An Anchorage woman suing Gov. Mike Dunleavy alleging he violated federal law by denying her this year’s Permanent Fund dividend because she was in a same-sex marriage will receive her check.

The Department of Law late Friday said Denali Nicole Smith should not have been denied the $1,606 paid out this year and called the rejection an “inadvertent mistake.”

“No one disagrees that the denial letter never should have been sent,” said state Attorney General Kevin Clarkson in a prepared statement. “But the [Permanent Fund] Division promptly remedied the action once it figured out its mistake.”

Clarkson began Friday by posting two comments on Twitter calling the lawsuit filed by two Anchorage attorneys “pointless.”

Kevin Clarkson calls the PFD same-sex lawsuit

One Tweet read:

“The lawsuit filed re: same-sex spouse PFD dividends is pointless. The complainant is eligible for PFD. Her 2019 application is listed as Eligible – Not Paid. It’s “Not Paid” only because she has not provided a correct physical and mailing address. Big non-issue here.”

This and one other Tweet were eventually deleted.

In the later release, Clarkson challenged the lawsuit filed by Caitlin Shortell and Heather Gardner.

“As an attorney, I am appalled that Ms. Shortell would file a false lawsuit knowing full well that the Division had already changed course and had in fact informed her that her client’s dividend was scheduled for payment before the lawsuit was filed,” he wrote. “Attorneys have an ethical duty to not file false factual statements with a court.”

Kevin Clarkson comments on same-sex PFD lawsuit in a since-deleted tweet on Nov. 22, 2019.

The Department of Law also said in the release applications like Smith's "were supposed to be put on hold, while the PFD Division sought advice from the Department of Law to ensure it was properly complying with the law." 

KTVA asked for copies of any notifications and were told it needed to be filed through an open records request, which the station did.

On Wednesday, Shortell and Gardner filed the suit on behalf of Smith, who now lives with her military spouse where she was stationed in Florida. They named Gov. Mike Dunleavy, plus other members of his administration, including Clarkson, and Revenue Commissioner Bruce Tangeman.

Shortell and Gardner attached a denial letter to the suit, which attributed laws nullified five years ago, but they once forbid legal recognition of same-sex marriages.

Shortell told KTVA the lawsuit still has merit and believes there are likely others who were denied the dividend for the same reasons as Smith.

“The complaint was accurate,” she said. “There were no false statements in the complaint. The complaint is on behalf of plaintiff Denali Smith and others similarly situated and we do have reason to believe that denial based on the enjoined statute was an ongoing process.”

According to attachments, the state denied Smith a PFD because she “was absent from Alaska 206 days during 2018 accompanying her same sex spouse.” 

Her attorneys also allege the state “verbally explained to Denali that if she were married to a man, she would not be denied her PFD.”

In the suit, Gardner and Shortell wrote:

“Five years after this court issued a permanent injunction from enforcement of the statutes, the State does not recognize the lawful marriages of same sex couples and declares their marriages void under Alaska law.  Denali Smith is lawfully married under the laws of sister states, but Alaska refuses to recognize her same sex marriage as a basis to deny her a PFD.”

Dunleavy, who has made the PFD a hallmark of his campaign and his current tenure, said he was unaware of the situation.

“I was only made aware of this yesterday,” he said in a prepared statement. “I immediately wanted to get to the bottom of it. The PFD should go to all eligible Alaskans regardless of their marital status. We are examining our regulations and processes to ensure those who are qualified get their PFD.”

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