Joint Landowners' Coalition NYS Complaint.pdf

8/14/2019 Joint Landowners' Coalition NYS Complaint.pdf

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STATE OF NEW YORK

SUPREME COURT: COUNTY OF ALBANY

_________________________________________

PLAINTIFF A - PLAINTIFF E ,

COMPLAINT/PETITION

Plaintiffs/Petitioners,

vs. Index No.:

THE STATE OF NEW YORK, ANDREW M.

CUOMO, Governor of the State of New York,

THE NEW YORK STATE DEPARTMENT OF

ENVIRONMENTAL CONSERVATION, JOSEPH

MARTENS, Commissioner of the New York State

Department of Environmental Conservation, THE

NEW YORK STATE DEPARTMENT OF HEALTH

and NIRAV SHAH, Commissioner of the New York

State Department of Health,

Defendants/Respondents.

_________________________________________

Plaintiffs/petitioners (plaintiffs), by and through their attorneys, complaining of the

defendants/respondents (defendants), herein state as follows:

PRELIMINARY STATEMENT

1. Plaintiffs bring this hybrid action and proceeding to obtain monetary damagesand/or mandamus and/or injunctive relief for damages suffered by plaintiffs as a result of: 1)

defendants actions which have effected a taking of plaintiffs property intereststhereby

depriving plaintiffs of certain property rights protected by the United States Constitution and the

Constitution of the State of New York, and 2) the enactment by defendants of a Moratorium on

the issuance of well drilling permits utilizing high volume hydraulic fracturing, a technique

commonly used throughout the country to develop thousands of natural gas wells in deep shale

formations.


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2. The Marcellus shale formation is estimated to contain some 500 trillion cubic feetof natural gas and covers a large area, some 54,000 square miles in the main states of New York,

Ohio, Pennsylvania and West Virginia.

3. Beginning in 2008, natural gas drilling companies such as Fortuna Energy (nowTalisman Energy), Chesapeake Energy, Hess Corporation and Nornew, Inc. (Nornew) (now

known as Norse Energy Corp. USA (Norse)) evidenced great interest in drilling for natural gas

in the Southern Tier of New York causing an oil and gas leasing frenzy with natural gas drilling

companies paying some landowners as much as $5,000 per acre for nothing more than signing an

oil and gas lease.

4. On July 21, 2008, The State of New York brought an end to virtually all of theleasing activity and development when it imposed a Moratorium on the issuance of well drilling

permits utilizing high volume hydraulic fracturing (HVHF) that by its terms would run to some

indeterminate future time when the Department of Environmental Conservation of the State of

New York (DEC) issued a Supplemental Generic Environmental Impact Statement (SGEIS)

addressing the environmental effects of HVHF.

5. Other states including Ohio, Pennsylvania, West Virginia, Illinois and Californiawhich are rich in oil and gas resources completed their studies and adopted regulations and laws

pertaining to HVHF in just eight to twenty-four months and no state with oil and gas resources

has ever issued a moratorium on HVHF.

6. Though the SGEIS process for HVHF began in New York in 2008, it has yet to becompleted and has become exclusively a political issue with no discernible end in sight. From

July 21, 2008 through today, the apparently indeterminable SGEIS process has rendered the


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plaintiffsproperty and the natural gas trapped below the surface, unable to be developed and

unmarketable.

7. HVHF is the only commercially viable method of extracting natural gas frombeneath plaintiffs land and without the ability to use HVHF the plaintiffs natural gas is

valueless.

8. As more fully alleged herein, the conduct of defendants in imposing andperpetuating a Moratorium on the only commercially viable method to extract natural gas from

theplaintiffs propertieseffectuates an unconstitutional taking of plaintiffs property interests

and, alternatively, is an invalid exercise of the police power of the State of New York.

THE PARTIES

PLAINTIFFS A

9. At all times hereinafter mentioned, plaintiff ______________was and is a residentof the County of Broome and State of New York.

10. At all times hereinafter mentioned, plaintiff_____________ is a resident of theState of Pennsylvania.

11. At all times hereinafter mentioned, plaintiff ____________ is a resident of theCounty of Broome and State of New York.

12. At all times hereinafter mentioned, plaintiff ____________ is a resident of theState of Connecticut.

13. Plaintiffs___________________________________________________________________________ are hereinafter collectively referred to as the _______ Plaintiffs.

14. Prior to November 2, 2012, ________ Plaintiffs were the owners in fee simpleabsolute of certain real property located in the Town of Fenton, County of Broome and State of


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New York, comprising approximately 70 acres, which property is more particularly described in

a deed dated ____________ and recorded in the Broome County Clerks office on

____________, 1997 in Book ____ of Deeds at Page ___, a copy of which is attached hereto as

Exhibit A(the __________ Premises) .

15. By deed dated __________, 2012, ___________ conveyed 25% interest in and tothe ________ Premises to Plaintiffs ______________________.

16. The __________Premises is landlocked and at all times relevant herein the_________ Plaintiffs have and/or had no surface access to, or upon, the property.

17.

The highest and best use of the _________ Premises is for oil and gas

development and the property has been leased by the __________ Plaintiffs, or their

predecessor(s) in interest to various oil and gas operators over past years.

18. On or about _______, 2007, plaintiff ____________ entered into an oil and gaslease with Chesapeake Appalachia, LLC (Chesapeake), which lease was recorded in the

Broome County Clerks Office on___________, 2007 at Book ____ of Deeds at Page __, a copy

of which is attached as Exhibit B

19. Said lease had a five year primary term commencing on __________, 2007, witha three year option permitting the lessee to extend the lease for an additional three year period,

which option was exercised by the lessee by the filing of a Notice of Extension of Oil and Gas

Lease by Chesapeake in the Broome County Clerks Office on _____, 2013 in Book ____ of

Deeds at Page ___.

