N.C. Bar and Tavern Ass'n v. Stein

• Court: Supreme Court of North Carolina
• Decided: August 22, 2025
• Docket: 126PA24
• Status: Published

Opinion

IN THE SUPREME COURT OF NORTH CAROLINA

No. 126PA24

Filed 22 August 2025

NORTH CAROLINA BAR AND TAVERN ASSOCIATION; et al.

v. JOSHUA H. STEIN,1 in his official capacity as Governor of North Carolina

On discretionary review pursuant to N.C.G.S. § 7A-31 of a unanimous decision

of the Court of Appeals, 293 N.C. App. 402 (2024), affirming in part and reversing in

part an order entered on 29 March 2022 by Judge James L. Gale in Superior Court,

Wake County. On 5 June 2024 the Supreme Court allowed plaintiffs’ conditional

petition for discretionary review as to additional issues. Heard in the Supreme Court

on 23 October 2024.

Stevens Martin Vaughn & Tadych, PLLC, by Michael J. Tadych, K. Matthew Vaughn, and Robert F. Orr, for plaintiff-appellees.

Jeff Jackson, Attorney General, by James W. Doggett and Nicholas S. Brod, Deputy Solicitors General, and Amar Majmundar and Matthew Tulchin, Special Deputy Attorneys General, for defendant-appellant.

BERGER, Justice.

1 At all relevant times herein, Roy Cooper was Governor of North Carolina, and actions

taken by him in that capacity are the subject matter of plaintiffs’ claims. Joshua Stein was elected Governor in 2024, and pursuant to Rule 38 of the Rules of Appellate Procedure, the caption of this action has been amended to reflect this change. Similarly, Jeff Jackson has been elected Attorney General, necessitating amendment to the attorney listing. N.C. BAR AND TAVERN ASS’N. V. STEIN

Opinion of the Court

Plaintiffs are a group of bar owners and employees from across North Carolina

who challenge a series of executive orders entered by defendant-Governor Roy

Cooper. According to the trial court, Cooper’s executive orders restricted full

operation of plaintiffs’ establishments for over 400 days while permitting other

businesses to reopen. Plaintiffs argue that the closure and differing treatment

violated constitutional and statutory guarantees. Governor Cooper contends that the

measures were based on science and data and were necessary responses to an ongoing

emergency.

But even in a declared emergency, the powers of those who act on behalf of the

people have limits, and the citizens of this state rejected “because I said so”

governance long ago. However well-intentioned government actors may be, they are

constrained by the enduring commands of the Constitution; and constitutional

guarantees cannot be suspended in this state by executive fiat.

This Court recently confronted similar issues in Kinsley v. Ace Speedway

Racing, Ltd., 386 N.C. 418, 423 (2024). There, we addressed claims that COVID

regulations imposed by the Governor violated the Fruits of Labor and Equal

Protection Clauses in our State Constitution. Id. at 424–29. Based on our precedent

in State v. Ballance, 229 N.C. 764 (1949), we unanimously established a workable

Fruits of Labor test and clarified that rational basis review is not the appropriate

standard for Fruits of Labor claims. Id. at 424–26.

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Plaintiffs here, like the plaintiff in Ace Speedway, have stated colorable claims

under the North Carolina Constitution. But this case presents a slightly different

question: whether the trial court’s entry of summary judgment in favor of the

Governor was proper. Because our Fruits of Labor test is a fact intensive inquiry, we

agree with the Court of Appeals that the trial court erred when it entered summary

judgment. However, the Court of Appeals incorrectly applied rational basis review

to the Fruits of Labor claim. As discussed further herein, because the Court of

Appeals did not have the benefit of our decision in Ace Speedway when it issued its

opinion in this case, and we modify and affirm in part the vacatur of the trial court’s

order, and remand to the trial court.

Plaintiffs also advanced an Equal Protection claim pursuant Article I, § 19 of

the State Constitution. On this issue, the trial court applied rational basis review

and dismissed the claim. The Court of Appeals reversed, applying strict scrutiny in

its analysis. We reverse the Court of Appeals because our precedent states that the

proper scrutiny for economic regulations under the Equal Protection Clause not based

upon suspect classification is rational basis.2

In addition, plaintiffs asserted statutory claims for violations of the Emergency

Management Act and Public Records Act. For the reasons set forth herein, plaintiffs

have failed to establish that they qualify for recovery under the Emergency

2 Plaintiffs also asserted claims for constitutional and regulatory takings. Although the Court of Appeals addressed these claims in its opinion, plaintiffs failed to seek review of these issues in their conditional petition for discretionary review.

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Management Act, and they have failed to establish jurisdiction for their Public

Records Act claim and associated demand for attorneys’ fees. We, therefore, affirm

the Court of Appeals in affirming the trial court on these statutory claims.

I. Factual and Procedural Background

On 17 March 2020, Governor Roy Cooper issued Executive Order No. 118

entitled “Limiting Operations of Restaurants and Bars and Broadening

Unemployment Insurance Benefits in Response to COVID-19.” Exec. Order No. 118,

34 N.C. Reg. 1834 (Mar. 17, 2020). This action closed bars entirely and limited food

and beverage operations for restaurants. Id. Bars were defined in Executive Order

No. 118 as “establishments that are not restaurants and that have a permit to sell

alcoholic beverages for onsite consumption, under N.C. Gen. Stat. § 18B-1000(1).”3

Id. at 1837. Plaintiffs’ businesses qualify as bars under the executive order.

A “stay at home” directive was entered in Executive Order No. 121 which closed

non-essential businesses. Exec. Order No. 121, 34 N.C. Reg. 1903 (Mar. 27, 2020).

Restaurants were determined to be essential by Governor Cooper and were permitted

to continue limited operations while bars were to remain closed. Id. Subsequent

orders extended the closure, but by May 2020, phased reopening began.

3 Restaurants were defined in Executive Order No. 118 as “permitted food establishments, under N.C. Gen. Stat. § 130A-248, and other establishments that both prepare and serve food, including but not limited to, restaurants, cafeterias, food halls, dining halls, food kiosks at airports and shopping centers, or educational institutions, (‘food courts’), as well as private or members-only clubs where food and beverages are permitted to be consumed on premises.” Exec. Order No. 118, 34 N.C. Reg. at 1836.

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Phase 1 allowed restaurants to remain open under restrictions but continued

the prohibition on operation by plaintiffs’ establishments. Exec. Order No. 138, 34

N.C. Reg. 2141 (May 5, 2020). The Phase 2 reopening plan in Executive Order No.

141 permitted restaurants, tattoo parlors, breweries, wineries, distilleries, taprooms,

bars in hotels, and other establishments to reopen under capacity limitations and

other prescribed rules. Exec. Order No. 141, 34 N.C. Reg. 2360 (May 20, 2020). But

bars were again excluded from the reopening because they purportedly posed a

greater risk of the spread of COVID when compared to other businesses. Id.

Following entry of Executive Order No. 141, Governor Cooper held a press

conference in which he stated that continued restriction on bars was justified based

on data, science, and daily information received from doctors and other healthcare

experts.

In a sworn declaration provided to the trial court, Department of Health and

Human Services Secretary Mandy Cohen justified the “dimmer switch” approach to

phased reopening, stating that the “[r]isk is higher in spaces like bars, where people’s

pre-COVID learned behavior involves high-risk activities,” and that their approach

was “data driven.” Secretary Cohen further stated that a leading consideration in

the differing treatment was “the positive economic impact” that wineries and

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breweries produced, and that “the State has a strong economic interest in sustaining

them.”4

Plaintiffs made a public records request seeking the information Governor

Cooper had referenced in the press conference and thereafter filed suit. Plaintiffs

sought an injunction which would have enabled them to operate their businesses and

specifically alleged that there was no meaningful distinction between private bars

which were not permitted to operate under Governor Cooper’s executive orders, and

bars in restaurants, hotels, distilleries, wineries, breweries, private clubs, and other

establishments.5 The executive orders, according to plaintiffs, violated the North

Carolina Constitution’s Fruits of Labor and Equal Protection Clauses. Plaintiffs also

asserted claims for constitutional and regulatory takings, and statutory claims under

the Emergency Management Act and Public Records Act. Following the initiation of

suit, Governor Cooper supplied information responsive to plaintiffs’ public records

request.

The trial court denied plaintiffs’ request for a preliminary injunction on 26

June 2020. Thereafter, Governor Cooper moved to dismiss plaintiffs’ suit for lack of

personal and subject matter jurisdiction, and for failure to state a claim upon which

4 Another sworn declaration which provided justification for the differing treatment

was from Mr. Wit Tuttell, then vice-president for tourism and marketing with the Economic Development Partnership of North Carolina. He stated that wineries and breweries were more important drivers of the tourism industry in the state than bars. 5 Several plaintiff bar owners provided affidavits to the trial court which outlined

plans to open with limited capacity and in accordance with the executive orders.

