Arakaki #2 Defendants' Motion To Dismiss for Standing: Report of Oral Argument and Summary of Ruling

Defendants filed a motion to dismiss for lack of standing. Oral arguments on the motion to dismiss were held on April 29, 2002. On May 8, 2002 Judge Mollway issued her ruling on the motion, granting standing on certain issues. The case moves forward.


Here is a newspaper report published April 30 in the Honolulu Star-Bulletin by Hawaiian affairs reporter Pat Omandam who attended the April 29 hearing on the motion to dismiss:

Tuesday, April 30, 2002

Judge takes up issue of injury in OHA lawsuit

The agency maintains the 16 plaintiffs lack proper legal standing

By Pat Omandam

U.S. District Judge Susan Oki Mollway said she will decide within 10 days whether to dismiss a case that challenges state-run programs for Hawaiians. At issue is whether the group of 16 plaintiffs have standing as taxpayers and have suffered specific legal injuries because state land and money is being used to pay for programs for Hawaiians offered by the Office of Hawaiian Affairs and the state Department of Hawaiian Home Lands, the defendants in the case.

"What's happened is public money paid by taxpayers into the general fund is being diverted to two racially discriminatory programs from which all of our plaintiffs, and most of the people of Hawaii, are walled off," said attorney Patrick Hanifin, who, along with retired attorney H. William Burgess, represents the plaintiffs. "DHHL commissioners are obliged by law not to give anything to the general public without getting paid to do it. ... Similarly, OHA trustees say they have absolutely no duty to the general public and they're going to use the public's money for the benefit of their group and no one else," Hanifin said.

The lawsuit was filed in March, a month after a federal court judge dismissed a similar lawsuit filed by John Carroll, who sought to stop state ceded-land payments to OHA because of allegedly discriminatory practices.

During a nearly two-hour hearing yesterday morning, Mollway questioned both sides on legal precedence that could allow the case to move to trial. In mid-March, Mollway denied the plaintiffs' request for a temporary restraining order against the agencies, but she had indicated they likely had standing to go forward.

Burgess explained yesterday that the plaintiffs want the court to invalidate Section 5(f) of the state Admissions Act of 1959, which says one use of public trust land revenue is for the betterment of conditions of native Hawaiians. And the group wants the court to enforce the other sections in the act, which include using the public trust revenue, also known as ceded land revenue, toward public education.

Yesterday, OHA and the Hawaiian Homes Commission sought to have the case thrown out, claiming the group suffered no specific legal injury. OHA board attorney Sherry Broder told Mollway the plaintiffs have only a generalized grievance and that there is no direct "pocketbook" injury they can point to. Moreover, she said, it makes no sense that someone could challenge state programs for Hawaiians while federal programs for Hawaiians continue even after the U.S. Supreme Court said in the February 2000 Rice vs. Cayetano decision that OHA must open board elections to all Hawaii voters, not just Hawaiians. "I can't see the court philosophically issuing a ruling for people when a ruling will result in no remedy," Broder said. "The grievances are so generalized that there's really no way to put a finger on what they want."

The plaintiffs in this case are Earl F. Arakaki, Evelyn C. Arakaki, Edward U. Bugarin, Sandra P. Burgess, Patricia Carroll, Robert M. Chapman, Brian L. Clarke, Michael Y. Garcia, Roger Grantham, Toby M. Kravet, James I. Kuroiwa Jr., Fran Nichols, Donna M. Scaff, Jack H. Scaff, Allen Teshima and Thurston Twigg-Smith.


Here is a public statement by plaintiffs' attorney H. William Burgess describing Judge Mollway's ruling on the motion to dismiss:


Judge Susan Oki Mollway, on May 8, 2002, issued her decision on Defendants' motion to dismiss for lack of standing. She held that "Plaintiffs have taxpayer standing to assert their Equal Protection claims. To the extent that Plaintiffs assert claims that are not premised on actual expenditures of tax funds, however, those claims are dismissed."