20. On or about ______, 2007, an oil and gas lease was entered into with Chesapeake,which lease was recorded in the Broome County Clerks Office on___________, 2007 at Book

____ of Deeds at Page ___, a copy of which is attached as Exhibit C.


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21. Said lease had a five year primary term commencing on _________, 2007, with athree year option permitting the lessee to extend the lease for an additional three year period,


Lease by Chesapeake in the Broome County Clerks Office on______, 2009 in Book ____ of

Deeds at Page ___.

22. On or about ________, 2007, plaintiff __________ entered into an oil and gaslease with Chesapeake, which lease was recorded in the Broome County Clerks Office on

__________, 2007 at Book ____ of Deeds at Page ___, a copy of which is attached as Exhibit

D.

23. Said lease had a five year primary term commencing on __________, 2007, witha three year option permitting the lessee to extend the lease for an additional three year period,


Lease by Chesapeake in the Broome County Clerks Office on ______, 2013 in Book ____ of

Deeds at Page ___.

24. On or about _______, 2007, an oil and gas lease was entered into withChesapeake, which lease was recorded in the Broome County Clerks Office on____________,

2007 at Book ____ of Deeds at Page ___, a copy of which is attached as Exhibit E.

25. Said lease had a five year primary term commencing on ____________, 2007,with a three year option permitting the lessee to extend the lease for an additional three year

period, which option was exercised by the lessee by the filing of a Notice of Extension of Oil and

Gas Lease by Chesapeake in the Broome County Clerks Office on_____, 2013 in Book ____ of

Deeds at Page ___.


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26. Effective ___________, 2008, a 32.5% interest in each of the aforesaid oil andgas leases was assigned by Chesapeake to Statoilhydro USA Onshore Properties, Inc.

27. Since the Moratorium, the _______ Plaintiffs have been unable to market,develop or extract the natural gas from the ________ Premises.

PLAINTIFF B

28. Plaintiff, ________, is a resident of the County of Steuben, State of New York.29. On or about 2005, plaintiff ______ acquired the oil and gas and other minerals in

property in the Town of Addison, County of Steuben, more particularly described in a deed dated

_______ and recorded in the Steuben County Clerks office on ________ in Book ___ of Deeds

at Page ___ , a copy of which is attached hereto as Exhibit F (the_______ Premises).

30. Plaintiff _______ acquired the _______ Premises for the sole and exclusivepurpose of development and extraction of the oil and gas from the premises.

31. The highest and best use of the _____ Premises is for oil and gas development.32. Since the Moratorium, plaintiff ____ has been unable to market, develop or

extract the natural gas from the ______ Premises.

PLAINTIFFS C

33. Plaintiffs ____________, (______) are residents of the County of Broome,State of New York.

34. The _____ Family Trust (the Trust)is a trust formed on ___________ underthe laws of the State of New York, of which ____________ is trustee.

35. Prior to _________, 2012, the _____ were the owners in fee simple ofapproximately ______ acres in the Town of Colesville, State of New York more particularly


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described in a deed dated _______ and recorded in the Broome County Clerks office on

________ in Book ___ of Deeds at Page ___ (the ____ Premises).

36. On or about _________ the _____ entered into an oil and gas lease withChesapeake, a copy of which is attached as Exhibit G, which lease had an initial five year

primary term commencing on ________, 2007 and an optional additional five year extension.

By payment and Notice of Extension of Oil and Gas Lease dated ______, 2012 and recorded in

the Broome County Clerks Office on___________, 2012 in Book ____ of Deeds at Page ___,

Chesapeake extended the primary term an additional five years, to _____, 2017.

37.

_____ sole and exclusive purpose in entering into the oil and gas lease was to

market, develop and extract natural gas from the ____ Premises.

38. Pursuant to the oil and gas lease, and with the intent to develop the ____ Premisesand extract natural gas therefrom, on or about _______, 2009, Chesapeake filed a well permit

application for six horizontal wells known as ____, ______, ______, ________, _________ and

_________, which were to be developed by using HVHF.

39. The targeted formation was the Marcellus shale.40. Upon information and belief, Chesapeake filed the well permit applications in

anticipation of the release of the SGEIS and with the anticipation that permits for HVHF would

be issued shortly thereafter.

41. The highest and best use of the _________ Premises is for oil and gasdevelopment.

42. By deed dated ______, 2012, and recorded in the Broome County Clerks Officeon ______, 2012 in Book ____ of Deeds at Page ___, the _____ conveyed all oil and gas and


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petroleum products estate, interest and rights including, without limitation, all oil gas and other

rights in, under, and that may be produced from the ____ Premises to the ____ Family Trust.

43. Due to the Moratorium, the well permit applications have not been granted, nodrilling has yet occurred and neither the _____ nor the Trust have received royalty payments.

PLAINTIFF D

44. Plaintiff, ______ (____) is a resident of the County of Broome and State ofNew York.

45. On or about ______, 2008, ____ secured a line of credit encumbering certain realproperty he owned and utilized as his primary residence in the sum of $175,000.

46. ____s sole purpose in securing this line of credit was to obtain funds to purchasevacant real property in the Broome County area exclusively for oil and gas development and, in

particular, to develop the Marcellus shale formation lying beneath the property(ies).

