The horse industry in Connecticut was thrown into turmoil in May of 2006 at the hooves of a horse named Scuppy. In Vendrella v. Astriab Family Limited Partnership, the Supreme Court of Connecticut recently released its 6-0 decision in April, affirming the Appellate Court’s ruling that a horse belongs to “a species naturally inclined to do mischief or be vicious.”
Taking a Stride Back: Dirt Track Changes Coming to the Bluegrass
By: Eric Finke, Staff Member
Horse racing returns to the Bluegrass as Lexington once again becomes the horse capital of the world.[i] This spring will offer the last meet on the current synthetic track as the President of Keeneland, Bill Thomson, announced last week that “a state of the art dirt track” will once again become the racing surface. [ii] Keeneland has long been the final tune-up for many horses that have hopes of running in the Oaks and the Derby at Churchill Downs.[iii]
In 2006, Keeneland introduced its current synthetic track to increase the safety of horses under the stress of racing on dirt.[iv] This safety trend was seen nationwide as the California Horse Racing Board went so far as to require tracks, including the famous Santa Anita Park, to lay down a synthetic surface by 2007.[v] A surface switch proved to be a success based on studies of the Equine Injury Database.[vi] As recent as 2013, there were only 0.43 breakdowns per 1000 starts at Keeneland on the synthetic track surface, while the overall breakdown rate across the nation on dirt surfaces was 2.11 per 1000 starts.[vii] In the midst of all this change, Churchill Downs continued using a dirt surface, causing many owners to begin bypassing tracks like Keeneland, in favor of dirt.[viii] Horse owners that once eyed the Blue Grass Stakes as the premier event for testing the Derby waters have begun to stay away in recent years.[ix] World famous horse trainer Todd Pletcher has refused to run on a synthetic surface with a true frontrunner in his stable, preferring to run on a consistent dirt surface that would be comparable to what Churchill Downs has to offer.[x]
It is not surprising, albeit unfortunate, that courses including Keeneland are now reverting to the original dirt despite statistic proof of synthetic’s beneficial health results. Weather conditions in the United States are not as ideal some say, as compared to other continents like Europe where synthetic has been a great success.[xi] Expensive maintenance costs of synthetic tracks are cited as a reason to change back to dirt for others.[xii] New York Times sports columnist Joe Drape writes about the Keeneland announcement and who it is really serving, “Who’s more important: the equine athletes who put on the show, or the commercial breeders and captains of industry who sit on boards and in the box seats? We got the answer, and it’s sad.”[xiii] Contrary to these sentiments surrounding the reversion to dirt, Josh Rubenstein, Vice President of Del Mar Surfside Race Place, said, “We want absolutely the safest surface possible and feel returning to dirt will allow us to do that.”[xiv]
It is no secret that the culmination of the horseracing season, the Breeders Cup, has been held on the dirt tracks of Santa Anita Park and Churchill Downs the last four years straight.[xv] Thomason made reference to this unofficial dirt expectation, “It hasn't been laid down as a condition ... but we also know one of the things it does impact is our horsemen who have their horses going through those traditional dirt races coming to the Breeders' Cup."[xvi]
With so much potential being left out of both the starting and ticket gates, Keeneland is presumably under pressure to revert back to a surface that will draw the best competition once again. Avid fans of Keeneland horse racing and sports are left with an unsettling question after these various arguments: Is this most recent change to horse racing being done for the love of the sport, or purely for the love of money?
_________________[i] VisitLex: About Lexington, http://www.visitlex.com/about/, (last visited Apr. 9, 2014).
[ii] Alicia Wincze Hughes, Keeneland to replace synthetic racing surface with return to dirt track, Kentucky.com (Apr. 2, 2014), http://www.kentucky.com/2014/04/02/3174914/keeneland-to-replace-synthetic.html.
[iii] Keeneland spring meet offers Derby, Oaks preps, Washington Times (Apr. 3, 2014), http://www.washingtontimes.com/news/2014/apr/3/keeneland-spring-meet-offers-derby-oaks-preps/.
[iv] Natalie Voss, Keeneland’s Switch Back to Dirt Track Could Appeal to Breeder’s Cup and Derby Contenders, Business Lexington (Apr. 7, 2014), http://bizlex.com/2014/04/keeneland-switch-back-to-dirt-track-could-appeal-to-breeders-cup-and-derby-contenders/.
[v] Hughes, supra note 2.
