Schmitz v. State Board of Chiropractic Examiners , 2021 ND 73 ( 2021 )

FILED
IN THE OFFICE OF THE
CLERK OF SUPREME COURT
APRIL 20, 2021
STATE OF NORTH DAKOTA
IN THE SUPREME COURT
STATE OF NORTH DAKOTA
2021 ND 73Dr. Jacob Schmitz, Plaintiff and Appellant
v.
North Dakota State Board of
Chiropractic Examiners, Defendant and Appellee
No. 20200310
Appeal from the District Court of Burleigh County, South Central Judicial
District, the Honorable Pamela A. Nesvig, Judge.
REVERSED AND REMANDED.
Opinion of the Court by VandeWalle, Justice.
Michael J. Geiermann, Bismarck, ND, for plaintiff and appellant.
Seth J. O’Neill (argued), Assistant Attorney General, and Matthew A.
Sagsveen (on brief), Solicitor General, Bismarck, ND for defendant and
appellee.
Schmitz v. State Board of Chiropractic Examiners
No. 20200310
VandeWalle, Justice.
[¶1] Dr. Jacob Schmitz appealed from a judgment entered after the district
court granted the North Dakota State Board of Chiropractic Examiners’
motion to dismiss for failure to state a claim upon which relief can be granted
under N.D.R.Civ.P. 12(b)(6). Schmitz argues the court misapplied the law. We
reverse, concluding the district court erred in its application of Rule 12(b)(6),
and remand for further proceedings consistent with this opinion.
I
[¶2] In March 2019, the North Dakota State Board of Chiropractic Examiners
(the “Board”) issued an administrative complaint against Schmitz, a
chiropractor licensed by the Board. The administrative complaint initiated an
administrative proceeding against Schmitz, which resulted in the
administrative law judge (“ALJ”) issuing a recommended order granting
summary judgment to the Board. The ALJ declined recommending the
disciplinary action that the Board should take against Schmitz. Instead, he
noted six observations to aid the Board’s determination of disciplinary action
against Schmitz.
[¶3] In April 2020, the Board noticed a special meeting, with Schmitz listed
in the notice and agenda, including a footnote stating, “The governing body
anticipates this topic may be discussed in Executive Session. The legal
authority for Executive Session is N.D.C.C. [§] 44-04-19.1(2) Attorney
Consultation.” The Board held the meeting via conference call. Shortly after
commencing, the Board moved the meeting into an executive session for
approximately one hour and forty-five minutes. Schmitz alleges the Board
discussed and established the following sanctions against him in the executive
session: $30,000 in civil penalties; $33,000 for costs of the investigation and
proceedings to date; $60,000 for recovery to reimburse the Board for costs of
the proceedings related to attorney’s fees; and monitoring of his practice for six
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quarters at his expense. Following the meeting, Schmitz requested the
recording of the Board’s executive session. The Board denied the request.
[¶4] In May 2020, the Board held a regular meeting. The proposed agenda
included approving the draft order for summary judgment against Schmitz,
with a footnote providing, “[T]he governing body anticipates this topic may be
discussed in Executive Session. The legal authority for Executive Session is
N.D.C.C. [§] 44-04-19.1(1) Attorney Work Product and N.D.C.C. [§] 44-04-
19.1(2) Attorney Consultation.” Soon after the meeting began, the Board went
into executive session for approximately thirty-five minutes. After the
executive session, the Board voted to confirm the sanctions against Schmitz.
Schmitz requested the recording of this executive session, and was denied by
the Board.
[¶5] In June 2020, Schmitz commenced this lawsuit, alleging the Board
violated the law on access to public records and meetings. The Board moved to
dismiss for failure to state a claim upon which relief can be granted. After a
hearing, the district court granted the Board’s motion and dismissed the
complaint.
II
[¶6] Schmitz argues the district court erred by granting the Board’s Rule
12(b)(6), N.D.R.Civ.P., motion to dismiss. Our review of a dismissal under Rule
12(b)(6) is well-established:
A motion to dismiss a complaint under N.D.R.Civ.P. 12(b)[6] tests
the legal sufficiency of the claim presented in the complaint. On
appeal from a dismissal under N.D.R.Civ.P. 12(b)[6], we construe
the complaint in the light most favorable to the plaintiff and accept
as true the well-pleaded allegations in the complaint. A district
court’s decision granting a Rule 12(b)(6) motion to dismiss a
complaint will be affirmed if we cannot discern a potential for proof
to support it. We review a district court’s decision granting a
motion to dismiss under N.D.R.Civ.P. 12(b)(6) de novo on appeal.
Krile v. Lawyer, 2020 ND 176, ¶ 15, 947 N.W.2d 366 (cleaned up). “A court’s
scrutiny of pleadings should be deferential to the plaintiff, unless it is clear
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there are no provable facts entitling the plaintiff to relief.” Rose v. United
Equitable Ins. Co., 2001 ND 154, ¶ 10, 632 N.W.2d 429. Because
determinations on the merits are generally preferred to dismissal on the
pleadings, Rule 12(b)(6) motions are viewed with disfavor. Id. “The motion for
dismissal of the complaint should be granted only if it is disclosed with
certainty the impossibility of proving a claim upon which relief can be granted.”
Johnson & Maxwell, Ltd. v. Lind, 288 N.W.2d 763, 765 (N.D. 1980).
