City Lawsuit Nullified Based on Open Meeting Law Violation

By Joseph Kanefield and Ian Joyce

Arizona’s Open Meeting Law requires a city to approve the filing of a lawsuit in a public meeting. Such litigation, however, is often first discussed in a private or “executive session,” where the city council instructs its attorneys to file suit with the plan to approve or “ratify” the lawsuit at the next public meeting. So, what happens if the suit is filed, but the city council fails to timely approve or ratify that decision? According to the Arizona Court of Appeals’ recent decision in Desert Mountain v. Flagstaff, all of the city’s claims in the lawsuit are null and void.

In Desert Mountain, the City of Flagstaff (the City) held a special meeting on December 2, 2020, to discuss filing a lawsuit against Desert Mountain Energy Corporation to prevent it from mining helium near the City’s water source. During that meeting, the City Council convened an executive session for “legal advice regarding water litigation, and authorized its attorneys to file suit against Desert Mountain.”¹ Critically, however, the City did not later re-authorize the lawsuit in a public meeting — at least not for many years.

The City sued Desert Mountain on the theory that it did not have the necessary permits to operate the helium mine. After a series of procedural steps and appeals, Desert Mountain filed a counterclaim against the City on September 30, 2022, arguing that the entire case was null and void under the Open Meeting Law because the City had “not authoriz[ed] the filing of the Original Complaint in an open meeting.”² Apparently in response to these arguments, the City held a public meeting on January 17, 2023, where it ratified the lawsuit.

According to the Court of Appeals, however, the City’s belated “ratification” of the lawsuit was too late. As a preliminary matter, the City’s attempt to authorize the lawsuit in executive session only, plainly violated the requirement in the Open Meeting Law that requires “a public vote shall be taken before any legal action binds the public body.” The fact that the City could have theoretically withdrawn the lawsuit (i.e., making the lawsuit not “binding”) and the fact that the City’s budget previously contemplated some legal expenses, did not change this analysis.

The Court of Appeals also held that the City’s January 17, 2023, “ratification” came far too late. The Open Meeting Law does allow a city council to retroactively “ratify” decisions made in an executive session, but the ratification must occur within thirty days after the public body discovers the violation. Here, the court determined the City Council should have known that it was violating the Open Meeting Law the day that it approved the litigation in executive session on December 2, 2022; at the very least, it was on notice of the violation when Desert Mountain filed its counterclaim in September 30, 2022.

The court held that because the City Council violated the Open Meeting Law in approving the lawsuit, “[t]he City’s claims are null and void.”³ The City still has time to ask the Arizona Supreme Court to review this decision, so the Court of Appeals’ decision is not yet final. Nevertheless, this outcome highlights the importance of timely and proper compliance with the Open Meeting Law when taking any legal action.

Snell & Wilmer’s Special Litigation and Compliance Group has significant experience advising clients in open government matters, including public records and open meeting law compliance, and will continue to monitor the developments in this case.