Articles, Alerts & Perspectives

RMMLF Mineral and Energy Law Newsletter

(By Joseph K. Reinhart, Sean M. McGovern and Gina N. Falaschi)

Continuing from previous issues of this Newsletter, this report provides recent updates on the Pennsylvania Environmental Quality Board’s (EQB) proposed CO2 Budget Trading Program rulemaking, which would link Pennsylvania’s program to and implement the Regional Greenhouse Gas Initiative (RGGI) within the commonwealth beginning in 2022. See Vol. XXXVIII, No. 2 (2021), Vol. XXXVIII, No. 1 (2021), Vol. XXXVII, No. 4 (2020), Vol. XXXVII, No. 3 (2020), Vol. XXXVII, No. 2 (2020), Vol. XXXVII, No. 1 (2020), Vol. XXXVI, No. 4 (2019) of this Newsletter. RGGI is the country’s first regional, market-based cap-and-trade program designed to reduce carbon dioxide (CO2) emissions from the power sector. The proposed regulation would limit CO2 emissions from Pennsylvania’s fossil fuel-fired electric generating units with a nameplate capacity of 25 megawatts or greater that send more than 10% of their annual gross generation to the electric grid. The proposed initial emissions cap for Pennsylvania in 2022 is 78 million tons of CO2, which would decline annually.

The public comment period for the proposed rule ran from November 7, 2020, until January 14, 2021. The Independent Regulatory Review Commission (IRRC) released its comments on February 16, 2021. See Comments of the Independent Regulatory Review Commission, Environmental Quality Board Regulation #7-559 (IRRC #3274, CO2 Budget Trading Program (Feb. 16, 2021). The IRRC recommended that EQB (1) explain the choice to institute the program through regulation rather than legislation; (2) provide analysis of its statutory authority to enact the proposal; (3) consider recommendations from commentators on public health, safety, and welfare, economic or fiscal impact, and adequacy of data; …

The Legal Intelligencer

(by Blaine Lucas and Anna Jewart)

This past May, a curio story made international news when a Belgian farmer moved a stone monument on his property by approximately 7.2 feet.  While this typically would have remained unknown, except to the farmer and perhaps to his neighbor, the farmer did not consider that the stone had been placed in 1819 to mark his home country’s border with France, and moving it resulted in an approximate 3,000 square foot loss of territory for the French.  Luckily, the change in location was quickly caught and resolved without international incident.  The quick discovery and resulting amicable resolution between the two nations was made possible in large part because the local Belgian municipality, Erquelinnes, had geo-localized the stones in 2019 for its 200th anniversary and knew exactly where it should have been.  A few days after the story went viral, the Pennsylvania Commonwealth Court addressed what happens when municipalities here misplace their historic markers and later disagree over the location of their common boundaries.  In Woodward Twp. Mun. Corp. of Clinton County, Pa. v. Dunnstable Twp. Mun. Corp. of Clinton County, Pa., Nos. 704 C.D. 2020, 733 C.D. 2020 (Pa. Cmwlth. May 12, 2021), disagreement over boundary stones and surveys dating back to 1844 resulted in a modern-day battle of the experts to determine exactly where the shared boundary of the two townships actually lies.

Although it was avoided by the farmer in Erquelinnes, wars and lawsuits are often fought over the location of boundaries, whether they are private, municipal, or international.  Consequently, Pennsylvania law provides certain protections for the agreed upon location of municipal boundaries, and establishes procedures for both how to change them willingly, and how to resolve disputes surrounding their location.  …

Pittsburgh, PA

Renewables Law Blog

(By Bruce Rudoy)

