In the Matter of New York Statewide Coalition of Hispanic Chambers of Commerce, et al., Respondents,v.The New York City Department of Health and Mental Hygiene, et al., Appellants.

Brief

N.Y.June 4, 2014

To Be Argued By Fay Ng (20 Minutes Requested) COURT OF APPEALS STATE OF NEW YORK NEW YORK STATEWIDE COALITION OF HISPANIC CHAMBERS OF COMMERCE; THE NEW YORK KOREAN-AMERICAN GROCERS ASSOCIATION; SOFT DRINK AND BREWERY WORKERS UNION, LOCAL 812, INTERNATIONAL BROTHERHOOD OF TEAMSTERS; THE NATIONAL RESTAURANT ASSOCIATION; THE NATIONAL ASSOCIATION OF THEATRE OWNERS OF NEW YORK STATE; and THE AMERICAN BEVERAGE ASSOCIATION, Petitioners-Respondents, For a Judgment Pursuant to Articles 78 and 30 of the Civil Practice Law and Rules, - against - THE NEW YORK CITY DEPARTMENT OF HEALTH AND MENTAL HYGIENE; THE NEW YORK CITY BOARD OF HEALTH; and DR. THOMAS FARLEY, in his Official Capacity as Commissioner of the New York City Department of Health and Mental Hygiene, Respondents-Appellants. APPELLANTS' BRIEF MICHAEL A. CARDOZO, Corporation Counsel of the City of New York, Attorney for Respondents- Appellants, 100 Church Street, New York, New York 10007. Tel: (212) 356-0843 or 2505 Fax: (212) 356-2509 FNg@law.nyc,gov LEONARD J. KOERNER, PAMELA SEIDER DOLGOW, MARK MUSCHENHEIM, JASMINE M. GEORGES, SPENCER FISHER, FAYNG, of Counsel. December 17, 2013 Reproduce.d on Recycled Paper APL 2013-00291 TABLE OF CONTENTS TABLE OF AU'fHORITIES iii PRELIMINARY STATEMENT 1 JURlSDICTION OF THIS COURT 6 QUESTIONS PRESENTED 6 STATEMENT OF FACTS 7 A. The New York City Board Of Health 7 B. The Department's Enforcement Authority Over Food Service Establishments 9 C. The Adoption Of The Portion Cap Rule .11 D. The Instant Hybrid Article 78fDeclaratory Judgment Action 14 DECISION OF THE SUPREME COURT I4 APPELLATE DIVISION DECISION 16 POINT I 18 THE BOARD IS A UNIQUE BODY WITH AUTHORlTY TO ISSUE SUBSTANTIVE RULES AND STANDARDS, AND ITS BROAD AUTHORlTY EMANATES FROM STATE LAW 18 A. The Separation of Powers Doctrine 18 B. The Board's Power to Issue Substantive Rules and Standards 20 i POINT II 28 THE ADOPTION OF THE PORTION CAP RULE WAS ALSO A PROPER EXERCISE OF THE BOARD'S REGULATORY AUTHORITY 28 A. In Adopting The Portion Cap Rule, The Board Did Not Consider Impermissible Social Or Economic Factors 32 B. The Portion Cap Rule Was Not Written On A Clean Slate .41 C. Proposed City Council Resolutions And State Assembly Bills Did Not Preclude The Adoption Of The Portion Cap Rule .49 D. The Board Relied On Its Specialized Expertise In Public Health In Determining That Sugary Drinks Were A Significant Driver Of The Obesity Epidemic, The Link Between Portion Size And Consumption And In Establishing The Parameters Of The Portion Cap Rule 52 E. In Sum, The Adoption Of The Portion Cap Rule Was A Proper Exercise Of The Board Regulatory Authority .55 POINT III 55 AS SET FORTH IN POINTS I AND II, SUPRA, THE PORTION CAP RULE IS CONSISTENT WITH THE BOARD'S ENABLING LEGISLATION. SINCE PETITIONERS FAILED TO DEMONSTRATE THAT THE PORTION CAP RULE WAS SO LACKING IN REASON AND NOT SUPPORTED BY ANY EVIDENCE, THE RULE SHOULD BE UPHELD 55 A. Standard of Review 55 B. The Evidence Supporting the Adoption of Portion Cap Rule ....... 58 CONCLUSION 64 ii TABLE OF AUTHORITIES CASES Boreali v. Axelrod, 71 N.Y.2d 1 (1987) passim Bourquin v. Cuomo, 85 N.Y.2d 781 (1995) 51 Burke v. Kern, 287 N.Y. 203 (1941) 22-23 Catholic Med. Ctr. v. Dep't of Health, 48 N.Y.2d 967 (1979) 56 Clark v. Cuomo, 66 N.Y.2d 185, 189 (1985) 29, 51 Doe v. Axelrod, 73 N.Y.2d 748 (1988) 1 Dorst v' Pataki, 90 N.Y.2d 696,699 (1977) 29 Expedia, Inc. v. City of New York Department of Finance, N.Y.3d_, 2013 N.Y. LEXIS 3187 50 Finegan v. Cohen, 275 N.Y. 432 (1937) 22-23 Greater New York Taxi Association v. New York City Taxi and Limousine Commission, 972 N.Y.S.2d 513 (Sup. Ct., N.Y. Co. 2013) 30 Grossman v. Baumgartner, 17 N.Y.2d 345 (1966) 24, 25, 57 LaGuardia v. Smith, 288 N. Y. 1(1942) 18 iii Matter of Allstate Insurance Company v. Rivera, 12 N.Y.3d 602, 608 (2009) 29 Matter of Citizens for An Orderly Energy Policy v. Cuomo, 78 N.Y.2d 398, 410 (1991) 48 Matter of NYC C.L.A.S.H., Inc. v. New York State Office of Parks, Recreation & Historic Preservation, 2013 N.Y. Misc. LEXIS 4596 (Sup. Ct., Albany Co. 2013) .30 Matter of Comptroller v. Mayor of the City of New York, 7 N.Y.3d 256, 266 (2006) 48 Matter of Consolation Nursing Homes, Inc. v. Comm'r New York State Dep't of Health, 85 N.Y.2d 326 (1995) 53, 56 Matter of Consolidated Edison Company v. Department of Environmental Conservation, 71 N.Y.2d 186(1988) 30,49 Matter of Council of the City of New York v. Public Service Commission, 99 N.Y.2d 64 (2002) 19 Matter of General Electric Capital Corporation v. New York State Division of Tax Appeals, 2 N.Y.3d 249, 254 (2004) 56 Matter of Motor Vehicle Mfgs. Ass'n v. Jorling, 181 A.D.2d 83 (3d Dep't 1992) .43 Matter of New York City Comm. for Taxi Safety v. New York City Taxi & Limousine Comm'n, 256 A.D.2d 136 (Ist Dep't 1998) .43 Mater of Nicholas v. Kahn, 47 N.Y.2d 24 (1979) 29 IV Matter of the Legislature of the County of Rockland v. New York State Public Service Commission, 49 A.D.2d 484 (3d Dep't 1975) 57 Matter of New York State Health Facilities Association v. Axelrod, 77N.Y.2d340(1991) 43,51 Matter of Patrolmen's Benevolent Assn. of the City of New York v. N.Y. State Public Employment Relations Board, 6 N.Y.3d 563, 573-574 (2006) 22-23 Motor Vehicle Mfgs. Ass'n v. Jorling, 181 A.D.2d 83 (3d Dep't 1992) 43 New York State Health Facilities Ass'n v. Axelrod, 77 N.Y.2d 340 (1991) 63 New York State Restaurant Association v. New York City Board of Health, 556 F.3d 114 (2d Cir. 2009) 63 Nunez v. Giuliani, 91 N.Y.2d 935, 938 (1998) 55-56 Paduano v. City of New York, 45 Misc.2d 718 (Sup. Ct. N.Y. Co.), affd on op. below, 24 A.D.2d 437 (1st Dep't 1965), affd, 17 N.Y.2d 875 (1966), cert. denied, 385 U.S. 1026 (1967) 24, 31-32, 46 People ex reI. Knoblauch v. Warden of Jail of Fourth Dist. Magistrate's Court, 216 N.Y. 154 (1915) 24 People v. Blanchard, 288 N.Y. 145 (1942) 25, 26, 27 People v. Dejesus, 54 N.Y.2d 465 (1981) 36 v People v. Weil, 286 A.D. 753 (Ist Dep't 1955) 25, 46 Perez v. City of New York, 41 A.D.3d 378 (1st Dep't 2007), Iv. denied, 10 N.Y.3d 708 (2008) 27 Pet Professionals v. City of New York, 215 A.D.2d 742 (2d Dep't 1995) .44 Price v. New York City Board of Education, 16 Misc.3d 543 (N.Y. Co. 2007), affd, 51 A.DJd 277 (Ist Dep't 2008) 56 Rent Stabilization Association of New York City v. Higgins, 83 N .Y.2d 156 (1993), cert. denied, 512 U.S. 1213 (1994) .50 Schulman v. New York City Health & Hospitals Corp., 38 N.Y.2d 234 (1975) 24 Statharos v. New York City Taxi & Limousine Comm'n, 198 F.3d 317 (2dCir. 1999) 43 Under 21, Catholic Home Bureau for Dependent Children v. City ofNew York, 65 N.Y.2d 344 (1985) 18-19 STATUTES New York State Constitution, Article III, §1 18 New York State Constitution, Article IX, §3 18, 28 N.Y. Municipal Home Rule Law §36 19 N.Y. Municipal Home Rule Law §37 19 N.Y. Public Health Law § 225(4) 26 VI New York City Charter § 553(a) 7 § 553(b) 7 § 553(c) 53 § 554 7 §556 21,42 § 556(c)(2) 8,3,42,45 § 556(c)(9) 8, 23, 42, 45 § 556(e)(4) 42 §558(a) 21 § 558(b) 8, 21,45 § 558(c) 8,43 RULES AND REGULATIONS 10 N.Y.C.R.R. §14-1.190(b) 9 24 R.C.N.Y. §11.07 31 24 R.C.N.Y. § 47.61 46 24 R.C.N.Y. § 71.05 38 24 R.C.N.Y. § 81.03(s) 9 24 R.C.N.Y. § 81.08 31 24 R.C.N.Y. § 81.50 31 vii 24 R.C.N.Y. § 131.15 31 24 R.C.N.Y. § 141.08 31 24 R.C.N.Y. § 173.13 31 24 R.C.N.Y. § 181.07 38 OTHER AUTHORITIES http://www.choosemyplate.gov/food-groups/dairy.html 36 http://www.nyc.govlhtmlldohlhtmllabout/comment.shtml 12 http://www.cdc.govlhealthyweightJassessinglbmil 58 http://www.who.int/topics/chronic_diseases/en! 58 Briefing Paper of the Committee on Rules, Privileges and Elections" dated September 21, 2011, p. 2, accessible at http://legistar.council.nyc.gov/ View.ashx?M=F&ID=1564868&GUID=E40780AC-F987-49E8-BDF4- D46909F60B80 47 City ofNew York, New York City Charter, Adopted at the General Election Held November 3, 1936, 22 Greater New York Charter (as amended by L.1904, c.628) 22 New York City Charter Revision Commission, Proposed Charter for the City of New York (1936) 21-22 New York City Charter Revision Commission, Report of the New York City Charter Revision Commission (1936) 22 viii PRELIMINARY STATEMENT Respondents-Appellants, the New York City Department of Health and Mental Hygiene ("Department"), the New York City Board of Health ("Board") and Dr. Thomas Farley, Commissioner of the Department (collectively "appellants':), appeal from a Decision and Order (one paper) of the Appellate Division, First Department, entered July 30, 2013. The Appellate Division affirmed the Decision and Order of the Supreme Court, New York County (Tingling, 1.), dated March 11,2013, which declared New York City Health Code § 81.53 ("Portion Cap Rule" or "Rule") invalid. This Court should reverse. In order to have the Rule invalidated, petitioners had the burden of demonstrating either that the Board acted outside of its delegat.ed authority or "that the regulation was so lacking in reason for its promulgation that it is essentially arbitrary," Doe v. Axelrod, 73 N.Y.2d 748 (1988) (internal quotation marks and citations omitted). Neither circumstance exists here because the Board of Health acted appropriately and within its authority under the New York City Charter to address a disease threat in New York City, Furthermore, the Appellate Division's narrow view of the Board's powers, limiting them to "inherently harmful matters," is not only contrary to legislative history, and case law, but also essentially invalidates the powers of the Board to address other public health issues, leaving the residents of New Yark City vulnerable. 1 The Portion Cap Rule applies to all food service establishments which are subject to the enforcement jurisdiction of the Department and regulates how they serve a product whose overconsumption is driving the obesity epidemic. It prohibits them from selling a sugary drink in a cup or container that can contain more than 16 fluid ounces. The Board adopted the Rule after extensive public reVIew and comment and the submission of scientific evidence demonstrating that (1) more than 5,000 New Yorkers die every year from complications associated with being overweight or obese; (2) 58% of adult City residents are now overweight or obese, as are 40 percent of the City's public school children (K-8); (3) adults who are obese are almost three times as likely to develop diabetes as those who are at a healthy weight; (4) sugar-sweetened drinks are the largest single source of added sugars in the diet, contain no nutritional value, do not provide a feeling of fullness, and have been repeatedly linked to weight gain, obesity, type 2 diabetes, and cardiovascular disease in scientific studies; (5) food service establishments have over time increased the sizes of the portions they serve, leading to increased consumption by consumers; and (6) consumer consumption of foods and beverages is strongly influenced by the portion sizes they are given; thus, consumers given smaller-sized drinks are likely to consume less, reducing their caloric intake and risk of becoming obese. 2 Indeed, a 20-ounce sugary drink can contain the equivalent of 16 packets of sugar. Some restaurants in the City serve beverages in cups as large as 64 ounces. A sugary drink of this size contains 780 calories and the staggering equivalent of 54 teaspoons of added sugar. Large amounts of sugar have "toxic metabolic effects" and cause weight gain. On average, consuming 140 calories (the amount in one 12 ounce can of soda) each day, would amount to more than 51,000 calories consumed over the course of the year. This many calories theoretically can to lead to a IS-pound weight gain in one year if other sources (i.e., exercise and intake of other foods) are held constant. Other sources are not likely to change because when people are given larger portions, they unknowingly consume more, leading to increased caloric intake. This is especially true with sugary beverages; because they induce less satiety, they do not replace other foods but instead become additional calories consumed by the persons drinking them. Rates of obesity and diabetes are rising at alarming rates nationwide and in New York City. Faced with this problem, the Board adopted the Portion Cap Rule, which is a narrow, science-based intervention designed to help consumers make healthier choices. It is not a ban on sugary drinks, but merely a restriction on the size of the cup or container used to serve these products. Consumers who wish to drink more than 16 ounces of a sugary drink remain free to do so by buying a second drink, or getting a refill. Most will not. Those who 3 do, however, will be prompted to consider the amounts they are consuming - thus making conscious choices rather than having the choice made for them by restaurants and beverages companies, who have an economic interest in consumers purchasing larger sizes. The Appellate Division erroneously found that the Board, in adopting the Rule, exceeded its delegated authority. The adoption of the Rule, however, was pursuant to the Board's broad authority to respond to health crises, such as obesity. First, the Board has legislative authority, which has been confirmed in successive New York City Charters, and upheld repeatedly by this and other appellate Courts (Point I, infra). Further, the adoption of the Portion Cap Rule was well within the Board's regulatory authority (Point II, infra). In any event, whether characterized as legislative or regulatory in nature, the Board's authority is broad, and its special structure allows serious issues of public health to be addressed without being subjected to the vagaries of the political process. The Board is not, and should not be, prohibited from addressing the overconsumption of sugary beverages that contributes to the epidemic of obesity and skyrocketing rates of type 2 diabetes merely because the legislature has not yet acted in this area. This outcome would be an unprecedented, and unfounded, curtailment of the Board's authority . 