Clerk of the Superior Court

*** Filed ***

SUPERIOR COURT OF ARIZONA

MARICOPA COUNTY

CV 2020-093916 08/17/2020

CLERK OF THE COURT

HONORABLE TIMOTHY J. THOMASON N. Johnson
Deputy

MOUNTAINSIDE FITNESS ACQUISITIONS L JOEL E SANNES

LC

v.

DOUGLAS A DUCEY BRETT W JOHNSON

ANTHONY S VITAGLIANO
DAVID R SCHWARTZ
TIMOTHY ECKSTEIN
JAMES B REED
ROBERT B ZELMS
ANNI L FOSTER
COLIN PATRICK AHLER
RYAN JAMES REGULA
CARSON T H EMMONS
JUDGE THOMASON

MINUTE ENTRY

East Court Building – Courtroom 713

1:30 p.m. This is the time set for a GoToMeeting return hearing regarding Plaintiff
Mountainside Fitness’ Petition for Civil Contempt, filed August 12, 2020, pursuant to the Court’s
Order to Show Cause, filed August 14, 2020. Plaintiff, Mountainside Fitness Acquisitions, LLC,
is represented by counsel, Joel E. Sannes, Timothy Eckstein, James B. Reed, and Carson Emmons.
Plaintiff, Fitness Alliance, LLC, is represented by counsel, Robert B. Zelms. Defendant, Douglas
A. Ducey, is represented by counsel, Brett W. Johnson, Colin P. Ahler, and Ryan Regula. Anni L.
Foster, general counsel for Defendant, Douglas A. Ducey, is also present.

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Court Reporter, Scott Coniam, is present. A record of the proceeding is also made digitally.

Argument is presented regarding Plaintiff Mountainside Fitness’ Petition for Civil

Contempt.

For the reasons stated on the record,

IT IS ORDERED taking this matter under advisement.

2:07 p.m. Matter concludes.

LATER:

Mountainside Fitness Acquisitions, LLC (“Mountainside”) has filed a Petition for

Contempt (the “Petition”). The Governor has filed a Response. Mountainside filed a Reply. The
Court has considered the Petition, the Response and the Reply, along with the arguments of
counsel.

Mountainside contends that the Governor of the State of Arizona has violated this Court’s
ruling of August 4, 2020 (the “ruling”), which ordered that fitness centers and gyms must be
provided a meaningful opportunity to be heard and apply for reopening. This Court found that
Executive Order 2020-43 (“EO 43”), as implemented, did not provide plaintiff with adequate
procedural due process. The Court ordered that EO 43 be “enforced according to its terms,” by
requiring defendant to permit fitness centers “to complete some type of form or application to
receive authorization to reopen.” The Court specifically pointed out that the Governor or the
Arizona Department of Health Services (“ADHS”) would have “some discretion” in implementing
the Court’s Order and deciding which centers may open. The Court also noted, however, that the
process must operate in a “timely fashion” and should “move with deliberate speed.”

In response, the Governor directed ADHS to implement a process to comply with this
Court’s Orders. ADHS issued Emergency Measure 2020-02 (“EM 02”). The essential elements of
EM-02 are as follows:

1. Fitness centers can reopen only if they either (a) “meet, on an individual basis, the
terms and conditions for reopening,” or “apply to ADHS for approval to reopen,
prove they have taken or will take such extra steps beyond those required herein as
may be necessary to operate safely, and are expressly granted by ADHS approval
to reopen.”

