012-Ohio-3897, 975 N.E.2d 977. In Moore, this court held

that property owners could bring a declaratory-judgment action to challenge the

constitutionality of rezoning if the owners pled an injury caused by the rezoning.

Id. at ¶ 56. In dicta, the majority addressed the court of appeals’ holding that R.C.

2721.03 does not itself determine standing to bring a declaratory-judgment action:

“Although it is true that R.C. Chapter 2721 is the legislative source of a cause of

action for declaratory relief, we do not necessarily agree that the statute does not

confer standing.” Id. at ¶ 48. This court did not, however, decide that question.

{¶ 19} The equivocal statement in Moore hardly qualifies as a change in

law that warrants overlooking appellants’ waiver here. But even if it did,

appellants’ statutory standing claim would still fail, as they do not meet the

requirements of R.C. 2721.03. R.C. 2721.03 applies only to “person[s] whose

rights, status, or other legal relations are affected by a constitutional provision

[or] statute.” (Emphasis added.) See also Moore at ¶ 49 (declaratory relief

available only when there is a real, justiciable controversy and relief is necessary

“to preserve the rights of the parties”). Indeed, the three prerequisites to

declaratory relief are (1) a real controversy between the parties, (2) justiciability,

and (3) the necessity of speedy relief to preserve the parties’ rights. Burger

Brewing Co., 34 Ohio St.2d at 97, 296 N.E.2d 261, citing Am. Life & Acc. Ins.

Co. of Kentucky v. Jones, 152 Ohio St. 287, 296, 89 N.E.2d 301 (1949).

Appellants ignore these requirements. They do not show that they have any rights

at stake or that speedy resolution will bring them any concrete relief. They

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simply argue that they have an idealistic opposition to the government’s “use of

public fund[s] to prop up purely private corporations.” This is insufficient under

the Declaratory Judgment Act, and we reject appellants’ contrary assertion.

IV. Standing Under the JobsOhio Act

{¶ 20} Finally, appellants contend that the JobsOhio Act itself, and

particularly R.C. 187.09(B), cloaks them with standing to challenge JobsOhio.

R.C. 187.09(B) sets out time and place requirements for challenging the

constitutionality of the JobsOhio legislation and provides as follows:

Except as provided in division (D) of this section, any

claim asserting that [the JobsOhio Act] violates any provision of

the Ohio Constitution shall be brought in the court of common

pleas of Franklin county within ninety days after the effective date

* * * of this section * * *.

{¶ 21} R.C. 187.09(B) makes no mention of standing. Nevertheless,

appellants argue that the statute is ambiguous and that this court must broadly

construe it to provide standing to avoid rendering the statute meaningless.

Appellants claim that R.C. 187.09(B) is ambiguous because it contemplates that

someone will have standing to challenge the JobsOhio Act, but does not specify

who has this standing. We disagree.

{¶ 22} R.C. 187.09 conveys a clear and definite meaning. The statute

unambiguously provides that with the exception of claims within the original

jurisdiction of this court or a court of appeals, any constitutional challenge to the

JobsOhio legislation must lie in the Franklin County Court of Common Pleas and

must be brought within 90 days after September 29, 2011. R.C. 187.09(B) and

(D). The fact that R.C. 187.09 is silent as to who has standing to maintain a

constitutional challenge to the legislation does not render the statute ambiguous.

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January Term, 2014

Nor will we read the statutory silence as clearly expressing an intention to

abrogate the common-law requirements for standing. See Bresnik v. Beulah Park

Ltd. Partnership, Inc., 67 Ohio St.3d 302, 304, 617 N.E.2d 1096 (1993) (this

court will not read a statute as abrogating the common law unless the statutory

language clearly expresses or imports that intention). Accordingly, we reject

appellants’ argument that R.C. 187.09(B) grants them standing to challenge the

JobsOhio Act.

V. Appellants’ Policy Concerns

{¶ 23} Throughout their brief, appellants contend that it is a practical

necessity for us to grant them standing. Unless we allow them to pursue this

action, appellants argue, no one will ever be able to challenge JobsOhio or

enforce the Ohio Constitution. We disagree.

