Wal-Mart sues Clark County

Kim Smith and Adrienne Packer

Tuesday, Oct. 19, 1999 | 11:10 a.m.

Wal-Mart Stores is suing Clark County, claiming an ordinance passed two weeks ago banning certain combination grocery-retail stores is unconstitutional.

Joining Wal-Mart in the lawsuit, which was filed Monday in U.S. District Court, is Eastern Beltway LTD., which holds the lease on Wal-Mart's store located at Eastern Avenue and Interstate 215.

U.S. District Judge Philip Pro was scheduled to decide this morning whether a temporary restraining order against Clark County should be issued. Such a restraining order would temporarily prevent the county from implementing the ordinance, which bans stores in excess of 110,000 square feet from devoting more than 7.5 percent of their space to groceries.

According to the lawsuit, even though the county and state had already issued virtually all of the necessary permits for a supercenter on Nellis Boulevard and the expansion of a Wal-Mart on Eastern Avenue, county commissioners allowed themselves to be influenced by the anti-Wal-Mart campaign orchestrated by the United Food and Commercial Workers Union.

The union's influence prompted county commissioners to vote 3-2 Oct. 6 in favor of the ordinance, which was "expressly crafted and designed" to preclude Wal-Mart Supercenters from entering the grocery market in Clark County, the lawsuit says.

Wal-Mart alleges that because a number of amendments in the ordinance were not publicized in advance, the ordinance should be declared null and void under the Nevada open-meetings act. The company also believes that because Commissioner Myrna Williams voted from a hospital bed while recovering from pneumonia, she did not actually hear all of the evidence regarding the manner, as required by law.

The decision to file the lawsuit came as a surprise to few. Clark County District Attorney Stewart Bell had anticipated that legal action would take place even before the decision was made.

"It was abundantly clear to me long before the ordinance was passed that if it did pass, there would be litigation initiated," Bell said. "I rather welcome the court's involvement so that this issue can be settled once and for all and people can go forward."

The three Clark County commissioners who voted in favor of the ordinance -- Williams, Yvonne Atkinson Gates and Erin Kenny -- have been reluctant to discuss the reasoning behind their decision, saying that they have received threats since the vote was held.

Some have accused the trio of bending under the pressure brought by the union.

According to the lawsuit, the union first made disparaging comments about alleged lower nonunion wages and benefits at Wal-Mart and later made allegations concerning traffic problems and urban blight.

"The urban blight hypothesis, on its face, is a brazen attempt to protect the three existing multi-billion dollar union grocery stores from competition despite the fact that Clark County is not empowered to regulate either competition or to restrict nonunionized competitors," the lawsuit states.

The lawsuit said the urban blight argument is "irrational and nonsensical" because there is no evidence that Wal-Mart would drive other retailers out of business or that the buildings left empty after their demise would become havens for criminals.

Wal-Mart also claims in its lawsuit that the ordinance is invalid because its effect on interstate commerce is "clearly excessive." By prohibiting Wal-Mart from selling food the company would lose approximately $1 billion in sales over the next 20 years, the lawsuit states.

The ordinance also violates the Equal Protection Clauses of the United States Constitution and the Nevada Constitution, the lawsuit states.

As for the traffic argument, there is no appreciable difference between the traffic generated in a retail establishment in excess of 110,000 square feet and a retail-grocery store that is in excess of 110,000 square feet, the lawsuit states.

Many people had suspected the lawsuit would be filed just days after the vote.

But Daphne Davis, a community affairs coordinator for Wal-Mart, said today that the Arkansas-based corporation wanted to thoroughly examine the ordinance and the procedures followed during the commission's Oct. 6 meeting.

She said Wal-Mart also gauged community members' reaction.

"As as motivation, we obviously recognize the tremendous support from consumers in the valley for choice when it comes to grocery shopping," Davis said. "The commission acted outside its authority by improperly trying to protect grocery changes and prevent competition."

Davis said Wal-Mart is still considering filing a lawsuit against Tucson, Ariz., which recently passed a similar ordinance that bans stores like Wal-Mart's Supercenter.

Tucson's ordinance was initially about setbacks and architectural design, but last-minute size restrictions were added during the City Council meeting and no public hearing was held on the amendments.

"We are looking at Tucson," Davis said. "There are a number of issues associated with each decision. Each decision is different and the circumstances are different."