New York's highest court will hear arguments about whether local governments should be allowed to prohibit fracking operations like the one in southwestern Pennsylvania, above.
New York’s highest court will hear arguments about whether local governments should be allowed to prohibit fracking operations like the one in southwestern Pennsylvania, above. ()

ALBANY – When President Barack Obama visited the Baseball Hall of Fame in Cooperstown last month, he was greeted by demonstrators opposed to his support of extracting natural gas through the technique known as hydrofracturing or “fracking.”

On Tuesday, the state Court of Appeals will tackle the emotional issue of fracking as it hears arguments for the first time on whether New York municipalities—including Middlefield, the town surrounding Cooperstown—may use local ordinances to ban fracking.

The two fracking cases are part of a three-day June session that is packed with an unusual number of high-profile cases. The judges will also review New York City’s attempt to ban the sale of sugary beverages in containers larger than 16 ounces and the extent to which bankrupt law firms can claim an interest in the “unfinished business” that lawyers take with them when they jump to other firms.

Fracking involves injecting a water-based solution and sand into shale formations that lie beneath much of upstate New York and collecting the gas that migrates to well heads.

Proponents say it could be an economic boost to economically stagnant upstate areas. Opponents counter that it is likely unsafe to the environment, especially groundwater supplies.

The legal issue before the court involves whether state Oil, Gas and Solution Mining Law and Environmental Conservation Law preempts local planning and zoning laws and reserves for the state the right to regulate fracking, along with more traditional methods of energy extraction like drilling.

An Appellate Division, Third Department, panel ruled last year that state law does not preclude the Town of Dryden in Tompkins County and the Town of Middlefield in Otsego County from enforcing local ordinances prohibiting fracking (NYLJ, May 3, 2013).

Deborah Goldberg of the Manhattan-based environmental group, Earthjustice, will defend the Town of Dryden and its fracking ban.

She will argue that the town is not seeking to regulate technical aspects of fracking, which she concedes is within the purview of the state, but rather to exercise a municipality’s historic right to “protect the public health, safety, and general welfare” of its residents by controlling the permissible uses of land within its borders.

She will contend in Matter of Wallach v. Town of Dryden, 130, that to hold otherwise would violate the long-standing concept of “home rule” and recognize an “entitlement unique in the history of this state—the right to conduct heavy industrial operations throughout municipal territory, regardless of neighboring property interests or other local concerns,” Goldberg argued in her brief.

See Briefs for Appellant, Respondent, and Appellant’s Reply.

John Henry, a partner at Whiteman Osterman & Hanna in Albany, will defend the Town of Middlefield law in Cooperstown Holstein Corporation v. Town of Middlefield, 131.

Thomas West, a partner in the West Law Firm in Albany, will argue against the Dryden ordinance, contending that it usurps an area of regulation the state reserved for itself through the state mining law, which is codified in Article 23 of the state Environmental Conservation law.

The law says that the state statute “shall supersede all local laws and ordinances relating to the regulation of the oil, gas and solution mining industries,” West said in his brief.

Scott Kurkoski, a partner at Levene Gouldin & Thompson of Vestal, will similarly argue that state law allows for fracking the commercial development of the Middlefield farm despite that town’s anti-fracking ordinance.

See Briefs for Appellant, Respondent, and Appellant’s Reply.

Court of Appeals spokesman Gary Spencer said the number of calls from those interested in seeing Tuesday’s arguments has been higher than usual and an overflow room will be set aside in the Court of Appeals so observers will be able to watch the proceedings on closed-circuit television.

Fracking figures to become an issue in this fall’s campaign for governor between Democratic incumbent Andrew Cuomo and Republican challenger Rob Astorino.

Cuomo has had his administration studying whether the state’s 2008 moratorium on fracking should be extended or lifted since he took office in 2011. Astorino said fracking is safe, an economic boon and a way to use a home-grown energy source to lessen U.S. consumption of foreign oil.