{¶ 24} Appellants stress that they were the only litigants to file a lawsuit

within the 90-day time frame set by R.C. 187.09(B). Thus, they argue, if this

court does not grant appellants standing, no one will ever be able to challenge

JobsOhio. Appellants are mistaken. Both R.C. 187.09(C) and (D) provide

extended statutes of limitations for challenges to JobsOhio. R.C. 187.09(C)

provides that “any claim asserting that any action taken by JobsOhio violates any

provision of the Ohio Constitution shall be brought * * * within sixty days after

the action is taken.” And R.C. 187.09(D) allows aggrieved parties to bring an

original action in this court, without any time limitation. Additionally, to the

extent that the 90-day time limit in R.C. 187.09(B) is unconstitutional,1 as

appellants have suggested, a person with standing could still sue and challenge the

1

The issue of whether the 90-day time limit is constitutional is not before us today. Although

appellants initially asked this court to review the constitutionality of R.C. 187.09(B), we

specifically declined to exercise our discretionary jurisdiction over that issue. 134 Ohio St.3d

1416, 2013-Ohio-158, 981 N.E.2d 883. And even if we had accepted the issue for review,

appellants’ lack of standing would still prevent us from considering it here.

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time limitation as part of that suit. In short, appellants are not the last line of

defense against JobsOhio, despite the dire picture they paint.

{¶ 25} Justice Pfeifer’s dissent expresses similar concerns, erroneously

concluding that today’s decision “ensures that no court will ever address the

question of the constitutionality of the JobsOhio legislation,” because “[n]either

the state, nor its counsel, nor the majority opinion has been able to conjure a

realistic example of a person or entity that would have the requisite standing and

inclination to bring a claim.” The dissent’s statements are demonstrably

incorrect; in reality, all of the parties in this case—including appellants—

identified multiple persons and entities that could potentially bring a claim. Thus,

despite the dissent’s protestations to the contrary, we do not hold, and the parties

do not suggest, that no person could ever have standing to challenge JobsOhio. A

proper party—i.e., one with legal standing—may unquestionably contest the

constitutionality of JobsOhio. As to that proper party, the courthouse doors

remain open.

Conclusion

{¶ 26} Appellants have no personal stake in the outcome of this litigation

and therefore lack common-law standing to challenge the JobsOhio Act. The

public-right doctrine cannot save appellants, as it does not apply to actions

brought in common pleas courts. Appellants’ alternative claims to statutory

standing likewise fail.

{¶ 27} If and when an injured party seeks to challenge JobsOhio, we may

entertain such a case. But those parties are not before us today. Appellants lack

standing to bring this suit, and they may pursue it no further.

Judgment affirmed.

O’CONNOR, C.J., and WHITMORE and LANZINGER, JJ., concur.

KENNEDY, J., concurs in judgment only.

PFEIFER and O’NEILL, JJ., dissent.

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January Term, 2014

BETH WHITMORE, J., of the Ninth Appellate District, sitting for

O’DONNELL, J.

____________________

KENNEDY, J., concurring in judgment only.

{¶ 28} I concur in the majority’s judgment that ProgressOhio, Michael

Skindell, and Dennis Murray lack standing, in this case, to challenge the

constitutionality of R.C. 187.01 et seq. and 4313.01 et seq. (“the JobsOhio

legislation”). However, I write separately to address the public-policy concerns

that the majority summarily dismisses.

{¶ 29} The appellants argue that if they do not have standing, no one will

be able to challenge the constitutionality of the JobsOhio legislation, because they

are the only group to have done so within the 90-day statutory time limitation.

R.C. 187.09(B). In dismissing the appellants’ claim that they are the only ones

who timely filed an action challenging the constitutionality of the JobsOhio

legislation, the majority writes, “Appellants are mistaken. Both R.C. 187.09(C)

and (D) provide extended statutes of limitations for challenges to JobsOhio.”

Majority opinion at ¶ 24. I disagree.