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relief can be granted. Plaintiffs subsequently moved for partial summary judgment.

A hearing was held and the trial court entered an order allowing Governor Cooper’s

motion to dismiss and denying plaintiffs’ motion for partial summary judgment.

In reaching its decision on the Governor’s motion to dismiss, the trial court

indicated that it considered evidence and information outside of the pleadings. With

regard to plaintiffs’ state constitutional claims under the Fruits of Labor and Equal

Protection Clauses, the trial court analyzed whether Governor Cooper “acted with a

proper government purpose” and “whether [those] actions were reasonable.” The trial

court determined that because the executive orders were based on scientific data and

learned professional commentary, and because plaintiffs had not demonstrated that

Governor Cooper’s use of the police powers was unreasonable, plaintiffs could not

proceed with their Corum claim. As a result, the trial court dismissed plaintiffs’

constitutional claims and denied plaintiffs’ motion for partial summary judgment.

On the statutory claims, the trial court dismissed the Emergency Management

Act claim because there was “no evidentiary or legal basis to conclude that [plaintiffs’]

interests were ‘commandeered, seized, taken, condemned, or otherwise used in coping

with an emergency’ within the statute’s scope.”

In considering the Public Records Act claim, the trial court found that plaintiffs

had satisfied jurisdictional concerns by requesting mediation pursuant to N.C.G.S. §

7A-38.3E. But because Governor Cooper produced the requested records after the

filing of the complaint and plaintiffs never sought a hearing on their request or

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otherwise argued that defendant failed to comply with the request, the trial court

dismissed the claim. Plaintiffs’ request for attorneys’ fees related to their Public

Records Act claim, therefore, failed and was dismissed. Plaintiffs appealed.

On the state constitutional claims, the Court of Appeals determined that the

trial court had converted defendant’s motion into one for summary judgment because

it considered evidentiary materials beyond the pleadings. N. Carolina Bar & Tavern

Ass’n v. Cooper, 293 N.C. App. 402, 409 (2024). The Court of Appeals concluded that

the trial court erred in entering summary judgment, vacated the order, and remanded

the matter to the trial court. Id. at 423. Although not explicitly stated, the Court of

Appeals implied that genuine issues of material fact existed because the “articles and

data submitted by [d]efendant entirely fail to address any differences in the risk of

spread of COVID-19 between the bars he allowed to reopen and [p]laintiffs’ bars

which remained closed.” Id. at 423.

The Court of Appeals’ reasoning on these claims was somewhat intertwined

and overlapping. Concerning the Fruits of Labor claim, the Court of Appeals stated

that it applied rational basis review and determined that because the record lacked

scientific evidence to support the proposition that bars posed a greater of a risk than

other establishments, “the unequal treatment of [p]laintiffs . . . was illogical and not

rationally related to [Governor Cooper’s] stated objective of slowing the spread of

COVID-19,” id., and that Governor Cooper’s executive orders lacked sufficient

relation to “public health, morals, order, or safety, or the general welfare.” Id. at 418–

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19 (quoting State v. Ballance, 229 N.C. 764, 772 (1949)). On this claim, the Court of

Appeals vacated the trial court’s denial of summary judgment and remanded for

reconsideration in light of their analysis. Id. at 423.

In coming to this conclusion, the Court of Appeals found the record did “not

reveal the existence of any scientific evidence demonstrating [p]laintiffs’ bars, as

opposed to the bars located in other establishments serving alcohol, posed a

heightened risk at the time Executive Order No. 141 was issued.” Id. at 421. Thus,

the lower court reasoned that the Governor’s actions had the effect of denying

plaintiffs the fundamental right to earn a living. Id. at 426–27.

On plaintiffs’ Equal Protection claim, the Court of Appeals applied strict

scrutiny and concluded that Executive Order No. 141 was underinclusive because it

excluded bars from the phased reopening when restaurants and other seemingly

similar businesses that served alcohol were allowed to reopen. Id. at 427. This

unequal treatment, according to the Court of Appeals, was an “illogical and arbitrary

[ ] attempt to achieve [d]efendant’s stated health outcomes by applying different

reopening standards to similarly situated businesses that could have complied with

those standards.” Id.

The Court of Appeals affirmed the trial court on plaintiffs’ remaining claims.

Id. Under the Emergency Management Act, the lower court determined that

plaintiffs could not prevail under the plain language of the Act because Governor

Cooper did not “take or otherwise use [p]laintiffs’ land during a declared state of

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emergency.” Id. at 413 (emphasis omitted). In addition, the Court of Appeals

determined that the trial court erred when it concluded that it had jurisdiction over

plaintiffs’ Public Records Act claim because plaintiffs failed to comply with mediation

as required by the Act. Id. at 425–26.

Governor Cooper filed a petition for discretionary review with this Court on

plaintiffs’ Fruits of Labor and Equal Protection claims. We allowed review, and he

argues that (1) sovereign immunity precludes plaintiffs’ claims because damages are

not the least intrusive remedy and allowing plaintiffs’ Corum claim to proceed

violates Washington v. Cline, 385 N.C. 824 (2024); (2) the plaintiffs failed to state a

colorable constitutional claim under Deminski v. State Bd. of Educ., 377 N.C. 406

(2021); and (3) the Court of Appeals erred in applying strict scrutiny to plaintiffs’

Fruits of Labor and Equal Protection claims.

Factually, Governor Cooper asserts that public health concerns provided

sufficient cause to justify the governmental action. He argues that the means used—

targeted, phased reopening—were reasonable in light of the science and data

available. He argues that second-guessing his decisions would inhibit the State’s

ability to act in future emergencies. In addition, Governor Cooper contends that his

phased reopening plan was rationally related to reducing aggregate transmission risk

because private bars typically involve closer social interaction, louder environments,

and later hours, contributing to higher transmission risk. The unequal regulatory

treatment, he argues, was grounded in public health data and expert opinions.

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Plaintiffs filed, in response, a conditional request for discretionary review of

the lower court’s decision concerning their Emergency Management Act and Public

Records Act claims. We allowed review on each issue.

II. Discussion

A. State Constitutional Claims

Plaintiffs assert that Governor Cooper’s executive orders violated their rights

under the Fruits of Labor and Equal Protection Clauses. The Governor’s actions,

they contend, deprived them of the right to earn a living in a lawful occupation

without sufficient justification. Plaintiffs have specifically alleged that they were

arbitrarily singled out for closure while seemingly indistinguishable businesses were

allowed to reopen and that no credible public health distinction justified the differing

treatment.

Governor Cooper contends that sovereign immunity precludes plaintiffs’

claims because damages are not the least intrusive remedy and allowing plaintiffs’

Corum claim to proceed violates Washington v. Cline, 385 N.C. 824 (2024).

We note that many of the issues presented here are similar to those recently

addressed in Ace Speedway. There, this Court expressly held that “the State cannot

assert sovereign immunity as a defense to a valid Corum claim.” Ace Speedway, 386

N.C. at 423. “Corum claims are constitutional claims for damages directly against

the State,” and the underlying justification for these claims is the theory that where

there is a violation of a right, there should be some corresponding remedy.

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Washington, 385 N.C. at 825 (2024).

For a Corum claim to survive, a plaintiff must satisfy three criteria: (1) allege

that “a state actor . . . violated . . . constitutional rights,” (2) present a colorable claim,

and (3) “there must be no adequate state remedy.” Deminski, 377 N.C. at 413. When

all three are met, “sovereign immunity does not bar the claim and the trial court must

deny a motion to dismiss based on sovereign immunity.” Ace Speedway, 386 N.C. at

423 (cleaned up).

To be colorable, a plaintiff must “present facts sufficient to support an alleged

violation of a right protected by the State Constitution.” Ace Speedway, 386 N.C. at

423 (quoting Deminski, 377 N.C. at 413 (2021)). These “allegations are treated as

true and the Court examines whether the allegations, if proven, constitute a violation

of a right protected by the North Carolina Constitution.” Id. at 424 (cleaned up).

The third Deminski prong concerns the existence of an adequate alternative

state remedy. This consideration takes place in the Deminski analysis because it “is

effectively ‘an element’ of the constitutional claim.” Ace Speedway, 386 N.C. at 429

(citing Askew v. City of Kinston, 386 N.C. 286, 300 (2024)) (cleaned up).

There is a difference, however, in an ex ante determination as to the existence

of an adequate state remedy to establish a Corum claim and fashioning a remedy

once a violation has been proven at trial. On the front end, we simply ask whether

another established route to court exists to address purported violations of

constitutional rights.

