2020: A Year of Pipeline Court Fights, with One Lawsuit Headed to the Supreme Court

After years of mounting opposition to the increasing build-out of oil and gas infrastructure, 2020 is shaping up to be the year that pipeline opponents get their day in court.

One case headed to the U.S. Supreme Court takes a closer look at whether parts of the Appalachian Trail are off-limits to fossil fuel infrastructure and may determine the fate of two multi-billion-dollar pipelines. A defeat there, the industry argues, would severely limit its ability to get natural gas from the Marcellus shale to East Coast cities and export terminals. Another case weighs state sovereignty against pipeline interests and could have implications nationwide.

Meanwhile, a question of potentially greater significance looms: Can pipeline companies continue to justify taking private land as the public benefits of fossil fuel pipelines are increasingly questioned and the risks they pose to the environment and climate increase?

The rise of hydraulic fracturing, or fracking, launched a natural gas boom that has fueled a rush of  pipeline construction in recent years, with pipeline companies spending an average of $10 billion per year on expanding their pipeline network, according to the U.S. Department of Energy. That rush has racked up environmental violations in several states, and it has triggered a pushback by states, environmental groups and landowners.

Even in oil- and gas-rich Texas, where fossil fuel interests dominate state politics, landowners are pushing back on pipeline companies’ use of eminent domain.

Crossing the Appalachian Trail

In the case headed to the U.S. Supreme Court, the fossil fuel industry argues that its very ability to ship natural gas from the sprawling Marcellus and Utica shale basins to the East Coast is at risk.

The Supreme Court is expected to hear oral arguments on Feb. 24 related to a key permit for the Atlantic Coast Pipeline LLC’s proposed $7.5 billion natural gas pipeline from West Virginia to eastern portions of Virginia and North Carolina. It would cross the Appalachian National Scenic Trail, and that’s where the pipeline has run into trouble.

Justices will consider whether the U.S. Forest Service has the authority to grant permits for pipelines that cross the iconic backcountry footpath, which runs from Georgia to Maine and is part of the National Park System. Attorneys representing the Trump administration are also a part of the suit, arguing that the Forest Service does have jurisdiction to grant permits across the trail. In a brief filed Dec. 2, federal attorneys added that  the pipeline would lie “more than 600 feet below” the surface of the Trail and would be constructed using a “horizontal directional drilling technique” with entry and exit points on private lands not be visible from the Trail.

A federal appeals court invalidated the Forest Service’s permit for the Atlantic Coast pipeline in 2018, saying the agency lacked the authority to approve a right-of-way across the trail. Industry and government lawyers argue the appeals court was wrong.

“Simply put, there is no basis in any federal statute to conclude that Congress intended to convert the Appalachian Trail into a 2,200-mile barrier separating critical natural resources from the eastern seaboard” attorneys for Atlantic Coast Pipeline, LLC, told the Supreme Court in a Dec. 2 brief. 

If the Appalachian Trail were to cut off gas deposits from the East Coast, the impact would be significant. The Marcellus and Utica shale gas formations beneath Pennsylvania, Ohio and West Virginia are the largest source of fracked gas in the country and the trail lies between them and some of the country’s largest cities and natural gas export terminals.

Pipeline opponents argue that no such barrier exists—the ruling applies only to sections of the trail that pass through federal lands such as national forests and doesn’t affect the private and state-owned land that make up much of the trail.

“Between 25 and 50 percent of the trail is unaffected by this decision,” said D.J. Gerken, an attorney with Southern Environmental Law Center who represents environmental groups opposed to the pipeline.  “We were very surprised that [the Supreme Court] took it. It has a very specific application to a very specific context. It’s not the kind of case Supreme Court usually takes.”

There are also preexisting pipeline rights-of-way across the trail on federal land that predate the trail’s official creation in 1968 and could be used for a new pipeline, Gerken said. Between crossings on non-federal land and preexisting rights of way, a total of 55 oil and gas pipelines currently cross the trail, he said.

The proposed routes for the Atlantic Coast and another hotly contested gas pipeline, the Mountain Valley, would both cross the Appalachian Trail on federally owned land and would require significant rerouting if the Supreme Court upholds the lower court’s ruling.

Even if the Supreme Court sides with the pipeline company and the Forest Service and reinstates the agency’s permit, the company would still need to get other permit denials overturned, including from the U.S. Army Corps of Engineers and the U.S. Fish and Wildlife Service.

A New Way for States to Challenge Pipelines?

In another case, a federal appeals court sided with the state of New Jersey, ruling that the PennEast Pipeline company can’t use eminent domain—the mandatory sale of private or state-owned land for public use—to force the sale of state-owned land.

