In a 4-2 ruling with one judge not participating, New York’s highest court has affirmed lower court rulings invalidating a New York City Board of Health rule that would have limited the size of the containers in which sugary drinks are sold in certain venues. In re N.Y. Statewide Coal. of Hispanic Chambers of Commerce v. NYC Dept. of Health & Mental Hygiene, No. 134 (N.Y. June 26, 2014). Details about the intermediate appellate court ruling appear in Issue 492 of this Update.

Finding that the board lacks legislative authority, the majority weighed the separation-of-powers factors that are analyzed to determine whether a particular action is legislative or regulatory and determined that the board had overstepped its authority by engaging in political compromise, choosing between ends and making difficult and complex policy choices. It contrasted agency action regulating the purity of drinking water, the use of interior lead paint or the use of guards in the windows of high-rise apartments housing children—matters with a “very direct” connection to “the preservation of health and safety,” where there is “minimal interference with the personal autonomy of those whose health is being protected, and value judgments concerning the underlying ends are widely shared.”

In the majority’s view, “By contrast, when an agency in our present time either prohibits the consumption of sugary beverages altogether or discourages it by regulating the size of the containers in which the drinks are served, its choices raise difficult, intricate and controversial issues of social policy. Few people would wish to risk the physical safety of their children who play near high-rise apartment windows for the sake of unobstructed views. However, the number of people who over-indulge in sugary drinks, at a risk to their health, is clearly significant. An agency that adopts a regulation, such as the Portion Cap Rule or an outright prohibition on sugary beverages, that interferes with commonplace daily activities preferred by large numbers of people must necessarily wrestle with complex value judgments concerning personal autonomy and economics. That is policy-making, not rule-making.”

The court did not address an issue considered by the trial court, i.e., whether the Portion Cap Rule is “arbitrary and capricious.”

The two dissenting jurists argued that “the majority misapprehends, mischaracterizes and thereby curtails the powers of the New York City Board of Health to address the public health threats of the early 21st century.” According to the dissent, the board has broad authority to regulate public health and its regulations have the force and effect of state law, thus the only question should be whether it “acted reasonably within the bounds of its state-delegated powers.” The dissent further observed that the majority “just does not believe it to be a good idea for the Board to mandate the portion size of sugary drinks, apparently on the theory that the Council should be the sole arbiter of ‘the choices of New York City residents concerning what they consume,’ at least in those situations where the choices are not immediately life-threatening. I can appreciate this vision of the world as a philosophical matter, but I see no legal basis for it here.”

The dissent also asked why the majority even applied the separation-of-powers doctrine which arose in a case involving a constitutional provision vesting legislative power in the state, given that this case involves local government, and would have instead determined whether the regulation is “so lacking in reason for its promulgation that it is essentially arbitrary.” Under this test, the dissenters would have upheld the regulation, concluding, “What petitioners have truly asked the courts to do is to strike down an unpopular regulation, not an illegal one. Indeed, petitioners constantly stress just how unpopular the Portion Cap Rule is.”

The Center for Science in the Public Interest (CSPI) called the ruling “disappointing” and suggested that making reduced consumption of “these nutritionally worthless products” should be a priority for “boards of health, city councils, state legislatures, and even Congress.” See CSPI Statement, June 26, 2014.

 

Issue 528

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For decades, manufacturers, distributors and retailers at every link in the food chain have come to Shook, Hardy & Bacon to partner with a legal team that understands the issues they face in today's evolving food production industry. Shook attorneys work with some of the world's largest food, beverage and agribusiness companies to establish preventative measures, conduct internal audits, develop public relations strategies, and advance tort reform initiatives.

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