4 Indeed, the Board has consistently protected the health of New York City residents from chronic and preventable diseases and conditions through the exercise of its authorized powers, by requiring the fluoridation of the water supply, restricting the installation of window guards, requmng the posting of calorie counts on menus, and restricting the use of trans fats at food service establishments. Under the Appellate Division's view of the Board's authority as limited to "inherently harmful matters", the Board arguably might not have been ab Ie to take these actions. The Board's authority, however, to act more broadly was upheld by this Court in Paduano v. City of New York, 45 Misc.2d 718, 721 (Sup. Ct. NY. Co.), affd on op. below, 24 A.D.2d 437 (1 st Dep't 1965), affd, 17 N.Y.2d 875 (1966), cert. denied, 385 U.S. 1026 (1967). These prior Board of Health actions are of no small importance to the health of New York City residents. In 1960, the Board of Health restricted the use of paint with a certain lead content in residences, an action that in retrospect saved thousands of children from lead poisoning. At that time leaded paint was not classified as an "inherently harmful matter". Had the Appellate Division's excessively narrow view of the Board's powers been accepted at that time, these children would have been poisoned from the continued use of leaded paint and suffered permanent brain damage. 5 The Appellate Division's narrow view of the Board's authority was erroneous and the adoption of the Portion Cap Rule, like the other initiatives cited above, is well within the Board's authority. Finally, the Rule was well supported by scientific and medical studies, discussed in more detail in Point III, supra, and thus should be upheld. In sum, the Decision and Order (one paper) appealed from should be reversed and the petition dismissed. JURISDICTION OF THIS COURT Pursuant to CPLR 5602(a)(l )(i), this Court has jurisdiction to hear this appeal because the action originated in the Supreme Court, and the July 30, 2013 order of the Appellate Division finally determines this hybrid Article 78 proceeding/declaratory judgment action. In an order dated October 17, 2013, this Court granted leave to appeal. QUESTIONS PRESENTED 1. Whether the Appellate Division erred in holding that the Board of Health exceeded its authority in adopting the Portion Cap Rule? 2. Whether the adoption of the Portion Cap Rule was supported by "any" evidence and thus not arbitrary? These issues were raised before the Supreme Court and the Appellate Division. See, Record on Appeal filed in the Appellate Division, pp. 705-707; 6 Appellants' Brief, pp. 16-48 and Reply Brief, pp. 4-29, filed in the Appellate Division. Thus, these issues have been preserved for this Court's review. STATEMENT OF FACTS A. The New York City Board of Health The Board consists of the Commissioner of the Department as well as ten additional members, five of whom must be doctors of medicine. If not physicians, the other five members must hold at least a masters degree in "environmental, biological, veterinary, physical or behavioral health or science, or rehabilitative science or in a related field." Charter § 553(a). All ten of the additional members must have at least ten years of pertinent experience. Id. While Board members are appointed by the Mayor, with the advice and consent of the City Council, they serve fixed staggered terms of six years and can only be removed for cause, so they do not serve at the pleasure of the Mayor. Charter §§ 553(b),554. At the time the Portion Cap Rule was adopted, the members of the Board represented a broad range of health and medical disciplines, including: a former chairperson of the Department of Community Health Sciences at the Tulane University School of Public Health and Tropical Medicine; the president and CEO of Maimonides Medical Center in Brooklyn; an Associate Professor of Pediatrics and Community and Preventive Medicine at Mt. Sinai School of Medicine; a 7 Professor and Chair at the Department of Epidemiology at Columbia University Mailman School of Public Health; a Professor and Director of the Urban Public Health Program at Hunter College; and a fonner Administrator of the Health Care Financing Administration, the federal agency responsible for Medicare, Medicaid, and related programs. I While the Board is part of the Department, it acts as a separate and distinct entity, one that is charged with enacting and amending the Health Code. The Health Code has the "force and effect of law." Charter § 558(a). In amending, repealing or adding to the Health Code, the Board "may embrace in the health code all matters and subjects to which the power and authority of the department extends." Charter §§ 558(b) & (c). In turn, the Department "shall have jurisdiction to regulate all matters affecting health in the city of New York and to perform all those functions and operations perfonned by the city that relate to the health of the people of the city." Charter § 556. This authority specifically extends to the "control of communicable and chronic diseases" and to supervising and regulating the "food and drug supply." Charter §§ 556(c)(2) & 556(c)(9). Chronic diseases, long-lasting health conditions that can be controlled but not 1 New York City Council Resolution ("NYC Council Res.") No. 329 (2002); NYC Council Res. No. 331 (2002); NYC Council Res. No. 333 (2002); NYC Council Res. No. 428 (2002); NYC Council Res. No. 430 (2002); NYC Council Res. No. 748 (2004); NYC Council Res. No. 749 (2004); NYC Council Res. No. 520 (2006); NYC Council Res. No. 986 (2007); NYC Council Res. No. 443 (2010); NYC Council Res. No. 1058 (2011); NYC Council Res. No. 1059 (2011); NYC Council Res. No. 1085 (2011); NYC Council Res. No. 1086 (2011). 8 cured, include diseases where obesity is a leading risk factor such as type2 diabetes, some cancers and cardiovascular disease (1546, ~4). 2 B. The Department's Enforcement Authority Over Food Service Establishments The rules for food service establishments regulated by the Department are contained in Article 81 of the Health Code. A food service establishment ("FSE") is defined as "a place where food is provided for individual portion service directly to the consumer whether such food is provided free of charge or sold, and whether consumption occurs on or off the premises or is provided from a pushcart, stand or vehicle." Health Code § 81.03(s). A Memorandum of Understanding C'MOU") between the New York State Department of Agriculture and Markets and the New York State Department of Health ("State DOH") establishes an arrangement whereby enforcement of food safety regulations in supermarkets and groceries vests with the State Department of Agriculture and Markets while enforcement of establishments primarily serving individual portions of ready-to-eat food, whether consumption occurs on or off premises, vests with the State DOH (607-615). The MOU reflects a State policy to prevent some businesses from being dually regulated. Many local health commissioners are the permit issuing officials for food service establishments in their jurisdictions and are bound by the MOU. 10 N.Y.C.R.R. §14-1.190(b). 2 Unless otherwise indicated, numbers in parentheses refer to the pages of the Record on Appeal. 9 Specifically, businesses, such as convemence stores (e.g. 7-Eleven) and other grocery stores, which derive more than half of their revenue from sales of packaged food, are not subject to the State DOH's authority and are regulated by the State Department of Agriculture and Markets. The MOU provides (609): If an establishment has operations that may fall under the jurisdiction of both Health and Agriculture, Agriculture shall have jurisdiction over aU operations of the establishment unless sales of food for consumption on the premises or ready-to-eat for off premises consumption, measured by annual dollar receipts, exceeds fifty percent of total annual dollar receipts in which event Health shall have jurisdiction of the establishment. . . . In resolving such jurisdictional issue, the representations of the establishment operator shall be dispositive as to whether or not sales of food for consumption on the premises or ready- to-eat for off-premises consumption exceed fifty percent of the total annual dollar receipts of the establishment. In no instance shall an establishment be required to have a license or permit to operate from both departments or be inspected by both departments. Thus, although the MOU allows the departments to meet to determine whether a particular establishment is being regulated by the correct Department, an establishment must be regulated by only one of the two agencies. The Department's enforcement of all of the requirements in Article 81 of the Health Code, including the restriction on the use of trans fats, the 10 requirement to post calorie information and the requirement to post sanitary letter grades after inspections by the Department, are consistent with the authority granted to the State DOH under the MOU. C. The Adoption of the Portion Cap Rule At the June 12, 2012 meeting of the Board, Department staff presented a proposal to amend Article 81 to add a new rule for food service establishments, capping the size of cups and containers that they use to offer, provide and sell sugary beverages. See, Charter § 553(c) ("the Department Commissioner shall designate employees of the department "to the service of the board"),3 The Board voted to allow the Department to publish the proposal in the City Record, and thereby begin the opportunity for the public to comment on the proposal (712-741 ~ 742-760). On June 19, 2012, a Notice of Public Hearing was published in the City Record, advising the public that a hearing regarding the Portion Cap Rule would be held on July 24, 2012. The Notice of Public Hearing also instructed members of the public that they could submit written comments about the proposed amendment by mail or electronically on or before 5:00 P.M. on July 24, 2012 (761-768). 3 The Board, as well as the Department and the Commissioner, denied petitioners' contention that the Rule was drafted by the Office of the Mayor (49, ~4; 687, ~2). 11 A wide range of organizations and individuals supported the proposed amendment, including national and local professional societies, advocacy groups, academic institutions, elected officials, hospitals, community and faith-based organizations, insurance providers, scientific experts, and private citizens. Among these are 1199 SEIU, the American Public Health Association, the Center for Science in the Public Interest, Citizens' Committee for Children, Community Service Society of New York, City University of New York, Harlem Children's Zone, EmblemHealth, Greater New York Hospital Association, Montefiore Medical Center, Mount Sinai Medical Center, National Association of City and County Health Officials, New York Academy of Medicine, United Way, Yale University's Rudd Center for Food Policy and Obesity, and the YMCA of Greater New York (769-1417; 1564-1567).4 On July 24, 2012, a public hearing was held and oral comments, both supporting and opposing the proposed amendment, were heard by Department staff, the Commissioner and members of the Board (1147-1417). Thereafter, the Department provided the Board with copies of all the written comments, a transcript of the July 24, 2012 hearing, and a memorandum, dated September 6, 4 A selection of comments received by the Board in support of the Portion Cap Rule was submitted by appellants to the Court below (769-1060). The full text of all of the public comments submitted In response to the Portion Cap Rule IS available at http://www.nyc.govlhtml/dohlhtml/about/comment.shtml. 