Project Report:
Restraining Unlawful Private Pipeline Condemnations
Purpose
- Investigates causes tending to destroy or impair the free-market system.

Summary

Increasingly, private corporations are using government power to take private property in order to construct pipelines to move commodities like oil or natural gas. Many of these projects, properly understood, are illegal—either because of the private nature of the pipeline project itself, or because the project provides landowners with insufficient due process protections. Nonetheless, courts and legislatures more or less ignore these legal problems and allow private companies to steamroll property owners. The Institute for Justice proposes to help change that by filing amicus curiae briefs in strategically selected cases and engaging in limited and targeted educational efforts surrounding proposed changes to laws governing pipeline condemnations.

Description

Pipeline companies can help create an essential part of America’s energy infrastructure, but as private companies, their power is supposed to be limited. When the Federal Energy Regulatory Commission (FERC) authorizes a project and awards a company a permit—and therefore also delegating the power of eminent domain—the court sets “just compensation” for the land which must be paid to the property owner.

However, the power of pipeline companies to take people’s private property is anything but limited: It is a power that is systematically abused by pipeline companies across the nation. Pipeline companies are consistently seizing possession of the properties they want immediately—before any court of law enters final judgment in the condemnation action or any property owner is paid.

Worse yet, rather than holding these companies accountable, the courts are refusing to enforce any restrictions on the powers Congress has granted private companies. As we described in our proposal, the Institute for Justice is litigating and advocating to combat both egregious aspects of this unconstitutional power-play: Our efforts have brought vital issues before the courts and drawn the public’s attention to pipeline companies’ illegitimate use of quick-take eminent domain.

In March 2019, IJ submitted a cert petition to the U.S. Supreme Court on behalf of homeowners Gary and Michelle Erb. Our petition challenged the widespread practice of pipeline companies paying property owners like Gary and Michelle long after having persuaded federal courts to give them immediate possession of land.

The laws in place are designed to protect Americans—and ensure they are compensated justly for the land they worked hard to own. But each time courts ignore these limits, property owners have their land taken away by preliminary injunctions and many don’t see a single dime for years. In their May 2019 decision declining our petition, the U.S. Supreme Court left this process, which systematically disadvantages property owners, in place.

But as IJ and the Alex C. Walker Foundation understand, defending property rights is a marathon, not a sprint. That’s why we continued and will continue to fight in court on behalf of courageous property owners like Gary and Michelle who are ready and willing to stand up against this growing, national abuse.

In 2019, IJ filed two amicus, or “friend of the court,” briefs. One such brief, which we submitted to the U.S. Supreme Court, joined IJ allies at the Owners Counsel of America, Cato Institute, and Penneast New Jersey Property Owners. In it, IJ supported homeowner Karolyn Givens’ petition asking the high court to reverse a 4th Circuit Court of Appeals ruling that confirmed quick-take possession by a private company of her land.

IJ’s brief argued that by improperly issuing preliminary injunctions that allow immediate possession of property, circuit courts are disadvantaging Americans and blatantly ignoring their right to just compensation. But while this case, Givens v. Mountain Valley Pipeline, LLC, could have been one avenue to prevent further abuses of quick-take eminent domain, the U.S. Supreme Court rejected Karolyn’s challenge in October 2019.

During the grant term, IJ also laid the groundwork to attack unlawful private pipeline condemnations at the state level. In May 2019, we filed an amicus brief in Morello v. Seaway Crude Pipeline Company, LLC at the Texas Supreme Court.

As you may recall, in this high-profile case, a pipeline company sought to exercise the government’s eminent domain power to condemn a new piece of land, thereby avoiding the terms of its original agreement with a property owner.

IJ’s amicus drew upon our post-Kelo work, disputing the idea that private companies can use eminent domain to get out of voluntary, contractual agreements. Using the expertise we have gained successfully advocating against eminent domain abuse in 44 states, IJ put the practice of condemning more land to dodge restrictions on trial but unfortunately the state supreme court declined to hear the case.

While we continue to identify ever more cases with which to present the courts with an opportunity to restore full protections to property owners, IJ is also providing support for legislative and advocacy efforts. Throughout the grant term, IJ consulted with allies and other groups, including law firms, sharing our legal advice and feedback regarding case design and language for courtroom documents. We are also preparing to provide even more support for legislative reform efforts in the coming months.

Purpose

Property rights are fundamental to the free-market system. But increasingly, those rights are being undermined by condemnations for private pipelines, which frequently receive far less judicial scrutiny than other takings of private property.

Scope

There is significant existing legal advocacy against pipeline projects, but nearly all of it comes from the perspective of environmental-rights groups that want to stymie pipeline construction because they view pipelines as problematic from a wise use of resources perspective. Far too little attention and advocacy is dedicated to supporting the communities and individual property owners whose lives and businesses are upended. This project will be a pilot program of national and state-level advocacy designed to return property-rights protections to the localities and individuals who need it most.

Information Dissemination

One critical piece of IJ’s successful public interest litigation and advocacy is our ability to shape institutional messages. Through our communications strategy, IJ simplifies and disseminates complex issues to the mainstream media and evolving news outlets, securing not only features that describe our work and clients with wide audiences, but also generates greater public support for our cause.

One such feature includes broadcast coverage of IJ’s Givens brief in FOX News affiliate, WFXR. Reaching nearly 5,000 Americans in southwest Virginia, this single feature touched on both our arguments and the background of Karolyn’s case.

As you know, the leading publication covering energy and environmental news, E&E News, has featured IJ’s work in this area repeatedly over the past few years, including twice during the grant term. But we also shared our fight with non-professional audiences through IJ’s own forum at the Forbes site.

In August 2019, IJ published an article in Forbes discussing a D.C Circuit Court of Appeals’ decision rejecting Gary and Michelle’s challenge of a pipeline company’s FERC certificate (a second lawsuit arising from the same pipeline project as the case in which IJ represented them). The Forbes piece, while detailing a disappointing opinion, noted one justice’s powerful comments. Under court precedent, Judge Patricia Millett was compelled to vote with her colleagues; but in her concurrence, she slammed FERC, using phrases such as “Kafkaesque regime” and “bureaucratic purgatory” to describe these schemes.

Judge Millett’s writing sends a strong signal that courts are ready to hear arguments challenging aspects of unlawful pipeline condemnations, including the use of quick-take eminent domain to circumvent protections for property owners. IJ looks forward to seizing each opportunity in both the courts of law and the court of public opinion to put this practice on trial.

Just four months after the disastrous decision, the D.C. Circuit Court of Appeals agreed to rehear the case en banc!

For our policymaker and congressional staff audiences, IJ’s focus for the remainder of the grant term continues to be educational: highlighting the real-world impact eminent domain takings for pipelines have and how abusive practices can best be rolled back to empower Americans nationwide.

All activity described in this report was performed consistent with the Institute for Justice’s nonprofit status, IRS regulations, and our agreement with the Walker Family Foundation.

Project Link ij.org/issues/private-property/eminent-domain/

Amount Approved
$20,000.00 on 7/1/2019 (Check sent: 7/12/2019)


  Related Organizations
Institute for Justice  


The Erb Family
The Erb family joined with IJ to fight against unlawful private pipeline condemnations

Attachments
The Erb Family

Address
901 N Glebe Rd #900
Arlington, VA 22203


Phone
(703) 682-9320 ext 233
(703) 682-9321 (fax)

Contacts


Beth Stevens
Institute for Justice

Posted 3/29/2019 10:33 AM
Updated   1/10/2020 11:43 AM



 
  © 2020 Alex C. Walker Foundation       Search   Sign In