[vi] Equine Fatality Summary: Keeneland, Equine Injury Database, http://www.jockeyclub.com/pdfs/eid/Keeneland.pdf (last visited Apr. 9, 2014).
[vii] Supplemental Tables of Equine Injury Database Statistics for Thoroughbreds, The Jockey Club, http://jockeyclub.com/pdfs/eid_5_year_tables.pdf (last visited Apr. 9, 2014).
[viii] Voss, supra note 4.
[ix] Hughes, supra note 2.
[x] Don Agriss, Up the Backstretch: A back-to-nature movement in racing, The Island Packet (April 3, 2014), http://www.islandpacket.com/2014/04/03/3039209/up-the-backstretch-a-back-to-nature.html.
[xi] Voss, supra note 4.
[xii] Andrew Beyer, Keeneland reluctantly will be digging the dirt once again, Washington Post (Apr. 9, 2014), http://www.washingtonpost.com/sports/othersports/keeneland-reluctantly-will-be-digging-the-dirt-once-again/2014/04/09/080dbb3a-bfff-11e3-b574-f8748871856a_story.html.
[xiii] Joe Drape, A Track’s Shift to Dirt Adds to Horses’ Risks, The New York Times (Apr. 3, 2014), http://www.nytimes.com/2014/04/04/sports/in-a-tracks-decision-horses-are-the-losers.html?hpw&rref=sports.
[xiv] Joe Tash, Del Mar Fairgrounds to replace synthetic track with dirt, Del Mar Times (Apr. 9, 2014), http://www.delmartimes.net/2014/04/09/del-mar-fairgrounds-to-replace-synthetic-track-with-dirt/.
[xv] Breeder’s Cup, http://www.breederscup.com/history/event-year (last visited Apr. 9, 2014).
[xvi] Hughes, supra note 2.
EPA Proposal Takes Great Steps to Broaden Clean Water Act Jurisdiction
By: Connor Egan, Editor-in-Chief
On March 25, 2014, the Environmental Protection Agency and Army Corps of Engineers released a proposed rule amending the Clean Water Act.
The proposal is a response to a near decade of demand by state and federal legislators and environmental groups to clarify the extent of the Act’s jurisdiction.
The proposed rule clarifies the Act’s jurisdiction over the nation’s streams and wetlands by amending its definition of “water.”
Today, Supreme Court decisions in 2001 and 2006
have left many uncertain as to the actual breadth of the Act’s coverage.
The proposed rule remedies this uncertainty by explicitly listing wetlands and intermittent streams as protected waters.
The EPA and Corps of Engineers are currently engaged in a 90-day outreach effort to solicit comment before the final rule making.
In an op-ed released in conjunction with the proposed rule, EPA Administrator Gina McCarthy explained, “[w]e are clarifying protection for the upstream waters that are absolutely vital to downstream communities.”
In a coordinate press release, the EPA stressed that the amendments would be consistent with the recent Supreme Court decisions, which seemingly narrowed the scope of Clean Water Act jurisdiction.
Since the proposal’s release, is has been hailed as the “biggest step forward for clean water in more than a decade.”
While the rule will not be finalized until early summer, its ratification would bring approximately 20 million acres of wetlands and 2 million miles of streams under EPA protection.
_________________
EPA and Army Corps of Engineers Clarify Protection for Nation’s Streams and Wetlands: Agriculture’s Exemptions and Exclusions from Clean Water Act Expanded By Proposal, EPA, Mar. 25, 2014,
[hereinafter Press Release] (publication in Federal Register still pending).
Id.
Id.
See Rapanos v. United States, 547 U.S. 715 (2006); Solid Waste Agency of N. Cook Cnty. v. U.S. Army Corps of Engineers, 531 U.S. 159 (2001).
Neela Banerjee, Clean Water Act proposal would protect more water sources in West, L.A. Times, Mar. 25, 2014, available at
http://www.latimes.com/nation/la-na-epa-waters-20140326,0,1080552.story#axzz2yznfcabq
.
Press Release, supra note 2.
Id.
Gina McCarthy, Clearer Protections for Clean Water, The Huffington Post, Mar. 25, 2014, available at
http://www.huffingtonpost.com/gina-mccarthy/clearer-protections-for-c_b_5029328.html
.
Press Release, supra note 2.
Environment America, EPA Rule Would Close Loopholes in Clean Water Act, Restore Protections for Streams and Wetlands, EcoWatch, Mar. 25, 2014,
http://ecowatch.com/2014/03/25/epa-clean-water-act-restore-protections-wetlands/
.