12 Size section. or non- 2012, summarizing and responding to the testimony and written comments (1418- 1441). At its September 13, 2012 meeting, the Board voted 8-0, with one abstention, to adopt the Portion Cap Rule. The members of the Board discussed why they believed this was a critically important public health initiative. A "Notice of Adoption of an Amendment (§ 81.53) to Article 81 of the Health Code" was published in the City Record on September 21,2012. The Portion Cap Rule was to go into effect on March 12,2013 (1442-1495; 1496-1537). The Portion Cap Rule provides, in pertinent part, as follows (1542): § 81.53 Maximum Beverage (a) Definition of terms used in this (1) Sugary drink means a carbonated carbonated beverage that: (A) is non-alcoholic; (B) is sweetened by the manufacturer or establishment with sugar or another calorie sweetener; (C) has greater than 25 calories per 8 fluid ounces of beverage; (D) does not contain more than 50 percent of milk or milk substitute by volume as an ingredient. The volume of milk or milk substitute in a beverage will be presumed to be less than or equal to 50 percent unless proven otherwise by the food service establishment serving it. (2) Milk substitute means any liquid that is soy-based and is intended by its manufacturer to be a substitute for milk. (3) Selfservice cup means a cup or container provided by a food service establishment that is filled with a beverage by the customer. 13 (b) Sugary drinks. A food service establishment may not sell, offer, or provide a sugary drink in a cup or container that is able to contain more than 16 fluid ounces. (c) Self-service cups. A food service establishment may not sell, offer, or provide to any customer a self-service cup or container that is able to contain more than 16 fluid ounces. D. The Instant Hybrid Article 78/Declaratory Judgment Action On October 12, 2012, petitioners commenced this lawsuit, seeking to invalidate the Portion Cap Rule (46-681, 1583). Appellants served a verified answer (686-1537) and an affidavit by Commissioner Farley in opposition to the relief requested (1544-1582). Thereafter, petitioners moved by order to show cause for a preliminary injunction, enjoining the effective date of the Portion Cap Rule pending hearing and determination of the hybrid action (1656-1712). Appellants submitted an affidavit in opposition to the motion for a preliminary injunction (1716-1719). DECISION OF THE SUPREME COURT The trial Court permanently enjoined the implementation and enforcement of the Portion Cap Rule. Citing Boreali v. Axelrod, 71 N.Y.2d 1 (1987), it held that the Board acted beyond its delegated authority. In so finding, the Court rejected appellants' argument that the Board is a body uniquely charged with legislative authority to protect the public health in New York City (17-19). 14 In Boreali, this Court found that the New Yark State Public Health Council ("PHC") overstepped its regulatory authority when it adopted smoking regulations, previously considered, but not adopted by the State Legislature. The four "coalescing circumstances" present in that case were: (1) the PHC carved out numerous exemptions based solely upon economic and social considerations; (2) the PHC "wrote on a clean slate, creating its own comprehensive set of rules without the benefit of legislative guidance"; (3) the State Legislature previously adopted legislation relating to smoking in public places, and thereafter considered (but never adopted) 40 bills that addressed the same subject area; and (4) no special expertise in the field of health was necessary to develop the regulations. 71 N.Y.2d at 12-14. The trial Court concluded that the first three of the four Boreali factors were present in this case (21-36). It found, however, that the fourth factor was not present, reasoning that "the Board's Public Hearing and the memorandum after the Hearing evidence the exercise of the Board's expertise" (38). Although the Court found that a reasonable basis supported the Rule, it determined that it was arbitrary and capricious because it did not apply to "all food establishments in the City, [and] it excludes other beverages that have significantly higher concentrations of sugar sweeteners and/or calories on suspect 15 grounds, and the loopholes inherent in the Rule, including but not limited to no limitations on re-fills, defeat and/or serve to gut the purpose of the Rule" (40). APPELLATE DIVISION DECISION The Appellate Division affirmed the trial Court's order, holding that the Board impermissibly engaged in policy making in violation of the State Constitution's separation of powers doctrine (1779-1780; 1795). The Court did not address whether the Rule had a rational basis or was arbitrary or capricious (1795). The Court rejected the City's argument that appellate precedents, including Grossman v. Baumgartner, 17 N.Y.2d 345, 351 (1966), have recognized that the Board is not just a typical administrative agency, but is an entity with legislative authority (1778-1779). Additionally, notwithstanding the fact that Charter section 558(b), which governs the powers of the Board, is rooted in state law, the Appellate Division held that the Board "derives its power to establish rules and regulations directly and solely from the legislature, in this case, the City Council" (1779). Treating the Board as a typical administrative body, the Appellate Division then found that the four "coalescing circumstances" found in Boreali were also present in this case, and determined that the Board acted in excess of its legislative delegation (1784-1795). First, the Court found that the Board 16 considered non-health related issues, including political and economic factors, and that it was impermissible to exclude certain stores such as convenience stores (e.g. 7-Eleven) and grocery stores from the Rule, and also to exclude certain types of beverages, including milk and pure juice (1787-1788). With respect to the second Boreali factor, the Court found that the Board acted without any legislative guidance, reasoning that the legislature had not enacted a legislative scheme regulating the consumption of sugary drinks. The Court rejected appellants' argument that the Board of Health was vested with broad regulatory authority in the area of public health, including chronic disease prevention, and the regulation of restaurants (1788-1792). The Court also found that this matter was the subject of legislative debate because the City Council and State Legislature have unsuccessfully attempted to pass resolutions or enact legislation regarding sugary drinks and thus, the Board could not address the same policy areas as the proposals rejected by legislative bodies (third Boreali factor) (I792-1793). Finally, the Court found that the Board did not exercise any health or scientific expertise in adopting the Rule, noting that the "deleterious effects (e.g. obesity) associated with excessive soda consumption are well-known" (1794- 1795). The Court also reasoned that the "rule was drafted, written and proposed by the Office of the Mayor" (1795). 17 Although the Court found that the Board did not have the authority to adopt the Rule, it stated that it was not expressing an opinion as to the wisdom of soda consumption restrictions (1796). In order to avoid unnecessary redundancy, a detailed discussion of the Appellate Division decision is set forth in the argument sections of this brief. POINT I THE BOARD IS A UNIQUE WITH AUTHORITY TO SUBSTANTIVE RULES STANDARDS, AND ITS AUTHORITY EMANATES STATE LAW. A. The Separation of Powers Doctrine BODY ISSUE AND BROAD FROM The state constitutional separation of powers doctrine, that one branch may not infringe upon the power of another branch, is derived from Article III, § 1 of the State Constitution, which provides that the "legislative power of this State shall be vested in the Senate and the Assembly". There is, however, no state constitutional separation of powers doctrine applicable to all localities. Rather, although each city must have an elected legislative body (N.Y. Const., Art. IX, § I), the city determ ines the structure of its government, subject to applicable state laws such as the Municipal Home Rule Law, and is not required to follow a state separation of powers doctrine. See, LaGuardia v. Smith, 288 N.Y. I (1942); Under 21, Catholic Home 18 Bureau for Dependent Children v. City of New York, 65 N.Y.2d 344, 356 (1985). In fact, many municipalities in New York State have government structures with legislative and executive powers perfonned by one entity or by officers with overlapping legislative and administrative powers.s Further, local legislative powers are exercised in ways that may not include adoption by the local legislative body, for example by action of a charter revision commission followed by a referendum, or by a petition followed by a referendum. Municipal Home Rule Law §§ 36, 37. Cf. Matter of Council of the City of New York v. Public Service Commission of the State of New York, 99 N. Y.2d 64 (2002) (Council not the "local legislative body" for purposes of state regulations concerning granting and renewal of cable franchises). Although the New York City Charter provides for distinct legislative and executive branches of City government and generally, by implication, one branch may not infringe upon the other branch, this principle does not preclude the 5 See, ~, Mechanicville, New York (a city with a commission fonn of government, in which the voters elect citywide officials to act as commissioners, and these commissioners also sit as the City Council for the city, which has broad powers under their charter.http://www.mechanicville.com/DocumentCenterlHomeNiew/162; Saratoga Springs, New York (a commission form of government similar to that of Mechanicville, with a City Council that consists of the Mayor, who presides over the Council and is called the chief executive officer and four elected commissioners. http://ecodc360.com/documents/S/\O 11 O/SAO 11 O-c:.pd"t); Geneva, New York ( eight "councilors" and the mayor, who is a member of the council. The mayor is "head" of the city government but has "no adm inistrative powers or duties." The Council is the legislative and governing body of the city, and appoints the city manager and many other officers. http://www.geneva.ny.us/Government/PDFIcityCharter.pdf.). 19 judicial and statutory recognition, as discussed in Part B of this Point, infra, that the Board of Health has legislative authority in the area of public health because the Board is a local body which has been delegated authority from the state legislature. Further, as discussed in Point II below, even applying the principles of administrative law governing a typical agency's powers, the adoption of the Portion Cap Rule did not impennissibly reach beyond its legislative delegation of powers. B. The Board's Power to Issue Substantive Rules and Standards The Courts below erroneously treated the Board as a typical administrative agency that adopts regulations only to implement specific legislative enactments. The Court failed to distinguish between the administrative role of the Department and the unique role of the Board, recognized by statute and judicial decision, in promulgating the Health Code. If the Board's powers truly were limited to those of a typical administrative agency, there would have been no need to create a second "mere agency" (the Board) within an agency (the Department) that can already engage in administrative rule making. Nor would there be a need to vest that board with the independence that comes from defined tenns and removal only for cause. The Board must be something more, and a review of the 20 relevant Charter provisions demonstrates that it is a unique local body with special, including legislative, authority. The Charter vests the Board with the authority to "add to and alter, amend or repeal any part of the health code" as well as to "therein publish additional provisions for security of life and health in the city and confer additional powers on the department not inconsistent with the constitution, laws of this state or this charter ...." Charter § 55 8(b). The Health Code has "the force and effect of law." Charter § 558(a). It further charges the Board with "embrac[ing] in the health code all matters and subjects to which the power and authority of the department extends." Charter § 558(c). It similarly confers on the Department a broad grant of authority to "regulate all matters affecting the health in the city of New York." Charter § 556. The Appellate Division found that the Board's powers derive solely from the City Council (I 779). This finding was wrong because the Charter provisions described above date back, in essentially their present form, to the 1936 Charter revision, proposed by a commission established pursuant to an act of the State Legislature and approved by the voters in that year. These Charter provisions have the force and effect of state law.6 See New York City Charter Revision 6 The 1936 Charter was drafted by a commission created pursuant to special laws enacted by the State Legislature (Chapter 867 of the Laws of 1934 and Chapter 292 of the Laws of 1935). As a result, this Charter is understood to have the force and effect of State Law. See Finegan v. 21 Commission, Proposed Charter for the City of New York, at 137 (1936); City of New York, New York City Charter, Adopted at the General Election Held November 3, 1936, at 51. The 1936 Charter Revision Commission noted that the "Board of Health exercises extraordinary police powers affecting the health of the city. By its power to adopt a sanitary code [now the Health Code] the Board has plenary powers of legislation." New York City Charter Revision Commission, Report of the New York City Charter Revision Commission at 38 (1936). The Commission further noted the Board's "important legislative and semijudicial powers." 