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The Governor’s Washington v. Cline argument fails on this point. In that case,

we held that plaintiffs’ claim for damages could not proceed because, not only was

there an established route to vindicate the constitutional violation there—dismissal

of criminal charges—but the plaintiff had already received the existing remedy.

Washington, 385 N.C. at 830–31. The ex ante determination there was dispositive.

But on the back end, when a plaintiff has successfully proven a constitutional

violation at trial, courts must “bow to established claims and remedies where these

provide an alternative to the extraordinary exercise of its inherent constitutional

power.” Ace Speedway, 386 N.C. at 429 (quoting Corum v. University of North

Carolina, 330 N.C. 761, 784 (1992)). When not so constrained, courts are required to

“minimize the encroachment upon other branches of government.” Id. This minimal

intrusion is accomplished through the least intrusive common law “remedy available

and necessary to right the wrong.” Id.

Put another way, when the law already provides a legal pathway to vindicate

a constitutional violation, judges serve a gatekeeping function by precluding Corum

claims that intrude upon the State’s sovereign immunity. But when constitutional

claims are proven at trial, in the absence of established claims and remedies, judges

exercise inherent authority in crafting a meaningful remedy. See Washington, 385

N.C. at 830. A meaningful remedy is not necessarily one that makes plaintiff whole,

and even when a claimant specifically seeks money damages, a trial court may need

to fashion less intrusive remedy at the conclusion of the case. Corum, 330 N.C. at

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785.

We are concerned here with Deminski’s ex ante determination as to the

existence of an adequate state remedy for both state constitutional claims. As in Ace

Speedway, plaintiffs have “no adequate alternative remedy because there is no other

forum in which it could seek relief for these constitutional violations.” Ace Speedway,

386 N.C. at 423.

The Governor argues that there was an adequate alternative remedy under

the third Deminski prong because plaintiffs could have rushed to court and sought a

preliminary injunction to stop the emergency orders from taking effect. This is a

circular argument, because the only available cause of action in which to seek that

preliminary injunction would have been the Corum claims at issue here, meaning

there was no adequate alternative remedy. Thus, Governor Cooper’s argument is not

one concerning the availability of a remedy other than these Corum claims, but

instead an argument about whether the remedies sought in these Corum claims are

the least-intrusive ones. As noted above, that least-intrusive remedy analysis “arises

after the claimant proves a constitutional violation.” Ace Speedway, 386 N.C. at 429

(emphasis removed). Thus, the issue is “not ripe” for adjudication. Id. at 430.

1. Fruits of Labor

Our State Constitution provides explicit protections for the first principles of

freedom: “We hold it to be self-evident that all persons are created equal; that they

are endowed by their Creator with certain inalienable rights; that among these are

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life, liberty, the enjoyment of the fruits of their own labor, and the pursuit of

happiness.” N.C. Const. art. I, § 1. “This provision creates a right to conduct a lawful

business or to earn a livelihood that is ‘fundamental’ for purposes of state

constitutional analysis.” Treants Enters., Inc. v. Onslow County, 83 N.C. App. 345,

354 (1986), aff’d, 320 N.C. 776 (1987). The mere interference with this fundamental

right by government is all that is required for a violation. See King v. Town of Chapel

Hill, 367 N.C. 400, 408 (2014) (“This Court’s duty to protect fundamental rights

includes preventing arbitrary government actions that interfere with the right to the

fruits of one’s own labor.” (emphasis added)).

Our Fruits of Labor jurisprudence was recently addressed in Ace Speedway,

where we unanimously reaffirmed that the Clause “bars state action burdening

[economic] activities unless the promotion or protection of the public health, morals,

order, or safety, or the general welfare makes it reasonably necessary.” Ace

Speedway, 386 N.C. at 424 (cleaned up) (emphasis added). Under our precedent, the

challenged government action “must be reasonably necessary to promote the

accomplishment of a public good, or to prevent the infliction of a public harm.” Id.

(quoting Ballance, 229 N.C. at 770).

The inquiry here requires the government to satisfy the two-pronged Fruits of

Labor test enunciated in Ace Speedway. Courts must first determine whether there

is a “proper governmental purpose” for the challenged action. Id. In answering this

question, we initially look at the actual purpose proffered by the government for the

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interference with economic activity, mindful that this “may not always be the purpose

initially put forward by the State.” Id. at 425. Plaintiffs, therefore, “may rebut that

assertion with evidence demonstrating that the State’s asserted purpose is not the

true one, and instead the State is pursuing a different, unstated purpose.” Id.

We then consider if the actual purpose is a proper governmental purpose. Id.

A proper purpose is one that “addresses the public interest” and “promote[s] the

accomplishment of a public good, or . . . prevent[s] the infliction of a public harm.” Id.

(cleaned up).

When the government satisfies the first prong of the Fruits of Labor test, it

must then show that “the means chosen to effect that purpose [are] reasonable.” Id.

at 426 (cleaned up). This is a question of fact, and we balance at this second prong

“the public good likely to result . . . against the burdens resulting to the businesses

being regulated.” Id. (cleaned up). Courts also considers “how effective is the state

action at achieving the desired public purpose, and how burdensome is that state

action to the targeted business.” Id. Again, these are fact-intensive inquiries, and

the analysis here “becomes a question of degree—given all the options available to

the state to advance the governmental purpose, was it reasonable for the state to

choose this approach, with its corresponding benefits and burdens?” Id. (cleaned up).

Applying this test, we turn to the Court of Appeals’ decision. The Court of

Appeals below vacated the trial court’s entry of summary judgment and remanded

for reconsideration in light of their constitutional analysis. Bar and Tavern, 293 N.C.

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App. at 423. That analysis concluded that the Governor “failed to present any ‘data

and science’ tending to show a rational basis for allowing some types of bars to resume

operations while keeping other bars closed.” Id. (emphasis added). Thus, the Court

of Appeals held that “continued closure of [p]laintiffs’ bars while permitting other

similar establishments to reopen under certain conditions violated [p]laintiffs’ right

to enjoy the fruits of their own labor from the operation of their respective

businesses.” Id.

This analysis used the wrong legal standard because, as explained above, the

legal standard for a claim under the Fruits of Labor Clause is not rational basis. Ace

Speedway, 386 N.C. at 425. To be fair, though, the Court of Appeals did not have the

benefit of our decision in Ace Speedway when it decided this case. Neither did the

trial court, nor the parties during fact discovery.

“When this Court implements a new analysis to be used in future cases,” our

approach has been to remand pending cases raising that same legal issue so that the

lower courts and the parties may “apply that analysis.” N.C. Farm Bureau Mut. Ins.

Co. v. Cully’s Motorcross Park, Inc., 366 N.C. 505, 514 (2013). Remand is particularly

appropriate in a case like this one, where the parties “did not have the benefit of the

precise formulation of the doctrine” when engaging in fact discovery. Whitacre P’ship

v. Biosignia, Inc., 358 N.C. 1, 39 (2004). Without knowing the proper constitutional

test that must be satisfied, the parties cannot be expected to use the tools of discovery

to obtain the information needed to prove their claims.

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Accordingly, plaintiffs sufficiently alleged a Fruits of Labor Clause violation

that satisfies Deminski, and we agree with the Court of Appeals that the trial court’s

summary judgment order must be vacated and the case remanded for further

proceedings. However, some of the reasoning in the Court of Appeals’ opinion cannot

be squared with our decision in Ace Speedway. Therefore, the parties, on remand,

are entitled to reopen fact discovery in light of our decision today. The decision of the

Court of Appeals on this issue is modified and affirmed, and remanded for further

proceedings.

But before leaving our Fruits of Labor discussion, we think it important to

address two items in the dissent. First, the dissent claims that this opinion

“significantly expands (and misstates)” the legal protections of the Fruits of Labor

Clause “by saying that all that is necessary is ‘mere interference’—rather than

arbitrary interference—with the right to conduct a lawful business or to earn a

livelihood.” The dissent insists that this “interference” standard is wrong and

“majority seems to be hellbent on dramatically reshaping—in record time—the law”

in this area.

But bizarre and angry rhetoric has become a staple of our dissenting

colleagues’ opinions, used to mask the weakness in their underlying reasoning. So it

is here. As frustrating as this is for the dissent, for nearly a century, this Court has

recognized a Fruits of Labor Clause claim when the state unconstitutionally

interferes with the right to conduct a lawful business. See, e.g., State v. Harris, 216

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N.C. 746, 753 (1940); State v. Ballance, 229 N.C. 764, 768 (1949); Roller v. Allen, 245

N.C. 516, 521–23 (1957).

In Harris, the state imposed burdensome regulations on dry cleaners. 216 N.C.

at 760. We struck them down. In State v. Ballance, the state imposed licensing rules

for professional photographers. 229 N.C. at 768. We again struck them down. Id.