R.C. 187.09

{¶ 30} R.C. 187.09 provides:

(B) Except as provided in division (D) of this section, any

claim asserting that any one or more sections of the Revised Code

amended or enacted by H.B. 1 of the 129th general assembly, any

section of Chapter 4313. of the Revised Code enacted by H.B. 153

of the 129th general assembly, or any portion of one or more of

those sections, violates any provision of the Ohio Constitution

shall be brought in the court of common pleas of Franklin county

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within ninety days after the effective date of the amendment of this

section by H.B. 153 of the 129th general assembly.

(C) Except as provided in division (D) of this section, any

claim asserting that any action taken by JobsOhio violates any

provision of the Ohio Constitution shall be brought in the court of

common pleas of Franklin County within sixty days after the

action is taken.

(Emphasis added.)

{¶ 31} The divisions within R.C. 187.09 are separate and distinct.

{¶ 32} Am.Sub.H.B. No. 1, effective February 18, 2011, and

Am.Sub.H.B. No. 153, effective September 29, 2011, created JobsOhio. R.C.

187.09(B) sets forth a time limitation on challenging the constitutionality of the

creation of JobsOhio, while division (C) sets forth a time limitation on

challenging the constitutionality of an action by JobsOhio.

{¶ 33} The majority declares that an individual with proper standing could

challenge the constitutionality of the 90-day time limitation in R.C. 187.09(B).

But who could meet the justiciability requirement, because cases filed in a

common pleas court require a concrete injury? See Ohio Trucking Assn. v.

Charles, 134 Ohio St.3d 502, 2012-Ohio-5679, 983 N.E.2d 1262, quoting State ex

rel. Ohio Academy of Trial Lawyers v. Sheward, 86 Ohio St.3d 451, 469-470, 715

N.E.2d 1062 (1999) (“ ‘In order to have standing to attack the constitutionality of

a legislative enactment, the private litigant must generally show that he or she has

suffered or is threatened with direct and concrete injury in a manner or degree

different from that suffered by the public in general, that the law in question has

caused the injury, and that the relief requested will redress the injury’ ”).

{¶ 34} At oral argument, the state appellees, the governor, the directors of

the development and the office of budget and management, and the treasurer

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suggested that those holding the bonds secured by profits from the sale of liquor

and liquor-permit holders may have standing under R.C. 187.09(C). However,

those arguments ring hollow. Pursuant to R.C. Chapters 151 and 166, the state

has authority only to issue a bond, while JobsOhio has authority only to pay off a

bond, pursuant to R.C. 4313.02(B)(1). Moreover, only the proceeds from the

sales of liquor flow through to JobsOhio, while the state retains the right the issue

permits and regulate or sanction permit holders. See State ex rel. JobsOhio v.

Goodman, 133 Ohio St.3d 297, 2012-Ohio-4425, 978 N.E.2d 153, ¶ 4, 5; R.C.

4313.02(E). Therefore, it is unclear how a party would have standing to challenge

the constitutionality of the JobsOhio legislation, because it is the state that issues

bonds and regulates the liquor business.

{¶ 35} However, while the appellants have raised valid policy concerns

and the possibility exists that no one will have standing to bring an action

pursuant to R.C. 187.09(B), those concerns and possibilities alone cannot confer

standing on the appellants.

{¶ 36} Therefore, I concur in the majority’s judgment.

____________________

PFEIFER, J., dissenting.

{¶ 37} With today’s decision, this court for the third time has refused to

determine the constitutionality of the JobsOhio legislation. In ProgressOhio.org,

Inc. v. Kasich, 129 Ohio St.3d 449, 2011-Ohio-4101, 953 N.E.2d 329, this court

said, “Not here,” finding unconstitutional the provision in the original JobsOhio

bill that required cases regarding the constitutionality of the legislation to be

brought exclusively in this court. In State ex rel. JobsOhio v. Goodman, 133 Ohio

St.3d 297, 2012-Ohio-4425, 978 N.E.2d 153, this court said, “Not now,” holding

that the mandamus case brought by JobsOhio against Ohio Department of

Commerce Director David Goodman was actually a declaratory-judgment action

that should be brought first in the court of common pleas. Today, this court ends

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all doubt about when it will determine the constitutionality of the JobsOhio

legislation, essentially responding, “Not ever.” Not here. Not now. Not ever.