Kate Bissell, Proposed Rule to Clarify Clean Water Act Coverage, The Wildlife Society, Mar. 31, 2014,
http://news.wildlife.org/featured/proposed-rule-to-clarify-clean-water-act-coverage/
; Juliet Eilperin and Darryl Fears, EPA proposes greater protections for streams, wetlands under Clean Water Act, Wash. Post, Mar. 25, 2014, available at
.
UK College of Law: KLJ & KJEANRL Hold Annual Banquet
The University of Kentucky College of Law recently reported: The Kentucky Law Journal (KLJ) and the Kentucky Journal of Equine, Agriculture, and Natural Resources Law (KJEANRL) held their annual banquet on Wednesday, March 26, at the Boone Center. There were roughly 140 attendees, including faculty and members of both journals.
Rachel King, Editor-in-Chief of the KJEANRL, and Sarah Lawson, Editor-in-Chief of the KLJ, each gave a short “State of the Journal Address.” Then Judge Jennifer Coffman delivered the keynote address to the banquet attendees, highlighting the importance of developing leadership skills. She was introduced by Dean Brennen, who also said a few words. Awards were presented by each Editor-in-Chief of the respective journals.
A Horse Owner’s Tax Checklist
By: Matthew Doane, Staff Member
With tax day upon us, horse owners must be cautious if they are attempting to deduct business expenses related to their horse activity. Section 183(a) of the Internal Revenue Code states, “[i]n the case of an activity engaged in by an individual or an S corporation, if such activity is not engaged in for profit, no deduction attributable to such activity shall be allowed under this chapter except as provided in this section.”[i] If an activity is not “engaged in for profit,” provision (b) of section 183 allows deductions only to the extent of gross income derived from the activity.[ii] Deemed the “hobby loss rules,”[iii] this means that if an individual’s horse activity does not rise to the level of “engaged in for profit,” but is simply a hobby, then that individual will only be able to deduct allowable expenses up to the threshold of income they have received relating to the activity.[iv] This can lead to serious tax implications if a taxpayer was planning on horse-related expenses being deductible, primarily larger tax liability, or in the case of previous tax year where a taxpayer included the deductions, an audit by the IRS. In 2011, this exact situation occurred, leading to a Tax Court opinion that provides some guidance to horse owners and the deductibility of horse-related expenses. [v]
In Blackwell v. Comm’r., the petitioners, Mark and Patti Blackwell, were seeking a redetermination of tax deficiencies on their 2005 and 2006 federal income tax returns, relating to the deductibility of business expenses related to their horse-breeding operation, Fresh Horses Farm.[vi] The main issue in the case, as laid out by Judge Swift, was “whether petitioners’ horse breeding activity constituted an activity carried on for profit under section 183.”[vii] The court relied upon Section 1.183-2(b) of the Income Tax Regulations, which sets forth a nonexclusive list of nine factors that are to be considered when deciding whether an activity has an “actual and honest profit objective.”[viii] The nine factors considered in the case include: 1) Manner in Which the Activity Is Carried On; 2) Expertise of the Taxpayer; 3) Time and Effort Expended in Carrying On the Activity; 4) Expectation That the Horses May Appreciate in Value; 5) Success in Other Activities; 6) History of Income or Losses; 7) Amount of Occasional Profits; 8) Financial Status; and 9) Elements of Personal Pleasure.[ix]
In Blackwell, the court, after examining all nine factors, held that the “petitioners’ motive, efforts, and investment in carrying on their FHF horse activity during the years in issue” was indicative of a “profit objective.”[x] The court’s holding centered around such facts as the petitioners’ substantial preparation and education associated with entering the horse business, the considerable amount of time and energy invested in the horse activity, and their dedication to proper business planning and book keeping procedures related to their horse activity.[xi] While the outcome in Blackwell was a positive one for Mark and Patti Blackwell, horse owners this tax season must still be mindful of the nine factor checklist set out in 1.183-2(b) of the Income Tax Regulations and examined in Blackwell v. Comm’r. to properly deduct expenses relating to their horse activity.
_________________
[i] 26 I.R.C. § 183(a) (2014).
[ii] See id. § 183(b).
[iii] Peter Reilly, Horse Breeders Win in Tax Court, Forbes (Aug. 13, 2011), http://www.forbes.com/sites/peterjreilly/2011/08/13/horse-breeders-win-in-tax-court/.
