U.S. Appeals Court Rejects Renewed Challenge to Mountain Valley Pipeline

(Reuters) — A federal appeals court has for the second time rejected a challenge by property owners to the Mountain Valley Pipeline's use of eminent domain, finding that a federal law bars the case despite a recent U.S. Supreme Court ruling that made it easier to sue federal agencies.

In a unanimous, unsigned opinion, on Tuesday, a three-judge panel of the U.S. Court of Appeals for the D.C. Circuit agreed with a district court's ruling that it could not hear the owners' lawsuit against the Federal Energy Regulatory Commission and the pipeline developers, because it was brought after the D.C. Circuit had taken up an appeal from a separate administrative challenge over the same issue.

The panel consisted of Circuit Judges Cornelia Pillard, Robert Wilkins and Justin Walker.

Mia Yugo, a lawyer for the landowners, said in a statement that her clients disagreed and would ask the Supreme Court to review the case.

"The right to private property is critical to the preservation of freedom in this country," she said.

FERC and a lawyer for the pipeline did not immediately respond to requests for comment.

FERC in 2017 issued Mountain Valley Pipeline, a joint venture of Equitrans Midstream, Con Edison Transmission and others, a certificate allowing it to use eminent domain to acquire property needed for the construction of a 303-mile pipeline from West Virginia to Virginia.

The $7.2 billion project has been entangled in multiple court battles, though most have been resolved and the project is expected to be finished this year.

Some opponents of the pipeline, including the Sierra Club, in 2017 petitioned FERC to reconsider its eminent domain decision, and when that was denied, appealed the D.C. Circuit. They challenged the certificate on multiple grounds, including that the use of eminent domain for the project was an unlawful taking of property under the U.S. Constitution.

The D.C. Circuit ruled against that appeal in 2019. In 2020, the property owners, who were not part of the original challenge, sued FERC and Mountain Valley Pipeline in Washington, D.C. federal court, bringing similar constitutional claims and also arguing that the Natural Gas Act unlawfully delegated expansive powers from Congress to the agency.

U.S. District Judge James Boasberg in May 2020 dismissed the case, finding that the Natural Gas Act strips district courts of jurisdiction over challenges to a certificate allowing eminent domain after an appeals court has taken up an appeal of an administrative challenge to that same certificate, as the D.C. Circuit had. The D.C. Circuit affirmed his ruling.

Last April, the U.S. Supreme Court greatly expanded private parties' ability to challenge agencies' structure and procedures without first going through an administrative appeal, reviving lawsuits by Taser maker Axon Enterprises' case against the Federal Trade Commission and a Texas accountant against the Securities and Exchange Commission. It ordered the D.C. Circuit to reconsider the pipeline case in light of that decision.

The panel said Tuesday that the outcome remained the same because the Natural Gas Act, unlike the laws at issue in the Supreme Court case, contained explicit jurisdiction-stripping language.

The case is Bohon et al v. Federal Energy Regulatory Commission, U.S. Court of Appeals for the D.C. Circuit, No. 20-5203.

For appellants: Mia Yugo of Yugo Collins

For FERC: Solicitor Robert Solomon

For Mountain Valley Pipeline: Jeremy Marwell of Vinson & Elkins

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