Goldwater Institute Sues the City of Phoenix

Posted: Aug 10, 2007 5:42 PM

What do you get when you put the owners of a small real-estate company, wine and cheese café, ice cream shop, Sign-a-Rama, Music Together and Hava Java in the same room? In Phoenix, Arizona, you’ve got a court case.

In July, 2007, the City of Phoenix signed a contract with the Klutznick Company to provide a $97.4 million subsidy for their CityNorth project through sales taxes. However, Klutznick and the city of Phoenix apparently overlooked- or simply ignored- the constitutional prohibition on corporate welfare within Arizona. On August 8th, the Goldwater Institute filed suit against Phoenix Mayor Phil Gordon for violation of this constitutionally protected right for free-market competition.

The Goldwater Institute will represent Meyer Turken, owner of Turken Industrial Properties; Kenneth Cheuvront, owner of Cheuvront Wine and Cheese Café and Cheuvront Construction; Zul Gilliani, who owns an ice cream shop; James Iannuzo, owner of Sign-a-Rama; Kathy Rowe, owner of Music Together; and Justin Shafer, owner of Hava Java. Together, these entrepreneurs will work with the Goldwater Institute to assert their rights to compete in a capitalistic marketplace, as insured by Arizona state law.

The stakes include the elimination of corporate welfare in Arizona, equitable business environment that does not favor the politically connected over small business owners, greater economic efficiency, and a realignment of city priorities.

As the case moves forward, the Goldwater Institute's Scharf-Norton Center for Constitutional Litigation, directed by Clint Bolick, will argue that the CityNorth subsidy violates three clauses within the Arizona constitution.

Stay tuned for updates in this monumental case, as citizens of Phoenix go to battle with the government to protect their economic freedoms.