author: Pigott, J.

text:
    [892 NE2d 846, 862 NYS2d 453]
    Solomon Mesholam, Respondent, v Isabelle Helene Mesholam, Appellant.
    Argued June 3, 2008;
    decided June 26, 2008

      POINTS OF COUNSEL

      Law Office of Glenn S. Koopersmith, Garden City (Glenn S. Koopersmith of counsel), for appellant.
    The decision to value the pension as of the commencement of a prior discontinued action for divorce is improper as a matter of law because it extends the court’s discretion beyond the boundaries set forth in Domestic Relations Law § 236 (B) (4) (b). It is violative of public policy and inconsistent with the broad construction of marital property championed by this Court, which should cause this Court to reverse the relevant portion of the amended judgment on appeal. (Anglin v Anglin, 80 NY2d 553; Matter of Ward v Ward, 94 AD2d 908; O’Connell v O’Connell, 290 AD2d 774, revd on other grounds sub nom. O’Connell v Corcoran, 1 NY3d 179; McAteer v McAteer, 294 AD2d 783; Cozza v Colangelo, 298 AD2d 914; Matter of Nicit v Nicit, 217 AD2d 1006; McMahon v McMahon, 187 Misc 2d 364; Match v Match, 179 AD2d 124; Thomas v Thomas, 221 AD2d 621; Iwanow v Iwanow, 39 AD3d 471.)

      Charles E. Holster III, Mineola, for respondent.
    I. Defendant-appellant’s filing of an appendix and brief which include and discuss only plaintiff husband’s notice of appeal from the Supreme Court’s April 17, 2002 decision, rather than his subsequent notice of appeal from the March 5, 2003 judgment of divorce, upon which jurisdiction was acquired by the Appellate Division, was frivolous and misleading. (People v Thompson, 83 NY2d 477; City of Albany v Yaras, 6 NY2d 749; Tausik v Tausik, 9 NY2d 664.) II. Since defendant’s application for leave to appeal specifically limited the issue she sought to have reviewed to one of statutory construction, she is bound by such limitation and may not raise the additional issue on this appeal of whether the decision of the Appellate Division constituted an abuse of discretion. (Quain v Buzzetta Constr. Corp., 69 NY2d 376.) III. Defendant may not make the argument for the first time in this Court that the trial court’s pension award should not be modified because it is inextricably linked to its maintenance award. (Bingham v New York City Tr. Auth., 99 NY2d 355; Buchsbaum v Buchsbaum, 292 AD2d 553; Schildkraut v Schildkraut, 223 AD2d 585; Guskin v Guskin, 18 AD3d 814; Ahrend v Ahrend, 123 AD2d 731.) IV Plaintiff husband would be severely prejudiced if as a result of defendant wife’s discontinuance of her 1994 divorce action she were to acquire a share of the increase in the value of the husband’s pension between 1994 and 1999 that would otherwise have been his separate property. (Giambrone v Giambrone, 140 AD2d 206; Wacholder v Wacholder, 188 AD2d 130; Kane v Kane, 163 AD2d 568; Thomas v Thomas, 221 AD2d 621; Cappa v Cappa, 212 AD2d 1056; Conklin v Wilbur, 26 AD2d 666; Schultz v Kobus, 15 AD2d 382.) V The Second Department’s flexible, fact-sensitive approach is correct. (Gonzalez v Gonzalez, 240 AD2d 630; Lamba v Lamba, 266 AD2d 515; Miller v Miller, 304 AD2d 727, 100 NY2d 615;
      Anglin v Anglin, 80 NY2d 553; Match v Match, 179 AJD2d 124; Martinucci v Martinucci, 288 AD2d 444; Marconi v Marconi, 240 AD2d 641; Tuccillo v Tuccillo, 8 AD3d 660; Janet B. v John B., 5 Misc 3d 1027[A], 2004 NY Slip Op 51584[U]; Greisman v Greisman, 14 Misc 3d 409.) VI. If this Court were to apply the law from the Third and Fourth Departments, defendant’s share of plaintiffs pension should remain what it is, not increased, since the wife presented no evidence that she contributed in any way to the increase in value of the husband’s pension. (Richards v Richards, 207 AD2d 628; O’Connell v O’Connell, 290 AD2d 774, revd on other grounds sub nom. O’Connell v Corcoran, 1 NY3d 179; McMahon v McMahon, 187 Misc 2d 364; Musumeci v Musumeci, 133 Misc 2d 139; Eastern Paralyzed Veterans Assn. v Metropolitan Transp. Auth., 79 AD2d 516; Matter of Cook v Carmen S. Pariso, Inc., 287 AD2d 208; Lewis v Spies, 43 AD2d 714.)
   OPINION OF THE COURT

Pigott, J.

The question is whether in this case the commencement of a prior, discontinued divorce action may serve as the valuation date for marital property for purposes of equitable distribution in a later divorce action. We hold that it may not.

The parties were married in 1969. The wife commenced an action for divorce in 1994. The husband answered, but did not counterclaim for divorce. Five years later, following long and contentious pretrial proceedings, the wife moved for permission to discontinue the action. The husband opposed the motion, and cross-moved to amend his answer to assert a counterclaim for divorce. Supreme Court granted the wife’s motion to discontinue the action and denied the husband’s cross motion.

Almost immediately, the husband commenced this action for divorce and ancillary relief. After finding that the husband was entitled to a divorce on the ground of constructive abandonment, Supreme Court held a bench trial to resolve disputed equitable distribution issues.

Supreme Court held that the husband’s pension must be valued as of the commencement date of the present action, rather than the commencement date of the wife’s 1994 action. Relying on Domestic Relations Law § 236 (B) (4) (b), the court reasoned that it was precluded from selecting a valuation date earlier than the commencement of the pending action. The court further observed that there was no evidence of “wrongdoing or ill-motive” in the wife’s election to discontinue the prior divorce action. After considering the duration of the marriage and the other statutory factors pursuant to Domestic Relations Law § 236 (B) (5) (d), Supreme Court determined that the marital property, including the marital portion of the pension, should be divided equally between the parties.

The Appellate Division modified the judgment of divorce, in part, and otherwise affirmed, holding that Supreme Court improvidently exercised its discretion in valuing the pension as of the commencement date of the present action. The court concluded that the “appropriate date for valuation” was the commencement date of the 1994 action because there was “no evidence that the parties reconciled and continued to receive the benefits of the marital relationship after the prior action was commenced” (25 AD3d 670, 671 [2006]).

We now modify the order of the Appellate Division and remit the matter to Supreme Court for further proceedings.

Domestic Relations Law § 236 (B) (1) (c) defines marital property as all property acquired “during the marriage and before the execution of a separation agreement or the commencement of a matrimonial action.” Thus, in the absence of a separation agreement, the commencement date of a matrimonial action demarcates “the termination point for the further accrual of marital property” (Anglin v Anglin, 80 NY2d 553, 556 [1992]). The definition of marital property “should be construed broadly in order to give effect to the ‘economic partnership’ concept of the marriage relationship recognized in the statute” (Price v Price, 69 NY2d 8, 15 [1986] [emphasis omitted]). Once property is classified as marital or separate, the trial court has broad discretion to select an “appropriate date for measuring the value of [the] property” (McSparron v McSparron, 87 NY2d 275, 287 [1995]). However, the valuation date must be between “the date of commencement of the action [and] the date of trial” (Domestic Relations Law § 236 [B] [4] [b]).

In determining whether the commencement of a particular “matrimonial action” terminates the accrual of marital property, we have looked to “the overall legislative intent of the Domestic Relations Law and . . . the particular application of the equitable distribution regime” (Anglin, 80 NY2d at 556). In Anglin, this Court held that the commencement of a separation action does not cut off the accrual of marital property because such an action “does not, ipso facto, terminate the marital economic partnership” (id. at 554). Rather, “[t]he economic partnership should be considered dissolved when a matrimonial action is commenced which seeks ‘divorce, or the dissolution, annulment or declaration of the nullity of a marriage’, i.e., an action in which equitable distribution is available” (id. at 557, quoting Domestic Relations Law § 236 [B] [5] [a]). We observed that this rule “provides internal consistency and compatibility and objective verification, as opposed to uneven, ephemeral, personal interpretations as to when economic marital partnerships end” (id.).

For similar reasons, we conclude that the value of marital property generally should not be determined by the commencement of an action for divorce that does not ultimately culminate in divorce. Equitable distribution is available “in an action wherein all or part of the relief granted is divorce” (Domestic Relations Law § 236 [B] [5] [a]). Where there is no divorce, there can be no equitable distribution. Consequently, permitting the commencement date of the prior, unsuccessful divorce action to govern the valuation date of marital property for the purposes of a later, successful action in which equitable distribution is available would be inconsistent with the statutory scheme.

In short, we hold today that courts must use the commencement date of the later, successful action as the earliest valuation date for marital property. However, the circumstances surrounding the commencement of the earlier action can and should “be considered as a factor by [the trial court], among other relevant factors, as [it] attempt[s] to calibrate the ultimate equitable distribution of marital economic partnership property acquired after the start of such an action by either spouse” (see Anglin, 80 NY2d at 558).

Here, as Supreme Court concluded, the pension benefits are marital property to the extent that they were earned prior to the commencement of the present divorce action (see Olivo v Olivo, 82 NY2d 202, 207 [1993]; Majauskas v Majauskas, 61 NY2d 481, 491 [1984]; see also Scheinkman, Practice Commentaries, McKinney’s Cons Laws of NY, Book 14, Domestic Relations Law C236B:26, at 424 [“Pension rights are determined as of date of commencement of action since rights earned subsequently cannot be considered marital property”]). As a result, the marital portion of the pension could not be valued at any time earlier than the commencement date (see Domestic Relations Law § 236 [B] [4] [b]).

Accordingly, the judgment appealed from and the order of the Appellate Division brought up for review should be modified, with costs to defendant, and the matter remitted to Supreme Court for further proceedings in accordance with the opinion herein and, as so modified, affirmed.

Chief Judge Kaye and Judges Ciparick, Graffeo, Read, Smith and Jones concur.

Judgment appealed from and order of the Appellate Division brought up for review modified, etc.


source: Caselaw Access Project

author: Smith, J. Jones, J.

license: Public Domain

text:
    [892 NE2d 839, 862 NYS2d 446]
    The People of the State of New York, Respondent, v Roman Baret, Appellant.
    Argued June 4, 2008;
    decided June 25, 2008

      POINTS OF COUNSEL

      Office of the Appellate Defender, New York City (Richard M. Greenberg of counsel), for appellant.
    Where Roman Baret moved to withdraw his plea based on detailed sworn allegations that he was pressured and threatened into pleading guilty by his codefendant, who was offered and received a sentence of probation pursuant to a “no-split” plea offer, the court should have granted the motion or at least conducted a hearing. (Boykin v Alabama, 395 US 238; People v Harris, 61 NY2d 9; People v Nixon, 21 NY2d 338; People v Pina, 35 AD3d 45; People v Richards, 17 AD3d 136; People v Caccavale, 305 AD2d 695; People v Stevens, 298 AD2d 267; People v Sung Min, 249 AD2d 130; People v Brown, 205 AD2d 436; People v Fanini, 222 AD2d 1111.)

