After hearing two days of arguments from both sides, former Nevada Supreme Court Chief Justice Robert Rose reach a ruling for preliminary injunctions regarding the lawsuit filed by the Railroad Management board against the Ely City Council. In his ruling, Justice Rose found the Ely City Council and Railroad Board of Trustees in violation of Nevada’s Open Meeting Law during their Aug. 7 city council meeting in which the council removed the Chairman and Vice-Chairman of the management board from office.
As part of Rose’s ruling, both John Gianoli and Steven Leith would be immediately reinstated as the two heads of the management board and their two appointed replacements, Judy O’Brien and Terry Walker, were null and void due to there being “no legally recognized vacancy” for them to fill.
“The vote to remove Mr. Gianoli and Mr. Leith was illegal and void. They are returned to their prior positions on the Management Board,” Rose stated in his ruling. “I can’t do this unless I find irreparable harm and I do find irreparable harm because we had abundant statements that these two gentlemen were the two top-ranking men on the board of trustees and because it was and is a very difficult time for the board members at this time. And for all the other reasons the plaintiffs have stated I find irreparable harm unless this immediate action and temporary injunction is issued.”
The judge said that he determined there were violations to the law due to the agenda item for that meeting not being “clear and concise” as the law requires. He also pointed out that the law requires three days notice to be given for the meeting and also to any public persons who will have their competence called into question.
“I also find that NRS 241.033 requires that whenever the competence, character or alleged misconduct on any member or public person is to be taken they are to be given notice of that fact. Three days in advance. No notice, as stipulated, was given,” Rose said. “This is so you cannot have removal or sanctions imposed by ambush. And that appears to be what has happened.”
Judge Rose’s ruling also stated that there was no violation in the June 26 meeting of the Ely City Council, where the council approved spending $10,000 for a forensic audit of the railroad’s books. The audit, which had been on for weeks waiting on a ruling from the judge, will continue as planned.
“I think that agenda item was sufficiently clear and sufficient. So no injunction relief will be given with regard to the authorization of the forensic audit or its continuation,” Rose said.
Several smaller violations of Nevada’s Open Meeting Law were also found regarding information that should have been available in the public’s information packet before the council’s meetings and also who should have been contacted about that. The judge said that the City’s Attorney Richard Sears should have stepped in to stop the council before they ever violated the law in these ways.
“I know it is not your custom to violate the law but you did. And if you didn’t know about it then your attorney certainly should have and told you not to, and when you moved to file your attorney should have stood up and said you cannot do that,” Rose said after stating his ruling. He then added that “I have heard none of that and that certainly should have happened. I get angry when you don’t follow the law because it is my duty to enforce it.”
Rose’s ruling on the preliminary injunctions is not the final say in the lawsuit, but it will be the legally binding say until a final verdict is reached in trial. As of yet, no date has been set for trial.
Before adjourning the court, Justice Rose warned both parties that their continued fighting will only hurt the “goose that lays the golden eggs,” referring to the railroad. He called this a “new time for the railroad” and that while in the past, both the Board of Trustees and the Management Board had acted as “co-equals” that this City Council and Board of Trustees do have the authority and that the current management board would have to “get used to it.”
“So, with those kind of cautionary remarks about continuing, I would much prefer to see you try to work it out,” Rose said.