In Roller, the state required an exam for ceramic tile installers. 245 N.C. at 521–23.

Once again, we struck it down. Id.

None of these cases involved laws prohibiting business activity entirely. They

all involved “mere interference” with the right to conduct a lawful business. When

state interference fails to satisfy the constitutional test for the Fruits of Labor Clause,

the interference is unconstitutional. Here, as explained above, Plaintiffs sufficiently

alleged unconstitutional interference, and thus have a right to seek discovery to prove

those allegations are true.

The dissent also complains that we are permitting the court system to “Monday

morning quarterback” the decisions of the Governor and his cabinet members. Not

so. Under the test in Ace Speedway, the Governor’s actions will be judged on the

information available at the time, not on what we know in hindsight. Ace Speedway,

386 N.C. at 424–25 and 427. We emphasized this in our discussion above. Once

again, the dissent’s rhetoric about Monday morning quarterbacking is simply

sophistry. What frustrates the dissent is not that Governor Cooper and his public

health officials are being held to account through the lens of hindsight; it is that they

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are being held to account at all.

2. Equal Protection

Article I, Section 19 of our State Constitution states that “[n]o person shall be

denied the equal protection of the laws; nor shall any person be subjected to

discrimination by the State because of race, color, religion, or national origin.” N.C.

Const. art. I, § 19. When assessing an Equal Protection Clause claim that the State

treated one class of people different from another, courts “employ a two-tiered

analysis.” Town of Beech Mountain v. Cnty. of Watauga, 324 N.C. 409, 412 (1989).

“When a legislative act operates to the disadvantage of a suspect class or interferes

with the exercise of a fundamental right, the upper tier or ‘strict scrutiny’ standard

is applied.” Id. “When the claim involves neither a suspect class nor a fundamental

right, the lower tier or ‘rationality’ standard is employed.” Id. Under this lower,

rational basis standard, “the government need only show that the challenged

classification bears some rational relationship to a legitimate governmental interest.”

Id.

“Generally speaking, this rationality test is the appropriate standard to apply

to purely economic regulations.” Id. This includes equal protection claims concerning

the right to earn a living or engage in a lawful occupation. Duggins v. North Carolina

State Bd. of Certified Pub. Acct. Examiners, 294 N.C. 120, 131 (1978). In this “area

of economics,” the State does not violate the Equal Protection Clause because its

chosen classification “is not made with mathematical nicety or because in practice it

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results in some inequality.” Powe v. Odell, 312 N.C. 410, 412–13 (1984).

Here, the trial court applied a rational basis test and determined that

exempting plaintiffs from reopening could be justified by scientific studies and

professional commentary suggesting that there was a need for greater regulation of

private bars than other businesses which served alcohol and facilitated public

gathering. The Court of Appeals applied strict scrutiny to the Equal Protection claim,

arguing that because the fundamental right to earn a living was implicated,

precedent required heightened scrutiny. But this cuts to the problem with the Court

of Appeals intermingling of its analysis of the Fruits of Labor and Equal Protection

claims.

The constitution indeed protects individual rights, but it also enables the state

to exercise police powers regulating health, safety, welfare, and morals. As this

Court’s precedent cited above illustrates, state action in this sphere often impacts the

right to earn a living, and economic line drawing is what governments do. While we

may disagree with the approach taken by state actors, on an equal protection claim

we are concerned not with the best way, but a permissible one. We need look no

further than the multitude of rules and regulations surrounding health and safety

standards, consumer protection, or sanitation requirements to understand the point:

each may implicate an individual’s fundamental right to earn a living, but we do not

apply strict scrutiny.

Such is the case here. Plaintiffs’ directly advanced a Fruits of Labor claim

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concerning closure of their businesses and the Governor’s justification as it related to

other similar businesses. This is separate and distinct from their claim that the line

drawing in exercise of the state’s police powers was impermissible, and the failure to

distinguish the claims subsumes the Equal Protection analysis.

Because there is at least some conceivable basis for the government’s action

here, we reverse the Court of Appeals.6 See White v. Pate, 308 N.C. 759, 766–767

(1983) (“The rational basis standard merely requires that the governmental

classification bear some rational relationship to a conceivable legitimate interest of

government.” (cleaned up)).

B. Statutory Claims

1. Emergency Management Act

Turning to the plaintiffs’ statutory claims, the Emergency Management Act,

among other things, grants the Governor the ability to impose significant restrictions

or prohibitions on otherwise permissible activity during states of emergency, should

the Governor determine that local control of the emergency is insufficient to ensure

adequate protection of lives and property. See N.C.G.S. § 166A-19.30(c) (2023);

N.C.G.S. § 166A‑19.20(a) (2023).

6 Of course, this isn’t to say heightened scrutiny is unavailable to individuals or groups

claiming economic harm from state sponsored emoluments, privileges, or monopolies in violation of the constitution, none of which are at issue here. See N.C. Const. art. I, §§ 32, 34; see also Richard Dietz, Factories of Generic Constitutionalism, 14 Elon L. Rev. 1 (2022).

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Relevant to the restrictions set forth in the Executive Orders here, the

Emergency Management Act allows the Governor to restrict “the operation of offices,

business establishments, and other places to or from which people may travel or at

which they may congregate” or “to maintain order and protect lives or property during

the state of emergency.” 7 N.C.G.S. §§ 166A-19.31(b)(2), 19.31(b)(5) (2023).

Compensation is available under the Emergency Management Act only when

property is “commandeered, seized, taken, condemned, or otherwise used in coping

with an emergency and this action was ordered by the Governor.” N.C.G.S. §

166A‑19.73(b) (2023). “Compensation for services or for the taking or use of property

shall be only to the extent that legal obligations of individual citizens are exceeded in

a particular case and then only to the extent that the claimant has not been deemed

to have volunteered his services or property without compensation.” N.C.G.S. §

166A‑19.73(a) (2023).

As we have stated, “[t]he primary rule of construction of a statute is to

ascertain the intent of the legislature and to carry out such intention to the fullest

extent.” Burgess v. Your House of Raleigh, Inc., 326 N.C. 205, 209 (1990). When

construing a statute, “words must be given their common and ordinary meaning,

nothing else appearing.” In re Clayton-Marcus Co., Inc., 286 N.C. 215, 219 (1974).

As nothing else appears in the statute, the common and ordinary meanings of the

7 These powers are given specifically to municipalities under N.C.G.S. § 166A-19.31(b)

(2023), not directly to the governor. The governor is able to exercise these powers as listed in subsection 166A-19.31(b) because of N.C.G.S. § 166A-19.30(c).

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terms commandeered, seized, taken, condemned, and otherwise used must be applied

when interpreting the Emergency Management Act. Id.

Thus, the State must provide compensation when the Governor uses power

under the Emergency Management Act to commandeer, condemn, seize, take, or

otherwise use property. N.C.G.S. § 166A‑19.73(b). In other words, under the plain

language of the Emergency Management Act, there must be some affirmative

appropriation or possession of private property during the stated emergency to

qualify for compensation. N.C.G.S. § 166A‑19.73(b).

Contrary to plaintiffs’ arguments, subsections 166A-19.31(b)(2) and (b)(5) are

materially different from subsection 166A-19.73(b) in that neither concern

deprivation of property, but rather restrictions on use. Compare N.C.G.S. § 166A-

19.31(b)(2) and (5) (authorizing prohibition and restriction of the operation of

business establishments and other activities reasonably necessary to maintain order

and protect lives during a state of emergency) to N.C.G.S. § 166A-19.73(b) (providing

compensation only when property is taken, commandeered, seized, or otherwise used

in coping with an emergency and the action was ordered by the Governor).

In crafting the Emergency Management Act, the General Assembly clearly

contemplated situations under which affected persons could receive compensation.

But the General Assembly did not authorize compensation when a governor exercises

his or her power under subsections 166A-19.31(b)(2) and (b)(5). We therefore affirm

the Court of Appeals.

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2. Public Records Act

Plaintiffs argue that the Court of Appeals erred in holding that the trial court

erroneously concluded it had jurisdiction to hear the Public Records Act claim. We

disagree.

The Public Records Act states that a person who has been denied access to, or

copies of, public records “may apply to the appropriate division of the General Court

of Justice for an order compelling disclosure or copying, and the court shall have

jurisdiction to issue such orders if the person has complied with” the mediation

requirements set forth in section 7A-38.3E. N.C.G.S. § 132-9(a) (2023). Based upon

the plain language of the Public Records Act, failure to comply with mediation

requirements deprives a court of jurisdiction.

