Smith Valliere PLLC Sues to Enjoin New York's Participation in Regional "Cap and Trade" Program That Has Imposed an Unlawful $320 Million Tax on New Yorkers

NEW YORK, June 27, 2011 /PRNewswire/ -- Smith Valliere PLLC, as lead litigation counsel, has commenced a lawsuit in New York Supreme Court challenging the legal authority of Governor Andrew Cuomo, the Department of Environmental Conservation ("DEC"), and the New York State Energy and Research Development Authority ("NYSERDA") to enter into an allegedly unconstitutional and illegal "cap and trade" program.  According to the suit, New York State has collected over $320 million in unauthorized taxes from this massive regulatory program, which has the effect of forcing New Yorkers to pay more for energy.  

Lead attorney Mark W. Smith explains that "This lawsuit is a direct legal challenge to the Regional Greenhouse Gas Initiative ("RGGI").  The alleged purpose behind RGGI is to reduce carbon dioxide emissions, but the reality is that it has become a large energy tax imposed illegally on New Yorkers."  Smith continues, "If New York State believes RGGI is a valuable program, then let's have a vote. Americans oppose taxation without representation, but that's what RGGI amounts to – an unauthorized tax imposed by unelected government bureaucrats."

The lawsuit explains that through the RGGI program, ten Northeast states, including New York, created a joint, regional "cap and trade" emission control program to limit and ultimately reduce the carbon dioxide emissions within the region.  Each of the ten states was allocated a portion of the overall cap. Under the RGGI scheme, each state issues a number of "allowances" (tradable certificates allowing the emission of one ton of carbon dioxide) equal to each state's specific cap for that year, and sells those allowances in a joint auction.  Affected generation facilities must acquire sufficient allowances to equal their actual emissions.  The allowances are sold at public auction and can be purchased by anyone – not just power generators.  If the power generators do not successfully bid for the allowances they need in order to run their plants, they must purchase them from other successful bidders (paying a premium for the allowances).  

New York, and the other states that formed the RGGI pact, specifically intended that the affected generation facilities would pass the full cost of the allowances on to customers of electricity, thereby raising the costs of electricity.  New York's alleged unauthorized, unlawful, and unconstitutional participation in RGGI has generated enormous tax revenues for the State – in excess of $320 million in the three years since it was improperly implemented.  

The lawsuit specifically challenges the Department of Energy Conservation and NYSERDA's legal authority to establish and operate RGGI without clear and unequivocal state legislation.  New York is the only state in the RGGI program to create its program exclusively by executive action, without proper legislative authority.  The suit also challenges the participating RGGI states' ability to enter into a multi-state "compact" without an act of Congress.  

Smith explains that "New York's participation in RGGI is a classic example of enacting legislation by unlawful 'executive fiat.'  The New York Legislature is the primary policymaking arm of New York State.  New York's bureaucratic implementation of RGGI without express and unambiguous legislative approval violates the Constitution."

Smith Valliere PLLC is a boutique litigation firm concentrating in complex, highly sophisticated business litigation. Located in Rockefeller Plaza in New York City, Smith Valliere handles large, high-profile matters throughout the United States. Lead attorney Mark W. Smith has been called by the media "one of the fastest rising legal stars in the country" and a "powerhouse attorney."  He has appeared throughout the media including in the Wall Street Journal, The New York Times, CNN, Fox News, and Bloomberg.  He is also The New York Times bestselling author of four books.  

Sam Kazman of the Competitive Enterprise Institute, a premier free-market public policy organization based in Washington, DC, is serving as co-counsel on the case.

MEDIA CONTACT
Marie Assante
R. Couri Hay Creative Public Relations
917-837-0755
[email protected]

SOURCE R. Couri Hay Creative Public Relations

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