      Robert T. Johnson, District Attorney, Bronx (Dana Levin and Joseph N. Ferdenzi of counsel), for respondent.
    The trial court properly exercised its discretion in denying defendant’s motion to withdraw his guilty plea. (People v Seaberg, 74 NY2d 1; People v Alexander, 97 NY2d 482; People v Fiumefreddo, 82 NY2d 536; People v Tinsley, 35 NY2d 926; People v Frederick, 45 NY2d 520; People v Harris, 61 NY2d 9; People v Young, 194 AD2d 307, 82 NY2d 761; People v Vellucci, 13 NY2d 665; People v White, 309 NY 636, 352 US 849; People v Dixon, 29 NY2d 55.)
   OPINION OF THE COURT

Smith, J.

We hold that the courts below did not abuse their discretion in rejecting, without a hearing, the claim of defendant-appellant, Roman Baret, that his guilty plea was the result of threats made by his codefendant.

Baret and Reynardo Nunez were charged with sale of cocaine and possession of cocaine with intent to sell it. The People offered them a plea bargain under which Baret would plead guilty to one count of sale and Nunez to one count of attempted sale. Under the People’s proposal, Baret would get a 2 to 6 year sentence, and Nunez would get probation. The deal was offered on a “no-split” basis: it was not available to either defendant unless both agreed to it. Both did, and their pleas were accepted after each told the court that no one had forced him to plead guilty.

Before being sentenced, Baret moved to withdraw his plea. In support of his motion, he submitted an affidavit, saying that he had initially rejected the deal when his lawyer told him about it. (Unlike our dissenting colleague [at 35 n], we think it clear from the record that Baret’s lawyer was not also representing Nunez.) Baret’s affidavit continued:

“Shortly thereafter, Mr. Nunez approached me and began to put pressure on me to plead guilty so that he could get Probation. . . .
“Mr. Nunez told me that T better do the right thing and plead guilty’ or he would make sure he ‘did the right thing.’ He continually told me that his life was ‘on the line’ and that he would ‘do what he had to do’ if I didn’t plead guilty. . . .
“Given these express and implied threats from Mr. Nunez, I felt in danger of physical reprisal if I did not plead guilty. . . .
“On December 23, 1996,1 appeared in Part 38 with [my lawyer] and Mr. Nunez. I was feeling a great deal of pressure from Mr. Nunez. My attorney told me I had to make a decision to plead or go to trial on that date.
“Under such pressure, I agreed to plead guilty and accept a State prison sentence of two to six years. I was in shock during the plea proceeding and did not have a clear idea what I was doing.”

Supreme Court denied Baret’s motion without a hearing. The Appellate Division affirmed, with two Justices dissenting on the ground that a hearing should have been held (43 AD3d 648 [1st Dept 2007]). A Justice of the Appellate Division granted leave to appeal to this Court, and we now affirm.

When a defendant moves to withdraw a guilty plea, the “fact-finding procedures” to be followed “rest largely in the discretion of the Judge to whom the motion is made” (People v Tinsley, 35 NY2d 926, 927 [1974]). “Only in the rare instance will a defendant be entitled to an evidentiary hearing” (¿d.). Here, Supreme Court’s exercise of discretion in denying Baret’s motion without a hearing finds ample support in the record.

Baret’s affidavit suggests, but does not unequivocally say, that he pleaded guilty only because he was afraid Nunez would have killed or injured him if he did not. The affidavit does not say what basis, if any, Baret had for believing that Nunez was able to carry out this threat. And the threat itself, couched in ambiguous language, is presented without any specific context. The affidavit does not tell us when or where Nunez spoke to Baret, how often, or whether in person or on the telephone. Nor does the affidavit describe Baret’s response. It uses such vague expressions as “[s]hortly thereafter,” “continually,” and “a great deal of pressure.” One would expect a man who had in truth been threatened with violence, and found the threat credible enough that he would accept a 2 to 6 year prison term rather than defy it, to be able to tell his story in much more specific detail.

We have no basis for disturbing the conclusion of both courts below that Baret’s showing of involuntariness was too flimsy to warrant further inquiry.

Accordingly, the order of the Appellate Division should be affirmed.

Jones, J.

(dissenting). Because I think that connected pleas have an inherent tendency to coerce and, thus, deserve heightened scrutiny, I respectfully dissent.

At the core of the constitutional requirement that a guilty plea be entered voluntarily, knowingly and intelligently (see People v Fiumefreddo, 82 NY2d 536, 543 [1993]) is the additional, unremarkable requirement that there “be an affirmative showing on the record” that defendant waived his or her constitutional protections (id.). In my view, defendant’s allegations of coercion—though not a model of specificity—under the circumstances sufficiently raised doubts about the voluntariness of his guilty plea such that, at a minimum, an uncumbersome evidentiary hearing was warranted.

This Court has long rejected “a formalistic approach to guilty pleas, preferring instead to leave the ascertainment” of the satisfactoriness of pleas “to the trial court’s ‘sound discretion exercised in cases on an individual basis’ ” (id., quoting People v Nixon, 21 NY2d 338, 355 [1967]). However, on guilty plea withdrawal motions, defendants “should be afforded [a] reasonable opportunity to present [their] contentions and the court should be enabled to make an informed determination” (id. [citation and internal quotation marks omitted; emphasis added]). This principle applies with greater force in the context of connected pleas.

Here, defendant initially made it known to his first attorney that he wished to plead not guilty. The People then offered him and his codefendant a connected plea which would fail if either declined the offer. Prior to sentencing, and with new counsel, defendant moved to withdraw his previously entered plea. Defendant alleged, in a sworn affidavit, that not long after the plea offer was made, his codefendant “began to put pressure on me to plead guilty so that he could get Probation”; that defendant had “better do the right thing and plead guilty” or he (the codefendant) would make sure that defendant “did the right thing.” Defendant stated that his codefendant “continually told [him] that his life was ‘on the line’ and that he would ‘do what he had to do’ if [defendant] didn’t plead guilty.” Given these threats, defendant stated that he “felt in danger of physical reprisal” were he to decline the plea offer.

In my view, defendant’s allegations were not facially incredible. As Justice Marlow in dissent below observed, it is unremarkable that defendant did not show fear or otherwise suggest that his plea was involuntary, or outright accuse his co-defendant of physical threats since the latter was present at the allocution.

We must take care to ensure that a guilty plea is not induced by fraud or coercion. On their face, the plea allocution minutes indicate that defendant satisfied all constitutional requirements for a knowing, voluntary and intelligent plea (see generally People v Nixon, 21 NY2d 338 [1967]). The problem, however, is that in certain cases, sole reliance upon the allocution presumes too much about what has previously taken place (or not) off the record. While the majority correctly takes stock of this reality, it fails to go one step further to recognize that in some cases, a defendant—all sincerity and a good faith fear in the alleged threats of coercion notwithstanding—will simply not be in a position to provide the kinds of specific facts sufficient to warrant further inquiry that the majority here requires.

Absent the kind of specificity the majority demands, defendants who find themselves in such a predicament would never be heard to complain. Although specificity in allegations of coercion entails matters of degree, and each case must be evaluated on its own facts, where nothing else existed to call defendant’s credibility into question, we should discourage courts from rendering summary determinations that risk depriving defendants of the opportunity, however brief, to make an uncomplicated case of coercion, outside codefendant’s presence (see People v Picciotti, 4 NY2d 340, 344 [1958] [“The manner in which (a) statement (of coercion) . . . was made (if made at all), the circumstances surrounding its utterance, its impact upon the accused, . . . (and) whether reasonable, are matters to be considered and passed upon” at a hearing]).

The hearing court here decided defendant’s motion without a hearing, on submission of his affidavit only. It is difficult to adequately evaluate defendant’s allegations on paper when he has never been afforded the opportunity to stand before the court uninfluenced by his codefendant’s presence. Moreover, the court’s frame of reference, in evaluating defendant’s submission without a hearing, is the allocution minutes; so it is no surprise that the hearing court, in its four-page written decision on the motion spent all but a single sentence to state, in summary form, that defendant “failed to substantiate his allegations of coercion.” The rest is dedicated exclusively to the uncontested, facial adequacy of the allocution minutes. As Justice Marlow noted in dissent, the allegations, if true, portray a picture of “a defendant whose free will was beclouded by the coercive force of his codefendant’s threats of future violence had defendant maintained his not guilty plea,” and “of a desperate codefendant who would not stop at acts of violence! ] to avoid going to prison” (43 AD3d 648, 652 [2007]). This would not be an unreasonable conclusion.

Lastly, I would simply note that although the plea is a vital instrument of judicial administration, a connected plea should not devolve into a situation whereby a defendant feels irretrievably ensnared by a previously entered guilty plea which, in retrospect, may have been at best ill-advised or, at worst, silenced at allocution by the very presence of a coercive agent. It should not be that only defendants with an intimate understanding of his or her codefendant’s wherewithal to make good on a promised threat of future harm should, in effect, receive the benefit of a closer look at alleged threats of coercion.

Accordingly, I would reverse and order a hearing.

Chief Judge Kaye and Judges Ciparick, Graffeo, Read and Pigott concur with Judge Smith; Judge Jones dissents and votes to reverse in a separate opinion.

Order affirmed.

       Defendant additionally asserted that he and his codefendant were represented by the same counsel at the pleading stage, and that their mutual counsel also put pressure on him to accept the connected plea. The People countered that the defendants were, instead, represented by separate counsel. It is unclear from the record, however, which version is accurate. In any event, even if defendant was represented by separate counsel, defendant indicated that his attorney advised him that if he did not accept the plea, his codefendant would not receive the plea offer. Though obviously not exceedingly probative, it does provide some context (however marginal) for defendant’s allegations.


author: Smith, J.

text:
    [892 NE2d 843, 862 NYS2d 450]
    The People of the State of New York, Respondent, v Gary Freycinet, Appellant.
    Argued May 29, 2008;
    decided June 26, 2008

      POINTS OF COUNSEL

      Appellate Advocates, New York City (Winston McIntosh and Lynn W.L. Fahey of counsel), for appellant.
    The trial court violated appellant’s constitutional right to confront the witnesses against him when, over objection, it admitted an absent medical examiner’s autopsy findings and permitted another medical examiner, who had not even been present when the autopsy was performed, to analyze and interpret the findings and give her opinion on contested issues based on them. (Crawford v Washington, 541 US 36; Ohio v Roberts, 448 US 56; People v Liner, 9 NY3d 856; People v Durio, 7 Misc 3d 729; Davis v Washington, 547 US 813; Diaz v United States, 223 US 442; People v Rogers, 8 AD3d 888; People v Nisonoff, 293 NY 597; People v Bryant, 27 AD3d 1124; United States v Feliz, 467 F3d 227.)