After initiating a suit under the Public Records Act, the parties may select an

agreed upon mediator. N.C.G.S. § 7A-38.3E(c) (2023). If the parties are unable to

agree, “the party filing the request for mediation shall bring the matter to the

attention of the clerk, and a mediator shall be appointed by the senior resident

superior court judge.” Id. The clerk thereafter must notify the parties and the

mediator of the appointment. Id. Following mediation, or waiver thereof, the

mediator must certify to the court that a mediation was conducted, or waived, and

the result of such mediation. N.C.G.S. § 7A-38.3E(f) (2023).

Plaintiffs, in their Second Amended Complaint, made a request for the

“initiation of mediation of this dispute pursuant to N.C. Gen. Stat. § 7A-38.3E . . . or,

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alternatively, for the mediation requirement to be dispensed with pursuant to N.C.

Gen. Stat. § 7A38.3E(d).”8 But merely requesting mediation or a waiver is not

sufficient under the statute. The record here does not contain any evidence that the

parties agreed on a mediator, that one was appointed, that mediation was attempted,

that waiver was appropriate, or that the court was notified of the results of any

mediation.

As explained above, mediation is a requirement for the trial court to have

jurisdiction to hear the Public Records Act claim. Because mediation was never

completed, not only did the trial court not have jurisdiction to decide the merits of the

Public Records Act claim, but plaintiffs also could not have substantially prevailed in

their Public Records Act claim such that attorneys’ fees were appropriate. We

therefore affirm the decision of the Court of Appeals on this issue.

III. Conclusion

On the Fruits of Labor claim, we modify and affirm in part the decision of the

Court of Appeals and remand this matter to the trial court to reopen factual discovery

and provide a new discovery schedule for the parties. We reverse the Court of Appeals

on its Equal Protection determination and affirm on plaintiffs’ statutory claims.

MODIFIED AND AFFIRMED IN PART, REVERSED IN PART.

8 It also appears that plaintiffs may have failed to satisfy the service requirements in

N.C.G.S. § 7A-38.3E(c).

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Riggs, J., concurring in part, dissenting in part

Justice RIGGS concurring in part and dissenting in part.

The Corum claim of the North Carolina Bar and Tavern Association (the

Association) under the Fruits of Their Own Labor Clause should be barred on the

basis of sovereign immunity because the members of the Association have an

adequate alternate remedy under the law, a claim for compensation under the North

Carolina Emergency Management Act. Thus, I would conclude that the trial court

properly entered judgment in favor of the Governor on his motion to dismiss the

Fruits of Their Own Labor claim.

Even if the claim was not barred on the basis of sovereign immunity—and it

should be—the Association did not, in its motion for summary judgment, establish a

disputed issue of material fact in its Fruits of Their Own Labor claim. Even under

the heightened scrutiny of governmental actions challenged under our State

Constitution’s Fruits of Their Own Labor Clause, as laid out in Kinsley v. Ace

Speedway Racing, Ltd., the Association has not met its burden of forecasting evidence

that (1) there was not a “proper government purpose for the [state action]”; or (2) the

“means chosen to effect that purpose” were not “reasonable.” 386 N.C. 418, 424

(2024). Although the Association claimed otherwise in its complaint, it put on no

competent evidence in seeking summary judgment that the Governor’s stated

purpose for entering Executive Order 141—slowing the spread of COVID-19 to save

lives—was an improper purpose or that the Governor’s actual purpose was something

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different. The Association further failed to forecast any disputed facts regarding the

means chosen to effectuate the purpose, and specifically that the means were not

reasonable. For these reasons, I respectfully dissent.

I concur with the majority’s conclusion that the Association has not

substantially prevailed in seeking disclosure of documents under the Public Records

Act, N.C.G.S. § 132-9(c), and are therefore not entitled to attorneys’ fees. I further

agree with the majority’s decision to reverse the Court of Appeals’ ruling on the

Association’s Equal Protection Claim.

I. Factual Background

The executive orders at dispute in this case were issued by then-Governor

Cooper in response to the “high public health threat posed by COVID-19 globally and

in the United States.” On 10 March 2020, with the required concurrence of the duly-

elected bipartisan Council of State, the Governor declared a state of emergency as he

was authorized to do by N.C.G.S. § 166A-19.30. Exec. Order No. 116, 34 N.C. Reg.

1744, 1744 (Mar. 10, 2020). One week later, on 17 March 2020, the Governor issued

Executive Order No. 118 limiting the sale of food and beverages in restaurants and

bars to carry-out, drive-through, and delivery only. The order directed the closure of

all restaurants and bars for on-site consumption of food or beverages.

Two months later, on 5 May 2020, the Governor began the process of slowly

reopening businesses in phases. In Executive Order 138 (Phase 1 Order),

restaurants, defined as permitted food establishments under N.C.G.S. § 130A-248,

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were allowed to be open for off-site consumption of food only. Bars, defined as

establishments that are not eating establishments under N.C.G.S. §§ 18B-1000(2)

and -1000(6) were “directed to not serve alcoholic beverages for onsite consumption.”

Exec. Order No. 138, 34 N.C. Reg. 2141, 2148 (May 5, 2020). The only businesses

required to remain closed under this Phase 1 Order were personal care and grooming

businesses and entertainment facilities without a retail or dining component.

Two weeks later, the Governor continued the process of reopening businesses.

The Governor issued Executive Order No. 141, “Easing Restrictions on Travel,

Business Operations, and Mass Gatherings: Phase 2.” (Phase 2 Order) In this Phase

2 Order, the Governor allowed eating establishments to open for on-premises

consumption of food and beverages with limited seating.1 The Phase 2 Order required

entertainment and fitness facilities that “do not offer a retail or dining component” to

remain closed. This included: bingo parlors, bowling alleys, indoor exercise facilities,

gyms, health clubs and fitness centers, movie theaters, skating rinks, gaming

establishments, museums, amusement parks, and, significantly for this case, bars

and night clubs.

In a contemporaneous press conference to update the public on the state’s

response to the pandemic, the Governor noted that the state was experiencing a

1 The Phase 2 Order also allowed all personal care and grooming businesses, including

tattoo parlors, to open. The majority groups tattoo parlors with restaurants when describing the businesses that were allowed to open under the Phase 2 Order; however, tattoo parlors were categorized as a personal care and grooming business, and all personal care and grooming businesses were allowed to open with restrictions.

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record high number of hospitalizations and deaths related to COVID-19. PBS North

Carolina: Coronavirus Briefing: NC Gov. Roy Cooper, (YouTube, May 28, 2020),

https://www.youtube.com/watch?reload=9&app=desktop&v=9WqTv5idkDk. The

Governor emphasized that the “health and safety of North Carolinians [i]s our

number one priority” and that the decisions to reopen businesses were difficult but

were being “made with daily briefings from doctors and health care experts.” Id. at

15:00–17:00. The Governor explained that he employed a phased or “dimmer-switch”

approach to the reopening of places where people congregate. Id. at 18:00-19:00. The

dimmer-switch approach worked by opening some categories of businesses, waiting

to ensure that any spike in COVID-19 cases did not overwhelm the hospitals, and

then opening more categories of businesses. Department of Health and Human

Services Secretary Mandy K. Cohen, M.D., M.P.H, stressed the need to “take modest

steps forward” in reopening businesses to avoid “overwhelm[ing] the health care

system” because the state was experiencing a high number of COVID-19

hospitalizations and positive test results. Id. at 22:20.

Almost immediately, on 4 June 2020, the Association filed a complaint

challenging Executive Order 141 and sought injunctive relief to reopen bars for onsite

beverage consumption. The Association alleged violations of the Association’s rights

under the Fruits of Their Own Labor Clause and Equal Protection Clause of the North

Carolina Constitution and requested compensation under the Emergency

Management Act.

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II. Adequate State Remedy under the Emergency Management Act

It is well established under North Carolina common law that the “doctrine of

sovereign immunity . . . prevents a claim for relief against the State except where the

State has consented or waived its immunity.” State ex rel. Stein v. Kinston Charter

Acad., 379 N.C. 560, 570 (2021) (quoting Harwood v. Johnson, 326 N.C. 231,238

(1990)). However, the state may waive sovereign immunity by its conduct, including

by enacting statutes that require government agencies to compensate parties for

injury. See, e.g., Nello L. Teer Co. v. N.C. State Highway Comm’n, 265 N.C. 1, 9 (1965)

(recognizing that state agencies may be subject to suit as expressly provided by

statute). Because the state may waive sovereign immunity by statute, Corum claims,

i.e., direct claims against the state for remedy of a constitutional violation, are only

available “in the absence of an adequate state remedy.” Corum v. Univ. of N.C., 330

N.C. 761, 782 (1992); see also Deminski ex rel. C.E.D. v. State Bd. of Educ., 377 N.C.

