Restaurant case to be heard

A case that will be heard before the New Mexico Supreme Court this week pits a state government that cites rising cases of coronavirus for restricting the operation of restaurants versus a sector that alleges the state's action will cost more jobs and prompt more businesses to close.

The New Mexico Restaurant Association and seven restaurants stated in court filings the state's restrictions have cost tens of thousands of jobs and closed more than 200 restaurants. The state maintains indoor dining at restaurants has contributed to a steep rise in COVID-19 cases, including about 15% of rapid responses to the outbreaks.

An Eddy County district judge on July 20 issued a temporary restraining order against enforcement of the state's indoor-dining ban for restaurants. The order had been scheduled to expire July 30, about the time Gov. Michelle Lujan Grisham's current health order would expire. Lujan Grisham re-imposed indoor dining bans July 13 after an increase in COVID-19 cases.

Three justices on the high court later that day issued a stay of the injunction and asked for responses by both parties by Thursday.

Court filings by the state and restaurants provide a glimpse into the arguments that likely will be presented to the state Supreme Court by Thursday.

Restaurants' case

The restaurant association stated in the request for a temporary retraining order at least 210 restaurants have closed and 52,000 jobs have been lost at restaurants and breweries because of the state's COVID-19 restrictions first imposed in mid-March. A significant number of those businesses lack outdoor seating capacity. The association estimated since the third quarter of fiscal year 2019, accommodation and food services have lost more than $192 million in taxable gross receipts.

When indoor dining was permitted June 1 at 50% capacity, the association estimated restaurants and breweries added 24,000 jobs. The state re-imposed the indoor dining ban July 13 after a rise in COVID-19 cases.

"The Association's best estimate is that the industry will lose at least and approximately twenty-five percent (25%) of current jobs should indoor dine-in services again be prohibited by the state," it stated.

Outlaw Meats of Fort Sumner stated in the petition the restrictions "will force (it) to go our business" because it is unable to pay its incurred debt. It stated patio service is unfeasible because of its location and "extremely high temperatures in the area."

Red River Brewing Co. stated it cannot pay its debt and does not have the financial resources to stay open more than about 60 days under current restrictions.

Texas Club Grill & Bar in Ruidoso stated it has lost $5,500 a month in revenue and employees facing reduced wages because of the restrictions.

K-Bobs of Las Vegas and Raton reported significant drops in revenue and worker layoffs or reduced wages. It stated those K-Bobs locations do not have a patio, and dining outdoors would "create an unsafe and undesirable environment."

The Trinity Hotel in Carlsbad said revenue fell by 80%, and its 41 employees face reduced hours and potential job losses. It stated its historic building does not have a patio, and it is not permitted to modify the building for that. It also stated it is too hot there for outdoor dining.

The petition stated COVID-Safe Practices by restaurants and breweries "have been sufficient to protect the public," and data doesn't support the closing of indoor dining.

It stated indoor restaurants are lower-risk than other places that have not been shut down, including hair salons, public transit, churches and gyms.

All the restaurants in the restraining-order request stated in affidavits they did not have any COVID-19 cases there.

The request stated the New Mexico Environment Department investigated 446 businesses since the start of the pandemic. Only eight restaurants had more than one COVID-19 infection.

"Based on the available data, there is minimal spread of COVID-19 amongst restaurant employees, and the spread associated with restaurants is not impacting the COVID-19 spread in a significant way," it stated.

It stated Lujan Grisham's most recent public health order was arbitrary, capricious and "not supported by any factual evidence."

"Indeed, the Governor has specifically excused restaurants themselves for any increase in COVID-19 cases," the petition stated, then cited a quote by her: "Restaurants did not do this to New Mexico."

State's case

The state's petition to the high court requesting a stay in the temporary restraining order said new restrictions on restaurants came after 'troubling infection trends" in the state and nationwide "with increasing evidence linking indoor dining at restaurants to a higher risk of infection."

It stated COVID-19 cases among restaurant workers in New Mexico "rose dramatically" about two weeks after indoor dining resumed in June and still was rising before the re-imposition of the ban.

During the first two weeks of June, the New Mexico Environmental Department dispatched its rapid-response teams five times to restaurants. That number rose to 16 in the following two weeks. During the final two weeks before the new restrictions, that number was 49.

The filing stated the proportion of rapid responses at restaurants in early June was 9.1%. During the following four weeks, the rate was 15.7% and 14.5%.

"There have also been significant compliance concerns with restaurants: approximately 20% of the reports of non-compliance to the New Mexico Department of Safety have involved restaurants," it stated.

The petition also maintained that a growth in cases at restaurants wasn't entirely attributable to rising cases in the state in general.

Robert Genoway, bureau chief of the New Mexico Occupational Health Bureau, stated in an affidavit that food industries as of July 12 had the highest percentage of rapid responses to COVID-19 cases, at 19%. Food industries include food manufacturing, grocery and restaurants. Restaurants account for 84% of that sector, he stated, and 14% of rapid responses.

Genoway also stated 420 of 2,100 complaints received by the Department of Public Safety were restaurants that allegedly failed to comply with public health orders.

The petition also cited a JPMorgan analysis of credit-card transactions at restaurants nationwide. It found a strong correlation in the rise in restaurant business with a rise in coronavirus cases later.

"The re-imposed limits on restaurants in New Mexico are consistent with a number of other states that have also recently recognized the added risks of indoor dining and have paused easing restriction or re-imposed restrictions on that activity," the petition stated, citing Texas and California as examples.

The state noted its mask mandate contains exemptions for eating and drinking - "the primary activities of (restaurants') customers."

Human Services Secretary David Scrase cited a recent study where the act of speaking can emit thousands of potentially infectious droplets that can linger in an enclosed space for eight to 14 minutes and greatly increase the risk of transmission.

As for allegations the restrictions are arbitrary and capricious, the petition asserted other sectors were not free from restrictions. Gyms, salons, churches, malls and other nonessential businesses are subject to a 25% occupancy rate. Recreational facilities that include theaters, bowling alleys, concert venues, bars, casinos and museums remain closed.