1d. It is critical to note that the Board's powers generally do not originate in the 1936 revision, but rather may be found in an almost identical fonn in § 1172 of the fonner Greater New York Charter, as amended by Chapter 628 of the Laws of 1904. This section was enacted entirely by the State Legislature. Thus, the Board's charge to act "for security of life and health in the city" and to "embrace in the health code all matters and subjects to which the power and authority of the department extends," reflects the "policy of the State" and carries State legislative authority. Compare Matter of Patrolmen's Benevolent Cohen, 275 N.Y. 432,436 (1937) (upholding Charter provisions notwithstanding inconsistencies with Election Law and stating that "[b]y this method the Legislature amended or revised the charter of the city of New York."); see also Burke v. Kern, 287 N.Y. 203, 215-216 (1941) (treating §44[b] of the 1936 Charter, which is now Charter §40[2], as a special law surviving enactment of general legislation). 22 Assn. of the City of New York v. N.Y. State Public Employment Relations Board, 6 N.Y.3d 563, 573-574 (2006) (finding that Charter and Administrative Code provisions concerning police discipline represent such a policy). Subsequently, the City Council further clarified the Board's expansive power. For example, in 1977, the City Council, without limiting the Department's broad authority delegated by the State Legislature, specified that the Department would have authority over "control of communicable and chronic diseases" (emphasis added) and the oversight of the "food and drug supply of the city." Charter §§ 556(c)(2) & (9), as amended by Local Law No. 25 of 1977. By doing so, the City Council similarly elaborated upon the scope of authority of the Board to act through the Health Code in light of the long-standing provision, derived from State law, that gives the Board the power to act on "all matters and subjects to which the power and authority of the department extends." Thus, the Board has both general and specific authority, conferred both by the State Legislature and by the City Council, over the matters it addressed in the Portion Cap Rule. Moreover, the legislative history of the Board set forth above, particularly its roots in State law, has long been construed by this Court and other Courts to support a uniquely broad mandate to take all necessary steps, within constitutional limits, to protect the public health. 23 The explicit language by this and other courts recogmzmg the extraordinary authority of the City's Board of Health to issue substantive rules and standards in public health could not be clearer. See, People ex reI. Knoblauch v. Warden of Jail of Fourth Dist. Magistrate's Court, 216 N.Y. 154,162 (1915) ("the board is a statutory body and its authority and powers are such only as are conferred by the statutes, but those powers are very broad -- well-nigh plenary") (emphasis added); Grossman v. Baumgartner, 17 N.Y.2d 345, 351 (1966) ("the Legislature intended the Board of Health to be the sole legislative authority within the City of New Yark in the field of health regulations as long as those regulations were not inconsistent with or contrary to State laws dealing with the same subject matter") (emphasis added); see, also, Schulman v. New York City Health & Hospitals Corp., 38 N.Y.2d 234, 237 n.1 (1975) (citing Grossman, the Court recognized that the Board could act in a legislative manner and noted that "the Board of Health has been recognized by the Legislature as the sole legislative authority in the field of health regulation in the City of New York") (emphasis added); Paduano v. City of New York, 45 Misc.2d 718, 721 (Sup. Ct. N.Y. Co.), afrd on op. below, 24 A.D.2d 437 (1 st Dep't 1965), afrd, 17 N.Y.2d 875 (1966), cert. denied, 385 U.S. 1026 (1967) (the Appellate Division affirmed on the opinion of the lower Court, which cited to the report of the 1936 New York City Charter Revision Commission, stating that the City's Charter "is intended to confer 24 'extraordinary' and 'plenary' powers of legislators for the protection of health upon the Board of Health," and that the '''Board of Health exercises extraordinary police powers affecting the health of the City. By its power to adopt a Sanitary Code the Board has plenary powers of legislation''') (emphasis added); People v. Weil, 286 A.D. 753, 757 (1 st Dep't 1955) (quoting People v. Blanchard, 288 N.Y. 145, 147 (1942)) (the Board "is invested with the power, extraordinary as to administrative agencies, to formulate standards as well as to issue orders enforceab Ie by penal sanctions.... The Sanitary Code [now the Health Code] may, therefore, 'be taken to be a body of administrative provisions sanctioned by a time- honored exception to the principle that there is to be no transfer of the authority of the Legislature"'). Although in some areas of public health, it has been recognized that the Board has "sale legislative authority", see, Grossman, the issue here is not whether the Board is vested with the sale legislative authority with respect to chronic diseases or food service establishments, but rather whether it has the requisite legal authority to enact the Portion Cap Rule. As set forth above, the express language of the Charter and the above-cited decisions make clear the Board's authority to initiate Health Code amendments as it did in this case. The Appellate Division did not distinguish the authority cited above. Rather, it reasoned that the Board was indistinguishable from the State Public 25 Health Council ("PHC") at issue in Boreali, where this Court found that "the scope of the PHC's authority under its enabling statute was deemed limited by its role as an administrative, rather than a legislative body" (1780). The PHC, however, was not vested with the broad authority conferred upon the Board. The governing statutory provisions vest the Board with much more extensive power, and unlike the PHC, the Board can amend the Health Code without approval of any other body or official. See, Public Health Law § 225(4) (although the PHC can establish, amend and repeal the Sanitary Code, its actions are subject to approval by the commissioner of the State DOH). As a result of its broad statutory delegation and distinct legislative history, the Board's relationship with the City Council is markedly different from that between the PHC and the State Legislature, which had created the PHC. Indeed, this Court has recognized in describing the authority for the City Sanitary Code (predecessor to the City Health Code) that the State Legislature may confer unusually broad local powers upon local health officers: "On that basis, the main business of safeguarding the public health has always of necessity been done by local boards or officers through sanitary by-laws or ordinances which have been accorded the force of law [citations omitted]. Consequently, the Sanitary Code is to be taken to be a body of administrative provisions sanctioned by a time-honored exception to the principle that there is to be no transfer of the authority of the 26 Legislature." People v. Blanchard, 288 N.Y. 145, 147 (l942) (emphasis added). 7 This Court relied upon Blanchard in Grossman. 17 N. Y.2d at 351-352. Further, the State Legislature has recognized the uniqueness of New York City in its authority to enact its own public health requirements. For example, New York State Public Health Law specifically carves out New York City from the applicability of nearly the entire Article 3 of the Public Health Law governing local health officers and local boards of health. Neither the lower Courts nor the petitioners' brief below cited any revisions to the Charter or any other laws which have limited the Board's historic powers. See, Perez v. City of New York, 41 A.D.3d 378 (lst Dep't 2007), 1Y.,. denied, ION. Y3d 708 (2008) ("It is a cardinal principle of statutory interpretation that the intent to change a long-established rule or principle is not to be imputed to the legislature in the absence of a clear manifestation") (internal quotation marks omitted). Indeed, the general provisions that concern the Council's role as the City's legislative body have been in the Charter since 1938. They were included by the same Charter Revision Commission that discussed the Board's plenary legislative powers, as noted above, and predated several decisions of this Court reciting those powers. Similarly, this Court's decisions in Grossman, Paduano, and 7 The primary substantive limitation on this doctrine set forth in Blanchard, that the Code may not actually prescribe criminal penalties as opposed to addressing public health concerns 27 Schulman postdate the home rule changes made to the State Constitution and state laws in the early 1960s, which did not affect the Board's powers. See N.Y. Const., Art. IX, § 3(b); Municipal Home Rule Law § 56(1 ) (earlier charter provisions preserved). In sum, based on the relevant Charter provisions and this Court's precedents, the Board is not a typical administrative agency and has the authority to issue substantive rules and standards in public health. The Board has both general (Charter § 558) and specific authority (Charter §§ 556(c)(2) and (c)(9)), conferred both by the State Legislature and by the City Council, over the matters it addressed in the Portion Cap Rule. POINT II THE ADOPTION OF THE PORTION CAP RULE WAS ALSO A PROPER EXERCISE OF THE BOARD'S REGULATORY AUTHORITY. As discussed below, even if this Court were to treat the Board as a typical administrative agency, the Portion Cap Rule was a valid exercise of the Board's authority. This Court has recognized that enabling legislation need not be detailed as to the agency's powers and that the agency, in adopting rules and directly, is not at issue here, for the misdemeanor penalty provision for Health Code violations is set forth as Charter § 558(e). 28 regulations, may make certain policy choices. Specifically, the Legislature may declare its policy in general terms, and endow administrative agencies with the authority to fill in details and interstices and to make subsidiary policy choices consistent with the enabling legislation. Dorst v. Pataki, 90 N.Y.2d 696, 699 ( 1977). "In so doing, an agency can adopt regulations that go beyond the text of that legislation, provided they are not inconsistent with the statutory language or its underlying purposes. II Matter of Allstate Insurance Company v. Rivera, 12 N.Y.3d 602,608 (2009). Thus, although an administrative agency may not go beyond stated legislative policy, "only when the Executive acts inconsistently with the Legislature or usurps its prerogatives" is this principle violated. Clark v Cuomo, 66 N. Y.2d 185, 189 (1985); Matter of Nicholas v Kahn, 47 N. Y.2d 24, 30 1979). In Boreali, this Court recognized that the line between pennissible administrative rule-making and impennissible legislative policy-making is "difficult-to-define". In Boreali, this Court found that the State PHC had impermissibly legislated by adopting a State Sanitary Code provision that was identical to stalled legislation and which prohibited smoking in certain, but not all, public areas. In doing so, this Court identified four "coalescing circumstances" present in that case. This Court noted that while "none of these circumstances, 29 standing alone, is sufficient to warrant the conclusion that the PHC has usurped the Legislature's prerogative, all of these circumstances, when viewed in combination, paint a portrait of an agency that has improperly assumed for itself' [the] open- ended discretion to choose ends', which characterizes the elected Legislaturets role in our system of government." III (emphasis added, citations omitted). This Court, however, has not applied a four-prong Boreali analysis in all cases where state administrative regulations have been reviewed. See, Matter of Consolidated Edison Company v. Department of Environmental Conservation, 71 N. Y.2d 186, 196-197 (1988) (Bellacosa, 1., concurring) (concurring in the result of upholding a regulation, but noting that the Court's reasoning "sidestepped" Boreali). Further, this Court has not ruled that a court should always apply a four- prong analysis in reviewing a local administrative rule. Here, the Appellate Division's rigid application of Boreali has pushed the "difficult-to-define" line between pennissible administrative rule-making and impennissible legislative policy-making to the point where virtually any action taken by the Board, past or present, arguably transcends it. 8 8 The Appellate Division's expansive application of the Boreali factors have already been cited by the lower courts invalidating other administrative regulations. See,~, Greater New York Taxi Association v. New York City Taxi and Limousine Commission, 972 N.Y.S.2d 513 (Sup. Ct., N.Y. Co. 2013); Matter of NYC C.L.A.s.H., Inc. v. New York State Office of Parks, Recreation & Historic Preservation, 2013 N.Y. Misc. LEXIS 4596 (Sup. Ct., Albany Co. 2013). 