Orus Berkley v. Mountain Valley Pipeline, LLC
Opinion
Plaintiffs
1
are landowners along the path of a proposed natural gas pipeline. They brought this action against the Mountain Valley Pipeline, LLC, the Federal Energy Regulatory Commission, and Neil Chatterjee, in his official capacity as Acting Chairman of the Federal Energy Regulatory Commission (hereinafter collectively referred to as "Defendants") challenging the constitutionality of various provisions of the Natural Gas Act,
I.
A.
This case involves a complex administrative review framework that warrants some introduction. In 1977, Congress transferred much of the authority from the now-defunct Federal Power Commission to the new Federal Energy Regulatory Commission ("FERC," or "the Commission").
See
Under the Natural Gas Act, FERC is responsible for vetting and approving construction of new interstate natural gas pipelines and expansions of existing pipelines.
See
15 U.S.C. § 717f. To approve such construction, FERC must find that the construction "is or will be required by the present or future public convenience and necessity."
("Certificate"), a pipeline company can begin construction.
Issuing such a Certificate conveys and automatically transfers the power of eminent domain to the Certificate holder.
See
Under the Natural Gas Act, an aggrieved party who seeks review from the issuance of a Certificate must first file for rehearing before FERC.
See
B.
In the present case, FERC issued a Certificate to Mountain Valley Pipeline, LLC ("Mountain Valley Pipeline") in October 2017. See 15 U.S.C. § 717f(c). At the time FERC issued the Certificate, Plaintiffs had already filed the complaint in this matter against Defendants in the U.S. District Court for the Western District of Virginia challenging the constitutionality of various provisions of the Natural Gas Act. The Defendants moved to dismiss for lack of jurisdiction.
In December 2017, the district court granted the Defendants' motions to dismiss on two grounds. First, the district court found that Plaintiffs' challenges "inher[e]" in a FERC order and are thus subject to the exclusive review provisions of the Natural Gas Act. J.A. 535-40. Alternatively, the district court held that, even if Plaintiffs' challenges fell outside that regime, Congress implicitly divested the district court of jurisdiction, pursuant to the Supreme Court's framework laid out in
Thunder Basin Coal Co. v. Reich
,
II.
We review the district court's dismissal of a complaint for lack of subject-matter jurisdiction de novo.
Nat'l Taxpayers Union v
.
U.S. Soc. Sec. Admin.
,
Over the past thirty years, the Supreme Court has issued a trio of cases addressing when Congress intends to divest district courts of jurisdiction over claims that should instead proceed exclusively through administrative review regimes.
See
Elgin v. Dep't of the Treasury
,
In
Bennett
, the plaintiff, who owned an investment firm that was the subject of an investigation by the Securities and Exchange Commission ("SEC"), filed suit in district court claiming that the SEC unconstitutionally used administrative law judges as part of its enforcement proceedings.
See
At the first step, the court must consider "whether Congress's intent to preclude district-court jurisdiction is 'fairly discernible in the statutory scheme.' "
A.
To determine whether the district court had jurisdiction to hear Plaintiffs' claims, we begin with the first step of our inquiry: "whether Congress's intent to preclude district-court jurisdiction is fairly discernible in the statutory scheme." Id. at 181 (internal quotation marks omitted).
In
Bennett
, this Court found that aspects of the statute at issue in the case, the Securities Exchange Act of 1934, 15 U.S.C. § 78a
et seq.
, indicated that Congress intended to divest the district court of jurisdiction. First, the statute established a "comprehensive scheme that provides for judicial review in the appropriate court of appeals."
Bennett
,
These considerations lead to the same conclusion in this case. Like the Securities Exchange Act, the Natural Gas Act establishes an extensive review framework, including review before FERC and eventually by a court of appeals.
See
15 U.S.C. § 717r. And, as with the statute in
Bennett
, the Natural Gas Act specifically allows for district court jurisdiction over certain actions, such as condemnation proceedings.
See
So, under this Court's precedent in Bennett , the Natural Gas Act's text and structure evince an intent from Congress to remove district-court jurisdiction.
B.
Continuing our analysis of whether the district court had jurisdiction to hear Plaintiffs' claims in this matter, we next consider the second step of our inquiry: "whether plaintiffs' claims are of the type Congress intended to be reviewed within this statutory structure."
Bennett
,
Regarding the first factor, whether the Natural Gas Act provides for meaningful judicial review in the circumstances before us, Plaintiffs argue that, because their claims are constitutional in nature and challenge the legitimacy of the statute itself, FERC cannot rule on them. Thus, Plaintiffs argue that they are deprived of meaningful review by having to wait until those claims are reviewed by a court of appeals.
In
Bennett
, however, we recognized that the Supreme Court had already rejected a similar line of reasoning.
See
For that reason, in
Bennett
, this Court said that a question about the constitutionality of an administrative law judge's authority to hear cases must also go through the agency review process, and that eventual review of the constitutional question before the court of appeals would still be meaningful.
See
Plaintiffs further attempt to distinguish their case from Bennett by arguing that the Natural Gas Act requires FERC to review petitions for rehearing within 30 days and that, by tolling this period, FERC unfairly delays judicial review while simultaneously allowing Mountain Valley Pipeline to begin construction. 4 This argument does not align with the statute, however.
Contrary to what Plaintiffs argue, FERC is not required to finally decide petitions for rehearing within 30 days. Rather, the statute says that "[u]nless the Commission acts upon the application for rehearing within thirty days after it is filed, such application may be deemed to have been denied." 15 U.S.C. § 717r(a) (emphasis added). Thus, the statute does not require a final decision within 30 days; it requires FERC to take some kind of action within 30 days for the petition not to be deemed denied by operation of law. FERC does so by issuing the tolling order.
That conclusion is not changed simply because the pipeline construction may continue while a rehearing petition is pending. We know this because Congress contemplated construction would be allowed to continue while FERC reviews a petition for rehearing. Specifically, the Natural Gas Act provides that "[t]he filing of an application for rehearing ... shall not, unless specifically ordered by the Commission, operate as a stay of the Commission's order."
To be sure, we acknowledge the possibility that FERC's use of a tolling order in certain cases may, in effect, deny a plaintiff meaningful judicial review, regardless of whether the Natural Gas Act could, in theory, provide such recourse. After all, there is a "strong presumption that Congress did not mean to prohibit all judicial review of executive action,"
Bowen v. Mich. Acad. of Family Physicians
,
Notably, we recognized in
Bennett
that plaintiffs are denied meaningful review when they are subject to " 'some additional and irremediable harm beyond the burdens associated with the dispute resolutions process.' "
However, although Plaintiffs' brief makes a few unsupported assertions about injuries they will suffer, they point to no evidence to corroborate their claims and, more critically, make no detailed arguments about those potential injuries. From the briefing, we have no answer as to what specific injuries Plaintiffs are alleging are potentially irreparable, why those injuries are not recompensable if post-deprivation relief is provided by the court of appeals, and how those specific claims distinguish Plaintiffs' case from seemingly contrary cases, such as Thunder Basin , Elgin , and Bennett . As the case is currently presented, Plaintiffs have not adequately produced evidence of irreparable injury, thereby indicating that the administrative review scheme found in the Natural Gas Act can provide meaningful review for their claims. Thus, the first factor weighs in favor of finding that Congress did not intend for district courts to have jurisdiction over claims such as those brought by Plaintiffs.
We next consider the second factor-that is, whether a claim is "wholly collateral" to the statutory review scheme.
Bennett
,
The same analysis applies here. Plaintiffs' constitutional claims are the means by which they seek to vacate the granting of the Certificate to Mountain Valley Pipeline. Therefore, their claims are not wholly collateral to the Natural Gas Act's statutory review scheme. This conclusion accords with the Supreme Court's findings in its trio of cases.
In
Elgin
, for example, the plaintiff's constitutional claims were not wholly collateral to the statutory review scheme found in the Civil Service Reform Act of 1978 because the claims comprised the vehicle by which the plaintiff sought to challenge his firing from government employment.
See
The situation here is more like that of Elgin and Bennett . Plaintiffs are seeking to reverse the issuance of a specific Certificate. The statutory review scheme provides for eventual review of this issue before a court of appeals; therefore, Plaintiffs must work through the statutory review scheme first. Thus, the second factor weighs in favor of finding that Congress did not intend for district courts to have jurisdiction over claims such as those brought by Plaintiffs.
Finally, we consider the third factor of "whether agency expertise could be brought to bear on the ... questions presented."