{¶ 38} An Ohio citizen who possesses no personal stake in the outcome of

a case other than ensuring that his or her government live up to the Ohio

Constitution has a means to vindicate that cause: “This court has long taken the

position that when the issues sought to be litigated are of great importance and

interest to the public, they may be resolved in a form of action that involves no

rights or obligations peculiar to named parties.” State ex rel. Ohio Academy of

Trial Lawyers v. Sheward, 86 Ohio St.3d 451, 471, 715 N.E.2d 1062 (1999).

{¶ 39} The majority reluctantly accepts the concept of public-right

standing, but tries to find a way to nullify it in this case. First, the majority claims

that the public-right doctrine applies only to actions in mandamus and or

prohibition. This is based upon the partial quotation of a statement in Sheward:

“Where the object of an action in mandamus and/or prohibition is to procure the

enforcement of a public right, the relator need not show any legal or special

individual interest in the result * * *.” Majority opinion at ¶ 10. However, the

full quote reads:

Where the object of an action in mandamus and/or

prohibition is to procure the enforcement or protection of a public

right, the relator need not show any legal or special individual

interest in the result, it being sufficient that the relator is an Ohio

citizen and, as such, interested in the execution of the laws of this

state.

Sheward, paragraph one of the syllabus.

{¶ 40} That statement from Sheward is about standing in general, and in

no way limits public-right standing to mandamus or prohibition actions. The

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object of the action is the essential element of public-right standing, not the type

of suit used to bring the action.

{¶ 41} Further, as the court of appeals in this case pointed out, it is the

nature of this court’s jurisdiction that results in this court finding public-right

standing in original actions rather than in declaratory-judgment actions:

Since the Supreme Court of Ohio does not have original

jurisdiction over actions for declaratory judgment, the only

situations in which the Supreme Court of Ohio will initially find

public-right standing will be original actions in mandamus or

prohibition challenging the constitutionality of a statute. This is

not the same as a rule permitting public-right standing only in

original actions.

2012-Ohio-2655, 973 N.E.2d 307, ¶ 16 (10th Dist.).

{¶ 42} The majority engages in circular reasoning when it states that

Article IV, Section 4(B) of the Ohio Constitution prevents the appellants from

asserting their claims in common pleas court. Article IV, Section 4(B) states:

The courts of common pleas and divisions thereof shall

have such original jurisdiction over all justiciable matters and such

powers of review of proceedings of administrative officers and

agencies as may be provided by law.

{¶ 43} The majority argues that a cause is justiciable only if the plaintiff

has standing, and that if a common pleas court proceeds in an action where the

plaintiff lacks standing, that court violates the justiciability requirement of the

Ohio Constitution. But the appellants here do not lack standing—they have

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public-right standing. Their cause is therefore justiciable. “[T]he public action is

fully conceived in Ohio as a means to vindicate the general public interest.”

Sheward, 86 Ohio St.3d at 473, 715 N.E.2d 1062.

{¶ 44} Finally, the majority characterizes the JobsOhio legislation as not

rising to the level of importance that a public-right case requires. This court’s

own docket suggests otherwise. The General Assembly thought that a resolution

of the constitutionality of the JobsOhio legislation was important enough to

create, through Section 3 of 2011 Am.Sub.H.B. No. 1 (“H.B. 1”), “exclusive,

original jurisdiction” in this court to quickly deal with constitutional claims

brought against the legislation—it installed a 60-day statute of limitations running

from the effective date of the act. In ProgressOhio.org, this court declared

Section 3 of H.B. 1 unconstitutional. 129 Ohio St.3d 449, 2011-Ohio-4101, 953

N.E.2d 329, ¶ 5. However, during the pendency of ProgressOhio.org, the

General Assembly passed 2011 Am.Sub.H.B. 153 (“H.B. 153”), which put in

place another method for contesting the constitutionality of JobsOhio: in the

common pleas court of Franklin County, with a statute of limitations for bringing

claims within 90 days after the effective date of the statute. R.C. 187.09(B). In

ProgressOhio.org, this court helpfully instructed the petitioners—the same

petitioners as in this case—that the provisions of H.B. 153 “provide a remedy for

petitioners to institute an action challenging the constitutionality of amended R.C.