47. On or about _______, 2008, ____ purchased vacant real property comprised ofapproximately 22 acres located in the Town of Lisle, County of Broome and State of New York

for the sum of $37,000, which property is more particularly described in a deed recorded in the

Broome County Clerks office on______, 2008 at Book ____ of Deeds at Page ___, a copy of

which is attached hereto as Exhibit H(the _______ A Premises).

48. Almost immediately after the purchase of the ____ A Premises, plaintiff ____ wasapproached by Chesapeake to lease the property and on or about ______, 2008, ____ entered

into an oil and gas lease with Chesapeake for extraction of natural gas from the ____ premises,

which lease was recorded in the Broome County Clerks Office on________, 2008, at Book

____ of Deeds at Page ____.


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49. A 32.5% interest in and to the oil and gas lease was later assigned by Chesapeaketo Statoilhydro USA Onshore Properties, Inc., which assignment was recorded in the Broome

County Clerks Office on_________, 2009, in Book ____ of Deeds at Page ___.

50. On or about__________, 2009, ____ sold the ____ A Premises reserving untilJuly 9, 2018, any and all mineral rights of the subject property, including, but not limited to, oil,

coal, gas and stone and [all] right and interest in a certain Oil and Gas Lease dated _____,

2008 All rights retained herein, including, but not limited to, any right to royalties and delay

rental dues, if any, will be assigned to grantees after July 9, 2018, as more fully described in a

deed recorded in the Broome County Clerks Office on________, 2009 in Book ____ of Deeds

at Page ___, a copy of which is attached as Exhibit I.

51. On or about ___________, ____ entered into a contract for the purchase of twoparcels of vacant real property comprised of approximately 13.80 acres and 1.0 acres,

respectively, in the Town of Kirkwood, County of Broome and State of New York.

52. On _________, 2008, ____ purchased the aforesaid 13.80 acre and 1.0 acre parcelfor the sum of $29,800.00, which real property is more particularly described in a deed dated

___________, 2008 and recorded in the Broome County Clerks office on _______, 2008 in

Book ____ of Deeds at Page ___, a copy of which is attached hereto as Exhibit J(the ____ B

Premises).

53. Though the ____ B Premises are located in the heart of the prime area of theMarcellus Shale in New York, plaintiff ____ was offered only a nominal leasing bonus, when

property owners located just a few miles across the border in Pennsylvania were receiving

upwards of $5,000.00 per acre.


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54. On or about ________, 2011, ____ sold the ____ B Premises reserving all of theoil, gas and minerals lying below the surface of the premises.. , said deed also reciting that

the Grantor. shall not have any right to enter upon the surface of the Premises or to conduct

any surface operations on the Premises, including but not limited to, the construction of

pipelines, the exploration, development, production and/or removal of oil, gas or other minerals

from under the surface of the Premises", as more fully described in a deed recorded in the

Broome County Clerks Office on_______, 2011 in Book ____ of Deeds at Page ___.

55. On or about ____________, ____ entered into a contract for the purchase ofcertain vacant real property located in the Town of Lisle, County of Broome and State of New

York comprised of approximately 60.5 acres.

56. On or about ______, 2009, ____ purchased the aforesaid approximate 60.5 acreparcel for the sum of $100,000.00, which property is more particularly described in a deed

recorded in the Broome County Clerks office on________, 2009 at Book ____ of Deeds at

Page ___, a copy of which is attached hereto as Exhibit K(the ____ C Premises).

57. The purchase of the ____ C Premises was subject to an existing oil and gas leasewith Ansbro Petroleum Company, which lease was dated ___________, 2007 and recorded in

the Broome County Clerks Office on_________, 2007 at Book ____ of Deeds at Page ___.

58. Said lease expired without any development upon the leased premises and, todate, plaintiff ____ has received no offers to lease ____ C Premises.

59. On or about ______, 2013, ____ conveyed ____ C Premises excepting andreserving one hundred percent (100%) of Grantors mineral estate interest and rights, including,

without limitation; all of the oil and gas in and under and that may be produced from th e land,

and additionally excepts and reserves the right to pool, unitize and/or remove said oil and gas,


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the right to execute oil, gas and other mineral leases, the right to receive any and all payments

therefrom, including without limitation, all rental, bonus and royalty payments for oil, gas and

other mineral leases, and the right to sell or otherwise dispose of said oil, gas and other

minerals, as more particularly described in a deed recorded in the Broome County Clerks

Office on ______, 2013 in Book ____ of Deeds at Page ___, a copy of which is attached as

Exhibit L

60. The highest and best use of all of the aforementioned properties owned by ____ isfor oil and gas development.

61.

Since ____ has acquired the subject properties, due to the Moratorium, he has

been unable to market, develop and/or extract the oil and gas lying beneath the properties.

PLAINTIFFS E

62. At all times relevant herein, plaintiff, ________ (______)was and is a limitedliability company organized under the laws of the State of New York with an address of

_________, Deposit, New York.

63. At all times relevant herein, plaintiff ______________, LLC (________)wasand is a limited liability company organized under the laws of the State of New York with an

address of _______________, Deposit, New York.

64. At all times relevant herein, _____________ LLC was and is a member of_______.

65. Prior to _________, 2007, __________ was the owner in fee simple absolute ofapproximately 93.3 acres of vacant real property located in the Town of Colesville, County of

Broome and State of New York bearing tax map no.___________, which property is a portion of

the property described in a Warranty Deed recorded on ___________, 2002 in the Broome


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County Clerks Office at Book____ of Deeds at Page ____, a copy of which is attached as

Exhibit M(the _________ Premises).

66. On or about _______, 2007, _______ entered into an oil and gas lease withNornew, a copy of which is attached as Exhibit N encumbering the ______ Premises which

provided for an initial five year primary term, subject to an option to extend the lease for a

second five year term.