Sugary Drink Ban

The limitation on sugary drinks a public health initiative of Michael Bloomberg during his final term as mayor of New York City. His successor, Bill de Blasio, has continued the legal fight to enact it in Matter of New York Statewide Coalition of Hispanic Chambers of Commerce v. New York City Dept. of Health and Mental Hygiene, 134.

The city’s Board of Health and Department of Health and Mental Hygiene instituted the “portion cap rule” in 2012 to prohibit the sale of soda and other beverages with high sugar content in containers larger than 16 ounces.

But two courts have struck down the rule. Both Manhattan Supreme Court Justice Milton Tingling Jr. and a unanimous Appellate Division, First Department, panel found that a rule as wide-ranging as the soda ban must be implemented by the City Counsel and the mayor together, not an administrative board appointed by the mayor (NYLJ, July 31, 2013).

Richard Bress, a partner at Latham & Watkins in Washington, D.C., will argue Wednesday that the beverage ban is not about preventing childhood obesity, as the city contends, but about the use of a city administrative board to make a sweeping change in city law.

“It is about an ill-conceived product ban that would have inflicted substantial and irrational economic harm on thousands of small businesses by prohibiting them from selling legal beverages that competing businesses next door would be permitted to sell freely,” he said in the plaintiffs’ brief.

Richard Dearing, an assistant corporation counsel, will counter that the city Board of Health is empowered by law to act against a “disease threat” in New York City.

The health risks associated with drinking too much soda, including obesity and diabetes, represents exactly that kind of threat, the city argues in its brief before the court.

See Briefs for Appellant, Respondent, and Appellant’s Reply.

Soon after becoming mayor in January, de Blasio said limiting sugary drinks was an example of where he agreed with the “core impulse” of the Bloomberg administration on a public health initiative. He said he might consider enacting a ban through city council legislation but termed the city’s stance in the high court case “legally strong.”

The fracking and beverage container cases each attracted more than a dozen amicus curiae briefs, an unusually large number for the court to accept on pending cases.

Unfinished Business

The court also will decide in In re: Thelen, 136, and In re: Coudert Brothers, 137. Those cases, to be heard Wednesday, involve the extent to which hourly legal matters “belong” to failing law firms when their former attorneys bring the cases with them to new firms.

A dozen prominent law firms are urging the Court of Appeals to declare as impractical the practice of allowing bankruptcy trustees to pursue profits from matters that partners carry from defunct firms to their new firms, and to find it contrary to nearly a thousand years of legal principle.

Briefs in all cases are available through Court-PASS, the Court of Appeals Public Access and Search System.

Several bar organizations argue that the “cardinal principle” of clients being able to freely choose their attorneys is at stake in the cases before the court.

But bankruptcy administrators argue that a partner’s duty to a dissolving law firm does not end by simply walking out the door (NYLJ, May 12). They said several other top state courts, including those in California, Florida, Illinois, Maryland, Massachusetts and Pennsylvania, recognize that hourly fee arrangements are subject to accounting when a law firm business is winding down.

Also among the 13 cases on the court’s June calendar are:

People v. Haggerty, 129. John Haggerty Jr.’s attorney will argue Tuesday that the political consultant was wrongfully convicted of grand larceny and money laundering for allegedly appropriating more than $1 million from a trust controlled by Bloomberg during his 2009 mayoral campaign (NYLJ, July 23, 2013).

Matter of Costello v. New York State Board of Parole, 140. The question of whether parole boards may rescind unpopular decisions granting freedom to inmates based on the “new evidence” of the effects that the crime continues to have on victims or their survivors will be the subject of arguments Thursday (NYLJ, April 17).

Matter of Doyle v. State Commission on Judicial Conduct, 106. Cathryn Doyle is challenging the recommendation of the Commission on Judicial Conduct that she be removed as Albany County Surrogate for not disclosing her close friendships with attorneys representing parties in several cases before her (NYLJ, Dec. 4, 2013). The court will hear the case Thursday.

The court will hand down rulings on this week’s cases beginning in late June.