Local News

Dell Attorney Asks Court To Dismiss Incentives Lawsuit

Posted April 26, 2006

— A taxpayer lawsuit challenging more than $300 million in incentives for Dell Inc. should be dismissed because courts have found similar packages legal, a company lawyer said Wednesday.

The General Assembly and local governments offered the computer manufacturer the deal in 2004 in exchange for a pledge to create at least 1,500 jobs at its plant near Winston-Salem and to invest at least $100 million in the area over the next 15 years.

Burley Mitchell, a former state Supreme court chief justice who represents Dell, told a judge that such incentive deals are a matter for elected officials, not the courts. Besides, Mitchell said, the state Supreme Court ruled a decade ago that similar taxpayer incentives were legal.

"The issues raised in the case just don't have any business before this court," Mitchell told Superior Court Judge Robert Hobgood.

Robert Orr, a former state Supreme Court justice representing the seven taxpayers who sued, countered that the courts should weigh the matter since his clients are challenging the constitutionality of the deal.

"Mr. Mitchell says that this is all about public policy," said Orr, who wrote the dissenting opinion in the state ruling that upheld incentives. "This case is whether elected officials abide by the limitations and provisions in both the North Carolina constitution and the United States constitution."

Dell and other defendants in the case, including the state of North Carolina and state Commerce Secretary Jim Fain, also argue the lawsuit should be thrown out since taxpayers aren't being harmed specifically by the incentives for Dell.

Dell, based in Round Rock, Texas, is getting up to $278 million in state incentives; a local package of $37.2 million to cover startup, tax relief and other costs; and more from foundations. The plant opened in October.

Hobgood said he did not expect to rule on the case Wednesday.

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