      Richard A. Brown, District Attorney, Kew Gardens (Jennifer Hagan and John M. Castellano of counsel), for respondent.
    The Appellate Division correctly held that the autopsy report was properly admitted under the Confrontation Clause. (Crawford v Washington, 541 US 36; United States v Feliz, 467 F3d 227; People v Nisonoff, 293 NY 597; Davis v Washington, 547 US 813; United States v Morgan, 505 F3d 332; United States v Munoz-Franco, 487 F3d 25; United States v Urqhart, 469 F3d 745; United States v Baker, 458 F3d 513; United States v Hagege, 437 F3d 943; United States v Weiland, 420 F3d 1062.)
   OPINION OF THE COURT

Smith, J.

In People v Rawlins (10 NY3d 136 [2008]), we considered whether fingerprint comparison reports and the report of a DNA technician were “testimonial” evidence under Crawford v Washington (541 US 36 [2004]). This case raises a similar question about an autopsy report. Analyzing the question in the way Rawlins requires, we conclude that the redacted report at issue here was not testimonial.

I

Defendant’s girlfriend died of a knife wound, and defendant was indicted for murder, manslaughter and other crimes. His defense was that he killed her either justifiably or by accident. He did not testify at trial, but relied on statements he made to police and a prosecutor after his arrest, in which he described the event as occurring when he and the victim were lying next to each other. According to his account, the two had an argument; the victim punched him and reached first for an iron and then for a knife; he reached the knife before she did; she grabbed his wrist; and the knife “just hit her.”

Dr. John Lacy, of the New York City Office of Chief Medical Examiner, performed an autopsy on the victim. Dr. Lacy later moved to Seattle, and he did not return for the trial. His report, redacted to eliminate his opinions as to the cause and manner of the victim’s death, was received in evidence over defendant’s Confrontation Clause objection.

The report said that Dr. Lacy observed “a single perforating stab wound of the face and neck and minor blunt force injury of the face.” It said that the stab wound was on the “left face in front of the left ear,” and that it was “oriented obliquely with one blunt angle close to the ear and one sharp angle directed toward the chin.” The report described the “wound track,” as passing “through the subcutaneous tissue and posterior scalp.” The report gave the location of the “exit wound” as “just within the hairline of the back of the neck.” It also noted a small round abrasion on the left cheek.

Dr. Corinne Ambrosi of the Medical Examiner’s office testified as an expert for the People, giving opinions based on the facts in Dr. Lacy’s report. She concluded that the cause of the victim’s death was bleeding from the stab wound. She also said that the knife, when it entered the victim’s neck, was positioned with its blunt edge toward the ear and its sharp edge “facing more toward the front.” She said that the wounds were “consistent with a right-handed person as a stabber on top of the person being stabbed” and “with the stabber using force.”

In closing argument, the People relied both on Dr. Ambrosi’s opinions and Dr. Lacy’s report to attack defendant’s version of the facts. The prosecutor argued that defendant must have been on top of the victim, not beside her as he said, and that so deep a wound, “from the front of her face to the back of her scalp,” could not have been inflicted by accident.

The trial judge, sitting without a jury, acquitted defendant of murder but convicted him, among other things, of manslaughter in the second degree. The Appellate Division affirmed. A judge of this Court granted leave to appeal, and we now affirm.

II

The Confrontation Clause of the United States Constitution says: “In all criminal prosecutions, the accused shall enjoy the right. . . to be confronted with the witnesses against him” (US Const Amend VI). Crawford and Davis v Washington (547 US 813 [2006]) establish that this clause does not bar the use of out-of-court statements by declarants who are not “witnesses”; and Crawford held that witnesses are “those who ‘bear testimony’ ” (Crawford, 541 US at 51). The Supreme Court has not defined “testimony” in this context, though it has said that “[a]n accuser who makes a formal statement to government officers bears testimony in a sense that a person who makes a casual remark to an acquaintance does not” (id.). The only issue on this appeal is whether the redacted version of Dr. Lacy’s autopsy report was “testimony” as that term is used in Crawford.

The question of when reports of scientific procedures are and are not testimonial is one we examined at length in Rawlins. In that case, we refused to establish an “absolute rule” that documents within the “business records” exception to the hearsay rule are never testimonial, noting that under New York law records of law enforcement agencies may be business records (10 NY3d at 149-150). Instead, we discussed “various indicia of testimoniality” (id. at 151). Among them are: the extent to which the entity conducting the procedure is “an ‘arm’ of law enforcement” (State v Crager, 116 Ohio St 3d 369, 379, 879 NE2d 745, 753 [2007], quoted in Rawlins, 10 NY3d at 153); whether the contents of the report are a contemporaneous record of objective facts, or reflect the exercise of “fallible human judgment” (10 NY3d at 154); the question—closely related to the previous two—of whether a pro-law-enforcement bias is likely to influence the contents of the report (id. at 153); and whether the report’s contents are “directly accusatory” in the sense that they explicitly link the defendant to the crime (id. at 156). Considering these factors, we held in Rawlins that fingerprint comparison reports prepared by a police department analyst, which said that prints found at two crime scenes belonged to the defendant, were testimonial. However, in People v Meekins (decided with Rawlins), in which the police had sent samples from a rape kit to a private laboratory for testing, we held that a technician’s report establishing that a particular DNA profile was obtained from one of the samples was nontestimonial.

Under the Rawlins approach, Dr. Lacy’s autopsy report was clearly not testimonial. The duties of the Office of Chief Medical Examiner, Dr. Lacy’s employer, “are, by law, independent of and not subject to the control of the office of the prosecutor”; the agency “is not a law enforcement agency” (People v Washington, 86 NY2d 189, 192 [1995]). Dr. Lacy’s report, redacted to eliminate his opinions, was very largely a contemporaneous, objective account of observable facts. The giving of opinions was left to Dr. Ambrosi, who testified at trial. Admittedly, a report of a doctor’s findings at an autopsy may reflect more exercise of judgment than the report of a DNA technician; for example, Dr. Lacy no doubt exercised judgment in characterizing the victim’s injury as a “stab wound.” Nevertheless, the significance of the report to this case derives almost entirely from Dr. Lacy’s precise recording of his observations and measurements as they occurred. It is hard to imagine how this redacted report could have been significantly affected by a pro-law-enforcement bias.

Finally, Dr. Lacy’s report did not directly link defendant to the crime. The report is concerned only with what happened to the victim, not with who killed her. As Crawford explains, the Confrontation Clause derives from the strongly held idea of our country’s founders, derived from English common law, that a person accused should have the right to face his or her “accuser.” The Clause is in a way an echo of Sir Walter Raleigh’s unheeded demand, quoted in Crawford: “Call my accuser before my face” (541 US at 44). Dr. Lacy was not defendant’s “accuser” in any but the most attenuated sense.

Accordingly, the order of the Appellate Division should be affirmed.

Chief Judge Kaye and Judges Graffeo, Read, Pigott and Jones concur; Judge Ciparick taking no part.

Order affirmed.


author: Pigott, J. Smith, J.

text:
    [893 NE2d 110, 862 NYS2d 833]
    In the Matter of Marty Markowitz, as Brooklyn Borough President, Appellant, v Gregory V. Serio, as Superintendent of the State of New York Insurance Department, Respondent, and Farmers New Century Insurance Company et al., Intervenors-Respondents.
    Argued May 28, 2008;
    decided June 26, 2008

      POINTS OF COUNSEL

      Michael A. Cardozo, Corporation Counsel, New York City (Drake Colley, Edward F.X. Hart, Alan H. Kleinman and Tahirih M. Sadrieh of counsel), for appellant.
    I. The Insurance Department’s own rule requires it to disclose the Regulation 90 filings. (Matter of Frick v Bahou, 56 NY2d 777; Matter of Gilman v New York State Div. of Hous. & Community Renewal, 99 NY2d 144; Matter of Visiting Nurse Serv. of N.Y. Home Care v New York State Dept. of Health, 5 NY3d 499; Matter of Duflo Spray-Chemical v Jorling, 153 AD2d 244; Matter of Trager v Kampe, 287 AD2d 643, 99 NY2d 361; Matter of Goldstein v New York State Indus. Bd. of Appeals, 292 AD2d 706; Matter of New York Tel. Co. v Public Serv. Commn., 56 NY2d 213; Matter of Xerox Corp. v Town of Webster, 65 NY2d 131; Matter of Turner v Department of Fin. of City of N.Y., 242 AD2d 146; Matter of Law Enforcement Officers Union, Dist. Council 82, AFSCME, AFLCIO v State of New York, 229 AD2d 286.) II. The record fails to show that the substantial competitive injury exception to the Freedom of Information Law applies to regulatory information submitted by all members of an industry where the only risk, borne by all members of the industry, is that some or all members of the industry might have better informed marketing. (Matter of Mantica v New York State Dept. of Health, 94 NY2d 58; Matter of Hanig v State of N.Y. Dept. of Motor Vehs., 79 NY2d 106; Matter of Capital Newspapers Div. of Hearst Corp. v Burns, 67 NY2d 562; Matter of Encore Coll. Bookstores v Auxiliary Serv. Corp. of State Univ. of N.Y. at Farmingdale, 87 NY2d 410; McDonnell Douglas Corp. v United States Dept. of Air Force, 375 F3d 1182; Public Citizen Health Research Group v Food &

      Drug Admin., 185 F3d 898; GC Micro Corp. v Defense Logistics Agency, 33 F3d 1109; Matter of Verizon N.Y., Inc. v Bradbury, 40 AD3d 1113; Matter of Bahnken v New York City Fire Dept., 17 AD3d 228, 6 NY3d 701; Matter of Sunset Energy Fleet v New York State Dept. of Envtl. Conservation, 285 AD2d 865.) III. A proper balancing of the public’s interest in disclosure versus the insurers’ interest in confidentiality must result in disclosure of the Regulation 90 materials. (Matter of Capital Newspapers Div. of Hearst Corp. v Burns, 67 NY2d 562; Matter of New York Times Co. v City of N.Y. Fire Dept., 4 NY3d 477; Matter of Newsday, Inc. v State Dept. of Transp., 5 NY3d 84; GC Micro Corp. v Defense Logistics Agency, 33 F3d 1109; National Parks & Conservation Assn. v Morton, 498 F2d 765; Matter of M. Farbman & Sons v New York City Health & Hosps. Corp., 62 NY2d 75; Matter of Fink v Lefkowitz, 47 NY2d 567; Matter of Washington Post Co. v New York State Ins. Dept., 61 NY2d 557.)

