Simms v. Napolitano

73 P.3d 631 (2003)

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Simms v. Napolitano

Arizona Court of Appeals
73 P.3d 631 (2003)

  • Written by Brett Stavin, JD

Facts

Jeremy Simms (plaintiff), a part owner of T.P. Racing, L.L.L.P. (T.P. Racing), applied to the Arizona Department of Gaming (the department) (defendant) for a license to provide off-track betting services to several tribal casinos. Following an investigation, the department informed Simms of their intent to deny his certification due to concerns that he was involved in questionable business practices, illegal activities, and organized crime. Along with this notice, the department informed Simms that he would have 30 days to appeal and that otherwise their decision would become a final order. Simms appealed, and an administrative hearing was scheduled. However, prior to the administrative hearing, Simms filed an action in trial court for a preliminary injunction to enjoin the department from denying his license. The complaint alleged that the department lacked authority to deny his license and further alleged that the department improperly continued its efforts to deny his license even after he had offered to withdraw his application. The trial court ruled in Simms’s favor, holding that the department’s power came from a tribal-state compact entered into pursuant to the Indian Gaming Regulatory Act (IGRA), as opposed to the traditional police power of the state. Therefore, the trial court concluded, the department lacked the authority to prevent Simms from withdrawing his application. The governor of Arizona and the director of the department appealed the trial court’s decision, asserting that the department’s authority derived from the state’s police power and that the department therefore had an inherent discretionary right to prevent withdrawals of applications. The state further argued that Simms had failed to exhaust administrative remedies before filing his action in trial court. In response, Simms argued that the department had no statutory authority to deny the withdrawal of his license and that the exhaustion-of-administrative-remedies argument was waived because it was not asserted in the trial court.

Rule of Law

Issue

Holding and Reasoning (Gemmill, J.)

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