187.01 et seq. by way of an action in the Franklin County Court of Common

Pleas.” 129 Ohio St.3d 449, 2011-Ohio-4101, 953 N.E.2d 329, ¶ 6. Today, we

see how well that advice worked out.

{¶ 45} In August 2012, JobsOhio itself was here itself seeking relief in

mandamus. It requested that this court rule on constitutional questions regarding

the legitimacy of the JobsOhio legislation, H.B. 1 and 153. Director Goodman of

the Department of Commerce refused to execute the franchise-and-transfer

agreement necessary to grant JobsOhio a franchise on the state’s liquor business,

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claiming that he could not execute the agreement until this court addressed the

merits of constitutional claims against the legislation. JobsOhio, 133 Ohio St.3d

297, 2012-Ohio-4425, 978 N.E.2d 153, ¶ 9. JobsOhio’s complaint in mandamus

sought a writ that would find the JobsOhio legislation constitutional and order

Goodman to exercise the franchise-and-transfer agreement. Id., ¶ 10. The

complaint focused on seven constitutional concerns:

(1) Whether the JobsOhio Act violates Article XIII, Section

1, which forbids the General Assembly from conferring corporate

powers via special act;

(2) Whether the JobsOhio Act violates Article XIII, Section

2, which requires all corporations to be formed under the general

laws;

(3) Whether the JobsOhio Act violates Article I, Section

16, which requires the courts to be open so injured parties may

obtain a remedy by due process;

(4) Whether the Legislation authorizes the State to lend

credit to a private corporation, in violation of Article VIII, Section

4;

(5) Whether the Transfer Act would require legislative

appropriations extending past a biennium, in violation of Article II,

Section 22;

(6) Whether the Transfer Act would result in the State’s

issuing debt in excess of limits provided in Article VIII; and

(7) Whether Am. Sub. H.B. 153 violates the “one-subject

rule” of Article II, Section 15.

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Complaint at ¶ 44, JobsOhio, case No. 2012-1356, available at http://

www.sconet.state.oh.us/pdf_viewer/pdf_viewer.aspx?pdf=712126.pdf.

{¶ 46} But this court held that the true object of the claim brought by

JobsOhio was a declaratory judgment that this court lacked the jurisdiction to

grant. JobsOhio, ¶ 14. Further, this court held that JobsOhio had “an adequate

remedy by way of a declaratory-judgment action in common pleas court to raise

its claim that H.B. 1 and 153 are constitutional.” Id., ¶ 15.

{¶ 47} It is clear that both the governor and the General Assembly were

fully aware that the JobsOhio legislation might exceed the boundaries of what is

constitutionally permissible or that the threat of a finding of unconstitutionality

could taint the program. They sought, through legislation and through lawsuit,

our timely review so that any infirmities could be corrected either legislatively or,

if necessary, by way of constitutional amendment. That we failed to act timely

does not mean that review is no longer important. It simply means that if we now

find the legislative scheme unconstitutional, a fix becomes messy.

{¶ 48} We should be mindful of history when considering whether “the

issues sought to be litigated in this case are of such a high order of public concern

as to justify allowing this action as a public action.” Sheward, 86 Ohio St.3d at

474, 715 N.E.2d 1062. Many of the claims brought by the appellants involve

Articles VIII and XIII of the Ohio Constitution. Those provisions were enacted in

response to the issues that generated the call for a constitutional convention in

1850-1851, the convention that created the Constitution of 1851, which is the

bedrock of Ohio law; it has been amended but remains our foundational

document. In C.I.V.I.C. Group v. Warren, 88 Ohio St.3d 37, 39-40, 723 N.E.2d

106 (2000), this court explained some of the history behind Article VIII, Section

4:

