Johnson v. Jackley

• Decision Date: 09 May 2018
• Docket Number: 28379
• Citation: 912 N.W.2d 356
• Parties: Joni JOHNSON, South Dakota Biotechnology Association, and Pharmaceutical Research And Manufacturers of America, Applicants and Appellants, v. Marty J. JACKLEY, in his Official Capacity as South Dakota Attorney General, Respondent and Appellee.
• Court: South Dakota Supreme Court

912 N.W.2d 356

Joni JOHNSON, South Dakota Biotechnology Association, and Pharmaceutical Research And Manufacturers of America, Applicants and Appellants,

v.Marty J. JACKLEY, in his Official Capacity as South Dakota Attorney General, Respondent and Appellee.

28379

Supreme Court of South Dakota.

CONSIDERED ON BRIEFS ON MARCH 19, 2018

OPINION FILED May 9, 2018

JON HANSEN, LISA M. PROSTROLLO, MATTHEW S. MCCAULLEY, Redstone Law Firm LLP, Sioux Falls, South Dakota, Attorneys for applicants and appellants.

MARTY J. JACKLEY, Attorney General, STEVEN R. BLAIR, Assistant Attorney General, Pierre, South Dakota Attorneys for respondent and appellee.

ZINTER, Justice

[¶1.] Joni Johnson, the South Dakota Biotechnology Association, and the Pharmaceutical Research and Manufacturers of America (collectively, "Appellants") requested a writ of certiorari to challenge an Attorney General’s ballot explanation of a proposed initiated measure. The proposed measure would limit the price state agencies may pay for prescription drugs. Appellants alleged the Attorney General’s explanation did not comply with the requirements of SDCL 12-13-25.1. The circuit court denied the writ, and Appellants appeal. We affirm.

Facts and Procedural History

[¶2.] In South Dakota, a proposed initiated measure’s full text does not appear on the ballot. Instead, the Attorney General prepares, and the Secretary of State includes, a statement that contains a "title," an "explanation," and a description of "legal consequences." SDCL 12-13-25.1. Under the statute:

1. The title must be "a concise statement of the subject of the proposed initiative";

2. The explanation must be "an objective, clear, and simple summary to educate the voters of the purpose and effect of the proposed initiative or initiated [measure]"; and

3. The legal consequences must be "a description of the legal consequences of the proposed initiative ..., including the likely exposure of the state to liability if the proposed initiative ... is adopted."

See id. Additionally, the explanation may not exceed two hundred words. Id.

[¶3.] The proposed measure in this case, according to its title, is an act to "establish a prescription drug pricing law enabling a State Agency to pay the same or lower prices for prescription drugs as the prices paid by the United States Department of Veterans Affairs." The first three sections prohibit state agencies from entering into agreements with drug manufacturers for the purchase of prescription drugs unless the net cost is equal to or less than that paid by the United States Department of Veterans Affairs. Section 4 requires the promulgation of implementing regulations, and section 5 purports to provide legal standing to the proponents if the proposal is approved and challenged in post-election court proceedings.¹

[¶4.] On August 22, 2017, the Attorney General submitted the following statement for the proposed measure:

Title :

An initiated measure establishing a cap on the price a State agency may pay for a prescription drug.

Explanation :

This measure limits the amount that a State agency may pay for a prescription drug. Under the measure, a State agency may not directly or indirectly pay more for a prescription drug than the U.S. Department of Veterans Affairs pays for that same drug.

The measure requires the State Bureau of Administration to enact rules establishing prescription drug prices payable by State agencies.

[¶5.] Appellants objected to the explanation and filed an application for a writ of certiorari to challenge it. Appellants argued that although the explanation summarized the measure’s "purpose," it did not summarize the "effect" or "legal consequences" of sections 1-4. They also argued it did not summarize any "purpose, effect, or legal consequence" of section 5.

[¶6.] The circuit court denied the writ. The court noted there was no dispute the explanation summarized the proposed measure’s purpose—to limit "the price to be paid by state agencies for prescription drugs[.]" The court concluded that the explanation also expressed the "effect" and "legal consequences" of sections 1-4 because the purpose, effect, and legal consequences were the same in this case. Although the explanation did not summarize section 5, the court ruled an explanation was unnecessary because section 5 was a collateral provision that could not be simply summarized in the word limit allowed under SDCL 12-13-25.1. Relying on this Court’s precedents citing Gormley v. Lan , 88 N.J. 26, 438 A.2d 519 (1981), the court expressed the view that Gormley deference precluded court intervention unless the Attorney General’s acts were manifestly corrupt, arbitrary, or misleading. Appellants appeal each of these rulings.