      Andrew M. Cuomo, Attorney General, New York City (Benjamin N. Gutman, Barbara D. Underwood and Cecelia C. Chang of counsel), for respondent.
    I. The regulation making each redlining report a “public record” preserves the Insurance Department’s ability to invoke exemptions from disclosure under the Freedom of Information Law. (Matter of New York Tel. Co. v Public Serv. Commn., 56 NY2d 213; Matter of Xerox Corp. v Town of Webster, 65 NY2d 131; Matter of Washington Post Co. v New York State Ins. Dept., 61 NY2d 557; Matter of Goldstein v New York State Indus. Bd. of Appeals, 292 AD2d 706; Matter of Blossom View Nursing Home v Novello, 4 NY3d 581; Matter of Medical Socy. of State of N.Y. v Serio, 100 NY2d 854; Matter of Turner v Department of Fin. of City of N.Y., 242 AD2d 146; Matter of Elcor Health Servs. v Novello, 100 NY2d 273; Matter of Lantry v State of New York, 6 NY3d 49.) II. The Insurance Department properly concluded that disclosing insurers’ most recent redlining reports would cause substantial competitive harm to those insurers. (Matter of Medical Socy. of State of N.Y. v Serio, 100 NY2d 854; Matter of New York State Elec. & Gas Corp. v New York State Energy Planning Bd., 221 AD2d 121; Matter of Encore Coll. Bookstores v Auxiliary Serv. Corp. of State Univ. of N.Y. at Farmingdale, 87 NY2d 410; Lion Raisins v United States Dept. of Agric., 354 F3d 1072; Center For Pub. Integrity v Federal Communications Commn., 505 F Supp 2d 106; Matter of Capital Newspapers Div. of Hearst Corp. v Burns, 67 NY2d 562; Matter of Short v Board of Mgrs. of Nassau County Med. Ctr., 57 NY2d 399; Flacke v Onondaga Landfill Sys., 69 NY2d 355.)

      Chadbourne & Parke LLP, New York City (Richard G. Liskov of counsel), and Dewey & LeBoeuf LLP (Ellen M. Dunn and Kelly H. Tsai of counsel) for intervenors-respondents.
    I. The ZIP code data appellant requested fall squarely within the statutory exemption for records which if disclosed, would cause substantial competitive injury. (Matter of Newsday, Inc. v Empire State Dev. Corp., 98 NY2d 359; Matter of Capital Newspapers Div. of Hearst Corp. v Burns, 67 NY2d 562; Matter of Encore Coll. Bookstores v Auxiliary Serv. Corp. of State Univ. of N.Y. at Farmingdale, 87 NY2d 410; Matter of Passino v Jefferson-Lewis, 277 AD2d 1028, 96 NY2d 709; Matter of Troy Sand & Gravel Co. v New York State Dept. of Transp., 277 AD2d 782, 96 NY2d 708; Matter of New York State Elec. & Gas Corp. v New York State Energy Planning Bd., 221 AD2d 121; Worthington Compressors, Inc. v Costle, 662 F2d 45; Gulf & W. Indus., Inc. v United States, 615 F2d 527; Center For Pub. Integrity v Federal Communications Commn., 505 F Supp 2d 106; National Parks & Conservation Assn. v Morton, 498 F2d 765.) II. Section 87 (2) of the Public Officers Law also exempts trade secrets from disclosure, which is an additional basis for affirming the Appellate Division’s order. (People ex rel. Matthews v New York State Div. of Parole, 95 NY2d 640; Matter of Couch v Perales, 78 NY2d 595; Matter of New York Tel. Co. v Public Serv. Commn., 56 NY2d 213; Integrated Cash Mgt. Servs., Inc. v Digital Transactions, Inc., 920 F2d 171; Public Citizen Health Research Group v Food & Drug Admin., 704 F2d 1280; Garvin GuyButler Corp. v Cowen & Co., 155 Misc 2d 39; Matter of Sunset Energy Fleet v New York State Dept. of Envtl. Conservation, 285 AD2d 865; Stanley Tulchin Assoc. v Vignola, 186 AD2d 183.) III. The Insurance Department properly interpreted Regulation 90 in harmony with both the entire Freedom of Information Law statute and Insurance Department Regulation 71 governing public access to Department records. (Matter of Fink v Lefkowitz, 47 NY2d 567; Matter of Encore Coll. Bookstores v Auxiliary Serv. Corp. of State Univ. of N.Y. at Farmingdale, 87 NY2d 410; Matter of Xerox Corp. v Town of Webster, 65 NY2d 131; Matter of New York Tel. Co. v Public Serv. Commn., 56 NY2d 213; Matter of ATM One v Landaverde, 2 NY3d 472; Matter of Gould v New York City Police Dept., 89 NY2d 267; Matter of Goldstein v New York State Indus. Bd. of Appeals, 292 AD2d 706; Matter of Frick v Bahou, 56 NY2d 777.)

      Melito & Adolfsen P.C., New York City (S. Dwight Stephens of counsel), and Wiley Rein LLP, Washington, D.C. (Craig A. Berrington and Gary P. Seligman of counsel), for American Insurance Association and others, amici curiae.
    I. Regulation 90 does not preclude the Insurance Department’s considered application of Freedom of Information Law exemptions. (Matter of New York Tel. Co. v Public Serv. Commn., 56 NY2d 213; Matter of Goldstein v New York State Indus. Bd. of Appeals, 292 AD2d 706.) II. The record overwhelmingly demonstrates the likelihood of substantial competitive injury faced by insurers that would result from contemporaneous disclosure of the ZIP code reports. (Matter of Encore Coll. Bookstores v Auxiliary Serv. Corp. of State Univ. of N.Y. at Farmingdale, 87 NY2d 410; Matter of Gould v New York City Police Dept., 89 NY2d 267; Matter of Glens Falls Newspapers v Counties of Warren & Washington Indus. Dev. Agency, 257 AD2d 948; National Parks & Conservation Assn. v Kleppe, 547 F2d 673; Public Citizen Health Research Group v Food & Drug Admin., 704 F2d 1280; Matter of Siegel, Fenchel & Peddy v Central Pine Barrens Joint Planning & Policy Commn., 251 AD2d 670; Matter of Passino v Jefferson-Lewis, 277 AD2d 1028; Matter of Belth v Insurance Dept. of State of N.Y., 95 Misc 2d 18; Center For Pub. Integrity v Federal Communications Commn., 505 F Supp 2d 106; Matter of Troy Sand & Gravel Co. v New York State Dept. of Transp., 277 AD2d 782.) III. Delayed disclosure of the ZIP code reports appropriately balances the competing interests as required by Freedom of Information Law. (Matter of Medical Socy. of State of N.Y. v Serio, 100 NY2d 854; Makastchian v Oxford Health Plans, 281 AD2d 197; Huskission v Sentry Ins., 123 AD2d 832; Kenney v Kemper Natl. Ins. Cos., 133 F3d 907; Matter of Fink v Lefkowitz, 47 NY2d 567; Matter of New York Times Co. v City of N.Y. Fire Dept., 4 NY3d 477; Matter of Newsday, Inc. v State Dept. of Transp., 5 NY3d 84; Matter of Washington Post Co. v New York State Ins. Dept., 61 NY2d 557; Matter of Gould v New York City Police Dept., 89 NY2d 267; Department of Defense v FLRA, 510 US 487.)
   OPINION OF THE COURT

Pigott, J.

“Redlining,” as the term is used in the insurance industry, is an insurer’s refusal to issue or renew, or its cancellation of, a policy premised exclusively on the geographic location of the risk. Concerned that auto insurers were engaging in that practice, Marty Markowitz, Brooklyn Borough President and petitioner in this proceeding, filed two Freedom of Information Law (FOIL) requests with the State Insurance Department seeking information “for each Kings County zip code, including, by carrier, the number of voluntary [automobile] policies issued, renewed, cancelled (other than for non-payment of premium) or nonrenewed.” Markowitz claimed that such zip code reports (commonly referred to as Regulation 90 reports) were available pursuant to 11 NYCRR 218.7 (d), an insurance regulation which states that such reports “shall be public record.”

The Department provided Markowitz with data relative to the total number of auto policies in force in New York in each county from 1999 through 2002, but refused to release any data generated after 1997 demarcating the number of policies in force broken down, by carrier, for each Kings County zip code. This refusal was based on the Department’s contention that Regulation 90 reports are exempt from disclosure or release under FOIL because their contents constitute either trade secrets or records that, if disclosed, “would cause substantial injury to the competitive position” of insurers (Public Officers Law § 87 [2] [d]). The Department advised Markowitz that the reports would be disclosed, but only after six years.

On December 3, 2004, after exhausting his administrative remedies relative to the denials of both FOIL requests, Markowitz commenced this CPLR article 78 proceeding against respondent Gregory V Serio, Superintendent of the Insurance Department. The petition seeks an order and judgment annulling, as arbitrary and capricious, the Superintendent’s determinations that the Regulation 90 reports are subject to a FOIL exemption, and ordering the Superintendent to produce the reports broken down by zip code. The Department answered asserting that its refusal to release the reports was neither arbitrary nor capricious and that its decision was reasonable and consistent with lawful procedure.

Markowitz and the Superintendent entered into a stipulation permitting several interested insurers to intervene in the proceeding. Those insurers submitted affidavits in support of their claims that the reports sought by Markowitz constituted confidential information, the release of which would result in substantial competitive harm.

Supreme Court granted the petition, holding that Regulation 90 expressly mandated public disclosure of the reports and that the Department failed to meet its burden of demonstrating that the Regulation 90 filings qualified under a FOIL exemption. The Appellate Division reversed and reinstated the Department’s administrative determinations, noting that although the Department had decided in 1994 that the Regulation 90 reports were public records as the regulation clearly stated, they were nevertheless subject to FOIL disclosure and its reversal of position in 2000 was neither arbitrary nor capricious because the Department had relied on additional evidence from insurers that the disclosure of such information would result in competitive harm to them (39 AD3d 247, 248 [1st Dept 2007]). The Appellate Division further held that the Department’s decision to exempt the reports on the ground that their release would result in substantial competitive injury was reasonable {id. at 248-249). This Court granted leave to appeal and we now reverse.

The Legislature enacted Insurance Law § 3429 to proscribe insurers from declining to issue or renew, or from cancelling, certain types of auto insurance “based solely on the geographical location of the risk” (Insurance Law § 3429 [a] [2]). That law directs the Superintendent to promulgate regulations establishing “procedures with respect to notification to insureds of the insurer’s specific reason or reasons for refusal to issue or renew or for cancellation” of auto insurance policies (Insurance Law § 3429 [b]).

