Coal Companies Lose|Battle Over Gas Pipeline

(CN) - Two coal companies lost another round in its ongoing wrangle with Rockies Express Pipeline LLC over a proposed natural gas pipeline after the 6th Circuit ruled that the claims belong in the two courts handling the dispute.

American Energy Corp. and Consolidated Land Co.'s challenged a Federal Energy Regulatory Commission permit to build the pipeline over the two companies' mines in Ohio, claiming the project was dangerous and would disrupt mining operations.

In the first round of the dispute, Rockies Express sought easement rights so it could commence construction of the pipeline.

The coal companies then filed a conversion action in an Ohio state court, arguing that the pipeline would cause them damages in excess of compensation offered under eminent domain.

The pipeline company then removed the action to a district court, which dismissed the coal companies' claims.

On appeal, the U.S. 6th Circuit said the two companies were simply trying to "sidestep" the "exclusive jurisdiction" of the courts handling the actions.

"Exclusive means exclusive, and the Natural Gas Act nowhere permits an aggrieved party otherwise to pursue collateral review of a Federal Energy Regulatory Commission certificate in state court or federal district court," Judge Sutton wrote for the three-judge panel.

The coal companies said it wanted the court to consider the dangers posed by the pipeline after it was built, rather than "pipeline-construction matters" in the FERC case.

"That slices things too thinly - not unlike the Kentucky woodsman who cut a plank so many times that it had just one side," Sutton said. "A case concerning construction matters may consider post-construction matters."

The judge branded as unfounded the coal companies fear that the amount of compensation owed would "exceed the jurisdiction of the condemnation action."

"To the extent the coal companies believe that Ohio law fails fully to compensate these injuries in violation of the Fifth (and Fourteenth) Amendment, they can raise that claim in the district court and, if necessary, here," the Judge concluded.

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