JLCNY Status of "Takings" Lawsuit by NY Landowners Against NY State


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A letter issued by the Joint Landowners Coalition of New York to member landowners and the general public on the status of the lawsuit they intend to file on behalf of landowners against New York State over its ongoing moratorium on hydraulic fracturing.

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JLCNY Status of "Takings" Lawsuit by NY Landowners Against NY State

  1. 1. April 23, 2013Dear Friends, Coalition Leaders, Landowners and Natural Gas Supporters,Contributions for our lawsuit against New York have been coming in steadily but westill need additional funds before we can move forward with the litigation. We heardfrom some of you who held off on contributing, hoping that a final decision mightcome from the Governor by April 12, 2013. Instead, all we received were moreexcuses and further confirmation that our property rights have already been taken.On February 8, 2013, the NYS Health Department Commissioner said he would befinished with his health review in a “few weeks” - that was over 2 months ago!On April 22, 2013, Fred Dicker of the New York Post said: “Sources said Cuomo hadalso told associates that he’s decided to put off a final decision until the end of nextyear because he wants to get through his 2014 re-election campaign without beingharassed by anti-hydrofracking protestors who have dogged him during severalpublic appearances.”On April 14, 2013, New York Magazine reported on an interview with GovernorCuomo. The Governor asked what if a “child falls into a well casing?” “I don’t wantthe liability, frankly, and I don’t have the knowledge.” So much for decisions basedon science and facts. If the Governor had ever visited a well site, he would know thatsuch an accident is impossible.On April 19, 2013, Susan Arbetter asked the Governor what his economic planswould be if HVHF is not approved. The Governor suggested that he will rely onyogurt to lift upstate New York from poverty. He said “Economic development nolonger works on a big bang theory, have to develop a thousand economic flowers.”For some reason our Governor does not understand that yogurt economics will notsave New York. From former Secretary Hillary Clinton to Governor Jerry Brown toPresident Obama, all of our nation’s leaders, except Governor Cuomo, recognizethat shale gas is a game changer for our countrys economy.
  2. 2. The SGEIS was ready to be released Labor Day 2012 until politics took over again.In July we will have been waiting to realize the benefits of natural gas developmentfor 5 years. By all indications, New York has already made its decision to depriveNew York landowners of our constitutionally protected property rights.It’s time to stand up for our rights.Attached you will find information about our lawsuit against New York State. Thiscase is not about individual gain. It is about the people of this state holding ourgovernment accountable.Please consider sending any donation you can afford to the "Landowner DefenseFund". I cannot emphasize enough what is at stake for us all. Our mineral rights willbe lost if we cannot win this struggle!Thank you for your assistance with this important endeavor.Warm Regards,Dan Fitzsimmons, PresidentJoint Landowners Coalition of New York, Inc.
  3. 3. The Joint Landowners Coalition of New York Is AcceptingDonations for a Lawsuit Against New York StateDonations are now being accepted by the Joint Landowners Coalition of New York for its lawsuitagainst New York State for a constitutional taking of our property rights under the United States andNew York Constitutions.Donations for the lawsuit can be made payable to “Landowner Defense Fund” and mailed to (please tearoff the lower half of this page and use it for mailing purposes)JLCNYPO Box 2839Binghamton, NY 13902Attention: Landowner Defense FundDonations can also be made by credit card by visiting the Landowner Defense Fund section of theJLCNY’s website at www.jlcny.orgThe JLCNY is a 501(c)(6) non profit corporation. Contributions or gifts to the Landowner DefenseFund through the JLCNY are not tax deductible as charitable contributions.----- ---------------------------------Cut here and send l to support this fund-------------------- ------------YES! I wish to contribute __________ to the Landowner Defense Fund.Name________________________________________________________________________Address:______________________________________________________________________City/State/Zip_________________________________________________________________Phone:_______________________________________________________________________Email: (optional) _____________________________________________________________(my phone and email address will only be used to communicate information or updates on the progress of the lawsuit and not for anyother purposes, and will NOT be shared with any other organization.)I am a landowners in the County(s) of, ___________________________________New YorkEnclosed is my check in the amount of $____________________________________________Make checks payable to: Landowner Defense FundMail checks to: JLCNYPO Box 2839Binghamton, NY 13902Attention: Landowner Defense FundI have made a donation on by credit card on the JLCNY website in the amount of $____________________
