Allegheny Defense Project v. FERC , 932 F.3d 940 ( 2019 )

United States Court of Appeals
FOR THE DISTRICT OF COLUMBIA CIRCUIT
Argued December 7, 2018 Decided August 2, 2019
No. 17-1098
ALLEGHENY DEFENSE PROJECT, ET AL.,
PETITIONERS
v.
FEDERAL ENERGY REGULATORY COMMISSION,
RESPONDENT
ANADARKO ENERGY SERVICES COMPANY, ET AL.,
INTERVENORS
Consolidated with 17-1128, 17-1263, 18-1030
On Petitions for Review of Orders of the
Federal Energy Regulatory Commission
Elizabeth F. Benson argued the cause for petitioners
Allegheny Defense Project, et al. Siobhan K. Cole argued the
cause for petitioners Hilltop Hollow Limited Partnership, et al.
With them on the joint briefs was Benjamin A. Luckett.
Michael N. Onufrak and Derek O. Teaney entered appearances.
Beth G. Pacella, Deputy Solicitor, Federal Energy
Regulatory Commission, argued the cause for respondent.
With her on the brief were James P. Danly, General Counsel,
2
and Robert H. Solomon, Solicitor. Anand Viswanathan,
Attorney, entered an appearance.
John F. Stoviak argued the cause for intervenors. With
him on the joint brief were Pamela S. Goodwin, Elizabeth U.
Witmer, Patrick F. Nugent, Kevin M. Sweeney, Jesse Stuart
Unkenholz, and Scott Borden Grover.
Before: GARLAND, Chief Judge, and TATEL and MILLETT,
Circuit Judges.
Opinion for the court filed PER CURIAM.
Concurring opinion filed by Circuit Judge MILLETT.
PER CURIAM: In February 2017, the Federal Energy
Regulatory Commission approved a natural gas pipeline
expansion called the Atlantic Sunrise Project, which stretches
from northern Pennsylvania, across the Carolinas, and into
Alabama. Environmental Associations whose members live
and work in the areas affected by the Project and individual
Homeowners whose property was used for the Project seek
review of the Commission’s orders permitting the
Transcontinental Gas Pipe Line Company to move forward
with the pipeline expansion. Because the challenges to the
Commission’s decision cannot surmount the deferential
standards of agency review and binding circuit precedent, we
deny the petitions.
I
A
Under the Natural Gas Act, 15 U.S.C. § 717 et seq., a
company wishing to construct a natural gas pipeline must first
3
obtain a certificate of “public convenience and necessity” from
the Federal Energy Regulatory Commission. See id.
§ 717f(c); Myersville Citizens for a Rural Community, Inc. v.
FERC, 783 F.3d 1301, 1307 (D.C. Cir. 2015). The
Commission “shall * * * issue[]” the certificate if it finds that
the proposed project “is or will be required by the present or
future public convenience and necessity.” 15 U.S.C.
§ 717f(e).
When a pipeline company files a certificate application,
the Commission reviews it under criteria set forth in its
Certificate Policy Statement, 88 FERC ¶ 61,227 (1999),
clarified, 90 FERC ¶ 61,128, further clarified, 92 FERC
¶ 61,094 (2000). The Certificate Policy Statement directs the
Commission to consider whether the project meets a market
need and whether the public benefits of the project outweigh
the harms. See Sierra Club v. FERC, 867 F.3d 1357, 1379
(D.C. Cir. 2017). If market need and public benefit are both
established, the Commission will issue a certificate authorizing
the pipeline’s construction. Id. Once that certificate is
granted, the Natural Gas Act empowers the private certificate
holder to exercise eminent domain authority if it “cannot
acquire by contract, or is unable to agree with the owner of
property to the compensation to be paid for, the necessary
right-of-way to construct, operate, and maintain a pipeline[.]”
15 U.S.C. § 717f(h).
A party wishing to challenge the Commission’s issuance
of a certificate of public convenience and necessity must file a
petition for rehearing with the Commission. 15 U.S.C.
§ 717r(a). Until the Commission disposes of that rehearing
petition, the agency action is not final for purposes of judicial
review. See id. § 717r(a)–(b); Clifton Power Corp. v. FERC,
294 F.3d 108, 110–111 (D.C. Cir. 2002). The filing and
disposition of such a rehearing petition is thus a mandatory
4
prerequisite to obtaining judicial review of the Commission’s
action. See Delaware Riverkeeper Network v. FERC, 857
F.3d 388, 399 (D.C. Cir. 2017); Clifton Power Corp., 294 F.3d
at 110–111. Congress directed that petitions for rehearing
may be “deemed to have been denied” if the Commission has
not “act[ed] upon the application for rehearing within thirty
days after it is filed[.]” 15 U.S.C. § 717r(a).
The National Environmental Policy Act (“NEPA”), 42
U.S.C. § 4321 et seq., “require[s] the Commission to consider
and disclose the environmental effects of the actions it
certifies.” Delaware Riverkeeper Network, 857 F.3d at 394
(internal quotation marks omitted). The Commission may
fulfill this requirement by compiling an Environmental Impact
Statement, which must consider, among other things, the
proposed project’s “indirect” environmental effects. See 42
U.S.C. § 4332(C); 40 C.F.R. §§ 1508.8, 1508.25(c).
B
In March 2015, the Transcontinental Gas Pipe Line
Company (“Transco”) applied for a certificate of public
convenience and necessity to build the Atlantic Sunrise Project.
After notice and public comment, the Commission issued a
final Environmental Impact Statement in December 2016. In
that Statement, the Commission concluded that “neither
construction nor operation of the Project would significantly
contribute to [greenhouse-gas] cumulative effects or climate
change.” J.A. 323.
On February 3, 2017, the Commission granted Transco its
requested certificate of public convenience and necessity. 158
FERC ¶ 61,125 (2017) (“Certificate Order”). Environmental
Associations and the private Homeowners whose land would
become subject to an easement for the Project both filed
5
petitions for rehearing with the Commission, along with
motions for a stay of construction pending disposition of their
petitions. Before Congress’s 30-day deadline for action on the
rehearing petitions expired, the Commission “granted”
rehearing, but only “for the limited purpose of further
consideration.” J.A. 600 (“Certificate Tolling Order”). The
Commission took no action on the stay motions for more than
five months, and then denied them.
In late August, a Pennsylvania federal district court
presiding over Transco’s eminent domain action entered an
order that declared Transco’s “right to immediate possession of
the properties in question,” based on the presumed validity of
FERC’s Certificate Order. Transcontinental Gas Pipe Line
Co. v. Permanent Easements for 2.14 Acres & Temp.
Easements for 3.59 Acres in Conestoga Township, Lancaster
County, Pa., Tax Parcel No. 1201606900000, 2017 WL
3624250, at *1, *3 (E.D. Pa. Aug. 23, 2017) (rejecting the
Homeowners’ objections as “attacks on the FERC order itself,”
which “can only be challenged in front of FERC, and then in
the United States Court of Appeals for the District of Columbia
Circuit”), aff’d, 907 F.3d 725 (3d Cir. 2018).
On September 15, 2017, while the Environmental
Associations’ and Homeowners’ petitions for rehearing were
still pending, the Commission issued an order authorizing
Transco to begin construction of the Project. J.A. 616
(“Construction Order”). Transco broke ground that same day.
The Environmental Associations promptly moved for
rehearing of the Construction Order and an order halting
construction. As its 30-day statutory deadline for action on
the Construction Order rehearing petition approached, the
Commission again issued an order granting rehearing “for the
6
limited purpose of further consideration.” J.A. 815
(“Construction Tolling Order”).
The Commission eventually denied the Homeowners’ and
Environmental Associations’ petitions for rehearing in
December 2017, more than nine months after rehearing was
sought and three months after construction began. 161 FERC
¶ 61,250 (2017) (“Certificate Rehearing Order”). Three
months after that—and nearly six months after construction
commenced—the Commission denied rehearing of the
Construction Order. 162 FERC ¶ 61,192 (2018)
(“Construction Rehearing Order”).
II
This consolidated case arises out of four petitions for
review collectively challenging the Certificate Order, the
Certificate Tolling Order, the Construction Order, the
Construction Tolling Order, and the Certificate Rehearing
Order. Because the Homeowners and Environmental
Associations both properly sought rehearing of the Certificate
Rehearing Order, which encompasses all of their claims for our
review and is the final agency decision greenlighting the
Project, this court has jurisdiction. See 15 U.S.C. § 717r. 1
The Commission’s factual findings are conclusive so long
as they are supported by substantial evidence. See 15 U.S.C.
§ 717(b). Where the Commission “has examined the relevant
considerations and articulated a satisfactory explanation for its
action, including a rational connection between the facts found
and the choice made,” we must uphold its decision. FERC v.
1
We therefore deny as moot the motions to dismiss the
petitions filed before the Certificate Rehearing Order issued, Nos.
17-1098 and 17-1128.
7
Electric Power Supply Ass’n, 136 S. Ct. 760, 782 (2016)
(formatting altered).
The Homeowners and Environmental Associations argue
that the Commission’s Certificate Order suffers from fatal
substantive and procedural flaws. Specifically, they argue
that the Commission improperly conducted its environmental
assessment under NEPA, failed to substantiate market need for
the Project as required by the Natural Gas Act, and denied them
due process by authorizing construction to commence before
the issuance of the Certificate Order could be judicially
reviewed. None of those arguments succeed.
A
The administrative record forecloses the Homeowners’
and Environmental Associations’ three NEPA arguments.
First, the Homeowners and Environmental Associations
argue that the Commission did not factor downstream
greenhouse-gas emissions into its evaluation of the Project’s
environmental impacts.
The Homeowners and Environmental Associations are
correct that customers’ burning of the natural gas that the
Project transports will produce greenhouse-gas emissions.
See Sierra Club, 867 F.3d at 1374. They are also correct that
NEPA required the Commission to consider both the direct and
indirect environmental effects of the Project, and that, despite
what the Commission argues, the downstream greenhouse-gas
emissions are just such an indirect effect. See id.; 40 C.F.R.
§ 1502.16(b).
But that is as far as the argument gets them, because the
Commission already took the steps the Homeowners and
8
Environmental Associations request. The Commission
addressed downstream emissions in the Environmental Impact
Statement, the Certificate Order, and the Certificate Rehearing
Order. In particular, the Commission estimated the amount of
CO2 emissions resulting from the gas that the Project would
transport and predicted that those emissions would be partially
offset by reductions in higher carbon-emitting fuel that the
Project’s natural gas would replace. Neither the Homeowners
nor the Environmental Associations have identified what more
the Commission should have said. That failure is fatal.
Unsubstantiated objections are not enough to stop an agency’s
action.
Second, the Homeowners and Environmental Associations
assert that the Commission impermissibly segmented its
environmental review by failing to consider the synergistic
effect of the Project on emissions associated with a different
pipeline—the Southeast Market Pipeline. Improper
segmentation occurs when FERC creates separate
Environmental Impact Statements for interconnected pipelines
that should have been evaluated as a single project. See City
of Boston Delegation v. FERC, 897 F.3d 241, 251–252 (D.C.
Cir. 2018).