[iv] See 26 I.R.C. § 183(a)-(b) (2014).
[v] See generally Blackwell v. Comm’r., No. 29287-09, T.C. Memo. 2011-188 (2011).
[vi] See id. at *6.
[vii] Id. at *1.
[viii] Id. (citing Dreicer v. Comm’r, 78 T.C. 642, 645 (1982)).
[ix] See id. at *6-*8.
[x] Id. at *8.
[xi] See id. at *6-*8.
[i] 26 I.R.C. § 183(a) (2014).
[ii] See id. § 183(b).
[iii] Peter Reilly, Horse Breeders Win in Tax Court, Forbes (Aug. 13, 2011), http://www.forbes.com/sites/peterjreilly/2011/08/13/horse-breeders-win-in-tax-court/.
[iv] See 26 I.R.C. § 183(a)-(b) (2014).
[v] See generally Blackwell v. Comm’r., No. 29287-09, T.C. Memo. 2011-188 (2011).
[vi] See id. at *6.
[vii] Id. at *1.
[viii] Id. (citing Dreicer v. Comm’r, 78 T.C. 642, 645 (1982)).
[ix] See id. at *6-*8.
[x] Id. at *8.
[xi] See id. at *6-*8.
Defend the Michigan Natural Resources Trust Fund
The Attorney General for the State of Michigan is Bill Schuette and he has been a staunch upholder of the Michigan Constitution.[i] Recently, he spoke about the need to preserve the Michigan Natural Resources Trust Fund (MNRTF) for its intended purpose.[ii] In 1984, the MNRTF began by an amendment to the Michigan Constitution.[iii] The MNRTF “is used to develop public recreation lands and is supported by oil, gas, and other mineral lease and royalty payments.” [iv] Thus, “the trust fund is constitutionally restricted for natural resources improvements and land acquisitions across the state.”[v] Since Michigan passed a constitutional amendment, legislators should not be allowed to reallocate money from the Trust Fund for their own “programs or projects.”[vi] Recent economic troubles in Michigan have led to a desire by lawmakers for the money to go elsewhere despite the constitutional implications involved.[vii] Attorney General Schutte has been clear in his directive through an “official opinion” that the Michigan legislature cannot do that.[viii] Schuette should continue to defend the MNRTF and ensure that the legislature allocates money from the fund properly.
Michigan has some of the most scenic parks and tourist areas in the country, and these areas need the MNRTF funds for both preservation and revitalization.[ix] “The Michigan Senate recently approved legislation allocating $27.6 million from the Natural Resources Trust Fund for 76 projects across the state, including upgrades to Midland’s Emerson Park area along the Pere Marquette Rail-Trail.”[x] It is in the best interest of Michigan residents that the state continues to attract visitors to enjoy the natural beauty of its natural resources. Tourists visiting Michigan from other states will inevitably spend money in the state, which will therefore lessen the state’s financial woes.[xi] Schuette should remain steadfast in protecting the MNRTF to preserve the state’s vast natural resources and defend the Michigan Constitution like he has done with so many other constitutional issues.[xii]
_________________
[i] Ilsa Matthes, Attorney General on Tour of U.P., Escanaba Daily Press (Mar. 28, 2014), http://www.dailypress.net/page/content.detail/id/546803/Attorney-general-on-tour-of-U-P-.html.
[ii] Id.
[iii] Id.
[iv] Id.
[v] Natural Resources Trust Fund Plan Passed by Senate Supports Local Park Improvements, Midland Daily News (Mar. 30, 2014), http://www.ourmidland.com/news/natural-resources-trust-fund-plan-passed-by-senate-supports-local/article_8048c60b-1c77-59bc-8488-56c0ff3c2365.html.
[vi] Matthes, supra note 1.
[vii] Id.
[viii] Id.
[ix] Natural, supra note 4.
[x] Id.
[xi] Matthes, supra note 1.
[xii] Id.
War on Coal: The Selenium Battle
By: Elizabeth Combs, Staff Member
[i] The Periodic Table – Selenium, Minerals Education Coalition, www.mineralseducationcoalition.org/elements/selenium (last visited April 1, 2014).
[ii] Id.
[iii] Toxic Selenium in Kentucky Streams, Appalachian Voices (Feb. 2013), http://appvoices.org/aww/KY_Selenium_Handout.pdf.
[iv] Id.