Bennett
,
The same is true here. Although perhaps unlikely to occur, FERC had the ability to, upon rehearing Plaintiffs' challenge here-and may still in future cases-revoke its issuance of a Certificate based upon threshold questions within its expertise. If that had occurred, Plaintiffs' constitutional claims would have been moot, without requiring a court to rule on them at all. Thus, under our precedent in Bennett , this final factor also weighs in favor of finding that Congress did not intend for district courts to have jurisdiction over claims such as those brought by Plaintiffs.
III.
In conclusion, under the two-step analysis this Court set out in Bennett , Congress intended to divest district courts of jurisdiction to hear the claims pursued by Plaintiffs and instead intended those claims to be brought under the statutory review scheme established by the Natural Gas Act. Accordingly, the district court lacked subject-matter jurisdiction to hear Plaintiffs' claims and appropriately dismissed their claims without prejudice. 5
The judgment of the district court is
AFFIRMED.
Plaintiffs are Orus Ashby Berkley, James T. Chandler, Kathy E. Chandler, Constantine Theodore Chlepas, Patti Lee Chlepas, Roger D. Crabtree, Rebecca H. Crabtree, George Lee Jones, Robert Wayne Morgan, Patricia Ann Morgan, Margaret McGraw Slayton Living Trust, Thomas Triplett, Bonnie B. Triplett, Dawn E. Cisek, Martin Cisek, Edith Fern Echols, and Estial E. Echols, Jr. After this appeal was filed, Dawn Cisek, Martin Cisek, Edith Echols, and Estial Echols withdrew their discrete appeals. Accordingly, we have updated the caption of this case to reflect their status as Plaintiffs and not as Plaintiff-Appellants.
However, there are limits to appellate jurisdiction. For instance, "[n]o objection to the order of the Commission shall be considered by the court [of appeals] unless such objection shall have been urged before the Commission in the application for rehearing unless there is reasonable ground for failure so to do." 15 U.S.C. § 717r(b). Additionally, "[t]he filing of an application for rehearing ... shall not, unless specifically ordered by the Commission, operate as a stay of the Commission's order."
In a letter filed pursuant to Fed. R. App. P. 28(j), FERC informed this Court of further developments regarding the pending request for rehearing before the Commission in this case. Specifically, on June 15, 2018, FERC took final action on the matter and upheld its issuance of the Certificate to Mountain Valley Pipeline. In the time since FERC's final order, no party has requested that we take any steps in light of this development. Furthermore, although we have an obligation to raise mootness issues
sua sponte
,
see
Friedman's, Inc. v. Dunlap
,
According to Plaintiffs-and undisputed by FERC-FERC regularly issues statements within 30 days of petitions for rehearing being filed that state, "[i]n order to afford additional time for consideration of the matters raised or to be raised, rehearing of the Commission's order is hereby granted for the limited purpose of further consideration, and timely-filed rehearing requests will not be deemed denied by operation of law. Rehearing requests of the above-cited order filed in this proceeding will be addressed in a future order." Appellants' Br. at 20 n.7.
We vacate the portion of the district court's opinion discussing an alternative ground for its holding-that the Plaintiffs' challenges "inher[e]" in a Commission order and are thus subject to the exclusive review provisions of the Natural Gas Act. J.A. 535-40. And because we uphold the district court's conclusion based upon its application of Thunder Basin , Bennett , and related cases, we decline to address that other line of reasoning in greater detail.
Reference
- Full Case Name
- Orus Ashby BERKLEY; James T. Chandler; Kathy E. Chandler; Constantine Theodore Chlepas; Patti Lee Chlepas; Roger D. Crabtree; Rebecca H. Crabtree; George Lee Jones; Robert Wayne Morgan; Patricia Ann Morgan; Margaret McGraw Slayton Living Trust; Thomas Triplett; Bonnie B. Triplett, Plaintiffs-Appellants, and Dawn E. Cisek; Martin Cisek; Edith Fern Echols; Estial E. Echols, Jr., Plaintiffs, v. MOUNTAIN VALLEY PIPELINE, LLC ; Federal Energy Regulatory Commission; Neil Chatterjee, in His Official Capacity as Acting Chairman of the Federal Energy Regulatory Commission, Defendants-Appellees.
- Cited By
- 16 cases
- Status
- Published