30 In so doing, the Court disregarded legislative history and case law. The purpose of Charter §§558 and 556 is to have a strong Board of Health capable of protecting and promoting the health of the City's residents. See Paduano, supra, 45 Misc.2d at 720-721. This broad power has enabled the Board, absent specific guidance from the City Counsel to: in 1960, prohibit the use of interior lead paint (Health Code §173.13), in 1976, require building owners to put guards in the windows of apartments housing children (Health Code §131.15); in 1964, require that the public water supply be fluoridated (Health Code §141.08); in 1994, create an immunization registry (Health Code §11.07); in 2006, restrict the use of artificial trans fats by food service establishments (Health Code §81.08), and in 2008, require some food service establishments to post calorie information (Health Code §81.50). The Appellate Division opined that the Portion Cap Rule is different because "soda consumption cannot be classified as a health hazard per se" and the Board only has the power "to protect the public from inherently harmful or inimical matters affecting the health of the City" (1790-1791). This reasoning, however, cannot be reconciled with Paduano, where this Court affirmed the lower courts' orders upholding the Board's authority to require, for the purpose of preventing dental cavities, that fluoride be added to water that was otherwise safe. Paduano v. City of New York, 45 Misc.2d 718,721 (Sup. Ct. N.Y. Co.), affd on 31 op. below, 24 A.D.2d 437 (1 st Dep't 1965), affd, 17 N.Y.2d 875 (1966), cert. denied, 385 U.S. 1026 (1967). The indisputable fact is that many of the eateries regulated by the Department are selling sugary beverages, a leading driver of the obesity epidemic and independently associated with an increased risk of type 2 diabetes and cardiovascular disease, in a manner that is unhealthy because it causes overconsumption, and the Board has the authority to stop that practice. As discussed below, applying the Boreali factors, in conjunction with the general principles of administrative law, the Portion Cap Rule did not "effectuate[] a profound change in social and economic policy that required Legislative action", but was instead a matter within the Board's regulatory authority. A. In Adopting The Portion Cap Rule, The Board Did Not Consider Impermissible Social Or Economic Factors. First, the Appellate Division erroneously found that the Board considered non-health related issues, including political and economic factors, and that it was impennissible to exclude certain stores, including convenience stores (7-Eleven) and grocery stores from the Rule, as well as excluding certain types of beverages, including milk and pure juice (1784-1788). In Boreali, the State PHC's declaration of findings for the public smoking ban "delicately balanced" the need to protect the public from secondhand smoke "against the goal of minimizing 'economic dislocations and governmental 32 intrusions.'" 71 N.Y.2d at 14 (citations omitted). Specifically, the public smoking ban included provisions that had "no foundations in considerations of public health" and were based "solely upon economic and social concerns," such as exemptions for bars, convention centers and small restaurants as well as the opportunity to obtain a waiver "based on financial hardship." 71 N.Y.2d at 11-12. The Court concluded that the PHC "built a regulatory scheme on its own conclusions about the appropriate balance of trade-offs between health and cost to particular industries in the private sector" and was thus "operating outside of its proper sphere of authority." 71 N.Y.2d at 12. In contrast to the actions of the PHC, the Board here did not balance any impermissible concerns with its duty to protect the public health. It was not impermissible for the Commissioner to comment that the rule would help ameliorate obesity-related health care expenditures in New York.9 Nor was it impermissible for Board members to consider comments about the economic impact of the proposed Portion Cap Rule raised during the public comment period. This Court in Boreali could not have intended to prohibit such discussions and responses to public comments about a proposal. Rather, the focus of the "other factors" prong should be on whether the health impact of the rule was 9 The fact that the health care system is overburdened by treating preventable chronic diseases presents a public health issue. 33 unnecessarily compromised In its development in order to balance other impennissible considerations. Any other interpretation would violate a basic tenet of administrative law - - that agencies should consider comments raised during the mandated notice and comment period prior to the adoption of regulations. In Boreali, this Court concluded that the PHC "built a regulatory scheme on its own conclusions about the appropriate balance of trade-offs between health and cost to particular industries in the private sector". 71 N.Y.2d at 12. Despite the dangers of second hand smoke, the PHC chose not to regulate some businesses solely because of the economic costs it would impose on them. In contrast, the Board did not sacrifice public health for economic and social concerns. In fact, one of petitioners' complaints is that the Board adopted the Rule notwithstanding the economic impact on the beverage industry and small business owners (57-59). The Department's response to the concern regarding the economic impact of the Rule was that the concern "means little compared to the necessity to protect New Yorkers from the obesity epidemic" (1776). Further, the Appellate Division erroneously reasoned that the Rule constituted an improper exercise of the Board's regulatory authority because it "is not an all-encompassing regulation" (1785). But the Court ignored the fact that the beverages and establishments excluded from its coverage are not covered either for health reasons or because they are beyond the reach of Article 81. For instance, 34 the Portion Cap Rule's definition of a sugary drink specifically excludes drinks that "contain more than 50 percent of milk or milk substitute by volume as an ingredient." Section 81.53(a)(1)(D),1O As Commissioner Farley explained in his affidavit (1563, ~35): the nutritional profile of these beverages differs dramatically from that of sugary drinks. Sugary drinks generally contain no nutrients other than sugar, while milk and milk products contain calcium, vitamin D and potassium - 3 of the 4 'nutrients of concern' often found deficient in the diets of Americans according to the USDA. In addition, dairy products play an important role in a balanced, healthy diet, may have a protective effect against certain diseases and weight gain, and research shows they have a greater effect on satiety than sugary drinks. Thus, an exclusion for drinks containing a majority of dairy (by volume) balances the nutritional benefits for consumers. This is especially important given that, according to the USDA, intake of dairy products by Americans is below recommended levels,(Footnotes omitted). The Rule treats soy-based milk as a dairy substitute, but not rice and almond-based milk, because the U,S. Department of Agriculture (USDA) has determined that soy milk is the only acceptable substitute for dairy milk. The 10 Consistent with its health focused approach, the Portion Cap Rule specifically places the burden on the food service establishment serving such drinks: "The volume of milk, .. in a beverage will be presumed to be less than or equal to 50 percent unless proven otherwise by the food service establishment serving it" [emphasis added]. 35 USDA does not recommend almond, rice or coconut milk as replacements for dairy as they offer variable amount of calcium and other nutrients. See, http://www.choosemyplate.gov/food-groups/dairy.html. Pure fruit juice is similarly not covered based on its nutritional benefits. Fruit juice "is exempted as it has no added sugar and provides many of the same nutritional benefits as the fruit or vegetable from which it is derived" (emphasis added) (1563, ~ 34). All the aforementioned beverages are different than sugary beverages, which uniquely have little or no nutritional value or satiety and which have been consistently Iinked in the scientific literature to weight gain, obesity, Type 2 diabetes and cardiovascular disease. Thus, the exemptions covering the aforementioned beverages arc based on pennissible health considerations. Alcoholic beverages are not covered by the Portion Cap Rule because the New York State Alcoholic Beverage Control Law regulates the sale of alcohol. It preempts cities and towns from enacting laws and regulations that concern alcohol sales. See, People v. Dejesus, 54 N.Y.2d 465, 470 (1981) ("the Alcoholic Beverage Control Law is exclusive and Statewide in scope and thus, no local government may legislate in this field." (citations omitted)). The Appellate Division also found that the Portion Cap Rule violated the first Boreali factor because it "does not apply to all [food service 36 establishments]" (1785). The Court's reasonmg IS based on a critical misunderstanding of the Department's enforcement jurisdiction. Without exception, the Rule applies to all food service establishments regulated and permitted by the Department. It does not apply to certain businesses because, under the MOU between the State Department of Health and the State Department of Agriculture and Markets, enforcement of food regulations in supermarkets and groceries vests with the State Department of Agriculture and Markets, and enforcement of establishments primarily serving individual portions of ready-to-eat food, whether consumption occurs on or off premises, vests with the State DOH, which gives enforcement authority to local jurisdictions (607-615). Thus, businesses, such as convenience stores (e.g. 7-Eleven) and grocery stores, which derive more than half of their revenue from sales of packaged food, are not subject to the State DOH's, and by delegation the Board's, rule-making or enforcement authority and are regulated by the State Department of Agriculture and Markets. The Portion Cap Rule applies to all food service establishments regulated and permitted by the Department under the State MOU. This is consistent with all of the requirements in Article 81 of the Health Code, including the restriction on the use of trans fat, the posting of calorie information on menus and menu boards, and sanitary letter grades after inspections by the Department. 