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2. Before any fitness center can meet the “terms and conditions for reopening,” it must
be located in a county that meets certain “community transmission metrics” that are
referred to as “Benchmarks.”
3. If the Benchmark qualifies as “Minimal,” fitness centers can open, provided they
use certain sanitation and physical distancing protocols (“Guidelines”) and limit
capacity to 50% occupancy.
4. If the Benchmark qualifies as “Moderate,” fitness centers can operate under the
same Guidelines as the “Minimal” Benchmark, but only at 25% occupancy.
5. A county’s Benchmark must remain at a lower level for 14 consecutive days before
a fitness center can submit an attestation form and operate.
6. If the Benchmark is “Substantial,” then a fitness center in that county must remain
closed.
7. A fitness center that must remain closed can still apply to ADHS for approval to
reopen if it can prove that it has taken or will take additional actions to operate
safely, beyond the Guidelines.
8. A business cannot reopen until it is granted permission to reopen.
9. If the application is denied, the business may request an informal settlement
conference with ADHS to discuss conditions for reopening.
10. If the settlement conference is unsuccessful, the business has the right to request a
hearing before the Arizona Office of Administrative Hearings (“OAH”).
Maricopa County is in the Substantial Benchmark. As such, fitness centers must remain
closed. A fitness center does have, however, the right to apply for reopening to “prove to ADHS
that it has taken and will take such additional actions as are necessary to operate safely.” EM 02(5).
There is nothing in EM 02 that describes what “additional” actions must be taken, in order to
qualify for reopening. There are no timelines in the EM. There is nothing in the EM about how
quickly ADHS must rule on an application.1 There is no timeline on how quickly a settlement
conference will be set.2 There is nothing in the EM concerning when the hearing at OAH must
occur.3 There is nothing in the EM that describes what the standard of review is at OAH.

1
The application on the ADHS website states that ADHS will review and issue its decision approving or denying an
application within 10 days of submission. Reply at Ex. 7.
2
The Governor states that an informal settlement conference must be held within fifteen days. That time limit is not
in the EM. It is, however, in A.R.S. §41-1092.06. Apparently, ADHS intends to use the time limits set forth in the
statute.
3
The Governor states that the hearing must be held within thirty days. The EM actually says that the hearing must be
requested within thirty days of the Settlement Conference. If hearings are in fact to be held within thirty days of
request, that is certainly a satisfactory timeline.
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“Civil contempt arises when a party refuses to do an act he lawfully is ordered to do, and
the power to punish for contempt is inherent in the trial court.” Holt v. Hotham ex rel. County of
Maricopa, 197 Ariz. 614, 616, ¶ 11 (App. 2000). “A finding of civil contempt requires that the
contemnor (1) has knowledge of a lawful court order, (2) has the ability to comply and (3) fails to
do so.” Lund v. Donahoe, 227 Ariz. 572, 583, ¶ 41 (App. 2011).

Of course, in order to establish civil contempt, the party against whom the citation is being
sought must have actually violated a court order. Bennett v. Napolitano, 206 Ariz. 520,525 (2003).
The purpose of civil contempt is to coerce the person to comply with the court’s order or to refrain
from doing something. Korman v. Strick, 133 Ariz. 471, 474 (1982).

Post-deprivation process is adequate unless it can be characterized as “meaningless or

nonexistent.” Scott v. McCaughtry, 810 F. Supp. 1015, 1019 (E.D. Wis. 1992). The court should
consider the private interest, the risk of an erroneous deprivation of that interest through the
procedures used and the probable value of alternative procedures and the government’s interest.
Kuck v. Danaher, 600 F.3d 159, 163 (2d Cir. 2010).

There are certainly problems with EM 02. The EM uses community transmission metrics
for the first time. The process is adequate if the Benchmark for a county is Minimal or Moderate.
The potential problem is for counties that fall within the Substantial range, which is where
Maricopa County is presently. Fitness centers in those counties must remain closed. There is,
however, a process provided for applying to reopen. The question is whether this process is
meaningless or nonexistent.

The EM provides no indication of what extra measures must be taken by the fitness centers
to qualify for reopening. Fitness centers applying to reopen would have no idea what they are
expected to do. In essence, they are being asked to meet a goal they know nothing about. The
fitness centers are told they need to explain what additional measures they are taking to operate
safely, but also told nothing about what level of precautions is necessary to satisfy ADHS.

The lack of standards is a bit troubling. The Governor argues, however, that the process
that was put in place was done to provide a fitness center an opportunity to tell ADHS everything
that it can reasonably do to open safely. If ADHS does not believe that the proposal is satisfactory,
then the informal settlement process is one that can be used to “iron out” an acceptable plan. The
process was intended to be “interactive.” Under the emergency circumstances currently existing
in this County, the process is reasonable and does provide fitness centers a reasonable opportunity
to be heard.

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There are reasonable timelines. The application implementing the EM on ADHS’s website
states that ADHS will issue a decision approving or denying an application within ten days of
submission. While there is no specific timeline in the EM on when a settlement conference must
be set, the Governor has stated that the fifteen day timeline in A.R.S. §41-1092.06 will be followed.
Finally, while the EM states that a hearing must be requested within thirty days of the settlement
conference, the Governor has stated that the hearings will occur within thirty days of request.