[v] Laura Beans, Coal Mining Industry Influences EPA’s Selenium Pollution Standards, EcoWatch (July 2013), http://ecowatch.com/2013/07/26/coal-mining-influences-epas-selenium-standards/.
[vi] Id.
[vii] Appalachian Voices, supra note 3.
[viii] Id.
[ix] Beans, supra note 5.
[x] Appalachian Voices, supra note 3.
[xi] Beans, supra note 5.
[xii] Emily McKinney, EPA Approves Kentucky’s New Science-Based Selenium Water Quality Standard, Frost Brown Todd, LLC (Nov. 25, 2013), http://www.frostbrowntodd.com/resources-1626.html.
[xiii] Id.
[xiv] Id.
[xv] Id.
[xvi] Id.
[xvii] Id.
[xviii] Appalachian Voices, supra note 3.
[xix] McKinney, supra note 12.
[xx] Appalachian Voices, supra note 3.
[xxi] McKinney, supra note 12.
[xxii] Id.
[xxiii] Id.
[xxiv] Groups Challenge EPA’s Dangerous Selenium Decision in Kentucky, Sierra Club (Dec. 13, 2013), http://content.sierraclub.org/press-releases/2013/12/groups-challenge-epas-dangerous-selenium-decision-kentucky.
[xxv] Id.
[xxvi] Daniel Siegal, Sierra Club Sues EPA To Block New Ky. Selenium Standard, Law360, Dec. 2013, available at http://www.law360.com/articles/495770/sierra-club-sues-epa-to-block-new-ky-selenium-standard.
[xxvii] McKinney, supra note 12.
Selenium is a naturally occurring metalloid element that can conduct electricity[i]. While small amounts of this element are essential to human and animal life, large amounts of selenium can cause deformities and disease in certain animals[ii] and harm humans.[iii] Although selenium is naturally occurring in certain places in our environment, such as within the selenium-rich coal seams and rock layers found in the mountains of Kentucky,[iv] it can become dangerous once released into the air and water.[v] Throughout many Central Appalachian states, including Kentucky, selenium is often exposed as a result of mountaintop removal coal mining activities,[vi] causing it to be discharged into streams and ground water.[vii] Once released into water systems, selenium accumulates in the tissues of fish and other aquatic animals.[viii] Harmful effects, such as abnormal spine curvature and bulging eyes[ix] [as seen in the photos above], can result if the amount of selenium contained in the tissue reaches toxic levels.[x]
Although the amount of selenium that can be released into water sources is monitored, criteria for selenium discharge does not normally appear on Clean Water Act (CWA) permit applications.[xi] Instead, each state establishes its own water quality criteria. Before becoming an enforceable monitoring criteria, these standards, as well as any subsequent revisions, must first be approved by the Environmental Protection Agency (EPA).[xii] As of 2013, the standard in Kentucky for chronic selenium discharge was 5 parts per billion (ppb).[xiii] However, based on cutting-edge scientific research into the long-term effects of selenium, Kentucky recently proposed a change to these standards.[xiv] The new monitoring process would involve testing the tissue of fish within any water sample exceeding the 5 ppb selenium limit.[xv] In order to trigger a water pollution violation, the concentration of selenium in the fish tissue would have to be greater than 8.6 ppb.[xvi]
Since the original selenium discharge criteria would trigger a water pollution violation simply upon a measurement exceeding 5 ppb in the water source,[xvii] many environmental groups interpreted the revised standard as effectively increasing the amount of selenium discharge allowed and thus weakening the standard for selenium exposure.[xviii] Although the revision to Kentucky’s standard was based on scientific information showing that selenium did not become toxic until it surpassed an accumulation of 8.6 ppb in fish tissue,[xix] other experts argued that toxic effects on aquatic life could be found at as low as 3 ppb in tissue.[xx] However, the EPA must first approve any revisions to a state’s standards for water quality.