But NEPA requires more to make out an improper
segmentation claim than the Homeowners and Environmental
Associations have offered. Specifically, the Commission has
no duty to consider the environmental effects of a separate
project if the project in question has “substantial independent
utility.” City of Boston Delegation, 897 F.3d at 252 (internal
quotation marks omitted); see also Coalition on Sensible
Transp., Inc. v. Dole, 826 F.2d 60, 69 (D.C. Cir. 1987) (asking
“whether one project will serve a significant purpose even if a
second related project is not built”).
9
The record supports the Commission’s determination that
the Southeast Market Pipeline and the Project are
independently justified and that each has its own distinct utility.
City of Boston Delegation, 897 F.3d at 252. That is because,
even if the Project were never built, the Southeast Market
Pipeline still would be connected to enough natural gas supply
to exceed its capacity. J.A. 843. On this record, that
disproves any claim of improper segmentation.
Third, the Homeowners and Environmental Associations
contend that the Commission was deficient in its analysis of an
alternative site for the Project called the Conestoga Route.
Under NEPA, agencies must “identify the reasonable
alternatives to the contemplated action,” Minisink Residents for
Envtl. Pres. & Safety v. FERC, 762 F.3d 97, 102 (D.C. Cir.
2014), and “discuss[] * * * the relevant issues and opposing
viewpoints,” Myersville, 783 F.3d at 1324–1325 (quoting
Nevada v. Department of Energy, 457 F.3d 78, 93 (D.C. Cir.
2006)). This requirement helps ensure that agency actions are
“fully informed and well-considered.” Id. at 1325 (internal
quotation marks omitted).
The Commission’s consideration of the Conestoga Route
passes NEPA muster. The Commission “look[ed] hard at the
environmental effects of its decision” by comparing the
proposed route with the Conestoga Route across highly
detailed criteria. Minisink, 762 F.3d at 102 (formatting
altered). 2 In doing so, the Commission openly grappled with
the factors favoring the Conestoga Route and reasonably
explained why the proposed route was nonetheless superior.
2
The “Waterbodies crossed” criterion, for example, quantifies
waterbodies for “Trout Stocking,” “High Quality Cold Water
Fishes,” “Cold Water Fishes,” “High Quality Warm Water Fishes,”
and “Warm Water Fishes.” J.A. 318.
10
It acknowledged that the Conestoga Route was shorter and
would follow existing rights-of-way for more of its length than
the proposed route would, but it placed more weight on the
proposed route’s virtues, including that it would cross fewer
recreational areas and would avoid potentially dangerous
elevation changes. That suffices for NEPA. See Myersville,
783 F.3d at 1308; Minisink, 762 F.3d at 112.
B
The Homeowners and Environmental Associations
separately claim that the Commission’s market-need
determination violated the Natural Gas Act. A showing of
market need is a precondition for the Commission to issue a
certificate of public convenience and necessity. See Sierra
Club, 867 F.3d at 1379; Myersville, 783 F.3d at 1309; 90 FERC
at ¶ 61,392; 88 FERC at ¶ 61,746. The certificate applicant
can make its required showing of market need for the pipeline
“by presenting evidence of ‘preconstruction contracts’ for gas
transportation service.” Sierra Club, 867 F.3d at 1379.
The Commission held Transco to this obligation. Its
finding of market need rested on the existence of contracts with
shippers for 100% of the Project’s capacity. That alone is
enough. See Sierra Club, 867 F.3d at 1379; Myersville, 783
F.3d at 1311; Minisink, 762 F.3d at 111 n.10. And the
Commission did not stop there. It also relied on comments by
two shippers and one end-user, as well as a study submitted by
one of the Environmental Associations, all of which reinforced
the demand for the natural gas shipments.
11
C
Finally, the Environmental Associations and Homeowners
argue that the Commission’s authorization for construction to
go forward while their rehearing petitions were still pending—
and thus before the Commission’s decision was final and
judicially reviewable—denied them due process. Circuit
precedent forecloses their claims.
A due-process claim turns on two essential inquiries.
First, is there a “liberty or property interest of which a person
has been deprived”? Swarthout v. Cooke, 562 U.S. 216, 219
(2011). Second, were the “procedures followed” by the
government in encroaching on those interests “constitutionally
sufficient”? Id.
The Environmental Associations run into trouble on the
first prong of that test. They assert that liberty and property
interests were bestowed upon them by the Pennsylvania
Constitution’s Environmental Rights Amendment, Pa. Const.
Art. 1, § 27, and the Natural Gas Act’s review procedures, 15
U.S.C. §§ 717f(c)(1)(B), 717r(a)–(b). This court has already
rejected those claims, and those decisions control here. See
Delaware Riverkeeper Network v. FERC, 895 F.3d 102, 110
(D.C. Cir. 2018) (Pennsylvania Constitution); Griffith v.
Federal Labor Relations Auth., 842 F.2d 487, 495 (D.C. Cir.
1988) (Natural Gas Act review procedures); see generally
LaShawn A. v. Barry, 87 F.3d 1389, 1395 (D.C. Cir. 1996)
(“One three-judge panel * * * does not have the authority to
overrule another three-judge panel of the court.”).
The Homeowners, for their part, lose on the second prong
of the due-process analysis. They argue that the
Commission’s delay in acting on their rehearing petitions while
authorizing construction to start “denied [them] the right to be
12
heard on whether Transco’s taking of their property actually
satisfies the public use requirement of the Fifth Amendment.”
Petitioners’ Opening Br. 47.
But, again, circuit precedent says otherwise. We have
held that, as long as FERC’s public-convenience-and-necessity
determination is not legally deficient, it necessarily satisfies the
Fifth Amendment’s public-use requirement. See Midcoast
Interstate Transmission, Inc. v. FERC, 198 F.3d 960, 973 (D.C.
