Breaking: NY Court Decisions in Binghamton & Sidney Cases

exclusiveAn important development in two New York court cases that potentially impacts shale drilling in the state–and no, neither is (directly) about the Dryden or Middlefield town ban cases currently before New York’s highest court, the Court of Appeals. The two cases we’re referring to are (1) the City of Binghamton and their ill-fated “moratorium” thrown out by a lower court judge in 2012 and subsequently appealed, and (2) a similar moratorium in the Town of Sidney, NY.

In the Binghamton case, the appeal of the tossed-out fracking moratorium authored by anti-drilling husband and wife team of David and Helen Slottje has been withdrawn–so that case is now officially ended and the moratorium remains tossed and unenforceable. This is big news with big implications. In the case of Sidney, the judge in that case (different judge from the Binghamton case) issued a decision yesterday, but as of the time we wrote and posted this story, we still do not have a copy of the decision. We’ll post it as soon as we get it. Let’s dive deeper into both cases…

(Important update at the end of this article)

Binghamton Appeal Dropped

First is the good news about the Binghamton case. You may recall that in December 2011, then-Binghamton Mayor Matthew Ryan sought to take advantage of a strong Democrat majority on City Council before new members would be installed in January 2012 by pushing through a vote on a two-year moratorium on fracking in the city (see Binghamton Bans Fracking; Serious Allegation by Councilman). It was a largely symbolic vote since no drillers have leased land in the City of Binghamton, but an important vote nonetheless as it sent a strong signal to the drilling industry that they are not welcome in Binghamton–which was the purpose of the measure.

In May 2012, Binghamton law firm Hinman, Howard & Kattell filed a lawsuit in state Supreme Court on behalf of five plaintiffs to overturn the Binghamton moratorium (see City of Binghamton Gets Sued Over Fracking Ban). Mayor Ryan promptly retained the services of outside counsel–the Slottjes, who helped author the moratorium language–to handle the appeal case on behalf of the city. In October 2012, Judge Ferris Lebous tossed out the moratorium vote (see NY Judge Throws Out Binghamton Fracking Moratorium).

The Slottjes appealed the decision to the next highest court in New York, the Appellate Court. The case has been tied up on appeal since that time. Last Friday, the Slottjes sent a letter to the court and to HHK attorney Rob Wedlake announcing that they have withdrawn the appeal–meaning Judge Lebous’ lower court decision stands and, most importantly, moratoriums are against New York State law (at least in this case for the reasons outlined by Judge Lebous).

What are the wider implications? It means that dozens of moratoriums passed by other towns and cities across New York State–moratoriums written by the Slottjes–are now in doubt. It is quite possible–indeed likely–that lawsuits will be filed in other locations using Binghamton as a precedent to nullify moratorium votes in those locations. [See note below.] The Binghamton case is a clear and strong victory for landowners throughout New York. Finally, a hard-fought and well-deserved victory after years of frustration and defeats.

However, there’s another aspect of this story that’s also of keen interest to MDN, an aspect that likely will not receive play in the mainstream media, and that’s the role of Binghamton’s recent election. Binghamton (thankfully) has a term limit. The mayor may only serve two terms–or eight years–total. Matt Ryan, a strong anti-drilling Democrat, left office on Dec. 31, 2013 at the end of his second term (good bye and good riddance). A new mayor, Republican Richard David, assumed office on Jan. 1, 2014. The rumor we’ve heard is that David sent the Slottjes packing and told them to drop the city’s appeal forthwith. It’s important to note that we have no verification of that. We tried to contact the new mayor’s office but were unsuccessful in eliciting a response. However, the facts certainly fit: a new mayor, and a few weeks later the appeal is suddenly and without warning dropped, cementing a huge victory for landowners and pro-drillers. The anti-drilling side doesn’t just give up–especially with the deep pockets of the Park Foundation funding them. We think there’s a connection between the election and the Slottjes bowing out. Our observation: elections matter–even in cities like Binghamton where there is no drilling per se.

Sidney Moratorium Case Decided

A case similar to Binghamton’s is the Town of Sidney, NY–about a half hour northeast of Binghamton on Interstate 88. In February 2013 the Sidney town board voted 3-2 in favor of a one-year moratorium on fracking. Since fracking is not yet allowed in New York (5 1/2 years into our statewide moratorium), this was another anti-drilling empty gesture, but with important implications just like Binghamton.

In June, the sharp legal team of HHK was on the case and filed a lawsuit on behalf of landowners (see Exclusive: Sidney, NY Sued by Landowners over Fracking Moratorium). MDN spoke to Rob Wedlake, lead attorney on the case, yesterday. He confirmed that he was notified yesterday that the judge has now rendered a decision. However, he did not yet have a copy of the decision and felt it was premature to speculate on the outcome. We concur, but we’re hopeful based on the scuttlebutt we’ve heard from other sources.

As soon as we get a copy of the judge’s decision we’ll post it. In the meantime, if we might speculate just a tad, a decision to toss out the Sidney moratorium will join the Binghamton decision and further strengthen landowner rights throughout the state. Sidney, in addition to the Binghamton decision, will no doubt be used as a precedent in cases challenging moratoriums elsewhere in the state. [ See note below.] Although there are important differences between the Binghamton and Sidney moratoriums and the Dryden and Middlefield ban cases, it’s conceivable Binghamton and Sidney may influence those cases too.

The Root of the Issue – “Home Rule”

The issue at the center of these cases is sometimes called “home rule”–the right of local municipalities to govern themselves. Generally speaking, having decisions made closer to the people’s whose lives that are affected is a good thing, but in the case of oil and gas drilling, which is a complex activity and a complicated science–localities are simply not equipped to deal with it. They don’t have experts like geologists on staff to advise them. Plus, there is the bigger picture to consider. We won’t delve into the particulars, but the law in New York stipulates the state has an overriding interest in maximizing our oil and gas natural resources and that the state, not towns whose boards change every few years, is uniquely qualified to monitor it, regulate it, and oversee it.

If towns can simply decide to ban fracking and shale drilling—temporarily or permanently–no serious driller will look at New York. It would be too risky–too much money is at stake with leases and equipment and personnel to be yo-yoed every few years at the whims of 3-2 majorities on town boards.

If the Sidney moratorium is tossed out, it, along with the Binghamton case, solidifies the concept that moratoriums–“temporary bans”–are illegal in NY.

What will then be left to decide is whether outright “permanent” bans (which of course are permanent only until the next board election) will be allowed. That issue will be decided by the Dryden and Middlefield cases sometime by early summer of this year (see NY Pro-Drillers File Final Briefs in Dryden/Middlefield Cases).

NOTE: It seems MDN’s enthusiasm about the Binghamton and Sidney cases being used as precedent to challenge moratoriums previously enacted is, well, too enthusiastic. We received this comment on that issue from Ken Kamlet, one of the sharp legal beagles at Hinman, Howard & Kattell: “I would not make the assertion that dozens of existing gas drilling moratoria are now in doubt.  Article 78 claims have a short (4-month) statute of limitations.  So, depending on the procedures that were (or weren’t) followed, it may be too late to challenge most of those existing decisions.  The greatest impacts will be on moratorium cases going forward–especially in Broome and Delaware Counties.” So there you have it. It was a red letter day for pro-drillers and landowners in New York, particularly in Broome and Delaware counties (where drilling is likely to happen someday). However, don’t look for lawsuits to be filed to overturn moratoriums in other parts of the state–not just yet anyway.