406, 413 (2021). For example, in the context of eminent domain, the General

Assembly has long provided an established remedy for when private property is taken

for a public purpose. See, e.g., Ferrell v. Dept. of Transp., 334 N.C. 650, 654 (1993)

(recognizing that the North Carolina General Assembly may implicitly waive

sovereign immunity by obligating a [state agency] to pay compensation to an injured

party). Similarly, here the General Assembly has provided a mechanism for an

injured party to seek relief and compensation in a court of law under the Emergency

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The Phase 2 Order, which placed restrictions on the members of the

Association’s operations during the pandemic, was authorized by the Emergency

Management Act. See N.C.G.S. § 166A-19.30 (2023) (outlining the powers of the

Governor during a state of emergency). The current version of the Emergency

Management Act was passed in 2012 to modernize the “authority and responsibility

of the Governor [and] State agencies” to, inter alia, respond to and recover “from

natural and man-made emergencies” and “[r]educe vulnerability[ies] of people and

property of this State to damage, injury, and loss of life and property.” N.C.G.S.

§ 166A-19.1 (2023) (emphasis added) (enunciating the legislative purpose of the

Emergency Management Act). An additional purpose of the Emergency Management

Act is to “[p]rovide for cooperation and coordination of activities relat[ed] to

emergency mitigation, . . . response, and recovery” between the state and “other

private and quasi-official organizations.” Id.

The Emergency Management Act grants the Governor and state agencies the

authority to impose “prohibitions and restrictions in the emergency area,” that “in

the Governor’s discretion” are appropriate to deal with the emergency. N.C.G.S.

§ 166A-19.30(c)(1) (emphasis added). The statute expressly authorizes “prohibitions

and restrictions” of the “operation of offices, business establishments, and other

places to or from which people may travel or at which they may congregate.” N.C.G.S.

§ 166A-19.31(b)(2) (2023).

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To advance the goal of encouraging cooperation and coordination between the

state and private organizations, the Emergency Management Act provides for

compensation “for services or for the taking or use of property . . . to the extent that

legal obligations of individual citizens are exceeded.” N.C.G.S. § 166-19.73(a) (2023).

The compensation under the Emergency Management Act is authorized when

“property [i]s commandeered, seized, taken, condemned, or otherwise used in coping

with an emergency.” N.C.G.S. § 166-19.73(b) (2023).

The majority reads the statutory language for conduct requiring compensation

far too narrowly and fails to give meaning to every word in the statute. In the

majority’s view, the Association’s members do not “qualify for compensation” under

this statute because the language in the statute requires “some affirmative

appropriation or possession of private property during the stated emergency.” I

disagree and find it curious that the majority is willing to rewrite a statute by adding

requirements, by judicial fiat, to reach the constitutional question and broadly

expand this Court’s jurisprudence under the Fruits of Their Own Labor Clause.

A fundamental principle of statutory interpretation is that courts presume that

when the “legislature enacts a statute, it intentionally includes and gives meaning to

every word therein.” Happel v. Guilford Cnty. Bd. of Educ., 387 N.C. 186, 207 (2025).

“Since a legislative body is presumed not to have used superfluous words, our courts

must accord meaning, if possible, to every word in a statute.” C Investments 2, LLC

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v. Auger, 383 N.C. 1, 12 (2022) (quoting N.C. Bd. of Exam’rs for Speech & Language

Pathologists & Audiologists v. N.C. State Bd. of Educ., 122 N.C. App. 15, 21 (1996)).

Thus, to properly interpret the statute, each term the General Assembly

included in the statute must have meaning: “commandeered, seized, taken,

condemned, or otherwise used property” to “cop[e] with an emergency.” N.C.G.S. §

166-19.73(b). Because the terms are not defined in the Emergency Management Act,

we interpret the statute based upon the ordinary meaning of the words in the statute.

See Spruill v. Lake Phelps Volunteer Fire Dep’t, Inc., 351 N.C. 318, 322 (2000)

(recognizing that undefined words in a statute should be accorded their “plain and

definite meaning when the statutory language at issue is clean and unambiguous”

(cleaned up)).

While I agree that the verbs commandeered and seized do, by their plain

meaning, suggest an affirmative appropriation or possession, the verbs or phrases

“taken” and “otherwise used” do not imply anything other than what they say, and

imposing an additional affirmative state action is not justified. See N.C.G.S.

§ 166-19.73(b). “Taken” and “otherwise used” expand the scope of conduct that is the

basis for compensation to include restrictions and limitations that stop short of

affirmative possession, like the restrictions and limitations in the Phase 2 Order.

“Taken” is widely understood to result from “[a]n action by a government, especially

under the power of eminent domain, that deprives a private owner of real property or

of the use and enjoyment of that property.” Taking, American Heritage Dictionary

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(5th ed. 2018) (emphasis added). Similarly, “used” means to “put into service or

employ for a purpose.” Use, American Heritage Dictionary (5th ed. 2018).

Here, the Phase 2 Order used the closure of bars to limit the spread of

COVID-19, avoid overwhelming North Carolina’s medical infrastructure, and

minimize the number of COVID-related deaths in North Carolina. At the time the

Governor entered the Phase 2 Order, the spread of COVID-19 had overwhelmed the

medical infrastructures and killed thousands of people, both in foreign countries like

Italy and large cities in the United States, such as New York City.

It seems strange to conclude that placing limitations and restrictions on

businesses that result in restricting the operation of some businesses to protect public

safety is not a statutory “tak[ing]” or “other use” under the Emergency Management

Act, and at the same time, claim that those same restrictions and limitations infringe

on an entity’s constitutional rights to under the Fruits of Their Own Labor Clause.

To be clear, no one is arguing that people and businesses that make sacrifices for the

public good, due to a hurricane or a pandemic or any other such emergency, should

lose their businesses because of that. Indeed, foreseeing the need for such equitable

state action, when the General Assembly, by statute, required businesses to

cooperate, coordinate, and contribute to the emergency response even in ways that

significantly impacts businesses for the purpose of protecting the public welfare, the

legislature put in place a means of incentivizing or compensating the businesses for

that contribution to the greater good. The General Assembly has done this by

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authorizing compensation under the Emergency Management Act. N.C.G.S. § 166A-

19.73 (2023) (authorizing the state to make compensation for property

commandeered, seized, taken, condemned, or otherwise used in coping with an

emergency [when] this action was ordered by the Governor). The legislature also

plainly afforded the discretion to effectuate this statute through prohibitions or

restrictions issued by Governor. N.C.G.S. § 166A-19.30(c)(1). Separately, the state

and federal government also appropriated funds to compensate businesses for the

impact of business closures. See, e.g., CARES Act, Pub. L. No. 116-136, § 1102, 134

Stat. 281, 286–94; U.S. Small Bus. Admin., Paycheck Protection Program (PPP)

Report 2, 5 (May 31, 2021), https://www.sba.gov/sites/default/files/2021-

06/PPP_Report_Public_210531-508.pdf; 2020 COVID-19 Recovery Act, S.L. 2020-4, §

4.2(a)–(d), 2020 N.C. Sess. Laws 68, 85–87. Where the legislature has created ample

and adequate state remedies for businesses that were injured by the collective action

needed to rein in a pandemic, there is no need for this Court to reach a constitutional

claim barred by sovereign immunity.

The General Assembly established a route for the Association’s members to

receive compensation for the closures applied to establishments that are not eating

establishments. See Deminski, 377 N.C. at 413-14 (recognizing that “a plaintiff must

have at least the opportunity to enter the courthouse doors and present his claim”).

The Governor acted within the discretion afforded him under the Emergency

Management Act and that Act also provides the Association with a means to request

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compensation for the effect of the action on their businesses. The proper action, then,

is to remand for reconsideration of claims under this Emergency Management Act.

Any common law claim under Corum should fail because there is an adequate state

remedy. Even if the compensation available through the Emergency Management

Act does not necessarily make the plaintiffs whole, the Act nonetheless provides an

adequate remedy. Washington v. Cline, 385 N.C. 824, 829 (2024) (confirming that an

“adequate remedy is a meaningful one, though not necessarily the one the plaintiff

might prefer”). For these reasons, I would dismiss the Corum claim and remand for

consideration of the Association’s claim for compensation under the Emergency

III. Fruits of Their Own Labor claim

Even if there were no other adequate state remedy, I would conclude that the

trial court did not err by entering summary judgment in favor of the Governor

because the Association did not forecast evidence to establish a disputed issue of

material fact for its Fruits of Their Own Labor claim even under the generous

standard set forth in Kinsley v. Ace Speedway, 386 N.C. 418, 425 (2024). To establish

a claim under the Fruits of Their Own Labor Clause, a plaintiff must show that the

challenged state action was not for a “proper governmental purpose,” of “promot[ing]

the accomplishment of a public good[ ], or . . . prevent[ing] the infliction of a public

harm. Id. at 425 (first quoting Poor Richard’s Inc. v. Stone, 322 N.C. 61, 64 (1988);

and then quoting State v. Ballance, 229 N.C. 764, 770 (1949)). Under the two-prong

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test outlined there, “[i]f the reviewing court determines that the challenged state

action serves a proper government purpose,” then the plaintiff must show that the

means chosen to effectuate that purpose were not reasonable. Id. at 426.2 “The

means used must be measured by balancing the public good likely to result from their

utilization against the burdens resulting to the businesses being regulated.” Poor

Richard’s, 322 N.C. at 66 (citing In re Certificate of Need for Aston Park Hospital,

Inc., 282 N.C. 542, 550 (1973)).