Cir. 2000). The Homeowners make no claim that they were
deprived of a meaningful opportunity to be heard as part of the
Commission’s proceedings leading up to its issuance of the
Certificate Order, and they make no effort to distinguish (or
even acknowledge) our holding in Midcoast.
* * *
For the foregoing reasons, the petitions for review are
denied.
So ordered.
MILLETT, Circuit Judge, concurring: As for the
Homeowners’ due-process claim, I recognize that circuit
precedent ties my hands. But the Commission has twisted our
precedent into a Kafkaesque regime. Under it, the
Commission can keep homeowners in seemingly endless
administrative limbo while energy companies plow ahead
seizing land and constructing the very pipeline that the
procedurally handcuffed homeowners seek to stop. The
Commission does so by casting aside the time limit on
rehearing that Congress ordered—treating its decision as final-
enough for the pipeline companies to go forward with their
construction plans, but not final for the injured landowners to
obtain judicial review. This case starkly illustrates why that is
not right.
I
My concern is not one of outcomes. The law and
administrative record dictate who should win in this case, as in
all Commission cases. My concern is about fair process and,
in particular, the ability of those who are directly injured—the
individuals whose property is taken in whole or in part by
Commission order—to have their day in court before it is too
late.
The Homeowners in this case are the Erb and Hoffman
families. Their “much beloved properties,” J.A. 581, are
located in Southeastern Pennsylvania, see Transcript of
Evidentiary Hearing 9, 53, ECF No. 27 (E.D. Pa. July 20, 2017)
(“Hearing Tr.”). That was where the Erbs built their “dream
home” and planned for their three sons to settle one day. Id.
at 10–11. The Hoffmans’ house is tucked among “rolling
hills” on their property—a home designed to be so private that
it could not be seen from the road. Id. at 52–53. They built
their lives there, among “lots of wildlife,” including the scores
of deer and turkeys they fed each day. Id. at 54. Both
2
families cherished the quiet, secluded nature of the places
where they chose to live.
That was until the Commission allowed the
Transcontinental Gas Pipeline Company (“Transco”) to move
in. In October 2015, the Commission notified the Erbs and the
Hoffmans that a pipeline under consideration might cut right
through their land. That would mean “removing topsoil, trees,
shrubs, brush, roots, and large rocks, and then removing or
blasting additional soil and bedrock to create a trench for the
pipeline,” and giving Transco a permanent right-of-way
through their yards. J.A. 581. The Erbs were “deathly afraid
of the pipeline” and did not “want to be anywhere near it.”
Hearing Tr. 45. The Hoffmans found the idea “unacceptable”
and “disturbing,” because Transco’s right-of-way in the middle
of their property would “totally take[] [their] privacy away.”
Id. at 59.
The Erbs and the Hoffmans fought hard before the
Commission to preserve their land. After the Certificate
Order issued, the Homeowners filed their request for rehearing
as well as a motion to stay the Certificate Order pending the
agency’s final rehearing decision. During the 30-day time
period allotted by Congress for agency action on the
Homeowners’ rehearing requests, the Commission ignored the
application for a stay. And before the 30th day passed, the
Commission issued a so-called “tolling order.” J.A. 600
(“Certificate Tolling Order”). Offering no explanation
whatsoever for its delay, the Commission just declared that
rehearing was “granted” for the sole purpose of buying the
Commission more time. Id. (“[R]ehearing of the
Commission’s order is hereby granted for the limited purpose
of further consideration[.]”).
3
The upshot of the Commission’s self-help was that its
continued inaction on rehearing—the non-finality of the
Certificate Order—jurisdictionally locked the Homeowners
out of federal court. See Delaware Riverkeeper Network v.
FERC, 857 F.3d 388, 393 (D.C. Cir. 2017); Clifton Power
Corp. v. FERC, 294 F.3d 108, 110–111 (D.C. Cir. 2002).
Indeed, when the Homeowners petitioned this court for review
of both the Certificate Order and the Certificate Tolling Order,
both the Commission and Transco were quick to seek dismissal
of the petitions as “incurably premature” because the rehearing
requests had not yet been resolved. See Motion of Movant-
Intervenor Transcontinental Gas Pipe Line Company, LLC to
Dismiss the Petitions for Review 15, No. 17-1128 (June 30,
2017); see also Motion of Federal Energy Regulatory
Commission to Apply Disposition of the Motion to Dismiss
Filed in Docket No. 17-1098 to the Instant Petitions, No. 17-
1128 (June 30, 2017); Motion to Dismiss for Lack of
Jurisdiction 5–6, No. 17-1098 (April 28, 2017).
While non-final for the Erbs and Hoffmans, the
Commission’s order was still final enough for Transco to
prevail in an eminent domain action in a Pennsylvania federal
district court and to acquire the needed easements over the
Erbs’ and Hoffmans’ land. Transco told the district court that,
in deciding whether eminent domain is appropriate, it “must
consider that the [Certificate Order] is final” and that its finding
of public convenience and necessity controlled the question of
whether the land was being taken for a public use. Hearing Tr.
138–139 (emphasis added). On that basis, the district court
granted Transco the “right to immediate possession of the
properties[.]” Transcontinental Gas Pipe Line Co. v.
Permanent Easements for 2.14 Acres & Temp. Easements for
3.59 Acres in Conestoga Township, Lancaster County, Pa., Tax
Parcel No. 1201606900000, 2017 WL 3624250, at *1 (E.D. Pa.
Aug. 23, 2017), aff’d, 907 F.3d 725 (3d Cir. 2018); see also id.
