Articles, Alerts & Perspectives

Washington, DC

Abigail M. Reecer recently joined Babst Calland as an associate in the Energy and Natural Resources Group and Pipeline and HazMat Safety Practice. Ms. Reecer represents client in pipeline safety matters before the Pipeline and Hazardous Materials Safety Administration (PHMSA), state agencies, and federal courts.

Prior to joining Babst Calland, Ms. Reecer was an associate with Hollingsworth LLP. He is a 2021 graduate of Georgetown University Law Center.

Pittsburgh, PA and Washington, DC

FNREL Mineral and Energy Law Newsletter

Pennsylvania – Oil & Gas

(Joseph K. Reinhart, Sean M. McGovern, Gina F. Buchman and Matthew C. Wood)

In August 2023, the University of Pittsburgh School of Public Health and the Pennsylvania Department of Health (DOH) released three “observational epidemiological” studies presenting findings of potential health impacts from human exposure to unconventional natural gas development (UNGD) activities. The studies, which were conducted in eight counties in southwestern Pennsylvania, excluding the City of Pittsburgh, focused on three specific health issues: (1) asthma, (2) birth outcomes, and (3) certain childhood cancers.

In the Asthma Study, researchers reviewed medical treatment for asthma (categorized by severity), as well as how close the patient lived to UNGD activities (considering the number of wells, production volume, and the phase of well development, i.e., preparation, drilling, hydraulic fracturing, and production). The study found no relationship between asthma exacerbations and proximity to wells during the well pad preparation, drilling, or hydraulic fracturing phases, but found an increase during the production phase. The increases were fairly consistent in the lower, moderate, and higher exposure groups and therefore, the expected dose/response relationship (i.e., more asthma exacerbations with more exposure) was not found. See Univ. of Pittsburgh Sch. of Pub. Health, “Hydraulic Fracturing Epidemiology Research Studies: Asthma Outcomes” (July 31, 2023); DOH, “PA Health and Environment Study: Asthma” (Aug. 15, 2023).

For the Birth Outcomes Study, researchers reviewed birth records and the distance mothers lived from UNGD activities and other industrial activities. Researchers for the Birth Outcomes Study considered the number of wells, production volume, and the phase of well development, in addition to potential exposure from certain facilities, i.e., impoundment ponds, facilities accepting oil and gas waste, compressor stations, Superfund sites, and industrial sites with a toxic release inventory. …

Pittsburgh, PA and Washington, DC

FNREL Mineral and Energy Law Newsletter

Pennsylvania – Oil & Gas

(Joseph K. Reinhart, Sean M. McGovern, Gina F. Buchman and Matthew C. Wood)

On August 23, 2023, a coalition of environmental groups filed a petition for review in the Commonwealth Court of Pennsylvania in which they challenged the constitutionality of Act 96 of 2022, 58 Pa. Cons. Stat. Ann. §§ 2801–2826. See Verified Petition for Review, Clean Air Council v. Pennsylvania, No. 379 MD 2023 (Pa. Commw. Ct. Aug. 23, 2023). Act 96 amended Title 58 to provide for oil and gas well plugging oversight, bonding, and well plugging funds, and requires an operator to obtain a bond to cover the well and well site in the event the operator fails to remediate the site and plug the well.

Act 96 removed authority from the Environmental Quality Board (EQB) to adjust well bonding amounts for conventional wells for 10 years from the effective date (July 19, 2022) and reserved that authority to the Pennsylvania General Assembly. The Act set the bonding amount for a conventional well at $2,500 and allows operators to obtain blanket bond coverage for multiple wells for $25,000, which must be increased by $1,000 for each additional well drilled, with the total blanket bond not to exceed $100,000. The environmental groups—Clean Air Council, Earthworks, Citizens for Pennsylvania’s Future, Protect PT, and Sierra Club—allege that the statutory bond amounts are inadequate and do not cover the actual costs of remediation and plugging. As a result, they argue, operators are not incentivized to promptly clean up and remediate oil and gas wells, leaving the costs of addressing abandoned wells to the Pennsylvania taxpayers. …

Harrisburg, PA and Charleston, WV

Legal Intelligencer

(by Casey Coyle, Stefanie Mekilo and Austin Rogers)

1995 was a watershed year.  Michael Jordan returned to the NBA after a two-year hiatus, Brad Pitt was named Sexiest Man Alive by People magazine, and the world met Buzz Lightyear for the first time.  Today, Buzz remains a constant fixture in pop culture, thanks largely to his signature catchphrase: “To Infinity and . . . Beyond!”  Indeed, Buzz himself may use that phrase to describe the Pennsylvania Supreme Court’s recent decision in Bert Co. v. Turk, 298 A.3d 44 (Pa. 2023), which calls into question the presumptive constitutional limit for punitive damages awards.