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January Term, 2014

“Since the state’s own resources were limited (at least at

first), the legislature relied heavily on private enterprise to build

and operate roads, bridges, ferries, canals and railroads. Most of

the canal system was financed directly by the state, resulting in

debts of $16 million. In the 1830’s the state and local governments

shifted to a policy of financing turnpike, canal and railroad

companies by lending credit or purchasing stock. Insofar as an

effective transportation network sprang into being in a remarkably

short time, these practices had the desired result. But, they also

had undesirable results: they put the state’s money and credit at

risk in business schemes that often were risky at best, and the

demonstrated willingness of the legislature and local bodies to use

them was an open invitation for private interests to dip into the

public till. Many of these companies failed, the public debt

burgeoned as a consequence, and by 1850 the burden was more

than the taxpayers could tolerate. This section was adopted to put

a halt to these practices.” [Editorial Comment to Section 4, Article

VIII] Baldwin’s Ohio Revised Code Annotated (1993) 202.

The climate of the times was agitation and anger over the

imposition of tax burdens on the citizens for the benefit of private

corporations and for the public losses incurred when subsidized

corporations failed. Gold [Public Aid to Private Enterprises under

the Ohio Constitution: Section 4, 6, and 13 of Article VIII in

Historical Perspective], 16 Toledo Law Review [405] at 411

[(1985)].

{¶ 49} Ohio was part of a national trend: “Between 1842 and 1852,

eleven states adopted new constitutions, simultaneously creating procedures for

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issuing government debt and for chartering corporations through general

incorporation acts.” Wallis, Constitutions, Corporations and Corruption:

American States and Constitutional Change, 1842 to 1852, 65 J.Econ.Hist. 211

(2005). These states were emerging from crises of public debt and corruption.

This emergence in Ohio has been described as follows:

It was the period when the people awakened to

consciousness of the state and that the state was a unit of the

individuals. This consciousness came about largely as the result of

the mad rush to rob the state treasury and heap up debts to be paid

by generations yet unborn.

***

Finally, the demand for relief grew so strong that, in 1849, the

legislature was compelled to allow people to vote on the question of

making a new Constitution. It carried, and the convention met.

Isaac Franklin Patterson, The Constitutions of Ohio, 18-19 (1912).

{¶ 50} The issues the appellants raise concern the structure of government

rather than individual rights. The fact that those issues do not lead to an injury to

an individual should not prevent this court from ensuring that the principles and

requirements of those constitutional provisions are maintained. By doing so, we

implicitly recognize the standing of our founders. This court bears a

responsibility to today’s citizens and to the framers to answer the questions the

appellants pose.

{¶ 51} This case presents issues easily as important as those involved in

the Medicaid expansion case, State ex rel. Cleveland Right to Life v. State of Ohio

Controlling Bd., 138 Ohio St.3d 57, 2013-Ohio-5632, 3 N.E.3d 185, where this

court dealt with the question “Did the Ohio Controlling Board violate R.C. 127.17

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January Term, 2014

by approving the Ohio Department of Medicaid’s request for increased

appropriation authority for the Hospital Care Assurance Match Fund?” Id., ¶ 4.

This court answered that question without even addressing the respondents’

argument that the relators lacked standing.

{¶ 52} Today, this court ensures that no court will ever address the

question of the constitutionality of the JobsOhio legislation. Neither the state, nor

its counsel, nor the majority opinion has been able to conjure a realistic example

of a person or entity that would have the requisite standing and inclination to

bring a claim. Ohioans will never know whether their government is violating the

constitution. Apparently, they do not deserve to know.

{¶ 53} It is understandable that once the bonds have been sold and the

program is up and running, neither the governor nor the legislature wishes to have

our review. We, however, should not compound past errors in judgment by

making another momentous error and limiting Ohio citizens’ access to our court

to question the constitutionality of legislation establishing the state’s direct

involvement into the finances of private corporations. It is a limitation that will

live far beyond this present controversy. This decision will be the lodestar

opinion offered as the reason to block judicial review of constitutionally

questionable legislation for decades to come.