The Judge also held that "Plaintiffs lack standing to assert claims as alleged beneficiaries of a public land trust created by the Admission Act in 1959. Accordingly, the court dismisses Plaintiffs' breach of public land trust claims." She said that Plaintiffs do not have standing to challenge payments of Ceded Land revenues to OHA or the payment of $30 million to the Hawaiian Home Lands Trust or the State's issuance of bonds for HHC, DHHL or OHA.

The Judge also denied OHA's motion to dismiss in which OHA had claimed that the case presents a nonjusticiable political question.

So the Arakaki plaintiffs' claim that the OHA laws and the HHCA/DHHL laws violate the Equal Protection clause of the 14th Amendment will proceed.

H. William Burgess and Patrick W. Hanifin, attorneys for the Arakaki plaintiffs, said, "Resolving the obvious about equal protection is still quite enough. This is a major step forward because it means the case will be decided on the merits and then, whatever the outcome, reviewed by the 9th Circuit and, possibly, by the U.S. Supreme Court."


Here is a newspaper report about the decision on standing, published in the Honolulu Star-Bulletin of May 10, 2002 by reporter Pat Omandam, who has closely followed this case:

Friday, May 10, 2002

Court upholds taxpayer challenge to OHA

A judge says that the plaintiffs have a legitimate standing

By Pat Omandam

A U.S. District Court judge has allowed a case challenging state-run programs for Hawaiians to continue to a possible trial. U.S. District Judge Susan Oki Mollway ruled on Wednesday that 16 plaintiffs do have standing as taxpayers to challenge direct payments of tax money to the Office of Hawaiian Affairs by the state Legislature.

But she said the plaintiffs do not have standing to challenge ceded-land revenue payments to OHA, as well as to the state's $30 million-a-year, 20-year settlement over the use of ceded lands with the state Department of Hawaiian Home Lands. "Plaintiffs do not have standing to challenge disbursement of money from Hawaii's general fund when the money does not come from state taxes," Mollway said in her 34-page ruling on the motion to dismiss the case. "The settlement of past claims is not an improper purpose that plaintiffs have taxpayer standing to assert."

Plaintiff attorney H. William Burgess said yesterday that while his clients do not have standing to make a claim based on ceded-land revenues, they can challenge the annual matching funds OHA receives from the Legislature. "She didn't give us everything we wanted, but it was a good result for us because she recognized that we do have taxpayer standing, so our case can continue on that basis," said Burgess, who added that the next step is a request for a preliminary injunction by the plaintiffs set for July 24. Attorneys for OHA and Hawaiian Homes had urged Mollway last month to dismiss the case because the plaintiffs had only a generalized grievance and could not show any direct "pocketbook" injury so, therefore, did not have standing.

The lack-of-standing issue resulted in the dismissal in U.S. District Court of previous cases brought against the agencies serving Hawaiians by Patrick Barrett and John Carroll. The two men originally filed separate lawsuits challenging the constitutionality of OHA and the Department of Hawaiian Home Lands. The cases were later combined but dismissed because the court ruled that plaintiffs suffered no legal injury and therefore did not have proper standing.

Yesterday, a panel of judges from the 9th U.S. Circuit Court of Appeals heard oral arguments in Honolulu related to Barrett's and Carroll's appeals of their cases. Attorney Walter Schoettle, who represents a group of native Hawaiians, wanted to intervene in the two appeals to get the court to rule that OHA is required to provide services to those with 50 percent Hawaiian blood. But OHA attorney Sherry Broder said OHA and the state opposed allowing this group to intervene because the blood quantum issue is divergent from the issue of standing, and its complexity may not be addressable in this appeal.

Judge Richard Tallman said the controversy over the constitutionality of state-run programs for Hawaiians has been stuck in procedural issues, and no one has yet dealt with the substance of the cases.


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