67. _______s sole purpose in entering into the oil and gas lease was to market,develop and extract natural gas in the premises and receive royalty payments therefor.

68.

On or about ________, 2008, _______ conveyed the _______ Premises,

reserving, inter alia, the rightto all surface and subsurface oil, gas and minerals and to enter

upon the premises for the purpose of exploration for and removal of any or all oil, gas and

mineralsas more particularly described in the deed which was recorded in the Broome County

Clerks Office on________, 2008, at Book _____ of Deeds at Page ___.

69. A correction deed dated _________, 2012 and recorded in the Broome CountyClerks Office on_________, 2012 was executed by the same parties to the _______, 2008 deed

to reflect that _______ excepted and reserved an undivided one-half interest in all oil, gas and

other minerals located on, in and under all of the premises together with the right of ingress

and egress for the purpose of exploring, drilling, operating, producing or marketing oil, gas and

other minerals, and for the purpose of construction and maintenance of any pipeline necessary

for the transporting of such oil, gas and other minerals .

70. _______s sole and exclusive purpose in excepting reserving the oil and gas wasto develop and extract natural gas lying beneath the property and, in particular, from the

Marcellus shale formation.


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71. Pursuant to the oil and gas lease, and with the intent to develop the ______Premises and extract natural gas therefrom, on ________, 2010, Norse filed a well permit

application with the DEC.

72. Upon information and belief, the Norse permit application was filed for aconventional vertical well due to the existing Moratorium.

73. Upon information and belief, Norse filed the well permit application for a verticalwell with the intent of drilling other wells using HVHF from the same well pad as soon as HVHF

was permitted in New York.

74.

The Norse permit was granted by the DEC on __________, 2010. It expired by

its terms during the Moratorium and the ______ Premises has not been developed to date.

75. On or about December 6, 2012, Norse filed for relief under Chapter 11 of theUnited States Bankruptcy Code and converted to Chapter 7 on or about October 10, 2013, which,

upon information and belief, was caused by New Yorks failure to permit HVHF to extract

Marcellus shale natural gas.

76. On or about ________, 2012, ________ acquired ownership of 100% of all of theoil, gas and other minerals underlying the ________ Premises as is more particularly described

in a Mineral Deed recorded on ________, 2012 in the Broome County Clerks Office at Book

____ of Deeds at Page ___, a copy of which is attached hereto as Exhibit O.

77. ______ owns only the oil, gas and minerals in the _______ Premises and does nothave any rights to the surface of the property, other than those incidental to the extraction of oil

and gas.

78. Upon information and belief, had Norse been permitted to develop the propertyusing HVHF, plaintiffs _______ and ______ would have realized substantial royalty payments.


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79. The highest and best use of the property is for oil and gas development.80. Since the Moratorium, plaintiffs ________ and _______ have been unable to

market, develop and extract oil and gas from ________ Premises.

81. The defendants Moratorium banning HVHF has rendered valueless or virtuallyvalueless the valuable oil and gas reserves of plaintiffs A through E, collectively referred to

herein as plaintiffs, and irreparably injured the plaintiffs.

THE DEFENDANTS

82. Defendant, State of New York, is a state organized and maintained pursuant to theNew York State Constitution with its principal office located at the State Capital, Albany, New

York.

83. Defendant, Andrew M. Cuomo, is the Governor of the State of New York.84. The New York State Department of Environmental Conservation is an agency of

the State of New York with its principal offices located in Albany, New York.

85. Defendant, Joseph Martens, is the Commissioner of the New York StateDepartment of Environmental Conservation.

86. The New York State Department of Health (DOH) is an agency of the State ofNew York with its principal offices located in Albany, New York.

87. Defendant, Nirav Shah, is the Commissioner of the New York State Departmentof Health.

88. Each individually named defendant is sued in his individual capacity and officialcapacity.


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89. Defendants State of New York, Andrew M. Cuomo, New York State Departmentof Environmental Conservation, Joseph Martens, New York State Department of Health and

Nirav Shah are collectively referred to herein as Defendants.

OPERATIVE FACTS

90. The DEC oversees the regulation of oil and gas drilling in the State of New York.91. It is the policy of the State of New York as codified at 23-0301 of the

Environmental Conservation Law to develop existing natural gas and oil resources within the

state in ways that prevent waste and provide for the greatest ultimate recovery of these valuable

resources.

92. The New York State Environmental Quality Review Act (SEQRA) requires thatgovernmental agencies, including the DEC, consider various factors prior to approving certain

activities, such as the drilling of a natural gas well, that may have an adverse effect on the

environment.

93. The DEC is required under SEQRA and applicable regulations to expediteproceedings in the interest of prompt review and to minimize procedural and administrative

delay.

94. In 1992, to streamline the well permitting process, the DEC prepared a GenericEnvironmental Impact Statement (GEIS) applicable to the operations and impacts associated

with the drilling of an oil and gas well. After the GEIS was adopted, any subsequent application

for the drilling of a natural gas or oil well within the parameters of the GEIS could be approved

without any additional SEQRA review.

95. When the DEC finalized the GEIS some 30 years ago, a technique known ashorizontal drilling was commonly in use in New York and was used to drill natural gas wells.


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96. When the DEC finalized the GEIS some 30 years ago, low volume hydraulicfracturing was also an established technology having been used in New York since the 1950's.

97. More recently, various technological advancements, particularly in the use ofhorizontal drilling combined with high volume hydraulic fracturing, have enabled economic

extraction of natural gas inpreviously undeveloped tight shale formations, such as the

Marcellus and Utica shale formations.

