En Banc Court Slams Policy of Letting Pipeline Challenges Go Stale

Screenshot of pipeline route from video by Atlantic Sunrise.

WASHINGTON (CN) — The Federal Energy Regulatory Commission faced stiff criticism Tuesday for its pattern of kicking homeowner protests down the road to keep pipeline disputes out of court.

“In this case, the commission used tolling orders to give itself roughly ten times as long as the statute allots for it to act,” U.S. Circuit Judge Patricia Millett wrote Tuesday for the D.C. Circuit, which heard the case en banc in April.

It was also Millett who accused the government of operating under a “Kafkaesque regime” last year when the case went before a three-judge panel.

The Federal Energy Regulatory Commission had banked on a better turnout from the full federal appeals court, but Tuesday’s ruling from the 11-judge court was all but unanimous.

Led by the Allegheny Defense Project, a group of homeowners brought the challenge here to enforce a time limit put in place by Congress so that parties can sue the commission if it fails to act on an application for rehearing within 30 days.

Over the last 12 years, the commission has had 39 cases where landowners challenging the construction of a natural gas pipeline sought a rehearing. In all 39 cases, Millett noted Tuesday, the commission issued what is known as a tolling order to buy itself more time and block the homeowners from seeking legal recourse.

“The commission has eliminated entirely the jurisdictional consequences of its inaction, preventing rehearing applications from being deemed denied even after they have been pending for prolonged periods of time,” wrote Millett, an Obama appointee. 

Attorneys for the commission conceded at oral arguments that tolling orders have become routine, but the D.C. Circuit otherwise took its side on the merits of the Atlantic Sunrise pipeline project that inspired the litigation.

The homeowners initiated proceedings before the commission after learning that Transco, short for the Transcontinental Gas Pipe Line, was planning in 2015 to dig through some 200 miles of private Pennsylvania land for a route ending in Alabama.

Because the commission issued a tolling order, however, it did not deny the homeowners’ stay request for nearly seven months.

“In so doing, the Commission dismissed the Homeowners’ concerns about the destruction of their trees, the digging or blasting of a trench across their yards, and the air pollution at their properties as merely ‘generalized claims of environmental harm [that] do not constitute sufficient evidence of irreparable harm that would justify a stay,’” Millett wrote.

Years of court battles unfolded, during which time the pipeline was completed. Natural gas was flowing for two months by the time the case first reached the D.C. Circuit in 2018.

The homeowners ultimately failed, however, to sway the court that the commission had improperly weighed demand for export capacity, not domestic use of the natural gas.

“On the merits of those petitions as well as the later petitions, the Homeowners’ and Environmental Associations’ challenge to the Certificate Order falls short because the commission did not rely on precedent agreements alone to find that the pipeline would be a matter of public convenience and necessity,” Millett wrote. “We therefore deny all four petitions for review.” 

At oral arguments, attorneys for the commission noted that the pipeline is running at 100% capacity, supporting the commission’s conclusion that the pipeline served a need in the market.

Neither the commission nor an attorney for the Transco responded to requests for comment. Elizabeth Benson, who argued the case for the Allegheny Defense Project, also did not respond. 

While Tuesday’s ruling was mostly unanimous, U.S. Judge Karen LeCraft Henderson wrote in a partial dissent that the doctrine of stare decisis prevents the court from invalidating the tolling order since the court has previously upheld such conduct.

Millet disagreed: “Stare decisis principles do not require us to continue down the wrong path,” she wrote.

“Because the approach to statutory construction reflected in our tolling order precedent was fundamentally flawed and grounded in a mode of statutory construction that has been foreclosed by the Supreme Court, stare decisis principles do not stand in the way,” the 36-page lead opinion concludes.

In a concurring opinion, three conservative judges agreed there is something amiss in the history of the case but that the commission nevertheless is authorized to push off pipeline challenges. 

“The court’s decision rightly jettisons the commission’s signature stalling tactic,” wrote U.S. Circuit Judge Thomas B. Griffith. “But it doesn’t alter the fact that the commission can postpone review by granting rehearing.”

As noted in a footnote of the lead opinion, the commission changed its rules in recent weeks to only allow construction activities after it has “acted on the merits of any timely rehearing applications.”

Millett goes on, however, to emphasize that the rule change does not prevent the government from expropriating private property to hand over to pipeline companies. 

Still, Griffith joined by U.S. Circuit Judges Neomi Rao and Gregory G. Katsas, both Trump appointees, argued the commission is moving toward a fairer process. 

“Those concerned about potential abuse of that power should take heart: The commission’s recent rule change is a major step in the right direction, and courts possess other tools to protect landowners,” the George H.W. Bush appointee wrote.

%d bloggers like this: