Judge issues $900M ruling against state

NORWALK — Ohioans might receive retroactive checks thanks to a ruling from a Franklin County court. In a long-awaited decision, Franklin County Common Pleas Court Judge Michael Holbrook on Wednesday ordered Gov. Mike DeWine and the Ohio Department of Job and Family Services to immediately reinstate Ohio's participation in the Federal Pandemic Unemployment Compensation program and take action to obtain Ohio's share of program benefits from the United States Department of Labor. It means the state could be forced to retroactively dole out about $900 million to Ohioans in pandemic relief funds. Former Ohio Attorney General Marc Dann and his law firm, Cleveland-based DannLaw, filed suit against the state in July 2021. The suit sought to overturn Gov. Mike DeWine's decision to prematurely end Ohio's participation in the federally funded COVID-19 program, aimed at helping Ohioans struggling with unemployment through the height of the pandemic, according to a press release. The lawsuit was filed on behalf of thousands of displaced Ohio workers who were denied approximately 13 weeks of federal unemployment benefits, due to the governor's decision. The Franklin County judge's ruling was reached Wednesday. "Today, Judge Holbrook validated our contention that Governor DeWine and the Ohio Department of Job and Family Services were required by Ohio law to accept and distribute the Federal Pandemic Unemployment Compensation payments to Ohioans devastated by COVID-19," Dann said. "The governor's decision to deny federal aid to families in crisis was arbitrary, unconscionable and illegal. We sincerely hope he will now honor his obligation to obey the law without delay," Dann said. Governor's call backfired? DeWine's decision to end the extra federal unemployment benefits was meant to satisfy a growing labor shortage amid business complaints that the extra $300 a week was discouraging workers from coming back to the job. The idea did not have the expected effect. "Economists say that any effect to end the extra benefits has been minimal, but business leaders looked at DeWine's decision as one tactic to address a labor shortage that has hurt the state's economy," said Ben Ayers, senior economist at Columbus-based Nationwide, per a Columbus Dispatch article published Dec. 1, 2021, nearly six months after DeWine's move. Local impact According to information gathered from Data.Ohio.gov, a repository for information from all Ohio agencies maintained by the state government, the decision to end distribution of federal unemployment benefits was especially premature in Huron, Erie and Ottawa counties. On June 26, 2021, the date Ohio's participation ended, the unemployment rate among local citizens was still critically high. The data shows that compared to the unemployment numbers on June 22, 2024, Erie County's rate of unemployment per one thousand residents was 510% higher, Huron and Ottawa counties were 260% and 244% higher, respectively. County 6/26/2021 6/22/2024 Change HURON 11.7 3.8 -260% ERIE 19.4 4.5 -511% OTTAWA 8.8 3.6 -244% The numbers According to Dann, eligible Ohioans will receive an estimated $900 million in program benefits due to Holbrook's ruling. "The payments will both enable people still reeling from the effects of the pandemic to rebuild their lives and significantly boost the state's economy," he said. "We've never understood why the governor would leave nearly a billion dollars sitting in an account in Washington, D.C., rather than allowing that money to flow into Ohio's 88 cities, townships and villages where it will fuel sales for local businesses and generate tax revenue. "Aside from being cruel, refusing funds made no sense from an economic standpoint," he continued. With the end of the federal program approximately 14 weeks after Ohio's withdrawal, eligible Ohioans could see a retroactive check of roughly $4,200. Class warfare Dann sees this case as more than simply a difference in policy philosophy. "This is a case of the ruling class persecuting ordinary people," Dann said in an interview with the Reflector. Dann feels he has a responsibility to advocate for ordinary Ohioans who find themselves battling seemingly overwhelming odds; in this case, taking on the plight of the people hurt most by the economic devastation brought on by the COVID-19 pandemic. According to Dann, the firm and its clients raised money for the filing fees and related expenses involved in initiating such a large case by crowd-sourcing, utilizing sites like GoFundMe to raise the capital needed for the fight. The firm has accrued a substantial outlay in fees and other expenses. "We have about $800,000 in uncollected fees," Dann said. "With this ruling, we should be able to recoup from the state." Appeals? Dann acknowledged that the decision could be appealed but noted the 10th District Court of Appeals had already ruled against the state. "The law, Judge Holbrook's ruling, and the opinion from the 10th District Court of Appeals are crystal clear: the state is required to obtain and distribute these funds," he said. "But, as we've now proven multiple times, if the governor refuses to abide by the law, we will fight, and we will win." Dann agreed time is of the essence. Although the money is currently in a dedicated fund for Federal Pandemic Unemployment Compensation program distribution, it could be re-appropriated at any time by the government. Dann believes the infrastructure is still in place to automatically make the payments directly to eligible Ohioans quickly, and there should not be a need to reapply. "The state has the information on file for the Ohioans who were receiving benefits on June 26, 2021, the date of the premature ending, and should be able to get the money into Ohioans' hands quickly," he said. Cost to Ohioans The federal government is responsible for paying the cost of distribution, and the only cost to Ohioans is the direct cost of paying for the failed legal defense of DeWine's decision. "The cost to distribute these funds comes directly from the federal government and will cost Ohio taxpayers nothing; this ruling will get $900 million into the hands of Ohioans, most likely to inject it into the Ohio economy quickly," Dann said. The attorney emphasized the fact that the case was the first time a Republican-led state was successfully sued over early withdrawal from the program. "The state will bear the cost of litigating; every lawsuit filed against a red state for the same action has been unsuccessful. The rule of law still stands in Ohio today."