fbpx

Pennsylvania Pipeline Eminent Domain

Pipelines & Eminent Domain: Take Now, Pay (Much) Later

Pipeline companies create an essential part of America’s energy infrastructure, but their power is supposed to be limited. As documented below, 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.

Worse yet, the courts—rather than holding these companies accountable—are merely rubber stamping whatever the pipeline companies demand rather than restricting their powers to those Congress has given them.

All of this is playing out in a Pennsylvania lawsuit that is now being appealed to the U.S. Supreme Court—a case with national implications as more natural gas pipelines are constructed and crisscross our country.

Pennsylvania Pipeline Eminent Domain

Date Filed

March 13, 2019

Original Court

U.S. Supreme Court

Current Court

U.S. Supreme Court

Case Status

Open

Attorneys

Media Contact

Scroll To

Case Team

The bluffs overlooking the Susquehanna River in Pennsylvania’s Lancaster County, have for centuries been “a region noted for the grandeur and beauty of its landscape scenery.”1 Those same qualities attracted Gary and Michelle Erb in 2008. The Erbs purchased a 72-acre tract of land, about a mile east of the Susquehanna, and built their dream home.

Gary loves to hunt, and the forested part of the property is, in his words, a “deer paradise.” Another part of the land is set aside for farming; Gary and Michelle rent out a farmhouse to a tenant who grows soybeans and corn. For years, their plan was to build another home on one of three developable plots of land on their property so they and their three adult sons could all live together on the homestead.

That all changed in 2015. That spring, the Transcontinental Gas Pipe Line Company (Transco) applied to the Federal Energy Regulatory Commission (FERC) for authorization to build its Atlantic Sunrise Project—a natural gas pipeline running through Pennsylvania, Maryland, Virginia and the Carolinas. The company’s plan, which FERC approved, has the pipeline running directly across the Erbs’ land, just 400 feet from their front door. Armed with a FERC certificate, the company first offered to buy a six-acre easement across the Erbs’ land at what the Erbs’ considered an extremely low price, so the Erbs declined and sought to negotiate a fairer payment. Transco then sued them, along with several of their neighbors, invoking the federal government’s power of eminent domain.

Eminent domain, no matter what its purpose, is always disruptive and tremendously burdensome to property owners. But what makes the Erbs’ situation even worse—and such a demonstration of the unrestrained power the pipeline companies employ—is that while the federal trial court and the court of appeals allowed Transco to take possession of the Erbs’ land in the summer of 2017, the courts have never required Transco to pay the Erbs any compensation for this taking. Construction on the pipeline is actually complete—with the line running straight through the Erbs’ yard—but the family has yet to receive any compensation whatsoever for the land that Transco took from them.

It is well understood that when FERC gives a company a permit to build a pipeline, that permit comes with the power of eminent domain. But it only comes with the ordinary power of eminent domain:  The federal government files a complaint, the court sets “just compensation” for the land, and the government then chooses whether to pay that court-fixed price or dismiss the case. The government (or in this case, the pipeline company) does not have to pay the price. But of course, it has no right to the property unless it does so; the right vests only if the government exercises its option to buy. If and when the landowner gets paid, the government gets the land. In delegating power to companies like Transco, Congress gave them the authority to bring precisely this kind of straight-condemnation proceeding.

It does not, however, come with a more drastic power to immediately seize possession of the property before a court enters final judgment in the condemnation action. Yet pipeline companies like Transco are consistently using the far more drastic power of eminent domain—a power that Congress never granted them—to take immediate possession of a piece of property and then put in their pipeline. These companies are consistently and predictably abusing this power because the courts are simply rubber stamping their actions, refusing to force the pipeline companies to operate within the limited powers Congress granted them when it created FERC in the first place. And if Congress never gave the pipeline companies the power to take immediate possession of a piece of property, no one else—whether that is FERC or the courts themselves—is allowed to give them that power.

Pipeline companies have distorted the process to benefit the companies and disadvantage landowners. Citing the federal courts’ power to enter “preliminary injunctions,” pipeline companies routinely demand access to land immediately, months or years before the court sets a price for the land and years before landowners get paid. Put differently, the companies accelerate the parts of eminent domain they like—installing pipelines on other people’s land—while slowing down the part they are less enthusiastic about:  specifically, paying.

An aerial view of Gary and Michelle Erbs’ farm and the pipeline that now stretches across their land—land taken by the pipeline company Transco, which has never compensated the Erbs for the taking.

Because the power of eminent domain is so prone to abuse and injustice when given to a for-profit company, Congress has set strict limits on these delegated powers. As one court noted in the 19th century, eminent domain is “harsh in its nature, rarely just, [and] liable to gross perversion.”2

In Gary and Michelle’s case, there is no question Congress has given pipeline companies power to acquire land “by the exercise of the right of eminent domain.”3 But given an inch, companies like Transco have taken a mile.