[¶7] Schmitz alleges in his complaint that the Board violated laws on access
to public records and meetings.
[¶8] Under N.D.C.C. § 44-04-18(1), all records of a public entity are public
records, open and accessible for inspection during reasonable office hours,
except as otherwise provided by law. “Upon request for a copy of specific public
records, any entity subject to subsection 1 shall furnish the requester one copy
of the public records requested.” N.D.C.C. § 44-04-18(2). “Attorney work
product is exempt from section 44-04-18.” N.D.C.C. § 44-04-19.1(1).
[¶9] All meetings of a public entity must be open to the public, except as
otherwise provided by law. N.D.C.C. § 44-04-19. “Attorney consultation is
exempt from section 44-04-19. That portion of a meeting of a governing body
during which an attorney consultation occurs may be closed by the governing
body under section 44-04-19.2.” N.D.C.C. § 44-04-19.1(2).
“Attorney consultation” means any discussion between a
governing body and its attorney in instances in which the
governing body seeks or receives the attorney’s advice regarding
and in anticipation of reasonably predictable or pending civil or
criminal litigation or adversarial administrative proceedings or to
receive its attorney’s advice and guidance on the legal risks,
strengths, and weaknesses of an action of a public entity which, if
held in public, would have an adverse fiscal effect on the entity. All
other discussions beyond the attorney’s advice and guidance must
be made in the open, unless otherwise provided by law. Mere
presence or participation of an attorney at a meeting is not
sufficient to constitute attorney consultation.
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N.D.C.C. § 44-04-19.1(5) (emphasis added). “A governing body may hold an
executive session to consider or discuss closed or confidential records.”
N.D.C.C. § 44-04-19.2(1).
[¶10] Schmitz contends the district court failed to accept as true the
allegations in the complaint. The complaint provides the ALJ issued a
recommended order for summary judgment in favor of the Board, but did not
propose any sanctions against Schmitz. The Board held a meeting in April
2020, with only two items on the agenda: 1) Schmitz, and 2) per diem. Shortly
after beginning the meeting, the Board went into executive session, which
lasted approximately one hour and forty-five minutes. After the meeting
opened back up to the public, the Board assessed $123,000 in penalties, costs,
and fees against Schmitz, and required his practice to be monitored for six
quarters at his expense. Schmitz alleges the Board discussed and established
these sanctions in the executive session. Schmitz requested the recording of
the Board’s executive session, and the Board denied the request. The Board
held another meeting in May 2020. The proposed agenda included approving
the draft order for summary judgment against Schmitz. Soon after the meeting
began, the Board went into executive session for approximately thirty-five
minutes. After the executive session, the Board voted to confirm the sanctions
against Schmitz. Schmitz requested the recording of this executive session, and
was denied by the Board.
[¶11] Schmitz claims the Board violated N.D.C.C. § 44-04-19 because the
discussion during the executive sessions went beyond the attorney’s advice and
guidance, so as to require such discussion to be public. Further, he claims the
Board violated N.D.C.C. § 44-04-18 by failing to provide him with a copy of the
recordings of the executive sessions. Accepting the allegations in the complaint
as true, which we must do for purposes of a N.D.R.Civ.P. 12(b)(6) motion to
dismiss, we conclude Schmitz has stated a claim upon which relief could be
granted.
[¶12] The Board argues some of the allegations in the complaint are conclusory
or speculative, and should be disregarded, relying on Brakke v. Rudnick, 409
N.W.2d 326 (N.D. 1987). In Brakke, the Court concluded that the trial court
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did not err in dismissing the complaint against the twenty-seven defendants
because of insufficient service of process. Id. at 331-32. As an additional and
independent reason for dismissal, the trial court determined the complaint
failed to state a claim for relief. Id. at 328. In relation to some of the allegations
in the complaint, the Court stated:
Although we recognize the complaint does contain generic
allegations that the “defendants” conspired to deny the plaintiffs
due process of law, the allegations are merely conclusory
statements unsupported by allegations of factual circumstances
specifically relating to any of the defendants. We do not believe
that those generic allegations are sufficient to state a cause of
action as to any specific defendants.
Id. at 333 (citations omitted).
[¶13] Here, the complaint does not contain generic allegations against
unnamed defendants. It contains specific allegations against the Board
relating to access to public records and meetings. We decline to extend the
limited rule in Brakke to the facts of this case. The complaint states a claim for
relief. Because the district court erred in its application of Rule 12(b)(6), we
reverse.
[¶14] Schmitz provided several prayers for relief in his complaint, including
for the district court to declare the executive sessions, or portions thereof,
violated the open meetings law, and order the recordings, or portions thereof,
be provided to Schmitz and made public. Attorney work product and attorney
consultation are exempt from the general laws on access to public records and
meetings. See N.D.C.C. §§ 44-04-19.1(1), 44-04-19.1(2). Accordingly, after an in
camera review, to the extent the district court determines on remand that the
recordings of the executive sessions, or discussion therein, went beyond the
scope of attorney consultation or attorney work product, we direct the court to
require disclosure of the recordings or discussion to only those matters not
exempt under the law.
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III
[¶15] We reverse the judgment and order granting the Board’s motion to
dismiss, and remand for further proceedings consistent with this opinion.
[¶16] Jon J. Jensen, C.J.
Gerald W. VandeWalle
Daniel J. Crothers
Lisa Fair McEvers
Jerod E. Tufte
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