NY court ruling reverberates in Colorado

new york ban fracking

A judicial earthquake occurred last week in New York and the aftershocks were felt across the nation’s gasfields. This time the earthquake wasn’t caused by an injection well. On June 30, the NY State Court of Appeals in a 5-2 decision upheld drilling bans in two small communities, Dryden and Middlefield, saying the towns could — as they did in 2011 — exercise their home rule authority to enact zoning laws that restrict industrial activity.

Nowhere were the rumblings felt more deeply than right here in gasland central, Colorado. This November voters will likely be considering a handful of anti-fracking ballot initiatives, causing poor Elmer Fudd Frackenlooper to tear his hair out as industry gnashes its teeth. In addition to those woes for the state and/or industry, there are currently 10 cities in the state with fracking bans. Plus Lafayette and Longmont are being sued by the Colorado Oil & Gas Association (COGA) — an industry-funded group NOT to be confused with Colorado Oil & Gas Conservation Commission (COGCC), which is funded by the state. The COGCC filed a separate lawsuit against Longmont in 2012, which is still pending. Oh, and Sovereign Oil & Gas sued Broomfield in late April. Their name says it all: we rule.

And if all that wasn’t enough to get your legal briefs in a bundle, there’s an 800-lb gorilla looming on the horizon in the form of the Federal Class Action, challenging the constitutionality of the Colorado Oil & Gas Conservation Commission (COGCC).

It’s important to note that from a legal standpoint what happens in NY State Court of Appeals has absolutely no bearing on other cases in other states. However the language of the ruling sets precedent for high courts in other states when they consider similar cases.

Maybe because I’m practically marinating in oil & gas these days, or maybe because of the legal wrangles in Colorado, or maybe just because my husband works for a NY company and that’s his second home, I really wanted to understand the New York court decision and how it impacts these same issues in Colorado. So, with the help of a couple friends and the google machine I set out to wander through the maze.

For you lawyer-types out there, click on the link for the Brief Amici Curiae submitted December 2012, on behalf of Respondents-Defendants-Respondents.

Click on the link to read the uncorrected version of the New York State Court of Appeals decision rendered on June 30, 2014.

If that’s way too much, here’s the cliff notes version:  New York Court Strikes Blow Against Fracking, by E. Christopher Murray, Esq., chair of Ruskin Moscou Faltischek’s Environmental Law Practice Group

For the most part, the Washington Post article below is good because it draws the connection between the issues in the NY decision and the issues facing Coloradans. Except for the beginning …

How two small New York towns have shaken up the national fight over fracking

The multibillion-dollar Anschutz Exploration Corp., which helped make its founder, Philip Anschutz, one of the richest men in America, filed a lawsuit three years ago against Dryden, a small town in Upstate New York.

The issue: Dryden was sitting on top of some of the best shale gas prospects in the country, and Denver-based Anschutz had bought a substantial number of leases giving it the right to drill there. But in August of that year, Dryden — like many towns seeking to restrain the rush to drill for shale oil or gas — had banned the combination of hydraulic fracturing and horizontal drilling known as fracking. It did this by adopting new language for its zoning laws and by citing road-use regulations, noise limits and the need to protect 31 “critical environmental areas.”

This week, in a landmark decision closely watched by industry and local governments across the country, Dryden won. The New York State Court of Appeals ruled in favor of Dryden and another town, Middlefield, which had been sued separately over similar local ordinances.

Well, that’s not exactly how this whole thing played out and this is where it gets complicated.

Once upon a time Anschutz held the O&G leases in Dryden and the company originally sued the town over zoning restrictions in 2011, claiming that NY Oil, Gas and Solution Mining Law (OGSML) prohibits towns from enacting local laws banning gas drilling activities. They lost in a trial court decision in early 2012. Anschutz decided the appeal wasn’t worth it so they sold two of their gas leases in the town to Norse Energy, a small, financially shaky operator, and apparently allowed their remaining Dryden leases to expire. Norse Energy then became the replacement plaintiff in the appeals process. In December 2012, Norse Energy filed for Chapter 11 bankruptcy, but the appeal moved forward anyway, leading some to surmise that Anschutz was using Norse as a sort of “rent-a-plaintiff” out of spite to drag the town through the appellate courts, costing millions, and teach other uppity little NY towns a lesson. Point of fact, Anschutz never was and is not now the “victim” here.

Now that I’ve explained all that go ahead and read the article – just skip those first three paragraphs.


But what does it all mean?

This week’s article in The Hill explains what the NY high court decision means to environmentalists.

‘Watershed moment’ for fracking foes?

Opponents of fracking are feeling emboldened by a ruling in New York’s highest court that found towns can outlaw the controversial drilling practice.

Environmentalists are cheering the decision against hydraulic fracturing as a major step toward more local control over the natural gas production. Industry groups, on the other hand, fear the ruling could results in a patchwork of local rules that slow development of the booming energy source.

“I think it’s a really watershed moment for the movement,” said Deborah Goldberg, an attorney with Earthjustice who argued the New York case for one of the towns involved …

… “I think it does have significance for other states,” said John Nolon, a professor in land use at the Pace University School of Law in New York City. “To the extent that this decision is based upon New York State’s delegated land use authority to local governments, it resonates in the other states.”

Nolon said states have similar laws that delegate zoning authority to local governments, a concept known as home rule, so the logic behind New York’s ruling should largely hold true elsewhere. The ruling reinforces that unless a state’s legislature specifically exempts certain activities from towns’ zoning powers, the towns retain them.

“To pick one thread and pull it out of the fabric is something that the state legislature can do, but I don’t believe the courts are going to lightly imply that they’ve done that,” Nolon said …

Interestingly the NY political newspaper, The Legislative Gazette addressed the public health issues head-on. Read this carefully, emphasis added:

Noted scientist says court ruling ‘only the beginning’

Environmental groups across the state welcomed last week’s New York state Court of Appeals decision defending municipalities’ right to prohibit fracking through the use of zoning laws …

… Scientist, activist and author, Sandra Steingraber, applauded the court’s decision, saying “From a public health point of view, I think it’s a great decision. The court has affirmed communities’ rights from the demonstrable risk of fracking and its infrastructure” …

… She echoed the concerns of townspeople and environmentalists across New York state that the negative environmental and health impacts connected with fracking operations cannot be contained within the boundaries of those municipalities that decide to approve fracking. “The problem remains that one community could ban fracking but still receive water and air contamination from neighboring communities. A statewide ban is the ultimate goal,” stated Steingraber …

… Steingraber, the co-founder of New Yorkers Against Fracking, cites the growing number of studies proving the alleged negative impact fracking has on the environment and community health. “It’s avalanched now,” she said.

“There are more studies in the peer reviewed medical literature showing the harm of fracking to human health just in the first four months of 2014 than published in all of 2011 and 2012 combined. By our count there are about 160 studies in peer-reviewed medical literature that show there is a serious threat of air contamination related to fracking. Some of which are known carcinogens.”

She added that there is no question as to whether or not fracking produces contaminated water, saying “Fracking is definitely linked to water contamination” …

… Steingraber went on to describe “frightening preliminary studies” which show harm to infants in communities where fracking has occurred. She also mentioned the potentially devastating impact fracking may have on the fragile aqueducts throughout the state if an earthquake should occur. She noted there are “preliminary studies that need to be backed up with more data, but once we know that these are open ended questions and concerns of communities, it becomes unthinkable to consider moving forward with fracking” …

Shh … listen. That sound you hear is the shit hitting the fan in NY and landing right here in Colorado.

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