Background

In 2017, four employees with non-solicitation agreements left their employment with The Bert Company d/b/a Northwest Insurance Services and joined First National Insurance Agency, LLC.  They moved as part of what is known in business parlance as a “lift-out,” a practice in which a group of employees from one company are hired by a competitor.  Northwest filed suit and obtained a preliminary injunction enforcing the agreements.  At the ensuing trial, the jury exonerated three employees from any liability and exonerated the corporate defendants on two claims.  While they found the remaining employee and corporate defendants liable on other claims, the jury only awarded Northwest $250,000 of the roughly $4 million in compensatory damages sought; the award was joint and several.  However, the jury awarded Northwest $2.8 million in punitive damages—representing an 11.2:1 ratio of punitive-to-compensatory damages on a per-judgment basis.

Appellants challenged the punitive damages award as unconstitutional.  Under U.S. Supreme Court precedent, courts must consider three guideposts when determining if a punitive damages award comports with the Due Process Clause of the Fourteenth Amendment to the U.S. …

Pittsburgh, PA, Charleston, WV and Washington, DC

Babst Calland has been recognized in the 2024 edition of Best Law Firms®, ranked by Best Lawyers®, nationally in 8 practice areas and regionally in 31 practice areas:

• National Tier 1
  • Environmental Law
  • Litigation – Environmental
• National Tier 2
  • Land Use & Zoning Law
  • Natural Resources Law
  • Oil & Gas Law
• National Tier 3
  • Energy Law
  • Litigation – Construction
  • Mining Law
• Regional Tier 1
  • Pittsburgh
    • Bet-the-Company Litigation
    • Commercial Litigation
    • Construction Law
    • Corporate Law
    • Energy Law
    • Environmental Law
    • Information Technology Law
    • Land Use & Zoning Law
    • Litigation – Construction
    • Litigation – Environmental
    • Litigation – Land Use & Zoning
    • Municipal Law
    • Natural Resources Law
    • Water Law
  • Charleston-WV
    • Commercial Litigation
    • Energy Law
    • Environmental Law
    • Litigation – Environmental
    • Oil & Gas Law
• Regional Tier 2
  • Pittsburgh
    • Admiralty & Maritime Law
    • Labor Law – Management
  • Charleston-WV
    • Mining Law
    • Natural Resources Law
  • Washington, D.C.
    • Energy Law
    • Environmental Law
    • Litigation – Environmental
    • Oil & Gas Law
• Regional Tier 3
  • Pittsburgh
    • Mergers &

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Pittsburgh, PA and Washington, DC

FNREL Mineral and Energy Law Newsletter

Pennsylvania – Mining

(Joseph K. Reinhart, Sean M. McGovern, Gina F. Buchman and Christina M. Puhnaty)

On September 23, 2023, PADEP published in the Pennsylvania Bulletin notice that the agency finalized its General Plan Approval and/or General Operating Permit for Coal-Mine Methane Enclosed Flares (GP-21). See 53 Pa. Bull. 6005 (Sept. 23, 2023). New or modified coal-mine methane enclosed flares in Pennsylvania are now subject to GP-21. Coal-mine methane enclosed flares with actual emission rates less than the following are exempted from GP-21’s permitting requirements:

• 4 tons per year (tpy) of carbon monoxide (CO) from a single enclosed flare or 20 tpy of CO from multiple enclosed flares;
• 1 tpy of nitrogen oxides (NOx) from a single enclosed flare or 5 tpy of NOx from multiple enclosed flares;
• 1.6 tpy of the oxides of sulfur (Sox) from a single enclosed flare or tpy 8 of the SOx from multiple enclosed flares;
• 0.6 tpy of particulate matter with a diameter of 10 microns or less (PM10) from a single enclosed flare or 3 tpy of PM10 from multiple enclosed flares;
• 1 tpy of volatile organic compounds (VOCs) from a single enclosed flare or 5 tpy of VOCs from multiple enclosed flares; and
• 0.5 tpy of a single hazardous air pollutant (HAP) from a single enclosed flare or 1 tpy of multiple HAPs from multiple enclosed flares. The HAPs may not contain Polychlorinated Biphenyls (PCBs), Chromium (Cr), Mercury (Hg), Lead (Pb), Polycyclic Organic Matter (POM), Dioxins, or Furans.