Decision

[¶7.] Certiorari is "granted only in very limited circumstances." State ex rel. Johnson v. Pub. Utils. Comm'n of S.D. , 381 N.W.2d 226, 230 (S.D. 1986). "[T]he review ... cannot be extended further than to determine whether the inferior court, tribunal, board, or officer ... has regularly pursued the authority of such court, tribunal, board, or officer." SDCL 21-31-8. In making that determination, we "do not review whether the [officer’s] decision is right or wrong." Adolph v. Grant Cty. Bd. of Adj't , 2017 S.D. 5, ¶ 7, 891 N.W.2d 377, 381. Rather, when an officer has jurisdiction, his acts will be sustained unless he did "some act forbidden by law or neglected to do some act required by law." Peters v. Spearfish ETJ Planning Comm'n , 1997 S.D. 105, ¶ 6, 567 N.W.2d 880, 883.

[¶8.] Thus, in ballot explanation cases, we must determine whether the Attorney General’s explanation satisfies the legal requirements of SDCL 12-13-25.1 : the explanation must include the proposed measure’s purpose, effect, and legal consequences. See Ageton v. Jackley , 2016 S.D. 29, ¶ 14, 878 N.W.2d 90, 94. In making that determination, we "cannot be concerned with what the Attorney General should have said or could have said or might have said or what is implied or suggested by what he did say. Rather we must focus on the language chosen."

Id. ¶ 25, 878 N.W.2d at 96. Ultimately, explanations cannot be set aside merely because they could be better. They need only be adequate . Id. ; SDCL 12-13-9.2.

[¶9.] Before reviewing the adequacy of this explanation, we first consider Appellants' argument regarding the deference that must be given to the Attorney General’s choice of language. Appellants contend the circuit court erroneously applied Gormley ’s standard. See Gormley , 438 A.2d at 525 ("[W]here ... authority confers discretion upon [administrative] agents, their actions will ordinarily not be overturned by the courts unless they are manifestly corrupt, arbitrary or misleading."). Appellants contend the Gormley standard is overly deferential and ignores the statutory requirements in SDCL 12-13-25.1. We disagree.

[¶10.] Although ballot explanations must satisfy the threshold requirements of SDCL 12-13-25.1, we have repeatedly emphasized that the Attorney General must be given "discretion as to how to author" them. S.D. State Fed'n of Labor AFL-CIO v. Jackley , 2010 S.D. 62, ¶ 9, 786 N.W.2d 372, 376 (construing parallel statute); Ageton , 2016 S.D. 29, ¶ 23, 878 N.W.2d at 96. That is because the Attorney General’s duty is administrative in nature, and "[u]nder the separation-of-powers doctrine, a court may not ‘exercise or participate in the exercise of functions which are essentially legislative or administrative.’ " State, Dep't of Game, Fish & Parks v. Troy Twp. , 2017 S.D. 50, ¶ 14, 900 N.W.2d 840, 846 (quoting Fed. Radio Comm'n v. Gen. Elec. Co. , 281 U.S. 464, 469, 50 S.Ct. 389, 390, 74 L.Ed. 969 (1930) ). Thus, as stated shortly after ballot explanations first became required, the Attorney General must have "significant discretion" in performing the statutory duty of drafting ballot explanations. Hoogestraat v. Barnett , 1998 S.D. 104, ¶ 21, 583 N.W.2d 421, 425 (Gilbertson, J., concurring) (pointing out that Gormley "properly" recognized the discretion must be significant).

[¶11.] Discretion in this sense permits the exercise of judgment in choosing between competing considerations.

The term discretion itself involves the idea of choice, of an exercise of the will, of a determination made between competing considerations. In order to have an "abuse" in reaching such determination, the result must be so palpably and grossly violative of fact and logic that it evidences not the exercise of will but perversity of will, not the exercise of judgment but defiance thereof, not the exercise of reason but rather of passion or bias.

Montana-Dakota Utils. Co. v. Parkshill Farms , LLC, 2017 S.D. 88, ¶ 19, 905 N.W.2d 334, 341 (quoting Basin Elec. Power Coop. v. Payne , 298 N.W.2d 385, 388 (S.D. 1980) ). The Gormley standard fits comfortably within this understanding. Moreover, we have repeatedly referenced Gormley in emphasizing the highly discretionary nature of the Attorney General’s duty. See Ageton , 2016 S.D. 29, ¶ 25, 878 N.W.2d at 96 ; AFL-CIO , 2010 S.D. 62, ¶ 7, 786 N.W.2d at 375 ; Schulte v. Long , 2004 S.D. 102, ¶¶ 11, 26, 687 N.W.2d 495, 498, 501-02 (majority opinion, and Zinter, J., concurring); Hoogestraat , 1998 S.D. 104, ¶ 21, 583 N.W.2d at 425 (Gilbertson, J., concurring). Therefore, in determining whether this explanation satisfied SDCL 12-13-25.1 ’s requirements, the circuit court did not err in utilizing a standard of review that considered whether the Attorney General’s actions were "manifestly corrupt, arbitrary or misleading." See Gormley , 438 A.2d at 525.

[¶12.] We next turn to Appellants' underlying argument that the explanation fails to conform to the requirements of SDCL 12-13-25.1. Appellants first contend that although the explanation adequately summarizes the purpose of sections 1-4, it does not summarize the effect of those sections. In ballot explanation cases, purpose is that "which one sets before him to obtain or accomplish," and effect is that "which is produced by an...