In Ace Speedway, this Court established that the test for assessing a challenge

to a governmental action under a Fruits of Their Own Labor claim is more stringent

than the rational basis test; we called it a reasonable basis test. To be sure, I do not

understand such claims to be evaluated under a strict scrutiny standard, but this

reasonable basis standard is more stringent than a rational basis standard. For a

Fruits of Their Own Labor claim, a reviewing court looks to “identify the State’s

actual purpose for the constraint on private business activity.” Ace Speedway, 386

N.C. at 424. As we explained in Ace Speedway, a plaintiff may rebut the State’s

asserted purpose “with evidence demonstrating that the State’s asserted purpose is

not a true one, and instead the State is pursuing a different unstated purpose.” Id.

2 The majority improperly shifts the burden of proof to the State on this second step,

when it stated “[w]hen the government satisfies the first prong of the Fruits of [Their Own] Labor test, it must then show that ‘the means chosen to effect that purpose [are] reasonable.’ ” When challenging state action as unconstitutional, the burden of proof is on the plaintiff to show that the state action was unconstitutional. See McKinney v. Goins, 387 N.C. 35, 44 (2025) (recognizing that the party challenging the constitutionality of state action bears the burden of showing the state action is unconstitutional).

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at 425. For example, in Ace Speedway, the State asserted that an abatement order

to close the speedway was for a proper government purpose of “protecting North

Carolinians from a novel virus—a virus that would eventually kill over one million

Americans.” Id. at 426. However, in its complaint, the plaintiff challenged that

contention by alleging that “it was singled out by the Governor for enforcement”

because of its political speech and “other businesses violating the emergency order

were not subject to similar enforcement action by the State.” Id. (cleaned up).

Importantly, of course, at the procedural posture in Ace Speedway, a motion to

dismiss, the court considers whether the parties had “sufficiently allege[d]” a claim

under the Fruits of Their Own Labor Clause. Id. at 422–23; see also Deminski, 377

N.C. at 412. When considering a complaint dismissed under Rule 12(b)(6), “we treat

plaintiff’s factual allegations as true.” State ex rel. Cooper v. Ridgeway Brands Mfg.,

LLC., 362 N.C. 431, 442 (2008) (quoting Stein v. Asheville City Bd. of Educ., 360 N.C.

321, 325 (2006). Because the plaintiff in Ace Speedway had alleged an improper

purpose, at that procedural posture, we accepted as true and thus that the plaintiff

met the standard of showing an improper purpose. Ace Speedway, 386 N.C. at 426–

27.

In contrast, here, the Association sought summary judgment.3 Summary

judgment is properly granted when the forecast of evidence “reveals no genuine issue

3 The trial court here denied the Association’s motion for partial summary judgment

and granted the Governor’s motion to dismiss under Rule 12(b)(6) of the North Carolina Rules of Appellate Procedure. However, because the trial court considered issues outside of the

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as to any material fact, and when the moving party is entitled to a judgment as a

matter of law.” Dobson v. Harris, 352 N.C. 77, 83 (2000) (quoting Koontz v. City of

Winston-Salem, 280 N.C. 513, 518 (1972)). “A genuine issue is one that can be

maintained by substantial evidence.” Id. (cleaned up) “All facts asserted by the

adverse party are taken as true, and their inferences must be viewed in the light most

favorable to that party.” Id. (citation omitted).

We review de novo the trial court’s decision to enter summary judgment in favor

of the Governor. Forbis v. Neal, 361 N.C. 519, 524 (2007). At summary judgment,

we assess the merits of a claim under the Fruits of Their Own Labor Clause to

determine whether the Association established a disputed issue of material fact such

that summary judgment in favor of the State was improper. “Summary judgment in

favor of the non-movant is appropriate when the evidence presented demonstrates

that no material issues of fact are in dispute, and the non-movant is entitled to entry

of judgment as a matter of law.” A-S-P Assocs. v. City of Raleigh, 298 N.C. 207, 212

(1979). The Association had the burden of showing “a genuine issue” of material fact,

and because the record does not show a factual dispute the Governor is entitled to

summary judgment.

complaint, the Court of Appeals properly considered the trial court’s order granting the Governor’s motion to dismiss as an order granting summary judgment in favor of the Governor. See Stanback v. Stanback, 297 N.C. 181, 205 (1979) (explaining a Rule 12(b)(6) motion to dismiss is “converted to a Rule 56 motion for summary judgment when matters outside the pleadings are presented to and not excluded by the court”).

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First, the Association did not forecast evidence rebutting the Governor’s stated

purpose in entering the order. The Phase 2 Order states that “slowing and controlling

community spread of COVID-19 is critical to ensuring that the [S]tate’s healthcare

facilities remain able to accommodate those who require medical assistance” and “the

continued community spread” with more than twenty thousand confirmed cases and

hundreds of deaths “requires the [S]tate to continue measures to slow the spread of

this virus.” Exec. Order No. 141, 34 N.C. Reg. 2360, 2360–61 (May 20, 2020). The

Association, via affidavit or other mechanism, offered no evidence that the Governor’s

purported reason was pretextual. The only pieces of evidence submitted by the

Association in support of the motion for summary judgment were affidavits from bar

owners explaining the hardships caused by the Phase 2 Order, including inability to

pay rent and personal debts. Because the Association did not forecast evidence that

the Governor’s stated purpose for the Phase 2 Order was not the actual purpose for

the order—even under the reasonable basis standard—the Fruits of Their Own Labor

claim should fail at this point. However, because the majority remands this case to

reopen discovery and gives the Association a second chance to establish its claim, I

find it necessary to address the second prong of the test for a Fruits of Their Own

Labor claim.

At summary judgment, the Association must forecast evidence that the means

chosen to effectuate that purpose were not reasonable. See Ace Speedway, 386 N.C.

at 426 (“If the reviewing court determines that the challenged state action serves a

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proper governmental purpose, the inquiry then reaches the second stage: ‘are the

means chosen to effect that purpose reasonable?’ ”)(quoting Poor Richard’s, 322 N.C.

at 64). The reviewing court balances the public good likely to result from the

government action “against the burden resulting to the business being regulated.”

Id. The Association provided affidavits that document the burden to their businesses.

However, the Association does not even attempt to show that the means employed by

the Phase 2 Order to effectuate its proper purposes were unreasonable to “slow the

spread of COVID,” “avoid overwhelming the health care system,” and protect the lives

of North Carolinians.

In contrast, the Governor forecasted evidence that the means employed for a

phased reopening of business— in a manner that controlled the spread of COVID-19

and protected the lives of North Carolinians—were reasonable. The Governor

provided the affidavit of Elizabeth Cuervo Tilson, M.D., M.P.H., the Chief Medical

Officer for the North Carolina Department of Health and Human Services. Dr. Tilson

attested that the individuals developing the policy recommendations were reviewing

and considering “the most recent data and studies from scientific publications and

the Centers for Disease Control and Prevention (CDC), as well as experiences from

other countries and states.” Specifically, the medical and public health team

constantly evaluated “scientific literature, current studies, media reports, and any

related data that speaks to the risks of transmission of the virus and the effectiveness

of mitigation measures that counties, states, and localities have put in place to

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minimize transmission of the virus.” In her affidavit, Dr. Tilson explains what was

known about how COVID-19 is transmitted and why the nature of bars makes them

more conducive to the transmission of COVID-19. The Association did not forecast

evidence that the analytical approach to the phased reopening employed by the

Governor was not reasonable.

The majority significantly expands (and misstates) the standard for a state

action to violate the Fruits of Their Own Labor Clause by saying that all that is

necessary is “mere interference”—rather than arbitrary interference—with the right

to conduct a lawful business or to earn a livelihood. The cases that the majority rely

upon confirm that the proper standard is arbitrary interference. This Court has long

recognized “that the police power of the State may be exercised to enact laws, within

constitutional limits, to protect or promote the health, morals, order, safety, and

general welfare of society.” King v. Town of Chapel Hill, 367 N.C. 400, 406 (2014)

(cleaned up) (quoting Standley v. Town of Woodfin, 362 N.C. 328, 333 (2008)). An

“exertion of the police power inevitably results in a limitation of personal liberty, and

legislation in this field is justified on the theory that the social interest is paramount.”

