Third Circuit Affirms Use of Eminent Domain by Natural Gas Pipeline

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On October 30, the U.S. Court of Appeals for the Third Circuit decided the case of Transcontinental Gas Pipe Line Co., LLC v. Permanent Easements for 2.14 Acres, et al. , affirming the District Court’s grant of a preliminary injunction to Transcontinental Gas Pipe Line Company, LLC (Transcontinental). This case involves the construction of the “Atlantic Sunrise Expansion Project,” a natural gas pipeline that runs through Pennsylvania, Maryland, Virginia, North Carolina and South Carolina.

Under the Natural Gas Act (NGA), pipeline companies can exercise powers of eminent domain when they are acting in the public interest. The Third Circuit cautions that this is a “standard” eminent domain power, and not a “quick take” that is permitted under another statute.

Here, by the District Court granting a preliminary injunction to Transcontinental, it effectively entitled the company immediate possession of certain right-of-way parcels owned by the appellant landowners, who refused to sell rights of access to Transcontinental. The landowners have argued that this grant of power to Transcontinental was unconstitutional and violated the separation of powers.

The Third Circuit disagreed. By way of background, the Third Circuit relates that Federal Energy Regulatory Commission (FERC) published a Notice of Intent to Prepare an Environmental Impact Statement (EIS) for the planned expansion on July 29, 2014, and the final EIS was issued by FERC in late December 2016. FERC then granted the necessary certificate to Transcontinental in February 2017, and denied a petition for rehearing in December 2017. The Transcontinental then filed condemnation complaints in federal court, and that court issued a preliminary injunction triggering the eminent domain process in August 2017. The landowners participated in these proceedings before filing this lawsuit.

Transcontinental could obtain eminent domain powers under the law if it:

(a)  had a certificate of public convenience and necessity from FERC;

(b)  has been unable to acquire the needed rights-of-way though negotiation; and

(c)  the offers of compensation payable to the landowners exceeded $3000.

Transcontinental satisfied these statutory requirements, and the District Court granted a preliminary injunction to the pipe line company. Accordingly, the Third Circuit held that the District Court did not usurp legislative power or “otherwise violate the principle of separation of powers.”

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