  4. 4. ABOUT THE LAWSUITLawsuit GoalsThe goals of this lawsuit are consistent with the goals of the JLCNY – to protect the constitutionallyguaranteed rights of NY landowners and push the State closer to approving the SGEIS and permitting wellsin the Marcellus and Utica shales. We believe that moving forward with natural gas development will bringthe greatest financial benefit to all New Yorkers, have an immediate impact on climate change, clean our air,dramatically reduce health impacts from air pollution and will allow our nation to come closer to achievingenergy independence.FundingThe action will not be commenced until the JLCNY has received sufficient funding. All of the funds donatedfor this effort will be administered by the JLCNY’s bank, Chemung Canal Trust Company (“CCTC”), in anon-interest bearing account.The JLCNY will deduct from the Landowner Defense Fund ongoing expenses incurred for the lawsuitincluding, but not limited to, fees and expenses for attorneys, experts, accountants and CCTC fundadministration (“Lawsuit Expenses”). Provided that donors have provided accurate identification andmailing information, a proportional share of donations remaining after deduction of the Lawsuit Expenseswill be returned to the donors for any donations of $100 or more (* $103.50 or more for credit carddonations) when the case is resolved. The balance of donations of less than $100 will be donated to theJLCNY general fund. For example, if a donation of $10,000 is made and the donor’s proportional share ofexpenses is $1,000, then $9,000 will be returned to the donor. If a donation of $99 is made and the donor’sproportional share of expenses is $50, the balance of $49 will be donated to the JLCNY general fund.Multiple donations from a single donor will each be treated as a single donation so that a donation of $200would be eligible for a return of a portion of the unused funds but a second donation of $99 by the samedonor would not since it is less than $100.* Pay Pal credit card payments: Pay Pal deducts a transaction fee from each donation and will credit theLandowner Defense Fund with the net balance. In order to be eligible for a return of funds after the caseresolution, credit card donations of $100 will need to add $3.50 for a total donation of $103.50.If an appeal is necessary, it will be the beginning of a new fund raising stage. Funds remaining in the initialstage will be used for the appeal stage. If the funds in the initial stage have been substantially depleted, theJLCNY reserves the right to limit reimbursement after the case resolution to the donors making donations inthe subsequent fund raising stages. Any appeals to a higher appellate court will commence a new fundraising stage.It is difficult to predict how the case will proceed and how long it will take. The DEC could approve theSGEIS and begin granting permits for HVHF prior to filing the complaint, soon after filing or afterprotracted litigation and discovery. The JLCNY is committed to proceeding with the lawsuit until the Stateauthorizes HVHF permits or until a court gives us a ruling in our favor, whichever comes sooner.Why Not a Class Action?A number of people have asked whether this will be a class action or an action that will involve hundreds oflandowners. While we would like to include a large number of plaintiffs in the action, the economic reality
  5. 5. is that numerous plaintiffs would make the action too costly to prosecute. Each property will require expertsto value the mineral rights and economic loss. We expect expert witness fees to be in excess of $100,000.00with just a few plaintiffs in the action. A large number of plaintiffs would cost millions of dollars in expertwitness and attorneys’ fees.Circumstances Have ChangedLandowners have been asking the JLCNY to commence this lawsuit for over two years. Until now, delay byitself was not enough to commence the claims. But, circumstances have changed. It is widely recognized thatthe SGEIS and the regulations have been completed. The SGEIS was prepared to be released on or aboutLabor Day 2012. The decision to further delay the release of the SGEIS was the Governor’s decisionentirely based upon politics, not science. New York started a new health review even though the Departmentof Health had already completed a 2012 health review and found that there were no health impacts from theprocess of hydraulic fracturing. New York’s dysfunction was further exemplified by Ohio which completedits HVHF regulations in 8 months and Illinois which was able to draft HVHF legislation in just 14 monthswith collaboration among landowner, environmental and industry groups.Ideal Plaintiffs• The lawsuit will primarily focus on landowners who own only the sub-surface mineral rights - and donot own the surface. The purpose of this strategy is to bring the best claims under existing law on takings inorder to establish legal precedent. The owners of sub-surface oil and gas rights have no use for their propertyother than exploration and development of oil and gas.