4
at *3–4 (rejecting the Homeowners’ claims as “attacks on the
FERC order itself,” which the district court did not have
jurisdiction to consider).
On August 31, 2017—eight days after Transco prevailed
in its eminent domain action and more than six months after the
Homeowners asked the Commission for a stay of the
Certificate Order—the Commission denied the Homeowners’
request for a stay. The Commission reasoned that the
Homeowners’ objections to Transco bulldozing and blasting its
pipeline into their homesteads were nothing more than
“generalized claims of environmental harm [that] do not
constitute sufficient evidence of irreparable harm that would
justify a stay.” 160 FERC ¶ 61,042, 2017 WL 3835932, at *2
(Feb. 9, 2017).
Two weeks later, apparently still too busy to act on the
Homeowners’ rehearing petition, the Commission nonetheless
found the time to issue a Construction Order authorizing
Transco to start construction on the Homeowners’ land. J.A.
616 (“Construction Order”). Which Transco promptly did.
J.A. 616; Oral Arg. Tr. 19. And when the 30-day time limit
for action on a request for rehearing of the Construction Order
approached, guess what? The Commission once again issued
an order that did nothing but give the Commission more time
to decide. See J.A. 815. Meanwhile, Transco’s construction
continued apace. And the Homeowners remained trapped
before the agency.
The Commission did not issue a final, appealable
certificate decision until December 6, 2017, months after
Transco had started construction.
5
II
Circuit precedent gave the Commission the tools it has
used to create this administrative quagmire for those who seek
to challenge its decisions. In my view, we should put an end
to it. A scheme that walls homeowners off from timely
judicial review of the Commission’s public-use determination,
while allowing eminent domain and functionally irreversible
construction to go forward, is in substantial tension with
statutory text and runs roughshod over basic principles of fair
process.
A
1
This much is clear: The Natural Gas Act makes the filing
of a rehearing petition a jurisdictional precondition to obtaining
judicial review of Commission decisions. 15 U.S.C.
§ 717r(a)–(b). The Act spells out what the Commission can
do once an application for rehearing is filed. It “shall have
power to grant or deny rehearing or to abrogate or modify its
order[.]” Id. § 717r(a). Unless the Commission so “acts
upon the application for rehearing within thirty days,”
rehearing “may be deemed to have been denied.” Id.
The most natural reading of that language is that Congress
told the Commission to “act[] upon the application for
rehearing” and to do so “within thirty days.” 15 U.S.C.
§ 717r(a).
The Commission reasons that it has “acted” because it
gave itself more time. But the Natural Gas Act requires the
Commission not just to act, but to “act[] upon the application”
itself. 15 U.S.C. § 717r(a). And Congress specified which
6
Commission actions count as “acts upon the application”: The
Commission could “grant” rehearing, “deny” it, “modify” the
underlying order, or “abrogate” it. Id. Casting aside
Congress’s time limit is not on that menu.
The Natural Gas Act answers the question of what should
happen if the Commission finds itself unable to act within the
allotted 30 days. Rehearing “may be deemed denied” by the
aggrieved party, who may then obtain judicial review. 15
U.S.C. § 717r(a); see id. § 717r(b); cf. 28 U.S.C. § 2675(a)
(Under the Federal Tort Claims Act, “[t]he failure of
an agency to make final disposition of a claim within six
months after it is filed shall, at the option of the claimant any
time thereafter, be deemed a final denial of the claim for
purposes of this section.”); 42 U.S.C. § 2000e-16(c) (Under
Title VII of the Civil Rights Act of 1964, agency inaction after
a specified time period for agency decision permits the
complainant to proceed to court.). There is no point to that
statutory time limit if the Commission can ignore it for no
reason at all and with no consequence at all.
Congress, in other words, gave the Commission 30 days to
fish or cut bait. Trapping an aggrieved party in administrative
limbo while the Commission spends several months thinking
about whether to go fishing is not an option.
2
But circuit precedent says otherwise. We have held that
the Commission’s tolling orders qualify under the statute as an
action upon the rehearing request. See Delaware Riverkeeper
Network v. FERC, 895 F.3d 102, 113 (D.C. Cir. 2018); see also
Moreau v. FERC, 982 F.2d 556, 564 (D.C. Cir. 1993) (FERC
had “yet to rule on the merits” after forty-four days).
7
Delaware Riverkeeper and Moreau faithfully followed the
fountainhead of circuit precedent upholding the Commission’s
tolling orders: California Company v. Federal Power
Commission, 411 F.2d 720 (D.C. Cir. 1969) (per curiam). But
that decision long predates modern statutory construction
jurisprudence, and did not claim to turn on the best reading of
the statutory text. To the contrary, California Company
described the Commission’s reading of Section 717r(a) as “far
from self-evident.” Id. at 722. Nonetheless, the court
deferred to the Commission because its approach “avoids * * *
administrative and judicial problems.” Id.
The court in Delaware Riverkeeper found itself bound by
California Company, and thus yielded to concerns about the
workability of a scheme that ties the Commission’s often
complicated decisionmaking to a tight 30-day timeframe. See
895 F.3d at 113. But, alas, “[i]f you give a mouse a cookie
* * *.” 1 The Commission has taken this court’s patience and
turned it into a license to routinely blow past Congress’s
deadline, granting itself as much time as it desires to act on
rehearing requests. One recent study showed that, between
2009 and 2017, the Commission issued tolling orders in
response to 99% of requests for rehearing of pipeline
certification decisions. Petition for an Extraordinary Writ, In
re Appalachian Voices, et al., No. 18-1006 at Exhibit G (Jan.