In Kentucky, where the “War on Coal” can be seen and felt by many citizens, coal companies and mining organizations are actively and regularly challenging the EPA and its seemingly ever-increasing regulatory authority over the coal mining industry. However, these same companies and organizations were surprised when the EPA chose to approve Kentucky’s new standards on selenium in late 2013.[xxi] This decision, which was highly anticipated by both environmental and coal mining organizations, was based on the fact that the new two-step process to measure chronic selenium discharge is grounded in the latest scientific research.[xxii] According to the EPA, the newly approved criterion focuses on the long-term effects of selenium and is not only adequate for, but also protective of, aquatic life.[xxiii]
At a time when environmental regulations continue to be strengthened and intensely enforced, it is quite unusual for the EPA and mining industry groups to be on the same side of an issue that involves coal, and yet the EPA’s decision to approve Kentucky’s revised selenium standard did just that. Interestingly, something just as unusual resulted from this decision–in response to the EPA’s approval of Kentucky’s revised standards, several environmental groups are taking action against the EPA.[xxiv] These groups, including the Sierra Club, Kentuckians For The Commonwealth, Appalachian Voices, and the Kentucky Waterways Alliance, have filed suit in the U.S. District Court for the Western District of Kentucky arguing that the new selenium standards violates the Clean Water Act.[xxv]
Likely due to the fact that the previous selenium criteria was a standard that these environmental groups relied on in past litigation regarding pollution by coal companies, these groups want the EPA to maintain the original standard for chronic selenium discharge–5 ppb as measured from water samples.[xxvi] The outcome of this case is important not only for Kentucky, but because other coal-producing states are expected to follow our lead, this decision may affect revisions to selenium standards in other states.[xxvii] However, regardless of what happens in this case or one’s opinions regarding environmental regulation, I think we all can agree that the issue of selenium and its unusual line-up of characters have certainly proven to be a unique and unusual battle in the “War on Coal.”
_________________[i] The Periodic Table – Selenium, Minerals Education Coalition, www.mineralseducationcoalition.org/elements/selenium (last visited April 1, 2014).
[ii] Id.
[iii] Toxic Selenium in Kentucky Streams, Appalachian Voices (Feb. 2013), http://appvoices.org/aww/KY_Selenium_Handout.pdf.
[iv] Id.
[v] Laura Beans, Coal Mining Industry Influences EPA’s Selenium Pollution Standards, EcoWatch (July 2013), http://ecowatch.com/2013/07/26/coal-mining-influences-epas-selenium-standards/.
[vi] Id.
[vii] Appalachian Voices, supra note 3.
[viii] Id.
[ix] Beans, supra note 5.
[x] Appalachian Voices, supra note 3.
[xi] Beans, supra note 5.
[xii] Emily McKinney, EPA Approves Kentucky’s New Science-Based Selenium Water Quality Standard, Frost Brown Todd, LLC (Nov. 25, 2013), http://www.frostbrowntodd.com/resources-1626.html.
[xiii] Id.
[xiv] Id.
[xv] Id.
[xvi] Id.
[xvii] Id.
[xviii] Appalachian Voices, supra note 3.
[xix] McKinney, supra note 12.
[xx] Appalachian Voices, supra note 3.
[xxi] McKinney, supra note 12.
[xxii] Id.
[xxiii] Id.
[xxiv] Groups Challenge EPA’s Dangerous Selenium Decision in Kentucky, Sierra Club (Dec. 13, 2013), http://content.sierraclub.org/press-releases/2013/12/groups-challenge-epas-dangerous-selenium-decision-kentucky.
[xxv] Id.
[xxvi] Daniel Siegal, Sierra Club Sues EPA To Block New Ky. Selenium Standard, Law360, Dec. 2013, available at http://www.law360.com/articles/495770/sierra-club-sues-epa-to-block-new-ky-selenium-standard.
[xxvii] McKinney, supra note 12.
Kentucky Proposed ‘Ag Gag’ Bill Raises Concern
By: Alison Cox, Staff Member
A Senate committee in the Kentucky General Assembly recently approved a bill that would make it a crime to film farm operations on private property without the owner’s consent. The Senate Agriculture Committee attached this legislation to House Bill 222, a bill designed to set euthanasia standards for shelter animals.
The new language has created public policy concerns by animal rights activists, as well as questions of constitutionality. Kentucky State Representative Joni Jenkins said that the language added by the Senate committee made the bill “more complicated, and maybe even unconstitutional.”
The Kentucky Legislature won’t pass House Bill 222 easily due to high public scrutiny.
This new language would subject a person to a Class B misdemeanor, punishable by up to 90 days in jail and a $250 fine, for secretly recording farm operations on private property.
The bill, however, does not apply to law-enforcement officials and farming operations on public property.
The Humane Society has dubbed this bill the latest issue of “ag-gag” legislation.
The Human Society defines an “ag-gag” bill as any bill that seeks to criminalize whistle-blowing on factory farms, and as a result keep Americans in the dark about where their food is coming from.