37 The existence of a set of establishments regulated by a state agency should not be misconstrued as exemptions based "solely upon economic and social concerns," which were found impennissible in Boreali. Such a reading of the first Boreali factor would require agencies to adopt regulations without regard to the practicalities of enforcement -- even where the regulating body lacks enforcement jurisdiction over the particular business. This would turn the principlcs of administrativc law on their head. The Appellate Division rejected the Department's representation regarding its jurisdiction under the MOU, relying on assertions by petitioners that "the agency has previously used its regulatory authority to promulgate citywide health rules that regulate all FSEs (see e.g. 24 RCNY Health Code 181.07) [city- wide regulation of common eating and drinking utensils]; 24 RCNY Health Code 71.05) [city-wide prohibition on the sale of "any food ... which is adulterated or misbranded"])" (1787). The Appellate Division's reliance was misguided. Health Code § 181.07 which prohibits the use of common eating and drinking materials is derived from Sanitary Code § 143. Health Code § 71.05 (misbranding), simply mirrors state and federal labeling requirements. There is nothing in the Record demonstrating that the Department has enforced these provisions against 38 businesses that under the MOU would fall under the jurisdiction of the state agency. The Appellate Division's reasomng that the Board should have coordinated with the State Department of Agriculture and Markets to "expand" its jurisdiction is completely unprecedented and places an untenable obstacle to administrative rule-making. Indeed, the Appellate Division failed to appreciate that expanding the Board's jurisdiction would disrupt the entire enforcement arrangement set forth in the MOU which would affect localities state-wide since the MOD is between two State agencies and governs more than the City. Also, the MOU does not contemplate a wholesale transfer of enforcement powers over a category of businesses. It provides (609): If an establishment has operations that may fall under the jurisdiction of both Health and Agriculture, Agriculture shall have jurisdiction over all operations of the establishment unless sales of food for consumption on the premises or ready-to-eat for off premises consumption, measured by annual dollar receipts, exceeds fifty percent of total annual dollar receipts in which event Health shall have jurisdiction of the establishment. . . . In resolving such jurisdictional issue, the representations of the establishment operator shall be dispositive as to whether or not sales of food for consumption on the premises or ready- to-eat for off-premises consumption exceed fifty percent of the total annual dollar receipts of the establishment. In no instance 39 shall an establishment be required to have a license or permit to operate from both departments or be inspected by both departments. Under the MOU) an establishment can only be under the jurisdiction of one of the two agencies. It only provides that the departments will meet to detennine whether a particular establishment is being regulated by the correct Department based on its sales receipts and does not envision the transfer of enforcement power of an entire category of businesses. The Appellate Division also reasoned that the Rule violates the first Boreali factor because "the Board has never categorized soda and the other targeted sugary drinks as inherently unhealthy" and instead "prescribes a mechanism to discourage New Yorkers from consuming those targeted sugary drinks)). The Court concluded that this "mechanism necessarily looks beyond health concerns, in that it manipulates choices to try to change consumer norms" (1785-1786). With this line of reasoning) the Appellate Division has substituted its own judgment for that of the Board)s health experts who have determined that overconsumption of sugary beverages is a serious public health issue that requires intervention. Overconsumption of sugary drinks stems, in large part, from how businesses have chosen to sell these beverages. The rule addresses this by addressing the portion size of cups and containers in food service establishments. 40 It is not a ban nor does it regulate anyone's choice of diet. Consumers who wish to consume more than 16 ounces of a sugary drink remain free to do so by making a conscious decision to buy a second drink, or get a refill. In making their decisions to consume greater than 16 ounces of sugary drinks, consumers will be prompted to consider the amounts they are consuming - thus making conscious decisions rather than accepting the choices made for them by the beverage and restaurant industries. Again, contrary to the Court's finding, this approach does not in any way detract from the fact that this Rule was based on health considerations and was adopted purely to address the obesity epidemic, of which sugary drinks is a leading factor, causing chronic diseases suffered by hundreds of thousands of New York City residents. In sum, the Appellate Division's finding that the Portion Cap Rule "necessarily reflects a balance between health concerns, an individual consumer's choice of diet, and business financial interests in providing the targeted sugary drinks" is not borne out by the record in this case. B. The Portion Cap Rule Was Not Written On A Clean Slate. This Court in Boreali held that the "PHC did not merely fill in the details of broad legislation describing the over-all policies to be implemented. Instead, the PHC wrote on a clean slate, creating its own comprehensive set of rules without benefit of legislative guidance" 71 N.Y.2d at 13. 41 In rejecting the City's arguments that the Board was vested with broad regulatory authority in the area of public health, including chronic disease prevention, and the regulation of restaurants (1789-1790), the Appellate Division completely ignored the Board's unique role supported by case law and legislative history. In contrast to the language of the New York Public Health Law at issue in Boreali, the Charter provisions that form the basis for the adoption of the Portion Cap Rule specifically provide the Board with an explicitedly broad grant of general as well as specific authority. These include the general provisions to "regulate all matters affecting the health in the city of New York," and to perform acts "as may be necessary and proper to carry out the provisions" of the chapter. Charter §§ 556 & 556(e)(4). Further, unlike the regulations invalidated in Boreali, the Charter goes on to identify specific areas that may be regulated by the Department, including the "control of communicable and chronic diseases"ll and the oversight of the "food and drug supply of the city." Charter §§ 556(c)(2) & (9) (emphasis added). Chronic diseases, long-lasting health conditions that can be controlled but not cured, include diseases where obesity is a leading risk factor such as type 2 diabetes, some cancers and cardiovascular disease. The Board may also "embrace II A set forth in Commissioner Farley's affidavit, "Obesity is a risk factor for many debilitating and often fatal chronic diseases ...." (1546, ~ 4). 42 in the health code" any of the matters "to which the power and authority of the department extends." Charter §§ 558(c). Such broad grants of authority have repeatedly been upheld by the Courts. In Matter of New York State Health Facilities Association v. Axelrod, 77 N.Y.2d 340 (1991), this Court upheld regulations requiring newly established nursing homes participating in the Medicaid program to agree to maintain a certain percentage of Medicaid patients as a condition of licensure. This Court reasoned that the statutory provisions in the Medicaid statute which declared that medical assistance for needy persons was a public concern and a goal and that the administrative agency was vested with the authority to choose appropriate means for achieving these ends. 77 N.Y.2d at 348. See also, Statharos v. New York City Taxi & Limousine Comm'n, 198 F.3d 317, 321-322 (2d Cir. 1999) (rejecting Boreali challenge, and holding that "language of the City Charter gives the Commission broad authority to issue rules that further its mandate to ensure financial responsibility on the part of the taxi industry" and that the financial disclosure regulations at issue "aim to do just that"); Matter of New Yark City Comm. for Taxi Safety v. New York City Taxi & Limousine Comm'n, 256 A.D.2d 136 (lstDep't 1998) (same). Similarly, in Matter of Motor Vehicle Mfgs. Ass'n v. Jorling, 181 A.D.2d 83 (3d Dep't 1992), the petitioners challenged a regulation promulgated by 43 the New York State Department of Environmental Conservation ("DEC") that related to automobile tailpipe emissions. The petitioners argued that the agency's adoption of the contested regulation "usurped the Legislature's prerogative to formulate State policy." IJh at 87. Relying on broad language that authorized DEC to "formulate, adopt and promulgate ... regulations for preventing, controlling or prohibiting air pollution," the court held that DEC "did not engage in policy making by promulgating the [contested regulation] but, rather, proposed rules which implemented the goals and plans set forth by the legislature." Id. at 86-87. See also Pet Professionals v. City of New York, 215 A.D.2d 742, 743 (2d Dep't 1995) (health code provisions upheld since the Board "was merely filling in the details of broad legislation describing the over-all policy to be implemented"). The Appellate Division, however, concluded that the relevant Charter provisions were intended by the legislature to provide the Board with the discretion to engage in rule making designed to protect the public only from "inherently hannful and inimical matters affecting the health of the City" (I 790-1791). The Court reasoned that, although the legislature intended to rely on the Board of Health's expertise in identifying and determining how to regulate inherently harmful matters affecting the health of the City, the Charter provides examples of these general functions when it explicitly grants the agency the power to supervise and regulate the safety of the water and food supplies, as well as the control of 44 diseases (see e.g. NY City Charter §§ 556[c][2]; 556[c][7]; 556[c][9])" (1790). The Court then concluded that "since soda consumption cannot be classified as a health hazard per se, the Board of Health's action in curtailing its consumption was not the kind of interstitial rule making intended by the legislature and engaged in by the Board of Health in the past" (1791-1792). The Appellate Division's citation to Charter §§556(c)(2) and 556(c)(9) as limiting the Board's general authority set forth in Charter §§558 and 556(c) is puzzling since these provisions actually expanded the Board of Health's specific authority. Section 556(c)(9) provides in pertinent part that the Department shall "supervise and regulate the food and drug supply of the City and other businesses and activities affecting public health in the city, and ensure that such businesses and activities are conducted in a manner consistent with the public interest". Section 556(c)(2) provides, in pertinent part, that the Department shall "supervise the reporting and control of communicable and chronic diseases and conditions hazardous to life and health". Thus, neither provision limits the Department's and the Board's authority to only "inherently harmful matters". The Appellate Division's erroneously and dangerously limited view as to the Board's authority is not only unsupported by the text of the relevant charter provisions, it also disregards judicial precedents upholding Board of Health regulations governing matters beyond "inherently harmful matters". See,~, 45 People v. Wei!, 286 A.D. 753, 757 (I st Dep't 1955) (the Sanitary Code [now the Health Code] provision requiring landlords to keep gas refrigerators in good order); Paduano v. City of New York, 45 Misc.2d 718, 721 (Sup. Ct. N.Y. Co.), affd on op. below, 24 A.D.2d 437 (1st Dep't 1965), affd, 17 N.Y.2d 875 (1966), cert. denied, 385 U.S. 1026 (1967) (upheld the Board's power to enact the City's water fluoridation initiative, which provided that a fluoride component be added to the City's public water supply). The Board's more recent adoption of Health Code provlslOns to address public health provide additional evidence that the Board did not act on a "clean slate" in this matter. For example, the Board has adopted nutrition, and physical activity requirements for group day care facilities in an effort to improve nutrition and physical activity in these settings. The standards prohibit beverages with added sweeteners and requires, no more than six ounces of 100% juice each day for children over eight months old, I% or skim milk for children over two, and that water must be available and easily accessible throughout the day. See 24 RCNY Health Code § 47.61. Additionally, the Board has restricted use of lead paint and artificial trans fats (1548, 'I~ 9, I0), and, in an analogous intervention designed to provide consumers with information to make more conscious choices about what they eat and drink, a requirement to post calories information on menus and menu boards 46 (1548, ~ 10). The restriction on artificial trans fats is particularly instructive because after the Board amended the Health Code, the City Council incorporated the restriction into the Administrative Code. In its statement of Legislative findings and intent, the City Council implicitly recognized the Board's legislative authority, in stating that the Board of Health had previously adopted the restriction "pursuant to the authority granted to it by § 558 of the New York City Charter" (627). Further, a briefing document prepared under the direction of a committee of the City Council has recognized that "[t]he Board may legislate on 'all matters and subjects to which the power and authority of the Department extends. . .. The jurisdiction of the Department is among the most extensive and varied of all City agencies.... In addition to its primary legislative function in relation to the Code, the Board is charged with certain administrative responsibilities". See, "Briefing Paper of the Committee on Rules, Privileges and Elections" dated September 21, 20 11, p. 2. 