8, 2018) (“Exhibit G”) (cataloguing tolling orders issued in 74
out of 75 pipeline certifications between 2009 and 2017); see
also Berkley v. Mountain Valley Pipeline, LLC, 896 F.3d 624,
631 n.4 (4th Cir. 2018) (noting that FERC does not dispute that
it “regularly” issues tolling orders). FERC has issued a
boilerplate tolling order in response to every motion for
rehearing of a pipeline certification decision since 2017 too.
1
See LAURA NUMEROFF, IF YOU GIVE A MOUSE A COOKIE
(1985).
8
It also bears noting that this court’s acceptance of tolling
orders started in a case that involved disputes over money, not
property. See California Co., 411 F.2d at 720 (rate dispute).
The same is true of all of the other cases cited in Delaware
Riverkeeper. See 895 F.3d at 113 (citing Kokajko v. FERC,
837 F.2d 524, 526 (1st Cir. 1988) (fees); General American Oil
Co. of Tex. v. Federal Power Comm’n, 409 F.2d 597, 599 (5th
Cir. 1969) (rates)). Because disputes over monetary payments
can be fixed later, the consequences of Commission delay were
temporary and remediable. One side or the other would have
to bear the financial cost while administrative and judicial
litigation went forward. The tolling order just assigned that
burden to the party that lost before the agency.
But allowing the Commission to take its time while private
property is being destroyed is another thing altogether. Under
the Natural Gas Act, “any holder of a certificate * * * may
acquire the [property] by the exercise of the right of eminent
domain.” 15 U.S.C. § 717f(h). On top of that, courts
involved in eminent domain proceedings—including in this
case—routinely treat the Commission’s non-final certificate
order as final and conclusive evidence that the taking serves a
public purpose. See Transcontinental Gas Pipe Line Co.,
2017 WL 3624250, at *4 (collecting cases).
Congress further directed that the filing of an application
for rehearing “shall not, unless specifically ordered by the
Commission, operate as a stay of the Commission’s
[certificate] order.” 15 U.S.C. § 717r(c). Of course, in doing
so, Congress presumably expected that rehearing decisions
would be resolved within 30 days, as the statute says. See id.
§ 717r(a). In other words, as Congress designed the rehearing
system, eminent domain proceedings would likely not
conclude before the Commission acted on rehearing and
9
afforded the applicant an opportunity for judicial review of the
public-use determination.
The Commission’s use of tolling orders upends that
balanced framework. Now the Commission can, in effect,
split the atom of finality knowing that its certificate orders will
be treated as conclusive in eminent domain proceedings, while
shielding those same orders from judicial scrutiny as non-final.
This imbalance is what allowed Transco’s lawyer in this case
to tell the Pennsylvania district court that, “as to this process,
the eminent domain process, the [certificate] order is final,”
Hearing Tr. 80, while it and the Commission told this court that
the very same certificate order does not constitute final agency
action for purposes of the Homeowners’ effort to obtain
judicial review, see Motion of Movant-Intervenor at 15
(arguing that the Homeowners’ petition for review of the
Certificate Order must be dismissed as “‘incurably premature’
because a Tolling Order was timely issued and the Commission
has not yet ruled on the merits of the Requests for Rehearing”);
see also Commission’s Br. 8 (asserting the same argument).
Making that bad situation worse, the Commission that says
it is too busy to act on rehearing applications nevertheless
consistently manages to find the time to grant orders
authorizing construction to go forward while rehearing is still
pending. See Construction Order; Exhibit G (cataloguing
cases where FERC authorized construction during the tolling
period).
The result is that the Commission can toll until the cows
come home and thereby forestall judicial review while people’s
homesteads are being destroyed. And the Commission knows
exactly what it is doing with its repeated issuance of cookie-
cutter tolling orders. Commissioner Glick has openly
acknowledged that the Commission’s use of tolling orders to
10
delay rehearing orders causes “landowners, communities, and
the environment” to “suffer needless and avoidable harm”
because, “while the parties await their opportunity to challenge
the Commission’s certificate decision in court,” the developer
goes ahead and “begin[s] construction on the new pipeline
facility[.]” PennEast Pipeline Co., 163 FERC ¶ 61,159, 2018
WL 2453596, at *4 (May 30, 2018) (Glick, Comm’r,
concurring).
Of course, the Commission advises the companies that
they proceed at the risk that the agency may have a change of
heart on rehearing. Commission’s Br. 24. Perhaps such
words work when the certificate orders just involve monetary
payments for fees or rates. But they ring hollow in eminent
domain and construction cases like this. Once the property is
in the company’s possession, the land is cleared, trees are cut
down, and the pipeline is cemented into a family’s backyard, it
is difficult if not impossible to unshuffle the deck. The
damage to property rights, property values, and the
environment is done. That creates rather than “avoids * * *
administrative and judicial problems.” California Co., 411
F.2d at 722.
In my view, the better course is to assume that Congress
“says in a statute what it means and means in a statute what it
says there.” Connecticut Nat’l Bank v. Germain, 503 U.S.
249, 254 (1992). So when Congress said that rehearing
petitions may be deemed denied and agency action final after
30 days, that is what it meant.
III
Circuit precedent has already rejected a due-process
challenge to the Commission’s tolling orders. See Delaware
Riverkeeper, 895 F.3d at 112–113. Yet, in my view, the
11
authority our precedent affords the Commission to issue tolling
orders while simultaneously allowing eminent domain
proceedings and construction to proceed—all before the
affected landowner can obtain judicial review of the
Commission’s public-use determination—skates on thin
constitutional ice. And courts must construe statutes to avoid,
rather than to create, constitutional problems. Zadvydas v.
