LINDA COLLINS AND DONNA BALL v. A. B. CHANDLER, III, IN HIS OFFICIAL CAPACITY AS ATTORNEY GENERAL; AND JONATHAN MILLER, IN HIS OFFICIAL CAPACITY AS TREASURER OF COMMONWEALTH OF KENTUCKY
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RENDERED:
September 19, 2003; 10:00 a.m.
NOT TO BE PUBLISHED
Commonwealth Of Kentucky
Court of Appeals
NO. 2002-CA-001985-MR
LINDA COLLINS AND
DONNA BALL
v.
APPELLANTS
APPEAL FROM FRANKLIN CIRCUIT COURT
HONORABLE WILLIAM L. GRAHAM, JUDGE
ACTION NO. 00-CI-00913
A. B. CHANDLER, III,
IN HIS OFFICIAL CAPACITY AS
ATTORNEY GENERAL; AND
JONATHAN MILLER,
IN HIS OFFICIAL CAPACITY AS
TREASURER OF COMMONWEALTH
OF KENTUCKY
APPELLEES
OPINION
AFFIRMING
** ** ** ** **
BEFORE:
BUCKINGHAM, GUIDUGLI AND SCHRODER, JUDGES.
GUIDUGLI, JUDGE.
Linda Collins and Donna Ball (hereinafter “the
Appellants”) appeal the Franklin Circuit Court’s opinion and
order on September 17, 2002, granting the Commonwealth of
Kentucky’s, et. al, motion for summary judgment and dismissing
their complaint as barred by sovereign immunity.
We affirm.
The Appellants filed their complaint and petition for
declaration of rights on August 20, 2000.
In their complaint,
Appellants requested a judgment declaring that all funds
received by the Commonwealth of Kentucky pursuant to the
settlement of the Tobacco Suit and the Master Settlement
Agreement adopted by the Consent Decree and Final Judgment
constitute monetary restitution under the Consumer Protection
Act and that such funds be delivered to the court or a courtappointed receiver for proper distribution to such citizens of
the Commonwealth who have suffered damage as a result of the
actions of the tobacco companies.
“The Tobacco Suit” the
Appellants referred to was the civil lawsuit filed by the
Attorney General of the Commonwealth, Albert B. Chandler, III,
on December 18, 1998 in the Franklin Circuit Court against six
tobacco companies (case number 98-CI-01579). “The Consent Decree
and Final Judgment” referenced above is the judgment entered in
said lawsuit by the Franklin Circuit Court on December 21, 1998,
resolving the Tobacco Suit.
“The Master Settlement Agreement”
is the 124 page document setting forth the terms and conditions
upon which the Tobacco Suit was settled among the tobacco
companies, the Commonwealth and numerous other states.
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Following the settlement in the Tobacco Suit,
Appellants, claim that they, as consumers of tobacco products,
have a vested right in a portion of the monetary proceeds
resulting from the settlement under Kentucky’s Consumer
Protection Act, KRS §§ 367.100 et. seq.
As such, they brought
this action against the Commonwealth of Kentucky (hereinafter
“the Commonwealth”), Albert B. Chandler, III (hereinafter
“Chandler”), in his official capacity as the Attorney General of
the Commonwealth of Kentucky, and Jonathan Miller (hereinafter
“Miller”) in his official capacity as Treasurer of the
Commonwealth of Kentucky (collectively hereinafter “the
Appellees”).
Basically, Appellants allege that since the
Tobacco Suit was brought under Kentucky’s Consumer Protection
Act and that since the Tobacco Suit alleged that as a result of
the unlawful conduct of the tobacco companies, the Commonwealth
and its citizens suffered damages, they should be entitled to
recover a portion of the financial settlement.
In the
complaint, the Commonwealth alleged it and its citizens suffered
damages based upon the financial burden incurred by its citizens
for the cost of purchasing tobacco products, the cost of medical
services for illnesses resulting from the use of tobacco
products, and the diminution of quality of life and/or loss of
life from various medical conditions associated with the use of
tobacco products.
Appellants also allege they are entitled to a
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share of the monetary funds received from the settlement in that
the settlement agreement provides that the settlement includes
any and all claims that the Commonwealth asserted or could have
asserted against the tobacco companies, including any and all
claims that could have been asserted on behalf of the state’s
citizens seeking restitution under any consumer protection act.
The Appellees responded with a motion to dismiss
arguing sovereign immunity, the statute of limitations, and
failure to state a cause of action.
The trial court denied the
motion concluding that the Appellants “have sufficiently pleaded
claims concerning [the Appellants’] authority to recover damages
under the Consumer Protection Act.”
The matter then proceeded
and subsequently the parties filed motions for summary judgment
or partial summary judgment.
Each motion was thoroughly briefed
and extensive replies submitted to the court.
Upon further
consideration and after reviewing the arguments presented, the
trial court eventually entered the September 17, 2002, opinion
and order granting Appellees’ motion for summary judgment and
dismissing the complaint on the basis of sovereign immunity.
This appeal followed.
On appeal, Appellants set forth two arguments as to
why sovereign immunity is not applicable to their claims.
First, they allege that the Tobacco Suit and the resulting
Master Settlement Agreement was an illegal “taking” by the state
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which is not barred by sovereign immunity.
