Two months after throwing out a lawsuit against the Arizona Board of Regents the judge who heard the case ordered the state to pay nearly $1 million in the agency’s legal fees.
In an extensive ruling, Maricopa County Superior Court Judge Christopher Whitten rejected arguments by Attorney General Mark Brnovich, who sued the regents over what he claimed was an illegal lease deal at Arizona State University, that the hourly fees charged by the attorneys defending the board were too high. The judge said while the hourly rate was above the average for what lawyers in Phoenix charge – the order did not say how much – that by itself doesn’t mean anything.
“The skill, experience and background of the defense lawyers in this case was far, far above average,” Whitten wrote in awarding $979,758 in legal fees. “In fact, they are at or near the top of the bar.”
The judge was no more impressed by claims by Brnovich that the number of hours billed was excessive, especially for a case that went from initial claim to judgment in less than a year. Whitten said the whole idea was to get the case handled in an expedited fashion.
“It was a sprint, not a marathon,” he said. “As such, it is not surprising that a great number of hours were billed in a short time, and by a large team of attorneys.”
The ruling only exacerbates what has been an often confrontational relationship between Brnovich and the Board of Regents, which operates the three state universities. That was driven home in a press release from ASU crowing about the award of the legal fees.
“Please let the good people of Arizona know about how their taxpayer dollars are being put to work by the attorney general for yet another failed lawsuit,” wrote ASU spokeswoman Katie Paquet.
All that drew a curt response from Brnovich aide Ryan Anderson who noted that the regents had claimed all along there was no merit to the lawsuit.
“You should ask them if this lawsuit was so frivolous, why did they feel the need to spend $1 million on two national law firms to make procedural arguments,” he said.
And Anderson said this isn’t the end of the matter.
“We can now move forward with our appeal (of the original ruling), including an appeal of these exorbitant fees,” he said.
At the heart of the battle is the effort by Brnovich to quash a proposal to create a 330-room Omni hotel and a 30,000-square-foot conference center on land that is owned by ASU.
In his lawsuit, Brnovich argued the deal violates the Gift Clause of the Arizona Constitution.
He pointed out that ASU is paying $19.5 million to build the conference center even though the contract allows the school to use with without paying rent just seven days a year. And Brnovich said ASU agreed to pay about $30 million to construct a 1,200 spot parking garage but will “gift” Omni 275 of the spots that the hotel gets to use exclusively and keep the revenue from the spaces.
And then there’s the issue that, by having the hotel built on property owned by the university, it escapes having to pay property taxes.
The deal does call for some “payments in lieu of taxes.” But Brnovich contends that will still leave schools and local governments short of what they would otherwise have received if the property were on the tax rolls the same as any other commercial development.
Whitten rejected the contention that property taxes were being illegally avoided as the land in question, being owned by the regents, already is exempt from taxes.
As to that Gift Clause argument, the judge never actually ruled one way or the other. He concluded that Brnovich waited too long after he and his attorneys knew about the deal to file suit.
The ruling on legal fees comes as Brnovich is in the midst of another battle with the Board of Regents, this one over tuition hikes at the state’s three universities. He contends that the board is ignoring a state constitutional provision mandating that instruction at state universities “shall be as nearly free as possible, citing sharp increases in tuition at Arizona schools in the past decade.
So far, though, Brnovich has been unable to even get a hearing on those claims.
Both a trial judge and the state Court of Appeals have ruled that state law allows the attorney general to sue only with specific legal authority or having been given the go-ahead by the governor.
The courts found nothing in statute giving Brnovich such a right. And Gov. Doug Ducey, who has been openly hostile to the legal challenge over tuition, has not agreed to let the lawsuit go forward.
Brnovich is now asking the Arizona Supreme Court to review those rulings.