It’s no secret that coal plants have had trouble competing with cheaper renewables and natural gas in recent years. Unexpectedly low prices from PJM’s latest capacity auction spurred a fresh wave of retirement announcements this month. But Talen Energy has decided that rather than retire coal plants and walk away, it would convert those sites to be used for other renewable energy-related projects. While Talen promised in November 2020 to shut down roughly 5 gigawatts of coal capacity in the 2020s, the company wanted more of a comprehensive strategy for this transition.  “This is the first of hopefully many unit transitions from coal to lower-carbon sources and battery,” said Cole Muller, who oversees Talen’s fossil-powered fleet in the territory of regional transmission organization PJM. “It’s really about decarbonizing, …investing in the communities and continuing to provide opportunities for our people.” After that project, Talen plans to build a 1-gigawatt battery fleet in the next three to five years on its existing properties, using individual batteries as large as 300 megawatts. “If you just retire it, you have a significant loss to both jobs and the tax base, and the communities at large,” Muller said. Talen tapped battery developer Key Capture Energy to build a 20-megawatt system as a demonstration of the concept. That smaller size allows for a streamlined approval process, Muller noted. But the battery will act just like any other commercial power plant, bidding into PJM’s markets for capacity, ancillary services and energy arbitrage. Assuming that goes well, Talen can add up to another 115 megawatts of battery storage to fully utilize the coal plant’s grid connection capacity. …

The Legal Intelligencer

(by Molly Meacham)

Even in ordinary times, keeping up with an ever-changing employment law landscape is a compliance challenge for businesses.  The extraordinary circumstances of the COVID-19 pandemic sparked unprecedented compliance challenges for employers, including workplace safety issues, additional temporary leave requirements, and interpreting existing obligations through the lens of COVID-19.

Compliance obligations for employers are continuing to evolve in 2021.  Presidential administration change and a change in the majority party in the U.S. Senate each typically cause new and revised legislation and regulations.  Combined with the ongoing pandemic, the result is continued significant alteration to the legal and regulatory framework that will impact employers in 2021 and beyond.  These developing issues include worker classification under the Fair Labor Standards Act (FLSA), a temporary expansion of the Consolidated Omnibus Budget Reconciliation Act (COBRA) under the American Rescue Plan Act of 2021 (ARPA), and COVID-19 workplace safety issues relating to fully vaccinated employees.

FLSA Independent Contractor Rule Withdrawn

One of the most important baseline employment-related determinations a business can make is whether a worker is properly classified as an employee or an independent contractor under the FLSA.  Worker misclassification is a frequently-litigated issue that represents significant legal exposure for businesses, as damages for misclassification can include retroactive application of minimum wage and overtime requirements, the value of employee benefits that were not provided, any legally-mandated sick time, or self-employment tax paid by the worker.

In the last weeks of the Trump administration in early 2021 the Department of Labor (DOL) issued a Final Rule seeking to clarify the independent contractor test and make it easier to identify workers covered by the FLSA.  The traditional independent contractor test contains six non-exclusive factors which the DOL’s Wage and Hour Division and the federal courts evaluate on a case-by-case basis to determine whether a worker is, as a matter of economic reality, dependent on the employer for work or in business for themselves, with no single factor considered dispositive.  …

RMMLF Mineral Law Newsletter

(Joseph K. Reinhart, Sean M. McGovern and Casey J. Snyder)

On February 16, 2021, the Pennsylvania Commonwealth Court affirmed the Pennsylvania Environmental Hearing Board’s (EHB) decision to deny environmental groups’ petition for attorney’s fees after a settlement with the Pennsylvania Department of Environmental Protection (PADEP) in a third-party permit appeal over Sunoco Pipeline L.P.’s (Sunoco) Mariner East 2 pipeline because neither side acted in “bad faith.” Clean Air Council v. PADEP, 245 A.3d 1207 (Pa. Commw. Ct. 2021). After the plaintiffs settled the dispute at the EHB over permits issued to Sunoco for its Mariner East 2 pipeline, the plaintiffs filed an application with the EHB to recover costs and fees of the litigation totaling nearly $230,000 from Sunoco, which was not a party to the settlement. Id. at 1210. The EHB applied a stricter standard for recovering fees from a private party than in applications to recover fees from PADEP, requiring the plaintiffs to show the private party acted in “bad faith.” Id. at 1211. Under this standard, the EHB reasoned, permittees would not be “dissuaded from vigorously protecting their interests . . . in good faith.” Id. (quoting Clean Air Council v. PADEP, 2019 EHB 228, 236). Finding no bad faith, the EHB denied the plaintiffs’ application for costs and fees. Id.