98. High volume hydraulic fracturing involves the injection of water, sand andchemicals under high pressure to create a multitude of small fractures to facilitate high volumes

of natural gas production.

99. The combination of horizontal drilling and HVHF has been successfully utilizedto develop thousands of wells in many other states, including thousands of such wells in

Pennsylvaniamany of them just a few hundred feet from the New York border.

100. Beginning in approximately February, 2008,New YorksSouthern Tier, WesternNew York and Central New York, experienced a profound expansion of oil and gas leasing

activity as these areas are believed to be located in the heart of the Marcellus shale formation.

101. In response to the heightened interest in developing deep shale formations thelegislature amended the Environmental Conservation Law of the State of New York (the ECL)

in 2008 to establish spacing requirements of drilling units for wells utilizing horizontal drilling

and hydraulic fracturing.

102. Spacing refers to the size of the drilling unit that can be efficiently drained by onewell. The ECL amendments made the administrative permitting process more efficient and

eliminated many hearings before the DEC on the appropriate size of the spacing unit for a

proposed Marcellus or other deep shale well.


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103. On July 21, 2008, now former Governor David Paterson signed into law theamendments addressing uniform spacing requirements for well drilling using HVHF. Two days

later Governor Paterson also issued a press release ordering the DEC to initiate a formal public

process to update the 1992 GEIS to address the environmental impacts of HVHF.

104. Governor Patersons directive resulted in a Moratorium which effectively shutdown the development of deep shale formations.

105. The development of the SGEIS began with public scoping meetings in Novemberand December, 2008. The purpose of the scoping meetings was to allow members of the public

and interested persons to recommend topics to be covered in the SGEIS. The scoping meetings

prompted over 3,700 written comments, and following review and incorporation of these

comments the DEC released the final scope for the draft SGEIS in February, 2009.

106. Thereafter, the draft SGEIS was released by the DEC on September 30, 2009.Public hearings on the contents of the draft SGEIS were held in October and November, 2009.

Over 13,000 written comments were submitted through to December 31, 2009, when the public

comment period on the draft SGEIS came to a close.

107. The DOH assisted with and contributed to the draft SGEIS.108. For a period of almost a year, the DEC purportedly was reviewing the comments

in an effort to complete the SGEIS. On December 13, 2010, now former Governor Paterson

issued Executive Order No. 41, directing the DEC to publish a revised draft SGEIS on or about

June 1, 2011.

109. Executive Order No. 41 explicitly provided that no permits would be issued untilthe completion of a final SGEIS, thus perpetuating the July 21, 2008 Moratorium.


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110. Executive Order No. 41 was extended by defendant, Governor Andrew M.Cuomo, on January 1, 2011, continuing the Moratorium.

111. The DEC released the revised draft of the SGEIS, a month late, on July 8, 2011.In its press release of June 30, 2011, announcing the impending release of the revised draft

SGEIS, the DEC reported that it had engaged independent consultants to perform research,

sought further information from the gas drilling industry, considered more than 13,000 public

comments and studied other states regulations and experience.... Since September, 2009, DEC

staff has spent approximately 10,250 hours updating the document.

112.

On July 1, 2011, Commissioner Martens announced the initial members of the

High-Volume Hydraulic Fracturing Advisory Panel charged with developing recommendations

to ensure DEC and other agencies are enabled to properly oversee, monitor and enforce HVHF

activities; developing recommendations to avoid and mitigate impacts to local governments and

communities; and evaluating the current fee structure and other revenue streams to fund

government oversight and infrastructure related to high-volume hydraulic fracturing. The

committee met several times between July and December of 2011, but postponed and canceled

several meetings thereafter. The panel has not met since mid-December 2011, and never issued

any recommendations.

113. Despite this extensive review, and despite the initial scoping process, the DECdecided to further consider the community and socioeconomic impacts of HVHF and engaged

independent consultants to research these effects.

114. The DEC stated that the community and socioeconomic research would becompleted by July 31, 2011.


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115. On September 7, 2011, the revised draft SGEIS was released which incorporatedthe analysis of the community and the socioeconomic impacts of HVHF.

116. On September 28, 2011 the DEC released draft regulations for HVHF (HVHFRegulations) and the proposed State Pollution Discharge Elimination System General Permit

regulations for storm water discharges associated with HVHF (SPDES Regulations)

(collectively referred to herein as the Regulations). The proposed Regulations for well

construction and HVHF reflected the provisions contained in DECs revised draft SGEIS.

117. Public hearings were held concurrently on the revised draft SGEIS and theRegulations with the public comment period held open until January 11, 2012.

118. The State Administrative Procedure Act mandates that proposed regulations befinal within one year of the last public hearing (SAPA 202(2)(a)(ii)) giving the DEC until

November 29, 2012 to finalize the Regulations.

119. On or about January 11, 2012, Commissioner Martens stated the DEC ismonths, but not years away from finalizing the revised draft SGEIS.

120. Beginning in early 2012, in order to minimize the political consequences relatedto the release of the SGEIS, the Cuomo administration began pursuing a plan to limit the first

HVHF permits those communities in Broome, Chemung, Chenango, Steuben and Tioga Counties

that expressed support for the technology. In response to the Governors proposal, over forty (40)

towns signed resolutions expressing their support. The Governors plan was confirmed by a

senior DEC official as reported by New York Times reporter Danny Hakim on June 13, 2012.

121. Governor Cuomo made numerous statements in 2012 that the final SGEIS wasimminent and that it would be completed before the end of the 2012 summer.


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122. Upon information and belief, the DEC was prepared to issue the final SGEIS soonafter Labor Day 2012.