Matt Dominguez of the Humane Society has said such bills, “go to show how much the industry has to hide.”
Not only will the bill potentially keep Americans in the dark, but it may also be a violation the First Amendment, as the bill is very much directed at restricting speech. The First Amendment does not free undercover investigators from civil or criminal liability, even if they ultimately produce an accurate video that serves the public good. But, this type of bill represents the broadest approach to “ag-gag” laws because these laws could potentially implicate a wide range of otherwise innocent activities and may face strong First Amendment challenges for overbreadth and government restraint of content of expression.
Tennessee Governor Bill Haslam vetoed a proposed “ag-gag” law after the Tennessee Attorney General called the bill “constitutionally suspect.”
The Tennessee bill was just one of fifteen so called “ag-gag” bills that were both introduced and defeated in 2013.
However, in February 2014, Idaho became the seventh state to pass “ag-gag” legislation into state law
. The Idaho legislation criminalizes unauthorized recording inside agricultural facilities, punishable by up to one year in jail and a $5000 fine.
Though the Kentucky bill is controversial, the bill has found support. Kentucky Farm Bureau has supported the provision as a necessity to protect Kentucky farmers.
However, there are serious implications to public policy if farmers’ rights are protected in this way. The farmers may be able to be protected through other means.
The public policy concerns and the suspect constitutionality of the Kentucky provision seem to outweigh the argument of protecting the farmer’s rights, but the question remains as to whether Kentucky will join eleven states that failed to pass proposed “ag-gag” legislation in 2013 or whether it will join the likes of Idaho and pass the controversial legislation.
_________________
Cho Park, Critics: Kentucky Senators ‘Snuck’ ‘Ag-Gag’ Into Animal Rights Bill, ABCNews (Mar. 28, 2014),
http://abcnews.go.com/Blotter/critics-kentucky-senators-snuck-ag-gag-animal-rights/story?id=23098835
.
Id.
Jack Brammer & Janet Patton, Kentucky bill would prohibit filming of farm operations without owner’s consent, Kentucky.com (Mar. 25, 2014),
http://www.kentucky.com/2014/03/25/3160704/kentucky-bill-would-prohibit-filming.html
.
Id.
Park, supra note 1.
Anti-Whistleblower Bills Hide Factory-Farming Abuses from the Public, The Humane Society (Mar. 25, 2014),
.
Brammer & Patton, supra note 3.
Jessalee Landfried, Bound & Gagged: Potential First Amendment Challenges to "Ag-Gag" Laws, 23 Duke Envtl. L. & Pol'y F. 377, 395 (2013).
Taking Ag Gag to Court, Animal Legal Defense Fund,
http://aldf.org/cases-campaigns/features/taking-ag-gag-to-court/
(last visited Mar. 31, 2014).
Anti-Whistleblower Bills Hide Factory-Farming Abuses from the Public, The Humane Society (Mar. 25, 2014),
.
Ag-Gag Bills at the State Level, ASPCA,
(last visited Mar. 31, 2014).
Id.
Kentucky ‘Ag Gag’ Bill Targets Undercover Animal Investigation Videos On Farms, Huffington Post (Mar. 25, 2014, 5:59 PM),
http://www.huffingtonpost.com/2014/03/25/kentucky-ag-gag_n_5030196.html
.
Id. (discussing the fifteen proposed ag-gag bills introduced in eleven states in 2013).
Application of the Bankruptcy Code to Mineral Rights in Space
By: Brad Butler, Notes Editor
In 2010, entrepreneurs Peter Diamandis and Eric Anderson founded Arkyd Astronautics,
which they later renamed Planetary Resources, with the intention of developing the technology to extract natural resources from asteroids.
Recent estimates suggest that an average 98-foot asteroid could yield as much as $50 billion worth of platinum.
Clearly, this could prove to be extremely lucrative, and the venture has caught the attention of several prominent investors such as filmmaker James Cameron, real estate developer Ross Perot, Jr., and Google co-founders Larry Page and Eric Schmidt.
However, these space-mining missions are extremely capital-intensive and would cost several hundred million dollars each.
In light of the high costs, debt financing will likely be required.
Unfortunately, creditors will not provide financing until there is a system in place that efficiently provides security for their debt and effectively ensures payment on that debt. In the United States, we have the bankruptcy system. However, it is unclear whether the Bankruptcy Code applies extraterritorially to assets located in space.