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Pittsburgh, PA and Washington, DC

FNREL Mineral and Energy Law Newsletter

Pennsylvania – Mining

(Joseph K. Reinhart, Sean M. McGovern, Gina F. Buchman and Christina M. Puhnaty)

On November 1, 2023, the Commonwealth Court of Pennsylvania held that the Pennsylvania Department of Environmental Protection’s (PADEP) CO2 Budget Trading Program Regulation (RGGI Rule) is an unconstitutional tax, declared the rule to be void, and enjoined PADEP from enforcing it. See Bowfin KeyCon Holdings, LLC v. PADEP, No. 247 M.D. 2022, 2023 WL 7171547 (Pa. Commw. Ct. Nov. 1, 2023).

After a lengthy rulemaking process, the RGGI Rule was published in the Pennsylvania Bulletin. See 52 Pa. Bull. 2471 (Apr. 23, 2022). The RGGI Rule would have linked Pennsylvania’s cap-and-trade program to the Regional Greenhouse Gas Initiative (RGGI), which is the regional, market-based cap-and-trade program designed to reduce carbon dioxide emissions from fossil-fuel-fired electric power generators with a capacity of 25 megawatts or greater that send more than 10% of their annual gross generation to the electric grid.

Two days after the RGGI Rule was published, a group of stakeholders filed a petition for review of the rule and an application for preliminary injunction in the commonwealth court. The court held a hearing on the preliminary injunction on May 10 and 11, 2022, and in a July 8, 2022, opinion, the court preliminarily enjoined the regulation as an unconstitutional tax.

In its November 1 decision on the merits, the court reaffirmed its earlier July 8, 2022, opinion, holding that the RGGI Rule constitutes a tax imposed by PADEP in violation of the Pennsylvania Constitution. …

Pittsburgh, PA and Washington, DC

FNREL Mineral and Energy Law Newsletter

Pennsylvania – Mining

(Joseph K. Reinhart, Sean M. McGovern, Gina F. Buchman and Christina M. Puhnaty)

The Shapiro administration recently released its Interim Final Environmental Justice Policy (Interim Final Policy) and latest Environmental Justice Mapping and Screening Tool (PennEnviroScreen). The Policy took effect on September 16, 2023, when official notice of the interim final rulemaking was published in the Pennsylvania Bulletin. See 53 Pa. Bull. 5854 (Sept. 16, 2023).

The Commonwealth first adopted an environmental justice policy (EJ Policy) in 2004 to provide citizens in EJ communities enhanced public participation opportunities during certain Pennsylvania Department of Environmental Protection (PADEP) permit application processes. In 2018, PADEP circulated a draft revised policy for public comment, but ultimately withdrew the proposed revisions in 2020 following receipt of public comments. After conducting further outreach in 2021, PADEP proposed an updated policy that would refine and expand the scope of the withdrawn 2018 revisions. On March 12, 2022, PADEP released a draft of the EJ Policy for public comment, and subsequently received more than 1,200 comments during the comment period.

The Interim Final Policy is the latest version of the EJ Policy to have been released by PADEP since the comment period closed last spring. Although PADEP had previously indicated that it was working to prepare a Comment Response Document in tandem with the Interim Final Policy, it has yet to release such a document. The Interim Final Policy will likely have a tangible impact on permitting and enforcement processes for various industries going forward.

The Interim Final Policy requires use of the PennEnviroScreen tool, which will replace PADEP’s current EJ Areas Viewer tool. …

Harrisburg, PA

Babst Calland today announced the opening of its office in Harrisburg, Pa., and the addition of two experienced litigation attorneys, Michael Libuser and Stefanie Pitcavage Mekilo.

Led by Shareholder Casey Alan Coyle, who joined the firm in August 2022, the Harrisburg office provides legal counsel for local, regional, and national businesses, industry sectors, and trade associations with focused practices in litigation, energy and natural resources, environmental, and legislative and regulatory affairs, among others.