While there are problems with the process, there is a process in place. It is up and running.
Various fitness centers have applied to reopen, including plaintiff EOS Fitness. Indeed, according
to the Governor’s papers, some 137 fitness centers have applied to reopen. At oral argument, the
Governor’s counsel indicated that well more than 200 centers have applied. The process does not
appear to be illusory or meaningless. Indeed, plaintiff EOS was approved to reopen following its
application. In addition, one other center appears to have been allowed to reopen. As such, the
Court cannot conclude that the process is meaningless.

Moreover, Mountainside had not even applied to reopen when it filed its Petition. In the
Reply, Mountainside stated that it has applied, but the date of the application, in the form of a letter
from counsel, was Friday, August 14, well after the Petition was filed.4 The Court agrees with the
Governor’s contention that Mountainside’s failure to submit an application and initiate the
approval process precludes it from seeking relief here under the doctrines of failure to exhaust
administrative remedies and ripeness. Minor v. Cochise Co., 125 Ariz. 170, 172 (1980).

In the Reply, Mountainside contends that by “granting EOS permission to reopen,

Defendant has conceded one of Mountainside Fitness’ arguments, which is that the procedures for
reopening could not be applied timely and rationally.” Reply at 8. This makes no sense. Obviously,
the process EOS went through was timely. While Mountainside contends that the protocols that
EOS agreed to in order to be approved for reopening were unknown and likely too stringent,5 the
fact of the matter is that there was a process that resulted in EOS being approved for reopening.6
This Court is not in a position to second-guess ADHS’s requirements and EOS’s agreement to
those requirements. The relevant question is whether there exists a meaningful post-deprivation
process. The Court finds that there is now a meaningful process.

4
It is likely not a coincidence that this is the same day that EOS was granted permission to reopen.
5
It appears as if EOS may have agreed to a ten percent occupancy level.
6
Mountainside complained at argument that “nobody knows” how EOS got approved and what they agreed to. Again,
however, Mountainside did not even attempt to use the process in order to find out what had to be done to get
permission to reopen. Moreover, there is no indication that Mountainside asked EOS how it got approval.
Mountainside suggested that EOS has some “secret,” favored status with ADHS and the Governor, but there is no
evidence to support that. Indeed, counsel for EOS stated that EOS has been diligently working on its proposed plan to
ADHS ever since this Court ordered that due process must be provided.
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Mountainside argues that the lack of objective standards in the ADHS process violates due
process.7 None of the cases cited by Mountainside at page eight of the Reply, however, deal with
emergency measures. Indeed, two of the cases addressed arguments about finding statutes void for
vagueness, which have nothing to do with the issue presently before this court. See Papachristou
v. City of Jacksonville, 405 U. S. 156, 170 (1972); State v. McDermott, 208 Ariz. 332, 336 (App.
2004). It is well settled that a lower standard of due process may be adequate in emergency
situations. Benner v. Wolf, 20-cv-775, 2020 WL 2564920, at *5 (M.D. Pa., May 21, 2020); Page
v. Cuomo, 1:20-CV-732, 2020 WL 4589320, at *12 (N.D.N.Y. Aug. 11, 2020).

There is a process in place. Fitness centers are taking advantage of the process, some of
them successfully. Mountainside has not even given the process a chance to work. It only
submitted a belated application on Friday. ADHS has had no opportunity to review and respond.
This Court cannot find that the process implemented by ADHS violates procedural due process.

The Court does not find that the Governor violated a Court order. Indeed, it appears as if
the Governor directed ADHS to generate a process that complied with the Court’s Orders. As such,
there is no basis to find the Governor in contempt of Court.8

The Petition for Contempt is denied.

7
It is not true that there are no objective standards. ADHS has set out very detailed standards for fitness centers when
a county is within Minimal and Moderate Benchmarks. To obtain approval while the Benchmarks are Substantial will
require a showing that a fitness center will commit to exceeding those standards at a level ADHS deems appropriate
for the particular facility. While a set of objective standards for counties in the Substantial range would be ideal, it is
appropriate to give ADHS some degree of discretion when dealing with a county whose COVID numbers remain
sufficiently serious.
8
Although not a major factor in the Court’s decision, the Petition also did not comply with Rule 65’s requirement that
the Petition be accompanied by a supporting affidavit.
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