12 Finally, the Appellate Division's reasoning that the Board had written on a "clean slate" because "neither the State Legislature nor the City Council has ever promulgated a statute defining a policy with respect to excessive soda 12 Can be acce-ssed at http://legistar.council.nyc.govlView.ashx?M=F&ID=1564868&GUID=E40 780AC-F987-49E8-BDF4-D46909F60B80 47 consumption" is contrary to this Court's recognition that the Legislature is not required "to supply agencies with rigid marching orders" and that flexibility is particularly important in certain complex fields where the Legislature cannot foresee all variables and thus, the area is "simply incapable of statutory completion". Matter of Citizens for An Orderly Energy Policy v. Cuomo, 78 N.Y.2d 398, 410 (1991). Appellants respectfully submit that public health is a complex field for which the Legislature cannot always anticipate developing problems and, for that reason, the Board was delegated broad authority by the State Legislature and the City Council to enable the Board to respond with innovative, science-based responses to public health problems. The Appellate Division's reasoning that the Portion Cap Rule was invalid because neither the State Legislature or the City Council had given the Board specific authority over sugary drinks is contrary to the broad delegation in the text of the relevant statutory provisions. See, Matter of Comptroller v. Mayor of the City of New York, 7 N. Y.3d 256, 266 (2006) ( "It would be an unjust reflection upon the wisdom and intelligence of the law-making body to assume that they intended to confine the scope of their legislation to the present, and to exclude all consideration for developments of the future. If any presumption is to be indulged in, it is that general legislative enactments are mindful of the growth and increasing needs of 48 society, and they should be construed to encourage, rather than to embarrass the inventive and progressive tendency of the people"). In sum, the adoption of the Portion Cap Rule was In accord with legislative policy and within the legislative delegation of authority. c. Proposed City Council Resolutions And State Assembly Bills Did Not Preclude The Adoption Of The Portion Cap Rule. The "mere fact that the Legislature has enacted specific legislation in a particular field does not necessarily lead to the conclusion that broader agency regulation in the same field is foreclosed." Consolidated Edison Co. v. Department of Environmental Conservation, 71 N.Y.2d 186, 193 (1988). In Boreali, it was particularly significant that the Legislature repeatedly failed to amend its anti- smoking law, prompting the PHC to attempt to do so on its own. Citing three unsuccessful City Council resolutions and five unsuccessful state Assembly bills, none of which proposed portion restrictions, the Appellate Division found that the Board could not address the same policy areas as the proposals (1792-1793).13 Even setting aside the issue of whether City Council 13 The Appellate Division cited to the following City Council Resolutions: Resolution No. 1265 (2012) (calling upon State Legislature to pass legislation that would add an excise tax on sugar sweetened beverages); Resolution No. 1264 (2012)(calling upon the U.S. Food and Drug Administration to require warning labels on sugar sweetened beverages); Resolution No. 0768 (2011)(calling upon the U.S. Department of Agriculture to authorize New York City to add certain sugary drinks to the list of prohibited goods for City residents who receive Food Stamp assistance). The Appellate Division cited to the following State Assembly bills: Bill No. A10010 (prohibiting the sale of sugar sweetened beverages at food service establishments and vending machines 49 actions should be relevant to the Board of Health in light of the Board's origins in state legislation, any "failed legislative inaction", as the Appellate Division has tenned it, is not indicative of legislative intent as held by a legion of this Court's precedents. Indeed, the statements made by this Court very recently in connection with local taxing authority raise significant questions about how, if at all, to apply this consideration. This Court stated that the fact of later legislative action or inaction after the "original enabling statute" should be "irrelevant": "The City either did or did not have the authority to tax hotel remarketers." Expedia, Inc. v. City of New York Department of Finance, _N.Y.3d_, 2013 N.Y. LEXIS 3187 (decided November 21,2013). The authority of the Board of Health originating in older statutes similarly should not tum upon the vagaries of later legislative disputes. Other case law is also infonnative along these lines. In Rent Stabilization Association of New York City v. Higgins, 83 N.Y.2d 156 (1993), cert. denied, 512 U.S. 1213 (1994), this Court upheld regulations adopted by the New York State Division of Housing and Community Renewal ("DHCR"), which enlarged the class of "family members" entitled to succeed to a rent regulated located on government property); Bill No. 567004 (imposition of a tax on beverage syrups and soft drinks); Bill No. A41 004 (imposition of a tax on beverage syrups and soft drinks); Bill No. A06229A (providing for the sale, availability and distribution of healthy foods and beverages on school property and at school sponsored functions); Bill No. AI0965 (prohibiting the purchase of food items which are not nutritional with food stamp program coupons or other access devices related thereto). 50 apartment upon the departure of the tenant of record. Notwithstanding the introduction of 27 bills in the State Legislature relating to succession rights, the Court rejected the argument that "the failed bills alone warrant the conclusion that the agency has exceeded its mandate". 81 N.Y.2d at 170. In Bourquin v. Cuomo, 85 N.Y.2d 781, 787 (1995), this Court stated "that proposed legislation sim ilar to [the] the Executive Order. .. was not passed, does not indicate legislative disapproval of the programs contemplated by the [Executive] order. Legislative inaction, because of its inherent ambiguity, affords the most dubious foundation for drawing positive inferences." 85 N.Y.2d at 787 (internal quotation marks omitted). Similarly, in Matter of New York State Health Facilities Association v. Axelrod, 77 N.Y.2d 340, 348, n.2 (1991), this Court, commenting on ten unsuccessful bills dealing with admission of nursing home patients based on Medicaid status which were introduced in the Legislature, stated "we ascribe no particular significance to the legislative inaction in this case". See~ Clark v. Cuomo, 6 N.Y.2d 185 (1985) ("that proposed legislation similar to Executive Order No. 43 was not passed does not indicate legislative disapproval of the programs contemplated by the [Executive] order"). In Boreali, unlike here, there was extensive and repeated consideration by the Legislature of the precise issue that the PHC attempted to 51 regulate - smoking in areas open to the public. The Appellate Division erred in finding that the Board overstepped its regulatory authority by adopting the Rule because sugary drinks generally, and not a cap on portion size, was the subject of minimal legislative debate. D. The Board Relied On Its Specialized Expertise In Public Health In Determining That Sugary Drinks Were A Significant Driver Of The Obesity Epidemic, The Link Between Portion Size And Consumption And In Establishing The Parameters Of The Portion Cap Rule. The fourth consideration cited by this Court in Boreali concerned the lack of "special expertise or technical competence" required in drafting the antismoking regulations at issue there. It should be emphasized that even the absence of expertise is not equivalent to the lack of authority or to agency overreaching. Indeed, this Court has specifically rejected the argument that an alleged lack of expertise calls a statutory delegation into question. Dorst v. Pataki, 90 N.Y.2d 696, 699-700 ("Nor is it significant for separation of powers analysis that the legislative delegation of rulemaking authority went directly to the Governor rather than to the Commissioner of Correctional Services or some other experienced administrator"). Thus, it is difficult to conceive that this consideration should be decisive in the analysis. Nevertheless, decisions of this Court do refer to the presence or absence of such expertise in determining whether to defer to an agency's judgment. In light of those decisions, the issuance of the Rule here in fact represented a 52 classic exercise of expertise by medical experts, and is fully entitled to deference, as described below. Consolation Nursing Home v. Commissioner of N.Y. State Dept. of Health, 85 N.Y.2d 326, 331-332 (1995) ("An administrative agency's exercise of its rule-making powers is accorded a high degree of judicial deference, especially when the agency acts in the area of its particular expertise ... "). Notably, the Appellate Division erroneously found that the Board did not exercise any expertise in adopting the Rule, reasoning that the Rule was drafted by the Mayor's Office and adopted by the Board without substantive change (1794-1795). First, this assertion is belied by the Record. The Board, as well as the Department and the Commissioner, denied petitioners' contention that the Rule was drafted by the Office of the Mayor (49, ~4; 687, ~2). In fact, it was researched and presented to the Board by Department staff who have scientific and medical expertise in this area and who, under the Charter, serve the Board (712- 741; 742-760). See, Charter § 553(c) ("the Department Commissioner shall designate employees of the department "to the service of the board"). The office assignment within the executive branch of the persons or people who drafted the proposal, however, is a distraction from Boreali's actual test, which is whether the development and adoption of the Portion Cap Rule involved any specialized expertise. Here, the adoption of the Portion Cap Rule by the Board involved its expertise. The Rule was only adopted after individual 53 Board members evaluated the scientific and medical studies published in health journals (1469-1470,1476-1477,1477-1479,1472-1473). The Board's medical and scientific expertise helped it to understand the impact of sugary drinks on the obesity epidemic; the link between portion size and consumption; and the potential efficacy of the proposal. The fact that both the Department and petitioners have submitted a large compendium of scientific literature in support of conflicting arguments demonstrates that this was something that could not have been successfully undertaken by laypersons. Furthermore, the very fact that petitioners argue that the proposal is arbitrary because it excludes drinks containing more than fifty percent milk or milk substitute, one hundred percent fruit juice, and alcoholic beverages-despite scientific evidence showing that these beverages do not have the same health consequences as the sugary beverages covered by the proposal-shows how easily the problem of obesity, and this proposal seeking to address it, can be misunderstood by those lacking the specialized, scientific expertise possessed by the Board. Even though the parties may disagree with the Board's conclusions, it cannot be disputed that the specialized expertise of the Board helped it to analyze the scientific arguments made in favor of, and in opposition to, the proposal. 54 E. In Sum, The Adoption Of The Portion Cap Rule Was A Proper Exercise Of The Board Regulatory Authority. To the extent the four "coalescing factors" found in Boreali are detenninative of the Board's authority to promulgate the Portion Cap Rule, none of them are present in this case. Further, the Board acted well within its broad statutory delegation, and that delegation has long been recognized by the appellate courts of this State. Thus, the Appellate Division erred in holding that the Board acted in excess of its regulatory authority in adopting the Portion Cap Rule. POINT III AS SET FORTH IN POINTS I AND II, SUPRA, THE PORTION CAP RULE IS CONSISTENT WITH THE BOARD'S ENABLING LEGISLATION. SINCE PETITIONERS FAILED TO DEMONSTRATE THAT THE PORTION CAP RULE WAS SO LACKING IN REASON AND NOT SUPPORTED BY ANY EVIDENCE, THE RULE, SHOULD BE UPHELD. 14 A. Standard of Review An "administrative regulation will be upheld only if it has a rational basis, and is not unreasonable, arbitrary or capricious.... On the other hand, [t]he challenger must establish that a regulation is so lacking in reason for its promulgation that it is essentially arbitrary." Nunez v. Giuliani, 91 N.Y.2d 935, l~ Having found that the Board exceeded its authority in adopting the Rule, the Appellate Division did not address this issue. 