Just five days after filing its complaint in February 2017, Transco filed a motion for a preliminary injunction asking for what is known as “quick take”—where the pipeline company takes the Erbs’ property now, but pays them later. By that August, the trial court had granted the company immediate possession of six acres of the Erbs’ land. Since then, Transco has installed its pipeline within sight of the Erbs’ home, and company employees often intrude on the property to work on the pipeline. Gary’s favorite hunting stand as well as prime hunting ground was needlessly destroyed. Deer were killed and left to rot in the field. They and their neighbors have had garbage from the pipeline company littered across their land. One of their neighbor’s hills is even disappearing; the company cut terraces into the slopes, eroding the topsoil.

For the Erbs, having a potentially dangerous pipeline so close to their home is a deal-breaker. Out of fear for their own safety, they are being forced to sell their dream home and move to a different tract of land they purchased farther from the pipeline’s potential blast radius. If such a pipeline were to explode, its destructive blast zone would extend 900 feet or more according to the Rachel Carson Council—putting the Erb family and their home well-within the blast zone.4

Michelle Erb said, “You try to put it out of your mind and go on with life, but the reality is it is a danger. It is dangerous living within 400 feet of a pipeline. People think that once the pipeline’s in the ground it goes away because you can’t see it. But it is there. We are living right next to it. It doesn’t go away. It is always there.”

And as they remain in their home, Transco continues to abuse its privilege by coming onto the Erbs’ property unannounced and without the Erbs’ permission. Michelle said, “They act like they own the easement area, but they don’t own it. They don’t pay taxes on that land; we do. They have taken away our sense of privacy and a sense of security. It is scary when people walk on your property out here in the country and you have no idea who they are.”

Gary added, “Transco is taking advantage of a broken system with the lower courts rubber-stamping what the pipeline companies are doing. The only ones who can stop this are the justices of the U.S. Supreme Court. This kind of abuse is happening to a lot of people, and it is going to happen to more and more people with these pipelines that are now being created all across the country. What Transco is doing isn’t right. It’s not the law. And they must be stopped. We’re trying to follow the law. I feel Transco should be made to follow the law, too. The system as it stands right now is very unfair and very unethical; it is very un-American.”

Gary concluded, “Our fight is about more than just our property. It is a fight for everyone that can’t fight and I know a lot of people that wish they could have fought but didn’t have the financial resources to do so. So, this is something we were called to do. In the end, justice and fairness will prevail; this will turn out to be something that’s fair for everyone. Right now the gas line companies are just steamrolling over private landowners and taking whatever they want, whenever they want it and with no restrictions by the courts.”

Through all this, Transco has not paid the landowners a dime. The case remains pending in the trial court, so the court has yet to establish the value of the seized land, and the company has yet to exercise its option to buy. Meanwhile, Gary, Michelle and some of their neighbors, have appealed the trial court’s grant of immediate access to their land. In November 2018, however, the U.S. Court of Appeals for the Third Circuit refused to restrain Transco’s tactics. Because Transco has the power to file eminent domain proceedings, the court said, the company would end up getting the land eventually. So letting the company intrude on the land years before a price has been set—much less paid—was inconsequential to the court. It simply “hasten[s] the enforcement of the substantive right.”5

In reaching this result, the Third Circuit’s decision marks the latest in a disturbing trend. More and more courts have blindly approved requests like Transco’s, which fly in the face of the standard eminent domain procedure Congress requires. In fact, it has become a nationwide phenomenon. Companies have secured hundreds of these “immediate possession” orders across the country, from Washington6 to West Virginia,7 Oregon8 to Ohio.9 In Gary and Michelle’s home state of Pennsylvania, pipeline companies have proceeded by immediate possession dozens of times in the past decade alone.

The companies’ intrusion on private property is immediate; their payment of just compensation is anything but. Represented by the Institute for Justice, Gary, Michelle, and three other families are asking the U.S. Supreme Court to hear their case and to put a stop to pipeline quick-take power-grabs nationwide by requiring pipeline companies to adhere to the laws that are designed to protect the rights of ordinary Americans even as those laws permit pipelines to be built.

About the Institute for Justice

The Institute for Justice (IJ) is the national law firm for liberty and the nation’s leading advocate for property rights. IJ has spent decades fighting against eminent domain abuse nationwide. IJ’s victories  have saved homes and businesses, including: the home of an elderly widow from Atlantic City who successfully fought then-developer Donald Trump’s abuse of eminent domain; an Atlantic City piano tuner’s home; a small auto repair shop in Arizona; 17 homes and business in Lakewood, Ohio; and a boxing gym for inner city youth in National City, California.

The U.S. Supreme Court has repeatedly called for judicial engagement when courts are scrutinizing the use of eminent domain by private entities, like Transco. But instead, the opposite is happening in the lower courts; they are not reining in the abusive actions of these pipeline companies. In fact, the courts are letting these companies get away with whatever the companies say is necessary to get their project completed. That is the opposite of what judges are supposed to do.

Unlawful takings like this are happening all across the United States and it is past time for the U.S. Supreme Court to step in and put a stop to them.

    JOIN THE FIGHT!   Sign up for newsletters:

    JOIN THE FIGHT!