123. Upon information and belief, in September 2012, Defendant, Andrew M. Cuomo,arbitrarily directed the DEC to delay the release of the SGEIS until after the election of

November 2012, a decision influenced exclusively by political concerns, unrelated to any

legitimate concerns with the SGEIS and without regard to the interests of prompt review and

minimal procedural and administrative delay.

124. On September 17, 2012, Fredric U. Dicker reported that Cuomo administrationinsiders said a final decision on the SGEIS would not be made until after the 2012 November

election.

125. Thereafter, on September 30, 2012, more than a year following the release of thesecond revised draft SGEIS, Commissioner Joseph Martens announced that he had requested

New York State Health Commissioner, Nirav Shah, to assess the impact of HVHF on public

health and declared that not until Commissioner Shahs evaluation was completed would a

decision be rendered as to whether to permit HVHF in New York and, hence, permit

development of the Marcellus and other deep shale formations (the Health Review).

Commissioner Joseph Martens also announced that he had asked Commissioner Shah to create

an outside panel of experts to advise him in his Health Review.

126. The Health Review was announced, notwithstanding that DOH had already beenactively engaged in the process at the time the initial draft SGEIS was released and not

withstanding that the DEC in early 2012 had concluded that potential health risks from air

emissions, water contamination and other possible sources would be preventable with the states


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proposed guidelines and had determined that significant adverse human health impacts were

unlikely.

127. In approximately November, 2012, a panel of experts was identified to facilitatethe Health Review.

128. On November 28, 2012, after receiving and processing over 66,000 individualpublic comments on the Regulations, the DEC issued a Notice of Revised Rule Making with

revisions to the Regulations. The revised Regulations were subject to a thirty (30) day public

comment period which was thereafter extended to ninety (90) days to February 27, 2013.

129.

On January 29, 2013, Bill Schwarz, a spokesman for DOH, stressed that the

outside consultants recommendations were part of a larger review being done by Commissioner

Shah and said in response to questions about whether the experts had made their

recommendations: The State Health Commissioner and three external consultants are reviewing

the data and information regarding potential public health impacts included in DECs draft

environmental impact statement.

130. During sworn testimony before a Legislative Budget Hearing on January 30,2013, Commissioner Shah testified that the vast majority of the material being reviewed for the

health assessment was available on the internet at the DEC website. During that testimony,

Commissioner Shah advised that the results of his assessment would be fully revealed within a

few weeks.

131. On February 8, 2013, it was reported that the three outside experts assistingCommissioner Shah with the Health Review had completed their work on the Health Review

more than a month earlier, a fact Commissioner Shah failed to disclose during his lengthy

testimony before lawmakers the previous week and DOH spokesman Bill Schwarz failed to


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disclose in his January 29, 2013 statement. One panel expert said his review was completed two

months earlier and was in the hands of the DOH; another said she completed her last comments

on the review about six weeks earlier; and, the third said all three consultants finished their work

at the same time.

132. On or about February 12, 2013, Governor Cuomo met with CommissionerMartens and Commissioner Shah and authorized the release of two statements to the public: (1)

Commissioner Shahs February 12, 2013 letter to Commissioner Martens advising him that he

needed to review three studies, two of which were by Geisinger Health Systems and University

of Pennsylvania and said I anticipate delivering the completed Public Health Review to you

within a few weeks, along with my recommendations, and (2) a statement dated February 12,

2013 from Commissioner Martens indicating that Commissioner Shah advised him that he

expected his review to be complete within a few weeks and that the DEC could issue permits

for HVHF if the DOH Public Health Review finds that the SGEIS has adequately addressed

health concerns.

133. Upon information and belief, the Geisinger Health Systems and University ofPennsylvania health studies have still not been fully funded.

134. DEC failed to meet the February 27, 2013 deadline for completion of theRegulations and allowed the Regulations to expire.

135. A month later, on March 12, 2013, Commissioner Shah indicated that his reviewwould, again, be done in a few weeks.

136. To date, Commissioner Shah has not issued a report, the SGEIS is not final, andDEC has issued no HVHF permits.


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137. Upon information and belief, Governor Cuomo, his administration and/ordefendants have issued a gag order preventing DEC, DOH and any New York State employee

from making any public comments about the SGEIS, the Health Review or HVHF without the

prior consent of the Cuomo administration.

138. On March 14, 2011, the Albany Times Union reported that Taury Smith, NewYork State Geologist and Director of the New York State Geological Survey of the New York

State Museum made favorable comments about HVHF stating that he has been examining the

science of hydrofracturing the shale for three years and has found no cases in which the process

has led to groundwater contamination; that several portrayals by anti-fracking groups about

underground pools being harmed because of drilling are exaggerated problems that are unrelated

to HVHF; that HVHF could help fight climate change; and that allowing HVHF in New York

would be a huge boost for New York job creation and for income and business tax revenues. The

Times Union also reported that Former DEC Commissioner Alexander Pete Grannis said he

agreed with Smith that the dangers of HVHF are overblown and that the DEC is on course to set

solid regulations.

139. On March 28, 2011, the Albany Times Union reported that the New York StateEducation Department would no longer allow Mr. Smith to talk to reporters or take calls related

to HVHF and that any failure to follow its internal protocol for handling media inquiries would

result in appropriate administrative action.

140. Taury Smith has remained silent on HVHF since his comments were reported onMarch 14, 2011. He left his position with New York State for a position as a private geology

consultant in January 2013.


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141. Upon information and belief, DOH and Commissioner Shah have failed toexpedite the Health Review in the interest of prompt review and have failed to minimize

procedural and administrative delay at the direction of the Cuomo administration.