The plaintiffs appealed the decision to the commonwealth court, arguing that the EHB should have applied the less stringent “catalyst test,” which would have required the plaintiffs to meet an easier standard: that the opposing party provided some benefit the fee-requesting party sought, the suit stated a genuine claim, and their appeal was a substantial or significant reason why the opposing party provided the benefit the fee-requesting party sought in the underlying suit. …

RMMLF Mineral Law Newsletter

(By Joseph K. Reinhart, Sean M. McGovern, Daniel P. Hido and Gina N. Falaschi)

Continuing from previous publications of this Newsletter, this report provides updates on the Pennsylvania Environmental Quality Board’s (EQB) proposed CO2 Budget Trading Program rulemaking, which would link Pennsylvania’s program to and implement the Regional Greenhouse Gas Initiative (RGGI) within the commonwealth. See Vol. XXXVIII, No. 1 (2021), Vol. XXXVII, No. 4 (2020), Vol. XXXVII, No. 3 (2020), Vol. XXXVII, No. 2 (2020), Vol. XXXVII, No. 1 (2020), Vol. XXXVI, No. 4 (2019) of this Newsletter.

After the public comment period closed in January 2021, the Independent Regulatory Review Commission (IRRC) issued its comments on the proposed rule on February 16, 2021. See Comments of the Independent Regulatory Review Commission, Environmental Quality Board Regulation #7-559 (IRRC #3274), CO2 Budget Trading Program (Feb. 16, 2021).

The IRRC’s comments, based on criteria in section 5b of Pennsylvania’s Regulatory Review Act, 71 Pa. Stat. § 745.5b, addressed the significant objections to the proposed rule from the members of the regulated community and general assembly. The comments recommended that EQB explain the choice to institute the program through regulation rather than legislation, provide analysis of its statutory authority to enact the proposal, and consider recommendations from commentators on public health, safety, and welfare, economic or fiscal impact, and adequacy of data. The IRRC also asked EQB to consider delaying the implementation of the rulemaking for one year to give the regulated community an opportunity to adjust business plans to account for increased costs associated with Pennsylvania joining RGGI. Under the Regulatory Review Act process, EQB will respond to these comments, and other public comments, when finalizing this rulemaking. …

The Foundation Water Law Newsletter

(By Lisa M. Bruderly)

On May 12, 2021, the Baltimore, Philadelphia, and Pittsburgh Districts of the U.S. Army Corps of Engineers (Corps) jointly issued a 15-day public notice (SPN 21-26), requesting comments on whether to reinstate certain 2017 and 2021 nationwide permits (NWPs) that are suspended in parts of Pennsylvania. The comment period closed on May 27, 2021.

The reinstatement is being proposed in case Pennsylvania State Programmatic General Permit 6 (PASPGP-6) is not finalized and issued prior to the expiration of Pennsylvania’s current state programmatic general permit (PASPGP-5) on June 30, 2021. At present, if PASPGP-6 is not issued before July 1, 2021, most projects in Pennsylvania impacting federally regulated waters would be required to obtain individual Clean Water Act § 404 permits. Obtaining an individual permit is typically a more lengthy and complicated process than obtaining coverage under a programmatic general permit or NWP.

State Programmatic General Permit

The PASPGP is the mechanism that the Pennsylvania Department of Environmental Protection (PADEP) and the Corps rely upon to permit most projects in Pennsylvania that impact federally regulated waters, but do not require an individual section 404 permit. PASPGP-6 allows applicants to obtain both federal section 404 permits and state water obstruction and encroachment permits for qualified projects impacting federal and state regulated waters.