Id. at 406 (cleaned up) (quoting Ballance, 229 N.C. at 769). The Fruits of Their Own

Labor Clause “ prevent[s] arbitrary government actions that interfere with the right

to the fruits of one’s own labor. Id. at 408. (emphasis added).

The cases the majority cite do not overturn statutes for “mere interference”;

rather the Court looked for arbitrary interference without a proper relation to the

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health, morals, order, safety, and general welfare of society. First in State v. Harris,

this Court concluded a statute violated the Fruits of Their Own Labor Clause because

it “delegated legislative function to create standards” for dry cleaners to a private

group, the commission, and “fail[ed] to fix limits within which the discretion of the

commission may be exercised.” 216 N.C. 746, 753 (1940). That failure to fix limits

meant that the Commission could use the police power for a private purpose—

“narrowing the field of competition” by arbitrarily discriminating among dry cleaners

within the state. Id. at 754–54. It was the arbitrary nature of the exercise of police

power by the commission that led this Court to invalidate the statute. Id.

Similarly, in Ballance, this Court recognized that the statute at issue,

regulating photography, exceeded the police power of the state because it was not

reasonably necessary to “promot[e] or protect[ ]. . . the public health, morals order or

safety, or the general welfare.” Ballance, 229 N.C. at 770. Legitimate state action,

the Court recognized, must have a rational, real, or substantial relation to public

health, moral order, safety, or general welfare. Id. Then in Roller, this Court

invalidated a test for ceramic tile installers because the licensing board which

promulgated the test had the power to create a monopoly out of the ceramic tile

industry. Id. at 523. The Court acknowledged that a “state cannot under the guise of

protecting the public, arbitrarily interfere with private business . . . .” Id. at 525.

Here, the Association did not forecast evidence that the Phase 2 Order

arbitrarily interfered with businesses without a rational, real, or substantial relation

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to public safety—saving the lives of North Carolinians in the face of an unprecedented

worldwide pandemic.

Implicitly acknowledging that the Association did not meet the burden

established by 85 years of caselaw and most recently explained in Ace Speedway, the

majority reopens discovery and lets the Association try again. This approach affords

special treatment to the Association that other litigants have not been granted by

this Court when it changes the standard for assessing constitutional violations. See,

e.g., Community Success Initiative v. Moore, 384 N.C. 194, 232–33, 240 (2023)

(changing the standard for review of a statute that limits the right to vote from strict

scrutiny to rational basis after plaintiffs won partial summary judgment and then

remanding the case to the trial court for dismissal with prejudice, without a second

chance to reopen discovery); Holmes v. Moore, 384 N.C. 426, 441, (2023) (changing

the standard for a facial challenge to a state statute under the Equal Protection

Clause and then remanding to the trial court not to reopen discovery but rather to

dismiss the plaintiff’s claims with prejudice).

Even though the Association did not forecast evidence that the Phase 2 Order

arbitrarily interfered with the businesses without a rational, real, and substantial

relation to health and safety, the majority reads significantly more protection into

our State Constitution for businesses than for the people of our state. Unfortunately,

the majority seems to be hellbent on dramatically reshaping—in record time—the

law as it relates to any economic regulation, even in the public health realm.

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Additionally, the majority seems to suggest that partisanship is at play in this dissent

when it states: “What frustrates the dissent is not that Governor Cooper and his

public health officials are being held to account through the lens of hindsight; it is

that they are being held to account at all.” Not so. Perhaps when one views the world

and law through a partisan lens, that lens distorts one’s appreciation of recent history

and facts. The signatories to this dissent just last year joined a unanimous opinion

ruling against the Governor and his public health officials and articulating a test for

liability under the Fruits of Their Own Labor clause. Ace Speedway, 386 N.C. at

429. And this very dissent rejects arguments made by the Governor with respect to

the potential availability of remedies under the Emergency Management Act.

At the end of the day, this Court is charged with the important duty to assess,

under the standard from Ace Speedway, the relative benefit of economic regulations

to the social interest based upon the evidence presented by a party seeking summary

judgment for claims under the Fruits of Their Own Labor Clause. We can and should

employ a balancing test to ensure that “given all the options available to the [S]tate

to advance the government purpose, . . . it was reasonable for the [S]tate to choose

this approach, with its corresponding benefits and burdens.” Ace Speedway, 386 N.C.

at 426. But this careful judicial approach is not an opportunity to second-guess state

action with the benefit of hindsight. Courts cannot “Monday morning quarterback”

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state actions taken in the midst of an unprecedented global pandemic. 4 As most

sports aficionados would likely concede, it is far easier to suggest plays after the game

that may have produced a better result than to actually make decisions based only

upon the information available on the playing field—particularly when human lives

are on the line. More importantly, court second-guessing appropriate legislative and

executive actions violates the separation of powers found in the State Constitution.

See State ex rel. McCrory v. Berger, 368 N.C. 633, 635 (2016).

In the context of orders entered during an emergency, the reasonableness of the

Phase 2 Order can be assessed through the prism of what the Governor and the team

advising him knew at the time. Cf. Diamond v. McDonald Service Stores, 211 N.C.

632, 634 (1937) (recognizing that in the context of a negligence action the standard of

care is what a “reasonably prudent man would have used under the circumstances”

but “the degree of care which a reasonably prudent man exercises varies with the

exigencies of the occasion”). Unlike legislative action, which is less time-sensitive

and allows the legislature to commission reports to study the effectiveness of

regulations, in an emergency such as the COVID pandemic, the Governor did not

4 It is worth noting at this juncture that in 2020 when the Phase 2 Order was in place,

North Carolina had one of the lowest rates of COVID related deaths per 100,000 residents within the fifty states as reported by the National Center for Health Statistics. Centers for Disease Control https://www.cdc.gov/nchs/pressroom/sosmap/covid19_mortality_final/COVID19.htm (last visited Aug. 17, 2025).

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have the luxury of commissioning a peer-reviewed study to research the exact effect

of different possible governmental regulations on the spread of a deadly disease.

To protect lives, the Governor had to act based on the science that was available

at the time. As discussed above, the affidavit from Dr. Tillson establishes the

scientific evidence that the Governor and public health officials were considering at

the time. And with respect to which businesses opened under which phases, the

Governor employed business classifications, designated by statute, allowing eating

establishments to be open for on-site consumption but restricteding non-eating

establishments. See Poor Richard’s, 322 N.C. at 65 (recognizing that this Court has

upheld regulatory business legislation so long as it was based on some distinguishing

feature of the business itself). The Phase 2 Order allowed restaurants to open for

“on-premises consumption of food and beverages” with limitations on the number of

people that could be in the establishment and how close they could sit to one another.

Exec. Order 141, 34 N.C. Reg. at 2367. “[E]stablishments that are not eating

establishments or restaurants as defined in N.C.[G.S.] §§ 18B-1000(2) and 18B-

1000(6)” remained closed. Id. at 2364, 2372. The Governor’s use of existing

regulatory guidelines to draw lines for which businesses remained closed, aligned

with approaches this Court has affirmed in the past. See Poor Richard’s, 322 N.C. at

65.

Science does not always graft on perfectly to how regulatory lines are drawn in

an emergency. Thus, because the Association did not forecast any evidence to suggest

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that there was, at the time, a more reasonable means of trying to contain the

devastation wrought by the COVID pandemic and the Governor introduced

competent evidence to support the reasonableness of the executive orders, the

Association does not satisfy the second prong of the Ace Speedway test and summary

judgment was properly entered for the Governor. See A-S-P Assocs., 298 N.C. at 214

(“When the most that can be said against [a state action] is that whether it was an

unreasonable, arbitrary or unequal exercise of power is fairly debatable, the courts

will not interfere. In such circumstances the settled rule seems to be that the court

will not substitute its judgment for that of the legislative body charged with the

primary duty and responsibility of determining whether its action is in the interest

of the public health, safety, morals or general welfare.” (cleaned up)).

In sum, I would dismiss the Association’s Corum claim because there is an

adequate alternate remedy in the Emergency Management Act and sovereign

immunity thus bars this action. Assuming arguendo there was no adequate state

remedy, I would reverse the Court of Appeals because the Association did not meet

its burden to forecast disputed issues of material fact on the Fruits of Their Own

Labor claim and the Governor provided evidence amply sufficient to establish his

actual purpose and the reasonableness of the means he chose to advance that

purpose. Thus, summary judgment in favor of the Governor was proper even under

the heightened standard set forth in Ace Speedway. For these reasons, I respectfully

dissent.

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Justice EARLS joins in this concurring in part and dissenting in part opinion.

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