55 938 (1998) (internal quotation marks and citations omitted); Matter of General Electric Capital Corporation v. New York State Division of Tax Appeals, 2 N.Y.3d 249, 254 (2004) (Where "an agency adopts a regulation that is consistent with its enabling legislation and is not so lacking in reason for its promulgation that it is essentially arbitrary, the rule has the force and effect of law") (citations omitted). An "administrative agency's exercise of its rule-making powers is accorded a high degree of judicial deference, especially when the agency acts in the area of its particular expertise." Matter of Consolation Nursing Home, Inc. v. Commissioner of New York State Department of Health, 85 N.Y.2d 326, 331 (1995). Consequently, a party that seeks to invalidate a regulation has "the heavy burden of showing that the regulation is unreasonable and unsupported by any evidence." Id. at 331·32 (emphasis added, citations omitted). Moreover, a reviewing court should defer to the responsible official's exercise of judgment regarding factors that may be difficult to weigh or quantify. Courts must allow a policy-maker to '''apply broader judgmental considerations based upon the expertise and experience of the agency he heads.'" 14. at 332 (quoting Catholic Med. Ctr. v. Dep't of Health, 48 N.Y.2d 967, 968-69 (1979)); see also, Price v. New York City Board of Education, 16 Misc.3d 543, 557 (N.Y. Co. 2007), affd, 51 A.D.3d 277 (1st Dep't 2008). ("The courts may not review rule- making choices between alternates; the choices as to how to fonnulate a rule is the 56 responsibility of the agency, and the court may only set such aside if there was no rational basis for the choice made by the agency. Notwithstanding that a court may feel that a different choice would havc been better, it is not the province of a court to make such a judgment"); Matter of the Legislature of the County of Rockland v. New York State Public Service Commission, 49 A.D.2d 484 (3d Dep't 1975) (in upholding the Commission's approval of new rates, the Court stated "although the areas of inclusion or exclusion of certain items in the rate base seem fairly arguable, and petitioner may have made a reasonable showing that some should be taken out, this kind of judgment in a technical area of public utilities regulation is one that lies within the special competence of the administrative agency. These judgments of the commission may well be debatable, but they are not arbitrary"). Finally, here, in light of the Board's unique legislative authority as discussed in Point I, supra, the Board is entitled to considerable deference that should go well beyond the deference afforded to an ordinary administrative agency. Grossman v. Baumgartner, 17 N.Y.2d 345, 350 (1966) ('The police power is convincingly broad, and the courts will not substitute their judgment of a public health problem for that of eminently qualified physicians in the field of public health"). 57 B. The Evidence Supporting the Adoption of Portion Cap Rule. As explained in the affidavit of Commissioner Thomas Farley, scientific evidence indicates that more than half of adult City residents (57.5 percent) are now overweight or obese, as are nearly 40 percent of the City's public school children (K-8). Despite numerous public health initiatives, obesity rates in the City have climbed. In 2011, 23.7 percent of adult New Yorkers were obese compared to only 18 percent who were obese in 2002 (1550, ~ 12).15 Obesity is a risk factor for many debilitating and often fatal chronic diseases,16 including heart disease, cancer, stroke, osteoarthritis, hypertension, gall bladder disease and type 2 diabetes. Adults who are obese are almost three times as likely to develop diabetes as those who are at a healthy weight (1546, ~~ 4, 5; 1539). The consequences of childhood obesity are equally devastating. Nearly one in four American teenagers suffers from pre-diabetes or diabetes. Childhood obesity leads to serious health consequences, including cardiovascular 15 Overweight and obesity ranges are calculated using weight and height to determine body mass index ("BMI"), which provides a reliable indicator of body fatness for most people (http://wwv''.cdc.gov/health\'\veight/assessing/bmi/). For adults, obesity is defined as a BMI ~30. For children, obesity is defined as a BMI above the 95th percentile for children of the same age and sex (1545, ~ 3, fn 2). 16 According to the World Health Organization, chronic diseases are diseases of long duration and generally slow progression. Chronic diseases, such as heart disease, stroke, cancer, chronic respiratory diseases and diabetes, are the leading cause of mortality globally, representing 63% of all deaths. Out of the 36 million people who died from chronic disease in 2008, nine million were under the age of60. http://www.who.int/topics/chronic_diseases/en/. 58 disease and increased mortality. As a result of this epidemic, today's children may have a shorter life expectancy than their parents (1546, ~~ 4,5; 1539). While many social, behavioral, environmental, economic and biological factors contribute to obesity, sugary drinks are a leading driver of the obesity epidemic (1552, ~15). As the Chair of the Department of Nutrition at Harvard University's School of Public Health stated at the July 24, 2012 public comment hearing: "large doses of sugar are metabolically toxic" and "soda is ... the single most important contributor to weight gain ... part of the problem is that the body does not recognize excess calories from sugar dissolved in water as we do calories in the form of solid food and we tend to add those calories rather than displace other calories, and of course that contributes to obesity" (1092-1094). Sugary drinks are the largest single source of added sugars in the diet, contain almost no nutritional value, do not provide a feeling of fullness, and have been repeatedly linked to obesity, type 2 diabetes and cardiovascular disease (1539). Compared to 30 years ago, Americans consume an additional 200 to 300 calories per day, "with the largest proportion of the increase due to sugary drinks" (1539) (citations omitted). Moreover, portion sizes have increased at the same time that rates of obesity have increased. Whereas the original Coca-Cola bottle was only 6.5 ounces, carbonated soft drinks are now routinely sold in cans and bottles that are much larger, and the sizes of fountain drink portions have 59 similarly expanded; beverages available at McDonald's have increased 457 percent from 1955, when it offered only one size of 7 ounces, to today, when a diner can purchase a sugary beverage as large as 32 ounces (1557, ~26; 1539).17 While large drinks are now routinely offered at most establishments, smaller drinks are scarce: the smallest drink size available in many restaurants is 20 ounces, and 10 some movie theaters a consumer cannot purchase a fountain drink smaller than 32 ounces. Increases in portion size have changed how people perceive what constitutes a nonnal size. Sixty years ago, Coca-Cola advertised that 16 ounces was enough to serve three people (1559-1560, ~~ 27-28; 749).18 Today, virtually every food service establishment serves individual portions of sugary beverages larger than 16 ounces. Larger portion sizes lead to increased consumption. "Numerous studies -- conducted in a variety of settings with an array of food and beverages -- consistently demonstrate that people eat more when offered larger portion sizes" (1422). The Director of Yale University's Rudd Center for Food Policy and Obesity stated: "People tend to consume food in units -- typically whatever is in a 17 Remarkably, some New York City restaurants offer individual drinks in cups as big as 64 ounces; a sugary drink of th is size contains 780 calories (39 percent of the 2,000 calories a day recommended for most adults) and the equivalent of 54 teaspoons of sugar, and no nutrients (1557, ~ 26; 1539). 18 Eight ounces is the standard portion size used by the United States Food and Drug Administration ("FDA") for nutrition labeling, a quantity which is meant to "represent the amount of food customarily consumed at one eating occasion" (1559-1560, ~~ 27-28). 60 bag, a bottle or a box. As bags, bottles, and boxes get larger, people consume more". "[A]reas with the highest rates of sugary drink consumption are consistently characterized by the highest rates of obesity" (1553, ~ 19) (citations omitted). In low-income neighborhoods many residents "report drinking 4 or more sugary drinks daily" (1539). Especially troubling is the fact that their increased consumption of sugary drinks is not offset by decreased consumption of calories elsewhere. People do "not compensate for their additional beverage intake by consuming less food, indicating that consuming large, calorie dense sugary drinks with meals can and does lead to excess calorie intake" (1422). By limiting the sizes of cups and containers that establishments regulated by the Department can use to serve sugary beverages, the Portion Cap Rule will reduce their consumption and help address the obesity epidemic that currently impacts millions of New Yorkers (1549, ~II; 1422). All food service establishments under the Department's jurisdiction, including fast food chains, are subject to the Rule. This is not an insignificant number. Although consumers can go to retail stores which are not under the Department's jurisdiction, the Department noted that "the majority of refrigerated beverages sold in pharmacies and bodegas tend to be 20 ounces or smaller" and that it was ;'improbable that consumers would seek out an alternative retailer for 61 four more ounces of a sugary beverage" (1426). In addition, patterns "of human behavior indicate that consumers overwhelmingly gravitate towards the default option" and that with the adoption of the Portion Cap Rule consumers "intent upon consuming more than 16 ounces would have to make conscious decisions to do so" (1423). Further, the application of the Portion Cap Rule to the food service establishments regulated by the Department - meaning those establishments selling prepared foods most likely to be consumed immediately, and not to the stores selling food predominately for home consumption - is in line with the public health purpose of the rule. The fact that refills are permitted also does not render the Rule ineffective. As an Assistant Professor of Medicine and Health Policy at New York University of Medicine stated: "We know that convenience drives many food purchases, particularly fast food purchases. If it becomes harder to carry two or more cups, people will be less likely to do so" (1423). Moreover, the Rule is designed to make consumption of large amounts of sugary drinks a conscious and informed choice by the consumer. Thus, although a consumer is free to consume more than 16 ounces by ordering a second drink, getting a refill, or going to another store, he or she will be making an 62 informed decision to do so, not accepting the portions chosen for him or her by restaurants and beverage companies. Finally, the fact that the Rule is allegedly "underinclusive" is not a basis to invalidate it. It is well established that government is not required to address all facets of a problem at once and may address a problem incrementally. In New York State Health Facilities Ass'n v. Axelrod, 77 N.Y.2d 340, 350 (1991), this Court upheld a regulation requiring newly established nursing homes to agree to maintain a certain percentage of Medicaid patients because such patients in the past often experienced more difficulty than others in obtaining health services. The Court stated Hpetitioner argues that the regulations are irrational because they apply to new applicant facilities and do not redress any discrimination by existing facilities. Merely because respondent has attempted to address part of a perceived concern, however, provides no basis for invalidating the regulations". See also, New York State Restaurant Association v. New York City Board of Health, 556 F.3d 114, 133, n.22 (2d Cir. 2009) ("we also reject NYSRA's suggestion that heightened review is appropriate because New York City has alternative means of achieving its goals or because Regulation 81.50 [calorie count posting requirements] impacts only ten percent ofNew York City restaurants"). For all the foregoing reasons, the Board did not exceed it statutory authority and the Portion Cap Rule was supported by a rational basis and was not 63 arbitrary. Accordingly, the Decision and Order appealed from should be reversed and the Petition dismissed. CONCLUSION THE DECISION AND ORDER (ONE PAPER) APPEALED FROM SHOULD BE REVERSED, AND THE PETITION DISMISSED, WITH COSTS. Respectfully submitted, MICHAEL A. CARDOZO, Corporation Counsel, Attorney for the Respondents- Appellants. By: --f------rl'--L--_;'-'F-- LEONARD 1. KOERNER, PAMELA SEIDER DOLGOW, MARK MUSCHENHEIM, JASMINE M. GEORGES, SPENCER FISHER, FAYNG, of Counsel. 64