Judge Rejects Challenge to Maine City’s Crude-Oil Ban

PORTLAND, Maine (CN) – A federal judge on Friday largely dismissed a pipeline operator's challenge to a small coastal city's ban on the export of crude oil from its harbor.

Portland Pipe Line Corp., a Canadian-owned subsidiary of ExxonMobil Corp. and Suncor Energy, sued the city of South Portland, Maine, in February 2015 after it passed its “clear skies” ordinance, which prohibits shipments of crude oil from the city’s waterfront.

The ban came in response to the company's plan to reverse the flow of an import pipeline between South Portland and Montreal.

Portland Pipe Line challenged the ordinance on the grounds that it is preempted under numerous federal and state laws and violates the company's civil rights, the city's own comprehensive plan, and its right to equal protection.

On Friday, U.S. District Court Judge John Woodcock rejected all but one of Portland Pipe Line's claims in a 229-page ruling.

South Portland "has a historically important and legitimate interest in restricting new uses within its zoning districts, and in prohibiting new structures associated with those uses," Woodcock wrote.

He found the ordinance does not "intrude into the foreign affairs power of the federal government" nor the "uniformity of federal maritime law," as the pipeline company claimed.

"There does not appear to be any direct conflict between specific federal laws or policies and the ordinance, so there is no potential for embarrassment to the United States government," Woodcock wrote. "The ordinance impacts a large and important industry and therefore inevitably will touch on federal foreign affairs in a broad sense, given the realities of a modern globalized economy. But it does so in a facially neutral manner and has no more than an incidental or indirect effect on foreign relations."

Environmentalists and residents who oppose the pipeline contend that the imported oil – which would then be exported from South Portland’s harbor to destinations in the U.S. and around the world – would be extracted from controversial Canadian tar sand deposits, which they argue gives off higher carbon emissions than other methods.

In his decision, Woodcock dismissed any claims that Portland Pipe Line was "treated differently" by the city or the ordinance.

"The ordinance does not make distinctions based on the type of pipeline, and applies with equal force to other methods of crude oil transport because it applies to any bulk loading of crude oil onto tankers, regardless of source,” he wrote.

But the judge refused to dismiss the question of whether the ban violates the Commerce Clause of the U.S. Constitution, noting "the parties disagree both mildly and vigorously about facts critical to the resolution of the Commerce Clause issue."

"The council’s primary purpose and intent in enacting the ordinance, as well as its primary practical effect, will have to be resolved by a fact finder," Woodcock wrote.

To date, South Portland has spent more than $1.35 million defending the ordinance.

The city said in a statement that it “is pleased that the judge has ruled in the city’s favor on eight of the nine counts in Portland Pipe Line’s complaint," and that it "looks forward to the opportunity to resolve the remaining issues in its favor.”

Portland Pipe Line could not immediately be reached Friday afternoon for comment.

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