Judge Questions Validity of Eminent Domain FERC Permit

By George Khoury, Esq. on September 26, 2018 | Last updated on March 21, 2019

In a recent Fourth Circuit appellate argument, Judge Roger Gregory explicitly stated his skepticism over a longstanding precedent allowing eminent domain property seizures prior to landowners being compensated.

The case before the appellate panel was brought by landowners in Virginia and West Virginia who are challenging the taking to create the Mountain Valley Pipeline, a 300-plus mile natural gas pipeline. Unfortunately for the landowners, the district court ruled that the construction could move forward and the companies involved could seize the land, before the landowners have been paid.

Precedent Is Wrong, Maybe?

Judge Gregory, in questioning the appellee over that precedent, East Tennessee Natural Gas Co. v. Sage, flat out stated that "maybe Sage is wrong."

Sage held that the gas company (in that case) could seize the land based upon a Federal Energy Regulatory Commission (FERC) permit approving the pipeline. The Mountain Valley Pipeline case concerns the same type of permit, and the companies building the pipeline are seeking to move forward with construction before the eminent domain proceedings and challenges are complete because the permit only lasts for three years.

However, as the attorneys for the appellants argued, and Judge Gregory seemed to agree, something just doesn't seem right. Chris Johns, one of those attorneys for the landowners pressed the court on the point that only Congress is actually authorized to take land, despite the precedent. He further explained that the holding in Sage, that timing doesn't matter, runs contrary to common notions of property law.

The Fifth Circuit is expected to hear several additional arguments over the pipeline this week.

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