Wichita Business, Kansas Attorney General Agree To Delay COVID-19 Lockdown Lawsuit

By Tim Carpenter, the Kansas Reflector

December 31, 2020

TOPEKA — A Wichita fitness studio’s lawyers and the Kansas attorney general reached agreement to delay action on a lawsuit demanding compensation for the government-ordered closure of business during the COVID-19 pandemic, officials said Thursday.

A Sedgwick County District Court judge was asked to grant a stay of proceedings under an arrangement endorsed by Omega Bootcamps, the fitness studio and gym, and the office of Attorney General Derek Schmidt, who is defending the state in the case. A joint motion filed with the district court affirmed both parties believed the 2021 Kansas Legislature should have an opportunity to consider policy issues raised by the suit. The deal would idle the case until June 1 or formal conclusion of the upcoming legislative session.

In the case, business owner Ryan Floyd seeks to interpret the Kansas Emergency Management Act in a way delivering to private businesses compensation for absorbing extraordinary losses linked to restrictions imposed during the pandemic.

“By asking the Legislature to take up this matter, the state is acknowledging government-use claims are possible in at least some circumstances under the Kansas Emergency Management Act,” said Ryan Kriegshauser, an attorney with Omega Bootcamps. “This is a major development that has statewide and possibly national implications because other states have similar statutory provisions.”

Schmidt, the Republican attorney general, said previously certain actions intended to curtail spread of a virus that in Kansas has killed more than 2,740 and infected at least 222,000 since March could inspire lawsuits.

However, in a statement the attorney general said he wasn’t conceding state law as written applied to facts in Omega Bootcamps and Ryan Floyd v. State of Kansas or similar cases.

“I agree with the basic principle, reflected in current law, that at least some of those whose property is significantly damaged by government actions undertaken for the public good during a state of emergency should be compensated for their loss,” Schmidt said. “However, current law was not designed to address these sorts of business shutdown orders.”

He did concur that public policy questions of compensation to businesses extended beyond the Sedgwick County lawsuit and would be better weighed by the Legislature rather than the courts.

“Rather than proceeding directly to litigation, we have reached agreement with the plaintiffs to jointly ask the court to put this lawsuit on hold,” the attorney general said. “In the event the Legislature fails to resolve this issue globally, the litigation will resume and we will provide the state a proper legal defense under current law.”

The 2021 legislative session begins Jan. 11 and lawmakers have been working since conclusion of the 2020 regular and special sessions on possible reform to KEMA, the state law crafted decades ago to help the state deal with disasters. It was framed as a response to flooding, wildfires and other natural calamaties instead of a pandemic requiring a worldwide vaccination campaign.

Josh Ney, co-counsel for Omega Bootcamps, precipitated the legal challenge Dec. 9 by filing suit in Wichita. The plaintiffs argued Gov. Laura Kelly’s shutdown orders and local health restrictions placed a more significant burden on small businesses and that those company owners deserved relief.

He also said state and local governments should consider disproportionate economic costs associated with curfews, shutdowns and restrictions before exercising unilateral power in the future.

“Both the state and local governments are officially on notice that they may have to compensate businesses for previously imposed restrictions,” Ney said. “We call on policy makers to act to make small businesses whole after the economic devastation caused by the governor’s shutdown orders.”

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