PennEast officials say they will appeal the decision to the Supreme Court by a February deadline.

“State governments, just like other landowners, should not be allowed to disrupt or veto vital energy infrastructure,” Anthony Cox, chairman of the PennEast Pipeline Company Board of Managers, said in a statement.

If the Supreme Court takes the case and upholds the lower court’s decision, it would provide states that are opposed to new natural gas pipelines with a powerful new tool to block them.

“That would be a much bigger hurdle nationwide than the issues over whether or not you can cross particular sections of the Appalachian Trail,” Alexandra Klass, an energy, environment and property law professor at the University of Minnesota, said.

A similar suit involving a pipeline proposed by Columbia Gas Transmission in Maryland is also making its way through the courts. A federal judge in Maryland upheld the state’s ability to deny the sale of state land to the developer in August. Columbia Gas is now appealing the ruling to a federal appeals court.

If the 4th Circuit Court of Appeals reaches a different conclusion in the Maryland case than that of the 3rd Circuit in the PennEast case, it would increase the odds that the Supreme Court would take up the case, Klass said. “There are just so many cases involving pipelines that I think it is likely that the court takes another one,” she said. 

Pushing Back on Pipelines in Texas

Of the 111 natural gas pipeline projects proposed or currently under construction that the U.S. Energy Information Administration tracks, seven would ship gas from the booming Permian Basin in West Texas to the Gulf Coast. 

In April, Texas landowners along the route of the proposed Permian Highway Pipeline, along with a city and county, sued Kinder Morgan, the company behind the project, and the Texas Railroad Commission, arguing that the Commission did not properly oversee the company’s routing and use of eminent domain.

“The eminent domain authority granted to private pipeline companies is in violation of the Texas Constitution because it delegates state power to private parties without sufficient standards to limit and guide their exercise of that power,” Clark Richards, an attorney representing the landowners said.

The suit was dismissed in June though Texas state judge Lora Livingston expressed concern over the wide latitude granted to pipeline companies in her ruling.

 “The Court is concerned with a power that, when exercised by a government entity, must be done in the harsh light of public scrutiny of open meetings and public notice, but, when exercised by a private entity, may be determined without public notice by a select few driven primarily by their financial interests,” Livingston wrote in her decision. Richards has since filed an appeal on behalf of the landowners.

In her ruling, Livingston said that changes in oversight of the use of eminent domain must come from the Texas legislature.  A bill that would have mandated greater public scrutiny of pipeline company’s use of eminent domain was introduced in the Texas legislature in January 2019 but did not pass.

The bigger question that’s likely to surface before the courts at some point is whether allowing oil and gas pipeline companies to take private land really constitutes a public benefit.

In a 2005 case, Kelo v. The City of New London, the Supreme Court ruled that a building developer’s taking of private land constituted a public benefit because of the financial benefits the development would bring. The ruling is increasingly coming under question. 

In September, a federal appeals court weighed in on a recently commissioned pipeline that ships natural gas from Ohio to Canada. In a rare challenge to the Federal Energy Regulatory Commission (FERC), the agency that approved the project, the court asked FERC to explain how a foreign export pipeline benefits the public. FERC’s response to the court is still pending. 

“There are lots of arguments to say all of this new fossil fuel infrastructure is bad for the public interest,” Bold Nebraska founder Jane Kleeb said.  “You can bring up water, you can bring up climate change, you can bring up property rights, I think that this is leading to a Supreme Court case not only challenging Kelo but challenging the broader definition of what public interest is.”

Kleeb said she anticipates this larger issue of what constitutes public interest when pipeline companies take private land to go before the Supreme Court in the next three to five years.

“I think you could even see it with KXL” she said, referring to the Keystone XL pipeline.  “Not only is this a private gain project, but it has major climate implications that are not in the public interest.”

Keystone XL and Dakota Access

Several other high-profile cases challenging oil pipelines are also making their way through the courts, including lawsuits involving the Keystone XL and Dakota Access pipelines. 

On Dec. 20, a federal judge in Montana refused to dismiss one one case, brought by indigenous advocates and environmentalists, that alleges that President Donald Trump violated treaties and the U.S. Constitution when he issued a cross-border permit in March 2019 authorizing TC Energy Corporation (formerly TransCanada) to build the Keystone XL pipeline. 

In another lawsuit, the Standing Rock Sioux Tribe of North and South Dakota and other tribes are suing the U.S. Army Corps of Engineers and pipeline builder Dakota Access, LLC, over what they allege was a failure to properly consult tribes over the pipeline, which was completed in 2017. That case is moving forward at the same time Dakota Access is seeking permission from state regulators to double the pipeline’s existing capacity.  

Top photo credit: Robert Nicklesberg/Getty Images

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