Second, they contend
that they have a mandamus claim against Chandler and Miller for
failing to properly perform their official duties and such a
claim is not barred by sovereign immunity.
We disagree with
each of these contentions.
Appellants cite to numerous cases that support their
contention that a taking claim against the government is not
barred by sovereign immunity because Section 13 and Section 242
of the Kentucky Constitution provide that no person’s property
shall be taken for public use without just compensation.
See
Holloway Construction Co. v. Smith, Ky., 683 S.W.2d 248 (1984);
Commonwealth v. Geary, Ky., 254 S.W.2d 477 (1953).
At page six
of their brief, Appellants state:
The appellants’ complaint herein
asserts a taking claim. The complaint
asserts that the monies received by the
Commonwealth of Kentucky in compromise and
settlement of the Consumer Protection Act
lawsuit it filed against the tobacco
companies are required by the Consumer
Protection Act to be distributed as
restitution to the state’s tobacco consumers
and that the Commonwealth of Kentucky’s
failure to distribute such monies to the
state’s tobacco consumers constitutes a
taking of their property without just
compensation. (Footnote omitted).
While we agree with Appellants’ statement that their complaint
asserts a taking claim and that the Kentucky Constitution and
the cases cited by Appellants support their argument that
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sovereign immunity would not be applicable if the government was
taking one’s private property, we believe the trial court
properly determined that under the facts alleged the Master
Settlement did not affect any citizens’ individual rights and
that the monies recovered belonged exclusively to the states.
In its order, the trial court held:
If the [Appellants] were successful,
whether in their restitution claim or in
their taking claim, their relief would be in
the form of disbursement of funds from the
Commonwealth’s treasury. The Commonwealth
is clearly protected from this type of
interference with governmental function.
See Ky. Const., Sec. 231; Withers v.
University of Kentucky, Ky., 939 S.W.2d 340
(1997). Moreover, as agreed to by the
tobacco companies and the participating
states, the settlement funds were not
apportioned into different claims. The
funds are intended to provide education,
research, and reimbursement of states’
expenses in treating sick smokers and their
families. See Floyd v. Thompson, 227 F.3d
1029, 1037 (7th Cir. 2000). This Court
cannot ignore the purpose and intent of the
Master Settlement Agreement. The tobacco
companies and states resolved the claims
which belonged exclusively to the states,
see Skillings v. Illinois, 121 F.Supp.2d
1235, 1238 (C.D. Ill. 2000), making the
settlement monies state funds to be
distributed according to each state’s needs.
Therefore, regardless of the named parties
to this suit, the real party in interest is
the Commonwealth of Kentucky as there is
really no way to categorize the relief
sought by the [Appellants] other than as
monetary relief. See Tate v. Salmon, 79 Ky.
540 (1881). The [Appellants] simply cannot
sue the Commonwealth or State constitutional
officers in their official capacity seeking
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damages from the State treasury. See Ky.
Const., Sec. 231; Withers v. University of
Kentucky, Ky., 939 S.W.2d 340, 346 (1997),
Foley Constr. Co. v. Ward, Ky., 375 S.W.2d
392, 393 (1963). See also Kentucky v.
Graham, 473 U.S. 159, 165 (1985) (quoting
Monell v. New York City Dep’t of Social
Servs., 436 U.S. 658, 690, n. 55 (178))
(“[A] suit against a governmental officer
‘in his official capacity’ is the same as a
suit “against [the] entity of which [the]
officer is an agent”). As the [Appellants’]
relief seeks to tap funds recovered under
the Master Settlement Agreement that belong
to the treasury of the Commonwealth,
sovereign immunity bars the [Appellants’]
suit. Therefore, this Court is without
jurisdiction to consider the [Appellants’]
remaining claims and the Complaint must be
dismissed.
We agree with the trial court that Appellants’ claims to the
monetary funds recovered by Attorney General Chandler in the
Tobacco suit are exclusively those of the Commonwealth and not
any individual citizen.
There was no taking by the government
in the settlement of the Tobacco Suit and thus, Appellants have
no claim to any state funds.
To allow otherwise would be to
violate our constitution.
By affirming the trial court as to the first issue
raised by Appellants, we, in effect, render their second claim
moot.
Appellants’ claim that a mandamus action seeking to
compel a government official (in this case Chandler and Miller)
to perform his ministerial duty under the law is moot based upon
the determination that the funds recovered from the tobacco
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companies are governmental and not any individual’s funds.
Appellants seek to have the court order Chandler and Miller to
pay the monies received from the Tobacco Suit to the state’s
tobacco consumers.
In that the settlement funds are not
consumers’ funds but rather state funds, both governmental
officials have complied with their statutory duties and no writ
of mandamus is necessary or proper in this matter.
For the foregoing reasons, the opinion and order of
the Franklin Circuit Court entered September 17, 2002,
sustaining the Appellees’ motion to dismiss is affirmed.
ALL CONCUR.
BRIEF FOR APPELLANT:
BRIEF FOR APPELLEE:
Richard M. Guarnieri
Frankfort, KY
D. Brent Irvin
Assistant Attorney General
Frankfort, KY
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