Davis, 533 U.S. 678, 689 (2001) (describing this “cardinal
principle” of statutory construction).
A
The Due Process Clause of the Fifth Amendment
guarantees that “[n]o person shall * * * be deprived of life,
liberty, or property, without due process of law[.]” U.S.
Const. Amend. V. Due process “calls for such procedural
protections as the particular situation demands” to
meaningfully protect the constitutional right at stake.
Morrissey v. Brewer, 408 U.S. 471, 481 (1972). At a
minimum, due process requires an “opportunity to be heard.”
Grannis v. Ordean, 234 U.S. 385, 394 (1914). And that
opportunity “must be granted at a meaningful time and in a
meaningful manner.” Armstrong v. Manzo, 380 U.S. 545, 552
(1965). This requirement not only “ensure[s] abstract fair
play to the individual.” Fuentes v. Shevin, 407 U.S. 67, 80–81
(1972). It also “protect[s] his use and possession of property
from arbitrary encroachment” by “minimiz[ing] substantively
unfair or mistaken deprivations of property[.]” Id. at 81.
That “danger” is “especially great” when the government
“seizes goods simply upon the application of and for the benefit
of a private party” such as Transco. Id.
Landowners like the Erb and Hoffman families
“[u]ndoubtedly * * * have a constitutionally protected property
interest in their home.” Freeman v. F.D.I.C., 56 F.3d 1394,
12
1403 (D.C. Cir. 1995). Determining whether the
Commission’s procedures for allowing private third parties to
build on private land pass constitutional muster therefore
requires weighing (i) “the private interest that will be affected
by the official action”; (ii) “the risk of an erroneous deprivation
of such interest through the procedures used”; and (iii) “the
Government’s interest, including the function involved and the
fiscal and administrative burdens that the additional or
substitute procedural requirement would entail.” Mathews v.
Eldridge, 424 U.S. 319, 335 (1976). That balance weighs
against the Commission’s current process of saddling
landowners with all the harm and risk of delay in its own
decisionmaking. And it weighs heavily in favor of reading the
statute’s 30-day time limit as the plain text prescribes to avoid
this constitutional question.
1
The right of the Erb and Hoffman families “to maintain
control over [their] home[s], and to be free from governmental
interference, is a private interest of historic and continuing
importance.” United States v. James Daniel Good Real
Property, 510 U.S. 43, 53–54 (1993); id. at 49 (“The
Government does not, and could not, dispute that the seizure of
Good’s home and 4-acre parcel deprived him of property
interests protected by the Due Process Clause.”).
And the Commission’s decisions authorizing Transco’s
“physical invasion” of the families’ homesteads, Loretto v.
Teleprompter Manhattan CATV Corp., 458 U.S. 419, 426
(1982), constitute a “government intrusion of an unusually
serious character,” id. at 433. Homeowners “suffer[] a special
kind of injury when a stranger directly invades and occupies
the owner’s property.” Id. at 436 (emphasis omitted); see also
James Daniel Good Real Property, 510 U.S. at 61 (An
13
“essential principle” is that “[i]ndividual freedom finds
tangible expression in property rights,” particularly where the
“privacy of the home and those who take shelter within it” is at
stake.); Hendler v. United States, 952 F.2d 1364, 1374 (Fed.
Cir. 1991) (“In the bundle of rights we call property, one of the
most valued is the right to sole and exclusive possession—the
right to exclude strangers[.]”) (emphasis omitted); cf. United
Church of the Med. Ctr. v. Medical Ctr. Comm’n, 689 F.2d 693,
701 (7th Cir. 1982) (“It is settled beyond the need for citation
* * * that a given piece of property is considered to be unique,
and its loss is always an irreparable injury.”).
All the more so because building the pipeline would cause
“permanent, irreparable environmental harm” to the Erb and
Hoffman families’ lands. J.A. 581. “Environmental injury,
by its nature, can seldom be adequately remedied by money
damages and is often permanent or at least of long duration,
i.e., irreparable.” Amoco Prod. Co. v. Village of Gambell, 480
U.S. 531, 545 (1987); see also National Wildlife Fed’n v.
Burford, 835 F.2d 305, 323–325 (D.C. Cir. 1987)
(“[D]estroying wildlife habitat, air and water quality, natural
beauty, and other environmental and aesthetic values and
interests” constitutes irreparable harm.). After all,
constructing a gas pipeline is not a tidy intrusion. It requires
cutting down the families’ trees, digging up their soil, blasting
their bedrock, displacing wildlife, and polluting the air.
Once Commission-authorized construction starts, then
“meaningful backward-looking relief to rectify an[]
unconstitutional deprivation” is rarely a viable option.
McKesson Corp. v. Division of Alcoholic Beverages &
Tobacco, 496 U.S. 18, 31 (1990) (emphasis added); see also
Amoco, 480 U.S. at 545; RoDa Drilling Co. v. Siegal, 552 F.3d
1203, 1210 (10th Cir. 2009) (“[C]ourts have held that, when
interests involving real property are at stake, preliminary
14
injunctive relief can be particularly appropriate because of the
unique nature of the property interest.”) (formatting altered)
(collecting additional cases).
2
The Commission’s process leaves landowners like the
Erbs and the Hoffmans to bear a material “risk of an erroneous
deprivation.” See Mathews, 424 U.S. at 335. Every time a
court reverses, vacates, or remands a Commission pipeline
certification decision—or when the Commission grants a
landowner’s rehearing motion on the merits—it means that the
people who had owned and organized their lives on the
pipeline-occupied land were subject to an erroneous
deprivation by the initial decision. See, e.g., Sierra Club v.