To that end, the Superintendent promulgated 11 NYCRR 218.7 (d), which provides that Regulation 90 reports must be filed annually “in a format . . . prescribed by the superintendent” and that “every such report shall be public record” (emphasis supplied). Contrary to Markowitz’s contention, however, the “public record” language does not negate an insurer’s right to assert that some information required to be included in the reports is exempt from disclosure under FOIL. Rather, as the Department has reasonably concluded, such language suggests that, although Regulation 90 reports are submitted by a private entity at the behest of the Department, they are subject to public disclosure unless the insurer asserts that a FOIL exemption applies and is able to sustain its burden of establishing nondisclosure. This interpretation is consistent with this Court’s construction of the “public records” language in the context of FOIL exemptions (see e.g. Matter of Xerox Corp. v Town of Webster, 65 NY2d 131, 132 [1985]; Matter of New York Tel. Co. v Public Serv. Commn., 56 NY2d 213, 219-220 [1982]). Indeed, this Court has held that “the FOIL exemptions must be read as having engrafted, as a matter of public policy, certain limitations on the disclosure of otherwise accessible records” (Matter of Xerox Corp., 65 NY2d at 132). Accordingly, the Department’s interpretation that 11 NYCRR 218.7 (d) does not deprive insurers of their right to contest the disclosure of Regulation 90 reports is neither irrational nor unreasonable and is “entitled to deference” (Matter of Gaines v New York State Div. of Hous. & Community Renewal, 90 NY2d 545, 549 [1997]).

Further evidence of the reasonableness of the Department’s interpretation of 11 NYCRR 218.7 (d) is found at 11 NYCRR part 241 (Regulation 71), which provides a regulatory framework concerning requests for, and the release of, Department records. For instance, 11 NYCRR 241.3 (a) states that “[e]xcept as otherwise provided by the Insurance Law, section 87 (2) of the Public Officers Law, or other provisions of law, all records produced [by the Department] shall be available for public inspection and copying,” thereby evidencing that FOIL exemptions are potentially applicable to all Department' records, even those filed pursuant to Regulation 90. Moreover, 11 NYCRR 241.6 (a) explicitly permits one “who submits any information to the [Department” to “request that the [D]epartment except such information from disclosure under” Public Officers Law § 87 (2) (d). Indeed, several of the insurers here have done so in the past when filing their annual Regulation 90 reports. Therefore, it is apparent that the Department’s interpretation of 11 NYCRR 218.7 (d) reconciles, and gives effect to, the key disclosure components of Regulations 90 and 71. As such, while the “public record” language indicates that the Regulation 90 reports are subject to disclosure, an insurer retains the right to assert and attempt to prove that they fall within an applicable FOIL exemption.

The Department and insurers argue that the applicable FOIL exemption here is Public Officers Law § 87 (2) (d), which states that the Department “may deny access to records or portions thereof that . . . are trade secrets or are submitted . . . by a commercial enterprise . . . and which if disclosed would cause substantial injury to the competitive position of the subject enterprise.” As the parties seeking the exemption, the Department and insurers are charged with the burden of proving their entitlement to it (see Public Officers Law § 89 [4] [b]; [5] [e]), meaning that they must demonstrate that the reports “ ‘fall[ ] squarely within a FOIL exemption by articulating a particularized and specific justification for denying access’ ” (Matter of Data Tree, LLC v Romaine, 9 NY3d 454, 462-463 [2007], quoting Matter of Capital Newspapers Div. of Hearst Corp. v Burns, 67 NY2d 562, 566 [1986]). Because the overall purpose of FOIL is to ensure that the public is afforded greater access to governmental records, FOIL exemptions are interpreted narrowly (see Matter of Washington Post Co. v New York State Ins. Dept., 61 NY2d 557, 564 [1984]). To meet its burden, the party seeking exemption must present specific, persuasive evidence that disclosure will cause it to suffer a competitive injury; it cannot merely rest on a speculative conclusion that disclosure might potentially cause harm.

Here, the Department and insurers have failed to meet this burden. The evidence suggesting they will suffer a competitive disadvantage is theoretical at best. The insurers’ key argument is that if they are forced to reveal zip codes of areas where relatively few policies are issued, competitors could use this information to exploit an insurer’s geographic weak spot. It has not been shown that zip code data, without more, would necessarily put the insurer at a competitive disadvantage. Because neither the Department nor insurers have met their burden of justifying the exemption of the reports under Public Officers Law § 87 (2) (d) (see Matter of Washington Post Co., 61 NY2d at 567), the order of the Appellate Division should be reversed, with costs, and the order and judgment of Supreme Court reinstated.

Smith, J.

(concurring). The majority concludes that Regulation 90 reports are available to the public only if the Freedom of Information Law (FOIL) makes them so. It also concludes that the insurers have failed to show that the reports are exempt from FOIL.

I disagree with both conclusions. I think that Regulation 90, by its own force, makes the reports “public record.” But if I were to consider the FOIL issue, I would find that the insurers had made an ample showing that disclosure of the records “would cause substantial injury to [their] competitive position” within the meaning of Public Officers Law § 87 (2) (d). Ironically, I end up agreeing with the majority’s result—but only because the majority’s two errors, as they affect this case, cancel each other out.

I

Regulation 90 requires insurers to submit certain reports and says: “every such report shall be public record” (11 NYCRR 218.7 [d]). The majority holds that this means only that the records are public unless a FOIL exemption applies. If that is all it means, the authors of the regulation were wasting their time writing the words, because all records of state agencies are public unless a FOIL exemption applies. But “public record” and “subject to FOIL” do not mean the same thing.

A public record, in ordinary speech, refers to a record that any member of the public can look at and copy. Deeds on file at the county clerk’s office are public records; so are the pleadings filed in most litigations. A clerk who is the custodian of public records will show them to anyone who walks into his or her office—or, if the office is technologically advanced, the documents may be available online to anyone with a computer. This is very different from documents subject to FOIL—as to which members of the public may only submit a FOIL request, which will be dealt with, often in cumbersome and time-consuming fashion, by the official assigned by the agency to deal with such things.

The majority cites Matter of Xerox Corp. v Town of Webster (65 NY2d 131 [1985]) and Matter of New York Tel. Co. v Public Serv. Commn. (56 NY2d 213 [1982]) for the proposition that “public records” and “subject to FOIL” have the same meaning. That is not what these cases hold. Xerox interpreted General Municipal Law § 51, a statute enacted before FOIL, which declared a broad category of documents to be “public records.” We held that, since the Legislature was “presumably aware of General Municipal Law § 51 at the time it enacted FOIL,” the later statute “must be read as having engrafted . . . certain limitations” on the earlier one (65 NY2d at 132). New York Tel. Co. involved a statute saying that all proceedings, documents and records of the Public Service Commission “shall be public records” (Public Service Law § 16 [1]). We held that, while the proceedings of the Commission are generally public, the statute does not prohibit the Commission from making exceptions for evidence “which falls within the category of trade secrets”— just as a court, whose proceedings are generally public, might put some sensitive information under seal (56 NY2d at 219). New York Tel. Co. says nothing about FOIL.

Xerox and New York Tel. Co. stand for the proposition that, where a broad category of material is declared to be “public record,” exceptions may be made, based on FOIL exemptions or simply on public policy. That proposition has no relevance to this case, for Regulation 90 establishes as “public record” not a broad category to which the insurers ask for an exception but the precise documents that they want to keep confidential for six years: reports showing insurers’ agents, brokers, policies and applications broken down by zip code. The insurers are seeking not an exception to the “public record” requirement but the virtual nullification of it.

I would hold that reports under Regulation 90 are public, as the regulation says they are, and would not reach any question under FOIL.

II

If I did reach the FOIL issue, however, I would hold that the documents in issue here are exempt from disclosure under Public Officers Law § 87 (2) (d), because they “are submitted to an agency by a commercial enterprise . . . and ... if disclosed would cause substantial injury to the competitive position of the subject enterprise.”

The insurers’ submissions make a specific and persuasive showing of competitive injury. The affidavit of Eric Webster, an official of intervenor State Farm Mutual Automobile Insurance Company, explains in detail how a State Farm competitor could gain an advantage from State Farm’s Regulation 90 reports. Such a competitor, Webster says, would compare and merge its zip code data with State Farm’s, would use that data to estimate its and State Farm’s market share in each zip code, would determine from that which areas to target, would do a targeted marketing campaign, and would use the results to create a statistical model to guide future marketing. Webster adds that Regulation 90 reports would help competitors assess the weaknesses and strengths of particular State Farm agents’ performance, using techniques that Webster describes at length. He also explains how, by tracking changes disclosed by the reports in “risk placement” between State Farm and an affiliated company, a competitor could detect a new State Farm marketing strategy, for example “a shift toward[ ] youthful, higher risk customers in specific zip codes.” Affidavits submitted by officials of the other insurer intervenors also contain explanations of the harm they will suffer.

The insurers’ factual submissions total 19 pages. The majority brushes them aside in three sentences. It says their showing “is theoretical at best” (majority op at 51), but that is true only in the sense that any attempt to predict the consequences of disclosure must be theoretical. The statute requires such a prediction. The exemption created by section 87 (2) (d) is available only on a showing that the information “if disclosed would cause substantial injury.”

The majority mentions only one of the insurers’ points, which it chooses to call their “key argument” (majority op at 51). The majority then responds with the unsupported assertion that “it has not been shown that zip code data, without more, would necessarily put the insurer at a competitive disadvantage” (id.). But that is exactly what the insurers have shown, in extensive detail—and even without that showing, it would be self-evident that a business can get a substantial advantage from information about its competitor’s success or lack of it in particular locations.

I have little doubt that insurers will suffer some significant competitive injury from the public disclosure of Regulation 90 reports. I would order those reports disclosed anyway, because I read the regulation as a policy determination by the Insurance Department, acting under the authority given it by the anti-redlining statute (Insurance Law § 3429), that the reasons for making this information public outweigh the insurers’ legitimate reasons for keeping it confidential. But the majority’s attempt to pretend that no policy choice need be made, because no competitive injury has been shown, simply ignores the record.

Chief Judge Kaye and Judges Ciparick, Graffeo, Read and Jones concur with Judge Pigott; Judge Smith concurs in result in a separate opinion.

Order reversed, etc.