{¶ 54} Across our state, in every county there is a courthouse; many of

them are historic buildings that sit in the center of town and are the center of civic

life. In those courthouses are dedicated staff and judges who have sworn to

“administer justice without respect to persons,” R.C. 3.23; there, no lobbyists, no

connections, no special relationships are necessary before a citizen can be heard.

Today, we slam the doors on all those courthouses, denying Ohioans the

opportunity to discover whether their government has been true to the

Constitution.

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{¶ 55} On the north side of this court’s own building, in the reflecting

pool, granite words have been installed by the artist Malcolm Cochran in a piece

called “In Principle and In Practice.” The words are Reason, Honor, Wisdom,

Compassion, Justice, Truth, Equity, Peace, Integrity, and Honesty. Mr. Cochran

would have been more accurate using just six of those letters: “We Pass.”

O’NEILL, J., concurs in the foregoing opinion.

____________________

O’NEILL, J., dissenting.

{¶ 56} I join Justice Pfeifer’s well-reasoned dissent. Hundreds of

millions of dollars in public funds are being funneled into a dark hole to be

disbursed without public scrutiny, and the highest court in the land is looking the

other way. The Supreme Court of Ohio is the last house on the street, and passing

on this case is an abdication of our duty as protectors of the Constitution.

{¶ 57} The risks presented by the court’s failure to act today are obvious,

preventable, and unnecessary. They are obvious, because it is alleged that

hundreds of millions of taxpayer dollars are being spent in direct violation of the

Ohio Constitution. They are preventable, because as Justice Pfeifer correctly

observes, the legislative scheme implemented does not foreclose a remedy—it

simply means that any remedy will be messy.

{¶ 58} And ultimately, those risks are unnecessary. The governor and the

Ohio General Assembly may very well be right here. Maybe it is permissible to

permit a private entity to spend hundreds of millions of taxpayer dollars without

the annoyance of public audits and the state auditor asking an occasional question.

Maybe this new-era form of governmental accountability does not violate Ohio’s

Constitution. But unless we examine the issue, the people of Ohio will never

have an answer to that question. It is simply shameful that the court has refused

to do its job.

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January Term, 2014

{¶ 59} Today’s ruling brings the triumph of form over substance to a

whole new level. And although this court has once again dodged the merits of this

case, I have little doubt that it will be back. When that time comes, it is likely the

economic loss and damage to public confidence will be substantial. It is never too

late to do the right thing. What we are doing here is simply wrong.

____________________

1851 Center for Constitutional Law and Maurice A. Thompson; McTigue

& McGinnis, L.L.C., Donald J. McTigue, Mark A. McGinnis, and J. Corey

Colombo, for appellant ProgressOhio.org, Inc.

Michael J. Skindell, pro se.

Dennis E. Murray Jr., pro se.

Squire Sanders (US), L.L.P., and Aneca E. Lasley; Organ Cole & Stock,

L.L.P., and Douglas R. Cole, for appellee JobsOhio.

Michael DeWine, Attorney General, Michael J. Hendershot, Chief Deputy

Solicitor, Stephen P. Carney, Deputy Solicitor, and Pearl M. Chin, Assistant

Attorney General, for appellees Governor John R. Kasich, Christiane Schmenk,

Timothy S. Keen, and Treasurer Josh Mandel.

Linda K. Fiely; Kalniz, Iorio & Feldstein Co., L.P.A., and Christine

Reardon, urging reversal for amicus curiae Ohio Education Association.

Victoria E. Ullman, pro se, urging reversal as amicus curiae.

Black McCuskey Souers & Arbough, L.P.A., and Thomas W. Connors,

urging reversal for amicus curiae American Policy Roundtable d.b.a. Ohio

Roundtable.

Shumaker, Loop & Kendrick, L.L.P., and Michael A. Snyder, urging

affirmance for amici curiae Thomas Niehaus and Mark Wagoner.

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Jones Day and Chad A. Readler, urging affirmance for amici curiae

Jonathan H. Adler, Bradford D. Mank, Andrew S. Pollis, Michael E. Solimine,

Cassandra Burke Robertson, Lee J. Strang, and Christopher J. Walker.

_________________________

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