If a drone is hovering over my back yard can I shoot it?

A Shot Gun With Bird Shot will do the Trick. Bird Shot will not hurt anyone and it will bring down the Drone.

I expect that with the advent of drones a new category of privacy law will open up. You realize of course that you can see what is in anyone's back yard by consulting Google earth. Satellites in space can resolve quite well enough to see how many cars you have parked in front of your house and if you own a dog. Violation of air space however is new legal territory however. I don't know if it is okay to shoot one down.

And the bullets fall to Earth and kill someone - you are now charged with Murder.... Great Idea.

There are laws about the discharge of any weapon within any city limits.

You could be charged with reckless discharging of a firearm or destroying government property if you do.

Shoot it with a paint ball gun. Maybe fill the balls with glue?

sure. are you ready to carry the consequences?

No, of course not.