PASPGP-6 has not yet been finalized. The draft PASPGP-6 was published for public comment on September 4, 2020. See Corps, Special Pub. Notice SPN-20-57 (Sept. 4, 2020); see also Vol. LIII, No. 3 (2020) of this Newsletter. The public comment period closed on October 4, 2020. On February 12, 2021, PADEP issued a conditional state water quality certification (SWQC) under section 401 of the Clean Water Act, which certifies that activities authorized by PASPGP-6 would comply with the commonwealth’s water quality standards if the applicant complies with the following conditions and “constructs, operates and maintains the project in compliance with the terms and conditions of State permits . …

Pittsburgh Business Times

20 People to Know connects the Pittsburgh-area business community with influential businesspeople working in key industries. In this installment of 20 People to Know, the Pittsburgh Business Times focused on legal professionals.

These listings are not meant to be comprehensive or a ranking, but rather an introduction to some of the behind-the-scenes players, key leaders and up-and-comers. Those selected offered their wisdom and thoughts on the region’s legal marketplace during this turbulent and transformative time.

Named to this list, Molly Meacham became co-chair of Babst Calland’s Litigation Group two years ago and recently was appointed to the firm’s board and is a member of its Emergency Response Committee. She also works in Babst’s Emerging Technologies Group, where she helps to bridge the litigation and mobility/transport practices. Her practice has two primary aspects: representing companies in commercial litigation and employment litigation matters, and serving as outside counsel providing companies with human resources advice and counseling.

For the full article, click here.

Washington, DC

Renewables Law Blog

(By Ben Clapp)

Developers of renewables projects are once again facing regulatory uncertainty regarding the scope of the Migratory Bird Treaty Act (“MBTA”) as a result of a proposed rule issued on May 7 by the U.S. Fish and Wildlife Service (“USFWS”).  The proposed rule, if finalized as issued, would revoke a rule issued in the last days of the Trump administration stipulating that deaths of migratory birds occurring incidental to lawful activities (i.e., incidental take) are not prohibited under the MBTA.

The proposed rule represents the latest development in a long-running debate.  At issue is whether the MBTA, a law passed in 1918 that was originally intended to prevent the extinction of migratory bird species due to commercial trade and hunting practices, prohibits the incidental taking of protected birds as a result of activities that are otherwise lawful, such as the operation of wind turbines or the clearing of land for a solar project, or whether the law prohibits only the intentional take (i.e., purposeful killing) of protected species.  The issue has resulted in a split among U.S. Circuit Courts of Appeals, as well as completely opposite legal interpretations issued by two Solicitors of the Department of Interior within the span of one year in 2017.

By revoking the prior rule, the USFWS would revert to interpreting the MBTA to prohibit incidental take of birds protected under the act, and to employing agency discretion in determining whether an incidental take of such birds warrants an enforcement action.  The proposed rule highlights the need for renewable project developers to implement best practices for avoiding the unintended take of protected migratory birds as a means of qualifying for agency enforcement discretion and thus avoiding fines for noncompliance.  …

Smart Business 

(by Sue Ostrowski featuring Carl Ronald)

If you’re considering selling your innovative product or commercializing your novel processes in another country, protecting your innovations with a patent in that country may be key to your success. But trying to navigate the process alone can prove difficult.

“It’s surprising how complicated it can be, and there are a lot of places to get tripped up,” says Carl Ronald, shareholder at Babst Calland. “While you can try to do it on your own, hiring a patent attorney can make the process much smoother, ensuring you are including all relevant information and complying with all relevant deadlines to protect your invention in the most cost-effective way possible.”

Smart Business spoke with Ronald about when you might need international protection and how a patent attorney can help you navigate the complex process.

When should a company consider applying for a patent outside the U.S.?

A U.S. patent only provides a protectable interest here in the U.S.; you can’t stop someone from using what your patent teaches to compete with you in other countries unless you’ve timely filed in those countries, as well. If you have an international customer base that is purchasing products or services that, in the future, may be produced with, employ, or contain your patented process or device, you should seek protection, at a bare minimum, in those countries where your anticipated market is largest.

Keep in mind the importance of secrecy before filing your application. In the U.S., you have one year to file a patent application covering your invention after you disclose it publicly. Other nations are not so lenient and, in many countries, any disclosure of your invention to someone who does not have an obligation of confidentiality will destroy novelty and likely preclude you from ever obtaining a patent in that country. …