To answer this question, we must determine whether Congress intended for the Code to apply outside the United States. In E.E.O.C. v. Arabian American Oil Company, the Supreme Court of the United States held that Title VII of the Civil Rights Act of 1964 did not apply to the conduct of an American employer abroad.
The Court stated that Congress must clearly express an intention for the statute to apply abroad to rebut the presumption against extraterritoriality, and Title VII simply did not do so.
However, the clear expression of intent is not a “clear statement rule” and a court should look to the statute in its entirety.
Furthermore, when a provision of a statute does provide for some extraterritorial application, then the presumption against extraterritoriality is rebutted for that provision alone.
In the case of the Bankruptcy Code, it is clear that Congress provided no clear statement, but Congress did show a clear intention to apply the Code abroad. The grant of jurisdiction to the bankruptcy court extends to all property owned by the debtor wherever located.
The “wherever located” language is also incorporated into the definition of property included in the bankruptcy estate.
Therefore, Congress clearly intended for the court to have jurisdiction over the property of the estate, but a grant of jurisdiction does give rise to substantive rights.
Courts routinely apply the jurisdiction of the Bankruptcy Code and look to local law when determining property rights. In Butner v. United States, the Supreme Court held that the Code did not articulate the priority of the secured creditors, so the Court looked to the local law of North Carolina.
In this case, the asteroids would certainly be the property of the company under the common law principle of ferae naturae
and the bankruptcy court would clearly have jurisdiction over the property. However, the problem then arises as to which law to apply. Here, the local law would be the governing law in space.
The major treaty that has served as the basis for all modern space law is the 1967 Treaty on Principles Governing the Activities of States in the Exploration and Use of Outer Space, Including the Moon and Other Celestial Bodies (“Outer Space Treaty” or “OST”), in which Article VI provides for the possibility for private entities to conduct business in space and possibly own property.
However, the OST does not discuss how the property rights are determined.
Another treaty, the Agreement Governing the Activities of States on the Moon and Other Celestial Bodies (“Moon Treaty”) states that natural resources in space are considered “the common heritage of all mankind.”
Fortunately, the Moon Treaty has only 14 signatories, none of which are space-capable nations.
So, there is some ambiguity as to what the law actually provides. Under the OST, there is no clear answer as to whether a private company may own an asteroid, how long it could own the asteroid, or who actually owns the resources extracted upon return to Earth.
Under the Moon Treaty, either everyone or no one owns all property and natural resources in space.
So, it is unclear whether the company would even have the right to sell the natural resources once it brings them back to Earth. If they cannot be sold, then they have no value and would not benefit the bankruptcy estate. Creditors will not lend money to a company that cannot monetize its assets and provide the potential for repayment of the loan extended by the creditor. Therefore, Congress must pass legislation that providing a mechanism for determining property rights and the effects of those rights, or all interested parties must amend the OST. Until either of these two things is done, there is no rational basis for creditors to lend money to private companies seeking to engage in space mining or exploration and modern innovation will be further deterred.
_________________
John Cook, NASA vet and X Prize creator at the helm of secretive space robot startup Arkyd, GeekWire (July 8, 2011, 10:48 PM),
http://www.geekwire.com/2011/nasa-veteran-emerges-helm-arkyd-stealthy-space-travel-startup/
.
Matthew Sparkes, Planetary Resources unveils cosmic plan 'to boldly go' and mine asteroids for gold and platinum, The Telegraph (April 24, 2012, 8:40 PM),
.
Id.
We’re on to Something, Planetary Resources,
http://www.planetaryresources.com/team/
(last visited Mar. 25, 2014).
Sparkes, supra note 2, at 1.
Id.
E.E.O.C. v. Arabian American Oil Company, 499 U.S. 244, 249 (1991).
Id.
Morrison v. Nat’l Australian Bank Ltd., 561 U.S. 247, 261 (2010).
Microsoft Corp. v. AT&T Corp., 550 U.S. 437, 455-56 (2007).
28 U.S.C. § 1334(e)(1).
11 U.S.C. § 541(a).
Butner v. United States, 440 U.S. 48, 55 (1979).
See Pierson v. Post, 3 Cai. R. 175, 176 (N.Y. Sup. Ct. 1805).
Rand Simberg, Property Rights in Space, The New Atlantis (Fall 2012), pages 20-31,
http://www.thenewatlantis.com/publications/property-rights-in-space
.
See id.
Id.
Id.
See id.
See id.