United States: Clearing The Fog On The PA Supreme Court’s Marcellus Shale Decision

Last Updated: February 3 2014
Article by Adam H. Cutler

There's been a good bit of confusion in the early reactions to the Pennsylvania Supreme Court's decision in Robinson Township et al v. Commonwealth of Pennsylvania, et al., declaring that key aspects of the Act 13 revisions to Pennsylvania's Oil and Gas Law are unconstitutional. The following is a  review of the main points to help clear the fog. 

Cutting right to the chase, the main results of the Supreme Court's 4-2 judgment are as follows:  

  • Act 13's limitations on local zoning authority, which were intended to promote statewide uniformity and certainty, are void and so are the sections of the law that enforce those limitations; 
  • The law's setback waiver provision is also void, and the majority further enjoined the entirety of the setback regime set forth in Act 13 from taking effect on the grounds that the remaining setback provisions were not severable from the waiver provision; 
  • The delegation of certain roles under the Act to the Public Utilities Commission for review of local ordinances and proposed local ordinances was upheld;  
  • Other aspects of the petitioners' claims are headed back to the Commonwealth Court for further proceedings consistent with the Supreme Court's opinion, most notably a challenge to Act 13's healthcare confidentiality provisions, a challenge to Section 3241 of the law on grounds that it would allow the unconstitutional taking of property for private purposes, and the issue of severability of the remaining valid provisions of Act 13 from those the Supreme Court declared invalid.  

Some quick background and context: Act 13 created a comprehensive new statutory and regulatory regime to govern Marcellus Shale and other unconventional oil and gas development in Pennsylvania. Among its provisions, the law (a) imposed consistent setback requirements for drilling activities from buildings, water supply wells and water bodies, but allowed developers to seek variances from the Department of Environmental Protection; (b) sought to promote statewide uniformity and certainty by restricting the scope of municipal zoning authority as it applied to oil and gas development activities; and (c) provided that health professionals could obtain information about trade secret or proprietary chemical constituents used in drilling operations in order to treat patients, so long as they agreed to keep that trade secret or proprietary information confidential.  

A group of municipalities, two local officials, an environmental group and its chief executive and a physician challenged these and related provisions of the law, and sought to have Act 13 declared unconstitutional under both the Pennsylvania and US Constitutions. They brought their claims first to the Commonwealth Court, which granted a preliminary injunction against the setback waiver and the municipal zoning limitations and then decided that those provisions were unconstitutional. On cross-appeals to the Supreme Court, only six of the seven justices participated in the consideration of the case (neither Justice Orie Melvin nor her successor, Justice Stevens, took part). 

The Supreme Court split 4-2 on the results, and in most respects on the reasoning on which the judgment was based. But the centerpiece of the lead opinion, authored by Chief Justice Castille, only had the support of two other justices who decided the case, and therefore did not constitute a majority of the Court. In his opinion, designated as the Opinion Announcing the Judgment of the Court, the Chief Justice extensively discussed the Environmental Rights Amendment to the Pennsylvania Constitution. That provision states that the people have a constitutional right to clean air, water and preservation of natural resources, and that the Commonwealth holds the public natural resources of the state in public trust "for the benefit of all of the people." Chief Justice Castille drew parallels between fracking and early coal industry practices. He stated that the municipal zoning restrictions and the setback waiver were in direct conflict with the Environmental Rights Amendment.  

Justice Max Baer, in his concurring opinion, agreed to invalidate the provisions at issue only on the narrower grounds of substantive due process. Together with Chief Judge Ronald D. Castille's group, which created a majority of justices determining that certain provisions were unconstitutional. 

Given the divided grounds upon which the decision of the Court was constructed, reports that the Environmental Rights Amendment has been imbued with new vigor may be premature. The 1971 Environmental Rights Amendment has only infrequently been interpreted and then not in the context of private individuals and municipalities seeking to invalidate legislation. However, the extensive discussion contained in the Chief Justice's opinion, which concludes that the Environmental Rights Amendment authorizes the Court to conduct its own evaluation of whether legislation 1) unreasonably impinges on rights to clean air and pure water or 2) breaches the Commonwealth's trustee obligations with regard to the conservation of public natural resources, is likely to be raised in future litigation.  

Another important takeaway: The Robinson Township decision does not have any impact on existing drilling activities in Pennsylvania. The decision does clearly alter the playing field in Pennsylvania going forward, most particularly in terms of the role municipalities will play in shale development. 

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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Adam H. Cutler
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