• We have also sought landowners who were under a lease where their company applied for a Marcellusor Utica Shale drilling permit but the company was unable to proceed because of the State’s actions.• We have focused our efforts on the core regions of the Marcellus and Utica shales where there is little orno activity in other formations. The viability of the Herkimer, Oneida and Trenton Black River formationsleave us open to arguments that the property has other economic values and can be drilled by conventionalmeans, unlike the Marcellus and Utica shales.• We have sought properties in the Susquehanna River Basin as opposed to those in the Delaware RiverBasin. For this first action, we do not want the DRBC’s failure to promulgate rules to be a defense to ourlawsuit against the State.The LawThe takings claims will be brought under the 5thAmendment of the U.S. Constitution and Article 1, § 7 of theNew York State Constitution. The claims are predominantly controlled by the law in two cases: Lucas v.South Carolina Coastal Council, 505 U.S. 1003 (1992) and Penn Central Transportation Co. v. City of NewYork, 438 U.S. 104 (1978).A “Lucas” taking is regulation that denies all economically beneficial or productive use of land. It is a per setaking where the determination is made without regard for the government’s justification. You must show a“complete elimination of value” or it does not qualify.Absent a permanent deprivation of all value of the property, a “Penn Central” taking is governed by a fact-specific balancing test considering the following: 1) the economic impact of the regulation; 2) the extent towhich the regulation has interfered with reasonable investment-backed expectations; and 3) the character ofthe governmental action.Takings claims are difficult claims to make against the government. A landowner who claims that landregulation has effected a taking of his property bears the heavy burden of overcoming the presumption ofconstitutionality that attaches to the regulation and of proving every element of the claim.
  6. 6. We are evaluating many legal theories which could be alleged against the State in order to increase ouropportunity for success. Those theories include, but not are limited to, temporary or de facto takings, equalprotection, civil rights violations and declaratory judgment relief based upon the unconstitutionality of theState’s conduct.We have been speaking with national experts on the relevant law and the facts of our case. We intend toconsult with these experts prior to filing our complaint, assuming sufficient funding has been received.Our national leaders agree that we must move forward with development of our natural resources.President Barack Obama“In the meantime, the natural-gas boom has led to cleaner power and greater energy independence. That’swhy my administration will keep cutting red tape and speeding up new oil and gas permits.” . . . . “weproduce more natural gas than ever before – and nearly everyone’s energy bill is lower because of it. Andover the last four years, our emissions of the dangerous carbon pollution that threatens our planet haveactually fallen.” President Barak Obama 2013 State of the Union AddressNYC Mayor Michael Bloomberg"It is up to the governor, but I personally have said we should be fracking, not in the watershed, but weshould be fracking. … About 13,000 people get killed every year by the pollutants from coal-fired plants. …[Also, as] Boone alluded to, getting oil from outside this country is expensive and it transfers our wealth topeople who are trying to destroy our lives. … Of all the things we can do, natural gas isnt perfect, but itcertainly looks like it can make this country energy-independent and reduce dramatically the pollutants goinginto the air," NYC Mayor Michael Bloomberg, SNL:New York should start fracking, say T. Boone Pickens, MichaelBloomberg, February 21, 2013, Governor Jerry BrownEven California Governor Jerry Brown, a prominent environmentalist, says the state should consider the useof fracking technology to develop its massive shale oil reserves and reduce reliance on imported oil. . . . "Wewant to get the greenhouse gas emissions down, but we also want to keep our economy going. Thats thatbalance thats required." Governor John Hickenlooper“Hi, this is Governor John Hickenlooper. In 2008, Colorado passed tough oil and gas rules. Since then wehave not had one instance of groundwater contamination associated with drilling and hydraulic fracturing.And we plan to keep it that way. That’s why Colorado recently passed the toughest—and fairest—hydraulicfracturing disclosure rule in the nation. In Colorado, we’ve proven that industry and the conservationcommunity can come together to solve problems. We can create jobs, promote energy security, and protectour environment.” truly hope our leaders in Albany will agree that it is time to move forward with natural gas developmentin New York. But, until New York moves forward, the JLCNY is committed to protecting theconstitutionally guaranteed rights of New York landowners.