SW Legal studies in Business

Economic Loss No Reason for Waiver from State Ban on Smoking in a Business
Description

Nebraska high court held that a business owner who claimed financial ruin by compliance with the state’s ban on smoking in his business was not due a waiver from the rule. The law does not allow consideration of financial injury as a reason for a waiver.

Topic Administrative Law
Key Words

Regulation; Waiver; Arbitrary and Capricious; Indoor Air Quality

C A S E   S U M M A R Y
Facts

Prout has owned Big John’s Billiards in Lincoln and Omaha for 25 years. At the time they were built, most customers smoked, so no consideration was given to construction issues regarding segregation of smoking and no-smoking customers. Today, the large majority of his customers smoke. It is not realistic to divide the buildings into smoking and non-smoking sections, which must be done or convert completely to non-smoking. Prout has posted signs telling patrons that smoking is allowed and that non-smokers should not enter if they do not want smoke exposure. That not being adequate under the law, Prout filed a request with the Nebraska Department of Health and Human Services Regulation and Licensure for a waiver from the indoor air quality rules. The Department denied the waiver. Prout filed a petition for review in district court. The court affirmed the denial of the waiver. Prout appealed.

Decision

Affirmed. The denial by the Department for the waiver under the Clean Indoor Act, so as to allow smoking in pool halls, was not arbitrary and capricious. That would be grounds for overturning the decision. Prout did not show a compelling reason for a waiver. He claimed that compliance with the rule would impose economic injury on his business. When he converted the Lincoln pool hall to non-smoking, revenues fell in half. But financial burden is not a factor considered under the Act. Prout did not show that the health and comfort of nonsmokers would not be significantly affected if the waiver were granted, so he is not due a waiver.

Citation

Prout v. Nebraska Dept. Health & Human Serv., 745 N.W.2d 570 (Sup. Ct., Neb., 2008)

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