       The intervener insurers are Farmers New Century Insurance Company, State Farm Mutual Automobile Insurance Company, State Farm Fire and Casualty Insurance Company, and Chubb & Son.


text:
    [892 NE2d 850, 862 NYS2d 457]
    In the Matter of Sambasiva Rao Venigalla et al., Respondents, v Dattatreyudu Nori et al., Appellants. Attorney General of State of New York, Intervenor.
    Argued May 28, 2008;
    decided July 1, 2008

      POINTS OF COUNSEL

      Hodgson Russ LLP, New York City (Daniel S. Steinberg, Joseph P. Goldberg and Jacquelyn R. Trussell of counsel), for appellants.
    I. The Appellate Division’s decision was error as a matter of law and should be reversed insofar as it invalidated the post-1970 bylaws and enforced the 1970 bylaws. (Matter of Alcott Staff Leasing v New York Compensation Ins. Rating Bd., 224 AD2d 54; Town of Somers v Comarco, 284 App Div 979, 308 NY 537; Matter of Berich v Ithaca Police Benevolent Assn., Inc., 23 AD3d 904; Matter of Salino v Cimino, 1 NY3d 166; Hildreth-Henry v Henry, 27 AD3d 419; Fascaldi v Fascaldi, 209 AD2d 576; Matter of Salahuddin v Coughlin, 222 AD2d 950; Matter of Roanoke Sand & Gravel Corp. v Town of Brookhaven, 24 AD3d 783; Matter of Conte v Town of Norfolk Zoning Bd. of Appeals, 261 AD2d 734; Matter of Bad v New York State Dept. of Envtl. Conservation, 35 AD3d 732.) II. The 1970 bylaws are invalid to the extent they conflict with Religious Corporations Law article 9 and the Hindu Temple Society of North America’s certificate of incorporation. (Matter of Herbert H. Lehman Coll. Found, v Fernandez, 292 AD2d 227; Keogh v Connolly, 235 AD2d 241; Christal v Petry, 275 App Div 550.) III. The court’s imposition of elections on the Hindu Temple Society of North America (Temple) and the supervision and determination by a court-appointed referee of membership in the Temple for purposes of voting in an election of trustees violated the Free Exercise Clauses of the United States and New York Constitutions. (Matter of Congregation Yetev Lev D’Satmar Inc. v Kahana, 9 NY3d 282; Serbian Eastern Orthodox Diocese for United States and Canada v Milivojevich, 426 US 696; Rector, Churchwardens &

      Vestrymen of Church of Holy Trinity v Melish, 3 NY2d 476; Matter of Venigalla v Alagappan, 307 AD2d 1041; Rector, Church Wardens & Vestrymen of St. Bartholomew’s Church in City of N.Y. v Committee to Preserve St. Bartholomew’s Church, 56 NY2d 71.) IV The Religious Corporations Law’s enumeration of rights and powers for particular religious denominations improperly prefers those established religions in violation of the Establishment Clause of the United States Constitution and violates the rights of the Hindu Temple Society of North America and its followers to the free exercise of religion and the equal protection of the laws. (Cantwell v Connecticut, 310 US 296; Catholic Charities of Diocese of Albany v Serio, 7 NY3d 510; Larson v Valente, 456 US 228; Everson v Board of Ed. of Ewing, 330 US 1; Grumet v Pataki, 93 NY2d 677, 528 US 946; Church of Lukumi Babalu Aye, Inc. v Hialeah, 508 US 520; Morris v Scribner, 69 NY2d 418; Matter of Saints of God In Christ Inc., 20 Misc 2d 532.)

      Chittur & Associates, P.C., New York City (Krishnan S. Chittur of counsel), for Dattatreyudu Nori and others, respondents.
    I. The 1970 bylaws were properly upheld and enforced. (Held v Kaufman, 91 NY2d 425; Ioele v Wal-Mart Stores, 290 AD2d 614; Crowther v City of New York, 262 AD2d 519; Matter of Board of Educ. of Roosevelt Union Free School Dist. v Board of Trustees of State Univ. of N.Y., 185 Misc 2d 704; Hildreth-Henry v Henry, 27 AD3d 419; Fascaldi v Fascaldi, 209 AD2d 576; Matter of Salahuddin v Coughlin, 222 AD2d 950; St. Vincent’s Hosp. & Med. Ctr. v Nationwide Mut. Ins. Co., 42 AD3d 523; Charney v North Jersey Trading Corp., 150 Misc 2d 849; Hauck Food Prods. Corp. v Stevenson & Co., Inc., 203 App Div 308.) II. Appellants’ statutory and constitutional challenges should not be considered since they were never raised before the Supreme Court. (Martin v New York Hosp., 295 AD2d 485; Bingham v New York City Tr. Auth., 99 NY2d 355; Matter of Salino v Cimino, 1 NY3d 166; Matter of Dowsett v Dowsett, 172 AD2d 610; Matherson v Marchello, 100 AD2d 233; Matter of Kalkstein v DiNapoli, 228 AD2d 28; Matter of Steel v Department for Aging of City of N.Y., 14 AD3d 423; Matter of Goodnature Prods. [Guangping Huang], 300 AD2d 1050; Matter of Fotopoulos v Berman, 298 AD2d 698.) III. In any event, the 1970 bylaws do not contravene the Religious Corporations Law. (Matter of Kaminsky, 251 App Div 132, 277 NY 524; Kroth v Congregation Chebra Ukadisha Bnai Israel Mikalwarie, 105 Misc 2d 904; Watt Samakki Dhammikaram, Inc. v Thenjitto, 166 Misc 2d 16; Mat

      ter of New York Soul Clinic, 208 Misc 612; Diamond v Art Contr. Co., Inc., 147 Misc 88; Witthaus v St. Thomas’ Church, 161 App Div 208; Emmett v American Equit. Assur. Co. of N.Y., 194 Misc 529; New York Dist. of Assemblies of God v Calvary Assembly of God, 64 AD2d 311; New York Annual Conference of Methodist Church v Nam Un Cho, 156 AD2d 511; St. Matthew Church of Christ, Disciples of Christ v Creech, 196 Misc 2d 843.) IV Appellants’ and the Attorney General’s construction of the Religious Corporations Law contravenes the Not-For-Profit Corporation Law. (Croughan v New York Mut. Benevolent Socy., 179 App Div 211; Matter of Hausner v Hopewell Prods., 22 Misc 2d 969; Islamic Ctr. of Harrison v Islamic Science Found., 262 AD2d 362.) V. The Hindu Temple Society of North America has a First Amendment right to have an elected board and open membership “irrespective of religion.” (Karageorgious v Laoudis, 271 AD2d 653; White Riv. Amusement Pub, Inc. v Town of Hartford, 481 F3d 163; Matter of Congregation Yetev Lev D’Satmar Inc. v Kahana, 9 NY3d 282.) VI. Appellants’ and the Attorney General’s construction renders the Religious Corporations Law unconstitutional. (Russian Church of Our Lady of Kazan v Dunkel, 67 Misc 2d 1032; Kedroff v Saint Nicholas Cathedral of Russian Orthodox Church of North America, 344 US 94; Bernal v Fainter, 467 US 216; DeSousa v Reno, 190 F3d 175; Nordlinger v Hahn, 505 US 1; Sugarman v Dougall, 413 US 634; In re Griffiths, 413 US 717; Examining Bd. of Engineers, Architects & Surveyors v Flores de Otero, 426 US 572; Graham v Richardson, 403 US 365; Soskin v Reinertson, 353 F3d 1242.)

      Krishnamurthy Aiyer, respondent pro se.
    Respondents have denied members of the Hindu Temple Society of North America any right to elect their own trustees and to seek accountability in all financial matters.

      Andrew M. Cuomo, Attorney General, New York City (Justin R. Long, Barbara D. Underwood and Benjamin N. Gutman of counsel), in his statutory capacity under Executive Law § 71.
    I. Religious Corporations Law § 182 requires article 9 corporations like the Hindu Temple Society of North America to have a self-perpetuating board even if the bylaws provide for elections by the membership. (People v Felix, 58 NY2d 156; Consumers Union of U.S., Inc. v State of New York, 5 NY3d 327; Matter of O’Brien v Spitzer, 7 NY3d 239; Matter of General Elec. Capital Corp. v New York State Div. of Tax Appeals, Tax Appeals Trib.,
      2 NY3d 249; Matter of Robert J., 2 NY3d 339; Robertson v Bullions, 11 NY 243; Benintendi v Kenton Hotel, Inc., 294 NY 112; Matter of Burkin [Katz], 1 NY2d 570.) II. The Religious Corporations Law does not violate the Free Exercise Clause or Establishment Clause of the Federal Constitutions. (Catholic Charities of Diocese of Albany v Serio, 7 NY3d 510, 8 NY3d 866; Matter of Congregation Yetev Lev D’Satmar Inc. v Kahana, 9 NY3d 282; Morris v Scribner, 69 NY2d 418; Cutter v Wilkinson, 544 US 709; Larson v Valente, 456 US 228; City of New York v State of New York, 76 NY2d 479.)
   OPINION OF THE COURT

Smith, J.

The Hindu Temple Society of North America was incorporated in 1970 under article 9 of the Religious Corporations Law. In the same year, it adopted bylaws calling for the members of the Society to elect its trustees. Those bylaws were never implemented, and were forgotten until 2001, when petitioners rediscovered them and demanded that the prescribed elections take place. The Appellate Division upheld petitioners’ demand.

We hold that the Appellate Division erred for two reasons: the requirement of elections for trustees is inconsistent with the Religious Corporations Law, and therefore invalid; and, in any event, the 1970 bylaws had been abandoned by 2001.

I

The Society’s certificate of incorporation was filed with the Department of State on February 17, 1970. It says that the Society is organized “[pjursuant to Article 9 of the Religious Corporations Law.” The certificate names seven trustees. On May 21, 1970, the Society applied to the Internal Revenue Service (IRS) for a tax exemption, attaching to its application a set of bylaws. The Appellate Division found that these bylaws were adopted by the Society in 1970, and we accept that finding as supported by the record.

The 1970 bylaws define the “General Body” as “all members in good standing who have paid their annual dues” and provide that “[t]he members of the General Body shall elect members of the Board of Trustees” for three-year terms, at meetings to be held annually. The 1970 bylaws also provide that they can be amended only by a vote of the General Body. So far as the record shows, however, neither these provisions nor any others in the 1970 bylaws were ever implemented, from May 21, 1970 until after the commencement of this proceeding in 2001. During that time, no one connected with the Society, so far as the record shows, ever mentioned the 1970 bylaws or appeared to be aware of their existence.

From the inception of the Society, it was in fact governed by a self-perpetuating board of trustees. The trustees named in the certificate of incorporation added others to their number, and when vacancies later occurred they were filled by a vote of the board. A memorandum prepared in 1975 describes the “Interim Organizational Structure” of the Society, making no reference to the 1970 bylaws and containing no provision for election of trustees by members. A 1977 report, directed at devising a “more permanent framework,” says: “It is most fortunate that the society did not adopt the recognized methods of cultural societies with annual elections, change of officers etc.” In 1978, the board adopted new bylaws that said “[t]he Board of Trustees will exercise the function of final selection and appointment” of its own ihembership. The Society operated under the 1978 bylaws, as amended by the trustees from time to time, until after this dispute arose; none of the amendments disturbed the board’s power of “final selection and appointment.” There is no record that anyone, before the 21st century, expressed any doubt that the 1978 bylaws were validly adopted.

The belief of the Society’s leadership that the Society should and did have a self-perpetuating, not an elected, board was not kept secret. An article entitled “Building Temples or Community Centres in Modern Times,” written in 1977 by one of the Society’s founders, held up the Society’s temple as a model. The article warned that “it will be self-defeating” if a temple “is organised as a cultural society with annual elections, [and] continuous change in officials .... High level people will not join if they have to stand for elections. Decision-making with clear-cut responsibility are [sic] difficult if subjected to general body meetings.” In a letter written many years later, after this litigation had begun, one of the petitioners in this case conceded—unhappily, and in provocative terms—the reality that had long existed: “The temple was managed in a totalitarian form from the very beginning.”

