Penn State Law The Agricultural Law Resource and Reference Center

by M. Sean High, Research Assistant

On June 27, 2012, in an unreported opinion, the Pennsylvania Commonwealth Court rejected post-trial motions and upheld a ruling that a Montgomery County municipality’s ordinance did not violate the Agriculture, Communities and Rural Environment Act (ACRE) and the Right to Farm Law (RFL). Boswell v. Skippack Twp., No. 389 M.D. 2006. ACRE provides farmers with a process to challenge local ordinances that are believed to be unauthorized due to existing state law, 3 Pa. Cons. Stat. §§ 311-318, while RFL protects normal agricultural operations from nuisance lawsuits and ordinances. 3 Pa. Stat. §§ 951-957. At trial, tree farmers James and Paula Boswell unsuccessfully challenged a Skippack Township ordinance precluding their use of a loud, high-pitched sound device designed to protect crops from deer damage. The Boswells claimed the decision was incorrect because evidence presented at trial proved their use of the sound device was a normal agricultural practice protected under ACRE and RFL.  The Commonwealth Court found no identifiable error in the original determination that use of the sound device was not a normal agricultural practice.  The Boswells litigated this case without the assistance of the Attorney General’s Office through the private party right of action authority under ACRE.  3 Pa. Cons. Stat. §§ 315(b).  For more information on these agricultural statutes, please visit the Agricultural Law Center’s ACRE Resource Area and Pennsylvania Right to Farm Act Resource Area

 



Federal Court Upholds Exercise of Arbitration Clause in Oil and Gas Lease Dispute

by Joseph M. Negaard, Research Assistant

On June 8th, the U.S. District Court for the Middle District of Pennsylvania upheld the motion of a natural gas company to compel arbitration of a lease dispute.  Roman v. Chesapeake Appalachia, LLC, 2012 WL 2076846 (M.D. Pa. Jun 8, 2012). Mr. and Mrs. Roman signed a 10 year oil and gas lease in 2001.  In 2011, The Romans sought a declaration from the court that their oil and gas lease was no longer in effect because the gas company had failed to initiate development under the lease.  The company responded with a motion to compel arbitration, citing the arbitration clause, which provided that “a disagreement…concerning this lease, performance thereunder, or damage [will be decided by] unanimous decision of the arbitrators and shall be final.”  The court held that the arbitration clause in this lease was enforceable because both Pennsylvania and federal courts have strongly supported enforcing arbitration provisions in contracts.  Using a “presumption of arbitrability” standard, the court reasoned that the issue of whether the company failed to develop the leasehold during the primary term was within the scope of the arbitration clause’s broad language. For more information on natural gas legal issues, please visit the Agricultural Law Center’s Marcellus Shale Resource Area.



World Trade Organization Appellate Body Rules on Country of Origin Labeling

by Joseph M. Negaard, Research Assistant


On June 29, 2012, the World Trade Organization (WTO) Appellate Body held that the United States’ Country of Origin Labeling (COOL) program negatively affects other countries’ rights to trade freely.  WT/DS384/AB/R; WT/DS386/AB/R.  Under COOL, retailers must inform consumers of the country of origin of certain food products, including most beef and pork products.  7 U.S.C. §§ 1638-1638d.  In 2008, Canada and Mexico filed disputes with the WTO, alleging that COOL was inconsistent with the United States’ international trade obligations because it disadvantaged livestock producers who export cattle and hogs to the United States.  Previously, a WTO panel found that COOL resulted in unfavorable treatment to exporting producers and that providing consumers with country of origin information was not a legitimate justification for COOL.  In ruling on the United States’ appeal, the WTO Appellate Body upheld the panel’s decision that COOL had a discriminatory impact on imported beef and pork, but held that COOL can be a legitimate tool to inform consumers about the origin of products as long as it does not affect other countries’ rights to trade freely.  For more information on COOL, please visit the Agricultural Law Center’s Current Issues webpage and the WTO website.

 


U.S. Supreme Court Health Care Ruling Does Not Affect Menu Labeling Requirements

by M. Sean High, Research Assistant

On June 28, 2012, the U.S. Supreme Court ruled on some aspects of the 2010 Patient Protection and Affordable Care Act (ACA), most notably the individual mandate and Medicaid provisions, but did not address menu labeling requirements that were established by the Act.  National Federation of Independent Business v. Sebelius, 132 U.S. 2566.  Under ACA, certain restaurants are required to post calories of each menu item on menus or menu boards and provide written nutritional information upon customer request, while applicable vending machine operators must prominently display each item’s caloric content.  These requirements apply to restaurants with twenty or more outlets and vending machine operators with twenty or more machines.  Public Law 111-148, Section 4205.  ACA charged the Food and Drug Administration (FDA) with formulating the labeling regulations, which become effective when FDA completes the rulemaking process.  To date, FDA has released a proposed rule, 76 Fed. Reg. 19192 (Apr. 6, 2011), but has not yet issued a final rule.  For more information on menu labeling, visit the FDA New Menu and Vending Machines Labeling Requirements website.

 



Temporary Drilling Ban Enacted in Southeastern Pennsylvania’s South Newark Basin

by Joseph M. Negaard, Research Assistant

As part of the 2012 Pennsylvania budget legislation, the General Assembly has instituted a temporary drilling moratorium in the South Newark Basin, which underlies parts of New Jersey and Southeastern Pennsylvania including Bucks, Chester, Berks and Montgomery counties.  Act 87 of 2012.  The Department of Environmental Protection is prohibited from issuing permits for oil and gas wells within the Basin until the Department of Conservation and Natural Resources has completed a study that will evaluate the practical implications and financial impacts for the area if drilling does occur.  72 P.S. § 1607-E(b)(1).  After the evaluation has been completed, the moratorium cannot be lifted until the counties in the South Newark Basin have the opportunity to choose to execute an impact fee on gas wells.  72 P.S. § 1607-E(b)(2).  The drilling moratorium is set to expire on January 1, 2018.  72 P.S. § 1607-E(c).  For more information on natural gas legal issues, please visit the Agricultural Law Center’s Marcellus Shale Resource Area and the Penn State Law Marcellus Shale Blog.

 


The center has been established pursuant to Pennsylvania statute, 3 PA. STAT. §§ 2201-2209, as a collaborative enterprise between Penn State Law, the Penn State College of Agricultural Sciences, and the Pennsylvania Department of Agriculture. The Center provides information and educational programs on agricultural law and policy for producers and agribusinesses, attorneys, government officials, and the general public. The Center does not provide legal advice, nor is its work intended to be a substitute for such advice and counsel.