The Harrisburg team of attorneys offers deep litigation experience in matters pending before state and federal appellate courts, with a particular emphasis on appeals before the Pennsylvania Supreme Court. They also represent clients in disputes pending before the U.S. District Court for the Middle District of Pennsylvania and state trial courts throughout Central Pennsylvania and matters brought before the Pennsylvania Commonwealth Court as part of its original jurisdiction.

“It is an exciting time for Michael and Stefanie to join Babst Calland and open a new office in Harrisburg,” said Mr. Coyle. “The Harrisburg office is uniquely poised to offer its clients the best of both worlds—pairing the service and pricing of a litigation boutique with the deep-bench expertise and resources of a law firm with more than 35 years of experience serving clients ranging from Fortune 100 companies to small and mid-sized businesses nationwide.”

Mr. Libuser represents clients in state and federal trial and appellate courts, with a particular emphasis on cases before the United States District Court for the Middle District of Pennsylvania. He served as a law clerk to the Honorable Yvette Kane, Senior United States District Judge for the Middle District of Pennsylvania, where he drafted opinions for the Third and Ninth Circuit Courts of Appeals and handled a wide range of district court matters involving complex civil litigation, commercial contracts, administrative law, trade secrets, and various statutory claims. …

Pittsburgh, PA

Pretrial Practice & Discovery

American Bar Association Litigation Section

(by Joseph Schaeffer)

Whether attorneys have encountered an inadvertently produced privileged document in their own practice, it is a common enough occurrence that the procedure is well established: Suspend further review, sequester the document, and notify opposing counsel. What is not well-established is what attorneys should do when they encounter inadvertently produced non-privileged documents. A New York trial court recently dealt with this situation in a case of first impression.

In Pursuit Credit Special Opportunity Fund, L.P. v. Krunchcash, LLC et al., No. 615070/2022 (N.Y. Sup. Ct. Oct. 4, 2023), the plaintiff’s financial consultant had responded to a subpoena from the defendants by producing multiple emails with a Dropbox link in the message body. As the defendants discovered early in their review, the Dropbox link not only was “live,” it provided access to a bevy of the plaintiff’s sensitive internal files—including folders named “Legal,” “Tax,” and “Financial.” Rather than immediately notify plaintiff’s counsel, though, the defendants reviewed the Dropbox (with the exception of the “Legal” folder) and sent the plaintiff a letter about a week later that referenced the internal documents as part of a demand for voluntary dismissal of the litigation. The plaintiff responded by moving the trial court to order the defendants to show cause why they should not be sanctioned for accessing the Dropbox files.

The trial court granted the plaintiff’s motion and entered a sanction against the defendants of nearly $156,000, representing the plaintiff’s costs in bringing the motion. Though acknowledging the absence of directly applicable authority, the trial court found guidance in Rule 4.4 of the New York Rules of Professional Conduct. …

Pittsburgh, PA

Pretrial Practice & Discovery

American Bar Association Litigation Section

(by Andy DeGory)

The process of researching and identifying an expert witness can be a daunting task in a complex commercial litigation setting. However, securing the appropriate expert tailored to your needs can be a critical component of a successful litigation strategy. While there is no exact formula for expert witness selection, the following pointers can help lead your team towards the right witness and a favorable outcome:

• Utilize your colleagues and network. When starting your search for an expert witness, polling your colleagues and other connections in the legal field can instantly provide you with multiple favorable candidates. Furthermore, your network may be able to significantly narrow your search down to a few options that will fit the needs of your case. This option is also particularly helpful for lesser-experienced attorneys who might be starting an expert search for the very first time.
• Google is your friend. Litigation attorneys may joke about relying on Google for legal research, however, an expert-witness search is actually an appropriate opportunity to fire up the search engine. Google (or another search engine) allows you to cast a wide net to build your list of expert candidates prior to a more formal vetting of your options.
• Vet your candidates with Westlaw or Lexis. Once you have narrowed your search down to your favorite expert candidates, Westlaw and Lexis provide excellent tools for vetting your candidates’ background and history serving as an expert witness. In particular, these legal databases allow you to examine past cases in which the candidate has provided expert testimony, prior expert reports submitted in those cases, deposition transcripts (if available), and any motions in limine/to exclude the candidate’s testimony.

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