Petitioners, members of the Society who disagreed with certain actions of its management, began this proceeding in 2001. The petition makes no mention of the 1970 bylaws, though it does assert that the Society’s members have “a valid right to participate in the governance” of the Society. The petition, relying on various provisions of the Not-For-Profit Corporation Law, sought removal of the board of trustees, appointment of a receiver, and other relief. While the case was pending before Supreme Court, petitioners discovered the 1970 bylaws and submitted them to the court as an alternative ground for the relief they sought.

In 2002, Supreme Court granted petitioners certain relief, but refused to dissolve the board or appoint a receiver. Supreme Court treated the bylaws adopted in 1978 and thereafter as valid amendments to the 1970 bylaws. Petitioners appealed. The Appellate Division, in a 2003 order, found “no evidence in the record that the required procedures were ever followed to amend the 1970 bylaws” and held that “Supreme Court should have voided the bylaws postdating 1970” (Matter ofVenigalla v Alagappan, 307 AD2d 1041, 1042 [2d Dept 2003]). Since none of the trustees had been elected as the 1970 bylaws required, the Appellate Division removed the board and directed “the appointment of a referee to direct and oversee a reorganizational meeting of the Society for the purpose of electing a new Board” {id. at 1043).

Supreme Court’s attempts, on remand, to carry out the Appellate Division’s 2003 order generated years of bitter litigation that need not be described here. At length, a new election was held—resulting in a board virtually unchanged from the old one. Despite their success in the election, the trustees appealed to the Appellate Division from a 2006 judgment confirming its results, arguing in substance that the election should never have been held. The Appellate Division affirmed the judgment in 2007 (41 AD3d 725 [2d Dept 2007]). We granted leave to appeal from the Appellate Division’s 2007 order of affirmance, bringing up for review its 2003 order directing an election. We now reverse.

II

The Religious Corporations Law, providing rules for the governance of religious bodies, contains articles applicable to many specific denominations, but not to the Hindu faith. A Hindu group that wants to become a religious corporation may, like other groups not specifically provided for, choose to incorporate either under article 9 (“Free Churches”) or article 10 (“Other Denominations”). The Society chose article 9.

An important difference between the two articles is that, while the trustees of article 10 corporations are elected by the body’s members (see Religious Corporations Law §§ 191, 192, 194, 195, 199), article 9 corporations have self-perpetuating boards. The original trustees of an article 9 entity are named in its certificate of incorporation (Religious Corporations Law § 180), and Religious Corporations Law § 182 provides: “Any vacancies occurring in the said board of trustees shall be supplied by the remaining trustees.” Article 9 makes no provision for any elections, other than votes of the trustees themselves. Indeed, the only, “members” referred to in article 9 are the members of the board of trustees.

The provisions of the Society’s 1970 bylaws that called for election of trustees by the “General Body” contradicted article 9 and were invalid from their inception. The Appellate Division erred in requiring the conduct of an election pursuant to those provisions.

That is enough to require invalidating the election, but we examine also the status of the 1970 bylaws as a whole—not just the provisions for election of trustees—so that the Society can know what its governing document is. We conclude that the 1970 bylaws have long been defunct. As the court said in Pomeroy v Westaway (189 Misc 307, 310 [Sup Ct, NY County 1947], affd 273 App Div 760 [1st Dept 1947]), “nonusage of a by-law, continuing for a considerable length of time, and acquiesced therein, will work its abrogation.” There could hardly be a clearer case than this one for the application of that rule.

While the Appellate Division was justified in finding, based on the submission of the 1970 bylaws to the IRS, that the Society adopted those bylaws in 1970, the record shows that they fell into complete desuetude for the next three decades. By 1975, those running the Society’s affairs had apparently forgotten (if they ever knew) that the 1970 bylaws existed. The Society was run in accordance with bylaws first adopted in 1978, which provided a different approach to governance than the 1970 bylaws, and all members of the Society knew or had the means of knowing this. Until 2001, none protested. To allow petitioners to resuscitate the 1970 bylaws when they finally rediscovered them would be unwise and unfair (see Matter of George [Holstein-Friesian Assn. of Am.], 238 NY 513, 522 [1924]).

Accordingly, the order of the Appellate Division should be reversed, with costs, and the case remitted to Supreme Court for proceedings consistent with this opinion.

Chief Judge Kaye and Judges Graffeo, Read, Pigott and Jones concur; Judge Ciparick taking no part.

Order reversed, etc.


author: Chief Judge Kaye.

text:
    [893 NE2d 105, 862 NYS2d 828]
    The People of the State of New York, by Eliot Spitzer, Attorney General of the State of New York, Appellant, v Richard A. Grasso, Respondent, et al., Defendants. (And Other Actions.)
    Argued June 3, 2008;
    decided June 25, 2008

      POINTS OF COUNSEL

      Andrew M. Cuomo, Attorney General, New York City (Barbara D. Underwood, Benjamin E. Rosenberg and Jeffrey P. Metzler of counsel), for appellant.
    I. Assertion of the nonstatutory causes of action is an appropriate exercise of the Attorney General’s historic common-law parens patriae authority. (State of New York v Cortelle Corp., 38 NY2d 83; People v Lowe, 117 NY 175; Finger Lakes Health Sys. Agency v St. Joseph’s Hosp., 81 AD2d 403; Hawaii v Standard Oil Co. of Cal., 405 US 251; Alfred L. Snapp & Son, Inc. v Puerto Rico ex rel. Barez, 458 US 592; People by Vacco v Mid Hudson Med. Group, P.C., 877 F Supp 143; State of N.Y. by Abrams v General Motors Corp., 547 F Supp 703; State of New York v Booth, 32 NY 397; People of State of N.Y. by Abrams v Seneci, 817 F2d 1015; People of State of N.Y. by Abrams v Holiday Inns, Inc., 656 F Supp 675.) II. The N-PCL did not limit or displace the Attorney General’s parens patriae authority. (People v New York Cent. & Hudson Riv. R.R. Co., 74 NY 302; People v Phyfe, 136 NY 554; People v King, 61 NY2d 550; Matter of Bayswater Health Related Facility v Karagheuzoff, 37 NY2d 408; Sheehy v Big Flats Community Day, 73 NY2d 629; Mark G. v Sabol, 93 NY2d 710; State of New York v Cortelle Corp., 38 NY2d 83; Consumers Union of U.S., Inc. v State of New York, 5 NY3d 327; Alco Gravure, Inc. v Knapp Found., 64 NY2d 458; Smithers v St. Luke’s-Roosevelt Hosp. Ctr., 281 AD2d 127.)

      Williams & Connolly LLP, Washington, D.C. (Gerson A. Zweifach, Brendan V. Sullivan, Jr., Steven M. Farina and Carl R. Metz of counsel), and Flemming Zulack Williamson Zauderer LLP, New York City (Mark C. Zauderer and Jonathan D. Lupkin of counsel), for respondent.
    I. The Attorney General’s parens patriae power does not extend to rewriting statutes. (Rogers v Hill, 289 US 582; Eisenberg v Central Zone Prop. Corp., 306 NY 58; American Baptist Churches of Metro. N.Y. v Gallo

      way, 271 AD2d 92; Kalmanash v Smith, 291 NY 142; Sheehy v Big Flats Community Day, 73 NY2d 629; People v Litto, 8 NY3d 692; Carrier v Salvation Army, 88 NY2d 2908; Mark G. v Sabol, 93 NY2d 710; Saratoga County Chamber of Commerce v Pataki, 100 NY2d 801; Matter of Citizens For An Orderly Energy Policy v Cuomo, 78 NY2d 398.) II. A suit to return compensation paid by the New York Stock Exchange is not a valid exercise of parens patriae authority. (People v Lowe, 117 NY 175; People v Ingersoll, 58 NY 1; Abrams v 11 Cornwell Co., 695 F2d 34; Matter of State of New York v New York City Conciliation & Appeals Bd., 123 Misc 2d 47; People of State of N.Y. by Abrams v Holiday Inns, Inc., 656 F Supp 675; Matter of Herbert H. Lehman Coll. Found, v Fernandez, 292 AD2d 227; Pennsylvania v New Jersey, 426 US 660; People v O’Brien, 111 NY 1; Town of Riverhead v Long Is. Light. Co., 258 AD2d 643.)
   OPINION OF THE COURT

Chief Judge Kaye.

This appeal arises out of compensation paid by the New York Stock Exchange (NYSE) to Richard A. Grasso, Chairman and Chief Executive Officer from 1995 until his resignation in September 2003. At all times relevant to this appeal the NYSE was a New York not-for-profit corporation regulated by the Not-For-Profit Corporation Law (N-PCL). The present challenge is to four of the eight causes of action brought by the Attorney General charging that the compensation paid to Grasso was excessive.

The Allegations of the Complaint

Three agreements, executed in 1995, 1999 and 2003, governed Grasso’s compensation by the NYSE. From 1995 through 2002, his base salary was roughly $1.4 million, but his bonus awards escalated from $900,000 in 1995 to $10.6 million in 2002. The 2003 agreement provided Grasso with an immediate lump sum payment of $139.5 million and an additional $48 million payable over four years—compensating him for past and future work.

The Attorney General alleges that the payments contemplated by the 2003 agreement were not reasonable or commensurate with the services performed by Grasso, and therefore violated N-PCL 202 (a) (12) and 515 (b). The complaint describes the situation as “a fundamental breakdown of corporate governance” predicated on numerous breaches of fiduciary duty, beginning with the composition of the Compensation Committee—its members hand-picked by Grasso—which ignored a benchmark system designed to calculate Grasso’s compensation. In 1999, 2000 and 2001, the Compensation Committee provided Grasso with awards exceeding the benchmark by 64% 141% and 65% respectively. In addition, the Attorney General alleges that information provided to Committee and Board members regarding the extent of Grasso’s compensation under various benefit programs was inaccurate, incomplete and misleading.

The complaint then shifts to a description of the negotiation process for the 2003 agreement, beginning with Grasso’s 2002 proposal. Instead of immediately approving the package, the Compensation Committee retained the law firm of Vedder Price to serve as independent consultant. By August 2003 an agreement still had not been reached and several Board members expressed disapproval of the $139.5 million figure. In light of these concerns, according to the complaint, the proposal was not included on the agenda for the August 7, 2003 Compensation Committee meeting or Board meeting. During the August 7 Committee meeting, however, the members present decided to approve the proposal and pass it on to the Board. Allegedly, as a result of this last-minute change, neither independent counsel nor opponents of the compensation package were at the meeting, and Board members who did attend had no opportunity to review the details of the package in advance of the meeting. The Board, nonetheless, approved the $187.5 million package.

