Federal Judge Hears Challenge to Massive Multistate Power Line

MADISON, Wis. (CN) — Issues surrounding a multistate power line corridor approved by a Wisconsin public service agency were argued in Madison federal court Monday by parties ranging from the agency to the transmission companies building the corridor and environmental advocates fighting its construction.

The Driftless Area Land Conservancy and Wisconsin Wildlife Federation sued the Public Service Commission of Wisconsin and three of its commissioners last December over the PSC’s approval of a 345 kilovolt, 17-story-high transmission line that will run more than 100 miles through Wisconsin, cutting through several protected wildlife refuges.

Construction of the $492 million Cardinal-Hickory Creek transmission line would also entail the condemnation and taking of private property in rural Dane, Grant and Iowa counties in the Badger State. The counties are in what is known as the Driftless Area, a rugged swath of forested ridges unaffected by glaciation that once spread across parts of Wisconsin, Minnesota, Iowa and Illinois.

The environmental groups’ lawsuit condemns the PSC for failing to force two of its commissioners to recuse themselves from the approval process due to entanglements with the private transmission entities pushing for the project, which the plaintiffs say will cost Midwest ratepayers more than $2.2 billion over the next 40 years and could have catastrophic environmental impacts.

The two PSC commissioners particularly at issue in the lawsuit are current commissioner Rebecca Valcq and Michael Huebsch, a former state lawmaker who served 16 years in the Wisconsin Assembly as a Republican and resigned from the PSC in January. Huebsch also served as secretary of Wisconsin’s Department of Administration under former Governor Scott Walker, a Republican.

Valcq, the environmentalists say, had conflicts of interest due to her connections with WEC Energy Group, a large Midwest energy firm that owns a 60% interest in the American Transmission Company, or ATC, a private energy company headquartered in Pewaukee, Wisconsin, and one of the transmission companies attached to the project. Valcq was regulatory counsel for We Energies for nearly 15 years, then represented the utility company with nationwide firm Quarles & Brady before being appointed to the PSC in 2019.

Those bringing the lawsuit say Huebsch had conflicts as a member of the advisory committee of the Midcontinent Independent System Operator, a nonprofit grid operator partnered with public utilities and transmission companies involved with the Cardinal-Hickory Creek line.

The three private entities awarded permits for the corridor—ATC, ITC Midwest and Dairyland Power Cooperative—were denied an opportunity to intervene in the environmentalists’ lawsuit in February by U.S. District Judge William Conley, who presided over Monday’s arguments, on the basis that their interests were well represented by the PSC and that allowing each of them to intervene would delay, complicate and prejudice the litigation moving forward.

The Chicago-based Seventh Circuit reversed Conley’s decision in August, finding that the transmission companies could not be excluded from the case because their interests may not be adequately represented by the PSC.

Monday’s hearing tackled the PSC and intervening transmission companies’ motions to dismiss the environmental groups’ lawsuit, which wants the PSC’s approval for the corridor voided based on the commissioners’ due process violations and for the court to enjoin the acquisition of private land for the corridor via eminent domain.

On the topic of the taking of lands for the project, Conley pressed the environmental groups to refute the notion that the commissioners approved the project and therefore the taking of private lands on the basis that it is beneficial to the public good, saying “I don’t know how I don’t find [the corridor] related to a conceivable public purpose.”

Howard Learner, the environmentalists’ counsel with the Environmental Law & Policy Center’s Chicago branch, argued that “the commission did find there were public benefits but that isn’t the end of the story,” pointing to the millions or potentially billions of dollars raked in by the transmission companies as outweighing the comparatively modest amount of public benefit from the corridor, particularly since the power lines are not necessary to keep the lights on in small-town Wisconsin.

PSC attorney Christianne Whiting resisted such a qualification of the public benefit of the corridor.

“The complaint never says that there is not public use, they just don’t like the public use,” Whiting said.

Brian Potts, an attorney for ATC with the Madison office of international firm Perkins Coie, noted Monday that his client is not actually going to use the transmission line and is only building it for a rate of return over the next 40 years, comparing the situation to entities that build and operate highways for public use.

Learner nevertheless argued that the Fifth Amendment property-taking issues are still relevant.

“When you are dealing with a privately owned transmission line moving electrons by private parties and you look at public benefits and private, if the private is disproportionate to the public…then that raises the Fifth Amendment problem,” Learner said.

At the outset of discussion on the due process claims implying the commissioners’ bias, Conley told the plaintiffs that “I know you’ve got smoke” in the form of long-term relationships between Valcq and Huebsch and the transmission companies, but was skeptical of any provable, substantial monetary return to the two commissioners that would have influenced their approval of the corridor.

Stephen Hurley, a partner with Madison-based firm Hurley, Burish & Stanton speaking on behalf of the environmental groups, reminded the court that the groups only needed to prove the appearance of and potential for impartiality or bias, not direct pecuniary interest, arguing that both commissioners should have recused themselves from the corridor approval process due to possible conflicts of interest.

When the transmission companies’ attorneys questioned what direct interest the commissioners would have had in approving the corridor project, Hurley said “what we’re concerned about is the possible temptation not to be fair,” which was triggered by Valcq spending almost her entire career advocating for an entity that owns a majority of one of the applicants on the project and Huebsch essentially advising one of the intervening energy concerns during the application process.

Conley still wondered whether those past professional connections were sufficient to prove enough bias to void the PSC’s decision, comparing the situation to a court having judges on the bench who are formerly members of the Federalist Society.

The defendants have attempted to stay discovery in the environmentalists’ lawsuit, but Conley said near the close of Monday’s 100-minute arguments that he is not inclined to grant them such a stay.

The Barack Obama appointee did not offer a timeline for his decision on the motions to dismiss on Monday, but said he will endeavor to get a decision out quickly and set an amended schedule for summary judgment hearings and a trial.

Follow @cnsjkelly

Subscribe to Closing Arguments

Sign up for new weekly newsletter Closing Arguments to get the latest about ongoing trials, major litigation and hot cases and rulings in courthouses around the U.S. and the world.

Email *

Submit