142. Upon information and belief, DOH is ready, willing and able to issue its HealthReview, there being no valid, rational, or legally defensible reason for further delay.

143. Upon information and belief, the DEC is ready, willing and able to issue the finalSGEIS and begin granting permits for HVHF, there being no valid, rational, or legally defensible

reason for further delay.

144.

Upon information and belief, Governor Cuomo has arbitrarily prevented DOH

from issuing its Health Review without any good faith, valid, rational, or legally defensible

reason.

145. Upon information and belief, Governor Cuomo has arbitrarily prevented the DECfrom issuing the final SGEIS and granting permits for HVHF for reasons based exclusively on

political concerns and without any good faith, valid, rational, or legally defensible reason.

146. In April 2013, it was reported that when asked at a political fundraiser when theHVHF stalemate would be resolved, Governor Cuomo responded by blaming the pro-fracking

lobby for not doing enough to shift public opinion in favor of approval, implying that his

personal political agenda motivated his continuation of the Moratorium which is contrary to the

interests of prompt review and minimizing procedural and administrative delay.

147. The Moratorium continues apparently interminably.148. Applications to the DEC for HVHF permits by plaintiffs or any operator would be

futile.


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149. Plaintiffs are suffering and will continue to suffer irreparable harm if theMoratorium is permitted to remain in place and plaintiffs are continually precluded from

exercising their property rights.

150. On __________, 2013 plaintiffs made written demand upon defendants to dowhat the law requires them to do; to wit, finalize the SEQRA process and issue a final SGEIS

with respect to HVHF within thirty (30) days of the demand.

151. Defendants have failed and refused to act in compliance with plaintiffs' writtendemand.

JURISDICTION AND VENUE

152. The Court has jurisdiction to grant a declaratory judgment and further andconsequential relief pursuant to CPLR 3001 and 3017(b).

153. The Court has jurisdiction pursuant to CPLR 7801 and 7803 to determine thisproceeding.

154. The Court has jurisdiction pursuant to CPLR 6301 to grant injunctive reliefnecessary to implement the relief requested herein.

155. The Court has jurisdiction pursuant to common law to grant relief for a taking ofproperty without just compensation in violation of the New York State Constitution, Article I,

Section 7(a).

156. The Court has jurisdiction pursuant to 42 U.S.C. 1983 and 1988 to grant relieffor a taking of property without just compensation in violation of the U.S. Constitution, Fifth

Amendment, as applied to the States through the Fourteenth Amendment, and to remedy and

award damages for procedural and substantive due process violations under the U.S.

Constitution.


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157. Venue in this Court is proper pursuant to CPLR 503, 506(b), and 509.FIRST CAUSE OF ACTION

DECLARATORY JUDGMENT - ILLEGAL AND VOID MORATORIUM

AS AGAINST ALL DEFENDANTS

158. Plaintiffs re-allege paragraphs 1 through ____ as though fully restated.159. The conduct of the defendants has resulted in a perpetual Moratorium banning the

issuance of well drilling permits for HVHF on plaintiffs surface and subsurface property.

160. SEQRA mandates that DEC issue a final SGEIS regarding HVHF, expediteproceedings in the interest of prompt review, and minimize procedural and administrative delay.

161. The DEC, as lead agency in the SEQRA process, has no authority to delegate itsdecision making to another State agency, to wit, DOH.

162. New York State enacted SEQRA to preserve and enhance the quality of theenvironment and to establish a process for reviewing the impact of proposed activity on the

environment.

163. SEQRA is not a public health review statute, and politics should never influencethe SEQRA process.

164. The Governor is not a lead agency in the SEQRA process and the Governor hasno authority to direct or control the SEQRA process.

165. The DEC, as lead agency in the SEQRA process, has no authority to allow theGovernor to control the process.

166. The DEC has evaded its responsibilities under SEQRA by delegating review toanother State agency, to wit, DOH and allowing the Governor to direct and control the process of

SEQRA decision making.


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167. Defendants have used the SEQRA process to perpetuate the Moratorium therebydepriving plaintiffs of their valuable property rights in their gas and oil deposits.

168. The Moratorium, in whole or in part, in both its enactment and perpetuation, isnot a valid exercise of the defendants powers underlaw, is an invalid exercise of the States

police powers, is arbitrary and capricious and contrary to law.

169. There exists an actual, imminent and justiciable controversy between the partieswith respect to whether the Moratorium, in whole or in part, is unlawful, unconstitutional, an

invalid exercise of defendants police powers, arbitrary, capricious, irrational, and otherwise

improper.

170. Plaintiffs should be granted a declaratory judgment that the Moratorium, in wholeor in part, is illegal, unconstitutional, and otherwise void and unenforceable.

SECOND CAUSE OF ACTION

ARTICLE 78 MANDAMUS

AS AGAINST CUOMO, DEC, MARTENS, DOH AND SHAH

171. Plaintiffs re-allege paragraphs 1 through _____ as though fully restated.172. A proceeding pursuant to CPLR 7803(1) lies to compel a body or officer to

perform a nondiscretionary duty.

173. Defendants, Andrew M. Cuomo, DEC, Joseph Martens, DOH and Nirav Shah,individually or collectively, are a body or officer within the meaning of CPLR Article 78.

174. A proceeding for Article 78 mandamus relief lies to compel finalization of theSEQRA process.

175. SEQRA mandates that DEC issue a final SGEIS regarding HVHF in a timelymanner.


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176. SEQRA mandates that the Governor and the DOH refrain from interfering withand/or obstructing the DECsissuance of a final SGEIS.

177. Plaintiffs do not seek a directive requiring these defendants to act with respect todiscretionary matters, but rather seek to require these defendants to perform their obligations

under SEQRA and permit issuance of a final SGEIS.

178. This proceeding is brought to compel these defendants to perform a duty enjoinedupon them by law, that involves no discretion and that they are duty-bound to perform.

179. There are no administrative steps available to plaintiffs to obtain the resultrequested and the pursuit of administrative relief would be futile.

180. Plaintiffs have a clear legal right to the relief sought.181. This proceeding is ripe for review.

THIRD CAUSE OF ACTION

N.Y. AND U.S. CONSTITUTIONS - TAKINGS CLAIM

AS AGAINST DEFENDANT THE STATE OF NEW YORK

182. Plaintiffs re-allege paragraphs 1 through ____ as though fully restated.183. Plaintiffs right to subsurface oil and gas reserves constitutes private property

within the meaning of the New York State Constitution, Article I, Section 7(a) and the U.S.

Constitution, Fifth and Fourteenth Amendments.

184. Plaintiffs property rights to subsurface oil and gas reserves are valueless unlessthe Moratorium is ended and HVHF permitted.

185. Defendants actions in enacting and continuing a perpetual Moratorium havedeprived plaintiffs of all economically beneficial use of their subsurface property rights.


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186. Defendants have unconstitutionally deprived plaintiffs of their private property, inwhole or in part, have interfered with plaintiffs reasonable investment-backed expectations with

respect to subsurface rights, and have taken plaintiffs property, all without just compensation in

violation of plaintiffs constitutional rights.

187. Through their actions, defendants have taken plaintiffs property for public use.188. Defendants have not provided just compensation to plaintiffs for taking plaintiffs

property.

189. Defendants, in taking plaintiffs property without just compensation, haveunconstitutionally compelled plaintiffs to bear a public burden which should be borne by the

public as a whole.

190. Plaintiffs should be granted a declaratory judgment that defendant State of NewYork has unconstitutionally deprived plaintiffs of their property rights and are entitled to an

award of monetary damages in an amount to be determined by the New York State Court of

Claims.

FOURTH CAUSE OF ACTION

VIOLATION OF SUBSTANTIVE AND PROCEDURAL DUE PROCESS -

U.S. CONSTITUTION - FOURTEENTH AMENDMENT

AS AGAINST ALL DEFENDANTS

191. Plaintiffs re-allege paragraphs 1 through ____ as though fully restated.192. Defendants have deprived and continue to deprive plaintiffs of due process of

law, as secured by the Fourteenth Amendment to the U.S. Constitution, by enacting and

perpetuating an unlawful Moratorium, thereby depriving plaintiffs of the use of their property.

193. Defendants have deprived and continue to deprive plaintiffs of due process oflaw, as secured by the Fourteenth Amendment to the U.S. Constitution, by enacting and


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perpetuating a Moratorium that lacks a reasonable time frame for defendants actions to be

completed, that is without a justifiable and demonstrated need, where the burden imposed is

borne by selected individuals, including plaintiffs, rather than the public at large, where there is

no enabling legislation or stated procedure for the Moratorium, and where there is no time

certain for its expiration, all of which violate plaintiffs rights to due process.

194. Unless defendants are enjoined from enforcing the Moratorium, plaintiffs willsuffer irreparable injury for which there is no adequate remedy at law.

FIFTH CAUSE OF ACTION

VIOLATION OF 42 U.S.C. 1983

AS AGAINST DEFENDANTS THE STATE OF NEW YORK AND CUOMO

195. Plaintiffs re-allege paragraphs 1 through ____ as though fully restated.196. Defendants, acting under color of State law, have deprived and continue to

deprive plaintiffs of their substantive and procedural due process rights secured by the U.S.

Constitution, in violation of 42 U.S.C. 1983.

197. Accordingly, plaintiffs are entitled to damages.WHEREFORE, plaintiffs respectfully request that this Court grant the following relief:

(a) A declaration that defendants actions constitute a Moratorium that is, in

whole or in part, illegal, unconstitutional, and otherwise, void and unenforceable;

(b) A judgment pursuant to CPLR Article 78 compelling the DEC to finalize

the SEQRA process and issue a final SGEIS with respect to HVHF within sixty (60) days and

awarding damages incidental to the primary relief requested or show cause why such relief

should not be granted;

(c) A permanent restraining order and preliminary and permanent injunctions,


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pursuant to CPLR Article 63 restraining and enjoining defendants from enforcing the

Moratorium as against the plaintiffs and compelling defendants to finalize the SEQRA process

and issue a final SGEIS with respect to HVHF within sixty (60) days or show cause why such

relief should not be granted;

(d) A declaration that plaintiffs are entitled to just compensation from the

defendants as a result of the taking of plaintiffs property in violation of theNew York State and

U.S. Constitutions and an order remanding the case to the Court of Claims for a judgment

awarding monetary damages;

(e) A declaration that the defendants actions, in whole or in part, violate the

plaintiffs rights to substantive andprocedural due process of law, as protected by the Fourteenth

Amendment of the U.S. Constitution;

(f) An award of monetary damages against the defendants pursuant to 42

U.S.C. 1983, attorneys fees pursuant to 42 U.S.C. 1988 and an order remanding the case to

the Court of Claims for a judgment awarding monetary damages;

(g) An award to plaintiffs for the full costs and attorneys fees arising out of

this litigation;

(h) Such other and further relief as this Court may deem just and proper.

Dated: ____, 2013NY

Documents

Joint Landowners' Coalition NYS Complaint.pdf