Grasso’s Resignation and the Instant Action

The negative reaction to Grasso’s compensation package forced his resignation and prompted an internal investigation. Based on the investigation’s results, the NYSE Interim Chairman wrote both to the Attorney General and to the Chairman of the Securities and Exchange Commission asking that they “pursue the matter on [the NYSE’s] behalf and as part of [their] broader responsibilities.” Five months later, the Attorney General commenced this action.

The complaint asserts eight causes of action—six against Grasso, one against Kenneth Langone (Chairman of the Compensation Committee from 1999 through June 2003), and one for declaratory and injunctive relief against the NYSE. The causes of action against Grasso can be separated into two categories—the statutory causes of action and the nonstatutory causes of action that are the subject of this appeal. The two statutory claims against Grasso—the second and third causes of action—are for unlawful transfer of corporate assets and breach of fiduciary duty (see N-PCL 720 [a], [b]). Section 720 (b) expressly authorizes the Attorney General to bring these two causes of action and that authority is uncontested in this appeal.

The four nonstatutory claims against Grasso are at bottom premised on provisions of the N-PCL but clothed in the common law. The first and fourth causes of action for a constructive trust and payment had and received, based on a theory of unjust enrichment, are premised on the reasonable compensation provisions of the N-PCL (see N-PCL 202 [a] [12]; 515 [b]). The fifth cause of action seeks restitution of certain benefit awards alleging that a majority of the Board failed to approve them as required by N-PCL 715 (f). Finally, the sixth cause of action alleges that the NYSE’s advance payments from a retirement plan violated the prohibition against loans to officers under N-PCL 716 and that the NYSE is entitled to reasonable interest thereon.

Grasso moved to dismiss the four nonstatutory claims on the ground that the Attorney General lacked authority to maintain them. Supreme Court denied defendant’s motion to dismiss, holding that the Attorney General had standing to sue under the parens patriae doctrine to vindicate the interests of the investing public.

A majority at the Appellate Division reversed and dismissed the four nonstatutory causes of action against Grasso, viewing them as an attempt to circumvent the fault-based claims provided by the N-PCL. The dissenting Justices would have permitted the claims to proceed based on the parens patriae doctrine. We now affirm the order of the Appellate Division.

Analysis

Although several provisions of the N-PCL mirror those regulating for-profit entities under the Business Corporation Law, one unique characteristic is the legislative codification of the Attorney General’s traditional role as an overseer of public corporations (see e.g. People v Lowe, 117 NY 175 [1889]).

At least 18 provisions of the statute detail the Attorney General’s varied enforcement powers. These powers include the ability to provide structural relief with respect to the corporation and to bring actions against individual directors or officers. Section 112 expressly authorizes actions or special proceedings to annul or dissolve corporations that have acted beyond their authority or to restrain unauthorized activities (N-PCL 112 [a] [1]). In addition, the Attorney General may enforce any right given to members of Type B or Type C corporations and, upon an order from Supreme Court, may do the same for Type A corporations (N-PCL 112 [a] [7], [9]). In addition, sections 719 and 720 permit the Attorney General to seek redress for injuries resulting from—to name only a few—unlawful distributions of corporate cash, property or assets (N-PCL 719 [a] [1], [4]), improper loans (N-PCL 719 [a] [5]), waste of corporate assets (N-PCL 720 [a] [1] [B]) and breach of fiduciary duties (N-PCL 720 [a] [1] [A]). The Attorney General’s authority to maintain these actions is explicitly codified under N-PCL 720 (b).

The Legislature’s comprehensive enforcement scheme, however, is not without limitation. First, any action or special proceeding brought by the Attorney General under the N-PCL “is triable by jury as a matter of right” (N-PCL 112 [b] [1]). Second, and most relevant to the issue before us, the Legislature has provided directors and officers with the protections of the business judgment rule (see N-PCL 717). The statute provides that officers and directors must discharge “the duties of their respective positions in good faith and with that degree of diligence, care and skill which ordinarily prudent men would exercise under similar circumstances in like positions” (N-PCL 717 [a]). Officers and directors are permitted to rely on information, opinions or reports of reasonable reliability so long as the officer or director acts in good faith (N-PCL 717 [b]). Moreover, the statute dictates that persons “who so perform their duties shall have no liability by reason of being or having been directors or officers of the corporation” (N-PCL 717 [b]).

Despite the numerous causes of action explicitly made available to the Attorney General, the four nonstatutory claims that are the subject of this appeal rest on an assertion of parens patriae authority to vindicate the public’s interest in an honest marketplace. Here, however, as the dispositive defect stems from the inconsistency between the two sets of claims, we need not and do not reach the scope of any such authority. Instead, a side-by-side comparison of the challenged claims and the statutory claims reveals that the Attorney General has crafted four causes of action with a lower burden of proof than that specified by the statute, overriding the fault-based scheme codified by the Legislature and thus reaching beyond the bounds of the Attorney General’s authority.

In an analogous context, we have consistently held that a private right of action may not be implied from a statute where it is “incompatible with the enforcement mechanism chosen by the Legislature” (Sheehy v Big Flats Community Day, 73 NY2d 629, 635 [1989]; see also Mark G. v Sabol, 93 NY2d 710 [1999]; Uhr v East Greenbush Cent. School Dist., 94 NY2d 32 [1999]). That the plaintiff here is the Attorney General as opposed to a private party does not preclude the application of these decisions (see e.g. People v Litto, 8 NY3d 692, 705 [2007]). Rather, in this context, the Attorney General’s role as a member of the executive branch heightens our concerns. Although the Executive must have flexibility in enforcing statutes, it must do so while maintaining the integrity of calculated legislative policy judgments. That balance falters where, as here, the Executive seeks to create a remedial device incompatible with the particular statute it enforces.

The two statutory claims asserted against Grasso, in addition to those provided in N-PCL 719, rest on the fault-based provisions enacted by the Legislature to remedy not-for-profit corporate wrongdoing. The second cause of action for an unlawful transfer permits an action “[t]o set aside an unlawful conveyance, assignment or transfer of corporate assets, where the transferee knew of its unlawfulness” (N-PCL 720 [a] [2] [emphasis added]). The third cause of action for breach of fiduciary duty permits an action for the “neglect of, or failure to perform . . . duties in the management and disposition of corporate assets” and for an officer’s “acquisition . . . , loss or waste of corporate assets due to any neglect of, or failure to perform . . . duties” (N-PCL 720 [a] [1] [A], [B]). This claim requires a showing that the officer or director lacked good faith in executing his duties. The plain language of these provisions reveals a legislative policy decision to provide officers and directors of not-for-profit corporations with the “business judgment” protections afforded their for-profit counterparts. The Legislature specifically provided for the Attorney General’s role as an overseer of not-for-profit corporations, and requires that he prove an officer’s fault to sustain these claims.

By contrast, the four nonstatutory causes of action are devoid of any fault-based elements and, as such, are fundamentally inconsistent with the N-PCL. The first and fourth causes of action—for a constructive trust and payment had and received— rely on the reasonable compensation provisions of the N-PCL and seek the same relief as the statutory claims, yet they lack any element of knowledge or bad faith. Rather, under these claims the Attorney General need only prove that Grasso’s compensation was unreasonable and, therefore, unlawful under the N-PCL and constituting an ultra vires act. Abandoning the knowledge requirement of N-PCL 720 (a) (2) and the business judgment rule, they would impose a type of strict liability.

The fifth cause of action asserts that Grasso’s salary was not approved in accordance with N-PCL 715 (f). Section 715 addresses circumstances relating to interested directors and officers. It provides, “[t]he fixing of salaries of officers . . . shall require the affirmative vote of a majority of the entire board” (N-PCL 715 [f]). It does not, however, grant the Attorney General the authority to maintain an action for the Board’s failure to properly vote on a compensation package. In fact, N-PCL 715 (b) provides the corporation—not the Attorney General—with the power to avoid contracts or transactions between the corporation and its officers or directors and, even then, such actions may only be maintained in the absence of good faith (N-PCL 715 [b]).

Finally, the sixth cause of action alleges that certain advance payments from Grasso’s supplemental retirement plan constituted an improper loan under N-PCL 716 and seeks interest on the loaned amounts. As distinct from the other three, the N-PCL expressly provides the Attorney General the authority to bring an action against directors who approve a loan in violation of N-PCL 716 (see N-PCL 719 [a] [5]; 720 [b]). The Attorney General’s present claim fails, however, for the same reason as the other three: the statutory claim would require the Attorney General to overcome a business judgment defense, whereas the action pleaded disregards the knowledge element that other unlawful transfers must allege (see N-PCL 719 [e]; 720 [a] [2]).

In summary, each of the challenged causes of action against Grasso seeks to ascribe liability based on the size of his compensation package. The Legislature, however, enacted a statute requiring more. The Attorney General may not circumvent that scheme, however unreasonable that compensation may seem on its face. To do so would tread on the Legislature’s policy-making authority.

Accordingly, the order of the Appellate Division should be affirmed, with costs, and the certified question answered in the affirmative.

Judges Ciparick, Graffeo, Read, Smith, Pigott and Jones concur.

Order affirmed, etc.

      . N-PCL 201 (b) defines four types of corporations, each with a different purpose. Type A corporations, like the NYSE, “may be formed for any lawful non-business purpose.” Type B corporations may be formed to serve “charitable, educational, religious, scientific, literary, cultural [purposes] or for the prevention of cruelty to children or animals”; Type C corporations “may be formed for any lawful business purpose to achieve a lawful public or quasi-public objective”; Type D corporations can serve any purpose so long as their formation is authorized “by any other corporate law of this state.”

      . In 1996 the Compensation Committee adopted a policy of assessing executive compensation by comparing it to the compensation paid to senior executives of large, for-profit companies—the “Comparator Group.” The basis for selecting these executives was to ensure that the NYSE offered competitive salaries to attract “world class talent.”

      . The Attorney General’s authority to maintain the second and third causes of action is, however, the subject of another appeal pending in the Appellate Division. Grasso alleges that the Attorney General has lost standing to sue under N-PCL 720 because the NYSE, after its corporate reorganization in 2006, became a for-profit company (NYSE LLC) with a not-for-profit regulatory arm (see People v Grasso, 13 Misc 3d 1227[A], 2006 NY Slip Op 52019[U], *9 [2006]). Supreme Court denied Grasso’s motion for summary dismissal of those claims.

      . Parens patriae is a common-law standing doctrine that permits the state to commence an action to protect a public interest, like the safety, health or welfare of its citizens. To invoke the doctrine, the Attorney General must prove a quasi-sovereign interest distinct from that of a particular party and injury to a substantial segment of the state’s population (see Alfred L. Snapp & Son, Inc. v Puerto Rico ex rel. Barez, 458 US 592, 607 [1982]). In varying contexts, courts have held that a state has a quasi-sovereign interest in protecting the integrity of the marketplace (see State of N.Y. by Abrams v General Motors Corp., 547 F Supp 703 [SD NY 1982]; People v H&R Block, Inc., 16 Misc 3d 1124[A], 2007 NY Slip Op 51562[U] [2007]).