Appeals court affirms injunction of New York soda portion-cap rule (erroneously called “ban”)

The New York Supreme Court, Appellate Division, First Department, today affirmed the trial court order enjoining the portion-cap rule on sugar-sweetened beverages promulgated by the New York City Board of Health.  Because Mayor Bloomberg was influential in promoting this rule (as detailed in my forthcoming article in the Fordham Urban Law Journal, “Local Health Agencies, the Bloomberg Soda Rule, and the Ghost of Woodrow Wilson”), it is often referred to as the Bloomberg Soda “Ban,” even though the rule did not ban any soda.

In its opinion, the Appellate Division held that the ban violated New York state’s curious doctrine of “separation of powers,” under Boreali v. Axelrod (N.Y. 1989).  This was a clarification of the trial court opinion, which seemed to invalidate the rule both for violating separation of powers and for being “arbitrary and capricious.”  Boreali, as I explain in my paper, relies heavily on nondelegation reasoning that has largely been abandoned at the federal level, constricting agency power based on the dubious premise that administrative “rulemaking” and legislative “policymaking” can be neatly separated.  There is nothing wrong with a state retaining its own distinctive brand of constitutional interpretation, of course, but there are good reasons to be skeptical of Boreali‘s “test” for whether administrative rulemaking has encroached on the supposedly separate sphere of legislative “policymaking.”

Boreali, as applied by the Appellate Division, requires an almost monastic approach to administrative rulemaking in which agencies like the Board of Health do not consider anything but health concerns in promulgating their regulations.  Because the Board’s exemption of certain drinks (like milk-based drinks) and retail establishments was based in part on practical or economic concerns, the court held that the Board had engaged in “policymaking” outside its proper realm.  Indeed, the court even concluded that because the rule “manipulates choices to try to change consumer norms,” it concerns itself with non-health-related issues, as if consumer norms were not integrally related to public health!

Other discouraging aspects of the Appellate Division opinion include its narrow reading of the Board’s authority under the city charter (which grants the Board the power to regulate “all matters affecting the health of the City”).  Like the trial court, the Appellate Division believes that the Board’s powers are limited to “sanitary” matters, and dismisses the notion–despite myriad scientific data–that soda consumption is a health hazard.

The Bloomberg administration may appeal the decision to the New York Court of Appeals (the state’s highest court), which has the discretion to decline hearing the appeal.  Regardless, the momentum behind the regulation has been nearly killed by these decisions.  Businesses like Dunkin’ Donuts were prepared to comply, and I have no doubt that the rule could have been smoothly implemented.  With Bloomberg’s term almost expiring and his potential successors lukewarm, if not hostile, to the rule, the chance of this innovative approach to fighting obesity and dental decay actually taking effect now appears slim.

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