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Sound v. State, Dept. of Human Services

Intermediate Court of Appeals of Hawai‘i

September 13, 2013

Manuel D. SOUND and Thompson Phillip, on behalf of themselves and all similarly situated persons, Plaintiffs-Appellants,
v.
STATE of Hawai‘i, DEPARTMENT OF HUMAN SERVICES, Lillian B. Koller, in her capacity as Director of Human Services, State of Hawai‘i, Department of Human Services, Med-Quest Division, Dr. Kenneth Fink, in his capacity as State of Hawai’, Department of Human Services, Med-Quest Division, Administrator, Defendants-Appellees.

Editorial Note:

This decision has been designated as "Unpublished disposition." in the Pacific Reporter. See HI R RAP RULE 35

Appeal from the Circuit Court of the First Circuit (Civil No. 09-1-2022-08).

Victor Geminiani, Lawyers for Equal Justice J. Blaine Rogers, Zachary A. McNish, (Alston Hunt Floyd & Ing), on the briefs, for Plaintiffs-Appellants.

Heidi M. Rian, John F. Molay, Lee-Ann Brewer, Deputy Attorneys General, on the briefs, for Defendants-Appellees.

NAKAMURA, Chief Judge, FUJISE and LEONARD, JJ.

SUMMARY DISPOSITION ORDER

In an action challenging the validity of certain administrative rules (2009 COFA Rules), Plaintiffs/Appellants Manuel D. Sound and Thompson Phillip (Plaintiffs) appeal from a Circuit Court of the First Circuit (Circuit Court) post-judgment " Order Denying Plaintiffs' Motion for Attorneys' Fees and Costs" filed on July 27, 2010 (Order Denying Fees).[1]

On August 31, 2009, Plaintiffs filed a Complaint seeking declaratory and injunctive relief against Defendants-Appellees State of Hawai‘i, Department of Human Services (DHS), Lillian B. Koller, and Dr. Kenneth Fink (collectively, the State),[2] to prevent the State from implementing the 2009 COFA Rules under two theories: (1) that the State's actions violated Article I, Sections 2 and 5 of the Hawai‘i State Constitution; and (2) the 2009 COFA rules were promulgated in violation of the Hawai‘i Administrative Procedure Act (HAPA), Hawaii Revised Statutes (HRS) § 91-3.[3] On January 26, 2010, the Circuit Court granted partial summary judgment in favor of Plaintiffs on the second of these grounds, declaring that the 2009 COFA Rules were not adopted in conformity with HAPA and were, therefore, invalid. The constitutional claim was thereafter dismissed as moot. The Circuit Court entered Final Judgment on April 19, 2010. The Circuit Court entered the Order Denying Fees on July 27, 2010, without stating its reasoning for doing so. A notice of appeal was timely filed.

On appeal, Plaintiffs argue that their request for attorneys' fees was improperly denied, raising two points of error: (1) the Circuit Court erred in denying Plaintiffs' request for attorneys' fees under the common fund doctrine; and (2) the Circuit Court erred in denying Plaintiffs' request for attorneys' fees under the private attorney general doctrine.

In conjunction with its other arguments, the State contends that Plaintiffs' request for attorneys' fees " is simply a request for monetary damages against the State" and should not be allowed. Although poorly presented and supported in the State's answering brief, this sovereign immunity argument has merit. [4] As the Hawai‘i Supreme Court recently reaffirmed:

Pursuant to the doctrine of sovereign immunity, the sovereign State is immune from suit for money damages, except where there has been a clear relinquishment of immunity and the State has consented to be sued. Bush v. Watson, 81 Hawai‘i 474, 481, 918 P.2d 1130, 1137 (1996) (citations and internal quotation marks omitted). This court has recognized that an award of costs and fees to a prevailing party is inherently in the nature of a daraacre award. Sierra Club v. Dept. of Trans. (Superferry II), 120 Hawai‘i 181, 226, 202 P.3d 1226, 1271 (2009) (quotation marks omitted) (quoting Fought & Co. v. Steel Eng'q & Erection, Inc., 87 Hawai‘i 37, 51, 951 P.2d 487, 501 (1998)). Accordingly, to properly award attorney's fees and costs against the State, there must be ‘ a clear relinquishment’ of the State's immunity[.] Id. (quoting Bush v. Watson, 81 Hawai‘i 474, 481, 918 P.2d 1130, 1137 (1996)....
This court has noted that the State has waived immunity to suit only to the extent as specified in HRS chapters 661 and 662. Taylor-Rice v. State, 105 Hawai‘i 104, 110, 94 P.3d 659, 665 (2004) (citations omitted). HRS § 661-1(1) contains a limited waiver of sovereign immunity for claims against the State of Hawai‘i that are founded upon a statute[.] Garner v. State, Dep't of Educ., 122 Hawai‘i 150, 160, 223 P.3d 215, 225 (App.2009). In determining the extent of the State's waiver of sovereign immunity, this court relies on the following principles derived from federal law:
(1) a waiver of the Government's sovereign immunity will be strictly construed, in terms of its scope, in favor of the sovereign; (2) a waiver of sovereign immunity must be unequivocally expressed in statutory text; (3) a statute's legislative history cannot supply a waiver that does not appear clearly in any statutory text; (4) it is not a court's right to extend the waiver of sovereign immunity more broadly than has ...

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