FERC, 867 F.3d 1357, 1379 (D.C. Cir. 2017); Delaware
Riverkeeper Network v. FERC, 753 F.3d 1304, 1320 (D.C. Cir.
2014).
The Commission’s prolonged tolling while construction
proceeds apace compounds the problem. The Supreme Court
has recently recognized that a “property owner has suffered a
violation of his Fifth Amendment rights when the government
takes his property without just compensation,” regardless of
whether damages might later ensue. Knick v. Township of
Scott, Pa., 139 S. Ct. 2162, 2168 (2019) (Takings Clause case
involving regulation by state government); see also id. at 2170.
Prompt access to federal court review of the lawfulness of the
taking, including the public use determination, is part of the
protection the Fifth Amendment affords. That access is
necessary to avoid “hand[ing] authority over federal takings
claims to state courts[,]” id., or—as here—to the same federal
agency that authorized eminent domain in the first place, see
City of Cincinnati v. Vester, 281 U.S. 439, 446 (1930) (“[T]he
question what is a public use is a judicial one.”).
15
Unsurprisingly, Transco supports the current state of
affairs. It reasons that homeowners can always seek
mandamus relief under the All Writs Act, 28 U.S.C. § 1651,
while the pipeline company’s bulldozers keep bulldozing. We
agreed in Delaware Riverkeeper, 895 F.3d at 113, and I
recognize that decision binds this panel.
But the due-process question is whether the Commission’s
process protects against erroneous deprivations. Mandamus
only protects against the most extreme outlier—the clearest,
most obvious, and wholly irreparable agency errors, and even
then only if a court chooses to use its discretion to grant that
extraordinary remedy. See Cheney v. United States Dist.
Court for D.C., 542 U.S. 367, 380–381 (2004) (Mandamus
requires a showing of “exceptional circumstances,” the absence
of “other adequate means” to obtain relief, and a “clear and
indisputable” right to the writ, and even still “the issuing court,
in the exercise of its discretion, must be satisfied that the writ
is appropriate under the circumstances.”) (formatting altered).
The proof is in the pudding. The Commission routinely
fends off mandamus actions while its tolling orders remain in
effect. See, e.g., In re Appalachian Voices, No. 18-1006 (D.C.
Cir. Feb. 2, 2018) (denying property owners’ petition for a stay
of pipeline construction under the All Writs Act); In re
Appalachian Voices, No. 18-1271 (4th Cir. March 21, 2018)
(same); Coalition to Reroute Nexus v. FERC, No. 17-4302 (6th
Cir. March 15, 2018) (same). Neither the Commission nor
Transco has cited a single instance in which a petitioner
opposing pipeline construction has succeeded by invoking the
All Writs Act.
The question then becomes “whether ‘the risk of an
erroneous deprivation’ would be reduced” by “procedural
16
safeguards” that would prevent pipeline construction from
beginning until the Commission acts on the merits of rehearing
requests. UDC Chairs Chapter, American Ass’n of Univ.
Professors v. Board of Trustees, 56 F.3d 1469, 1474 (D.C. Cir.
1995) (quoting Mathews, 424 U.S. at 335).
The answer is plain as day. Requiring the Commission to
act in a timely manner on applications for rehearing would
allow landowners to obtain both final agency and federal court
review before construction starts. Or the Commission could
achieve the same result just by declining to issue construction
orders until it resolves certificate rehearing requests on the
merits.
3
The Commission has no legitimate interest that outweighs
the unfairness and risk of harm imposed by the current regime,
especially given how easy it would be for the Commission to
fix the problem.
The Commission insists that tolling orders are necessary
because it takes more than 30 days to resolve the issues raised
in applications for rehearing. Oral Arg. Tr. 33. The short
answer is that the Commission should raise that argument with
Congress, which prescribed the 30-day timeframe for decision.
An equally short answer is that the Commission could try
working with rehearing applicants to obtain more time by, for
example, agreeing to hold its hand on construction orders or
staying initial certificate orders to forestall eminent domain
proceedings before it takes final action.
If that is too administratively burdensome, then the
Commission could try the easiest path of all: take absolutely
no action on the rehearing application. That would have the
17
effect of denying the request as a matter of law. See 15 U.S.C.
§ 717r(a). And that approach would have opened the
courthouse doors to the Homeowners four months before the
eminent domain decision and five months before construction
started. See id. § 717r(b).
Lastly, the Commission appeals to the “public need” for
the pipeline itself. Oral Arg. Tr. 35. That is pure question-
begging. The public need for the Atlantic Sunrise Project—
whether the Commission’s finding of public convenience and
necessity was lawful—is precisely the question for which the
Erb and Hoffman families seek judicial review.
Anyhow, it is well-settled that “the right to procedural due
process is ‘absolute’ in the sense that it does not depend upon
the merits of a claimant’s substantive assertions[.]” Carey v.
Piphus, 435 U.S. 247, 266 (1978); see also Fuentes, 407 U.S.
at 87 (“The right to be heard does not depend upon an advance
showing that one will surely prevail at the hearing.”). In other
words, “[t]o one who protests against the taking of his property
without due process of law, it is no answer to say that in his
particular case due process of law would have led to the same
result[.]” Coe v. Armour Fertilizer Works, 237 U.S. 413, 424
(1915). The question is not whether the Erbs and Hoffmans
will win; it is only whether they have a right to be fairly and
timely heard before their “federal claim dies aborning” in the
Commission’s process. Knick, 139 S. Ct. at 2167.
* * * * *
In cases involving private property rights, the Commission
has transformed this court’s decisions upholding its tolling
orders into a bureaucratic purgatory that only Dante could love.
While I acknowledge that circuit precedent currently forecloses
the Homeowners’ constitutional challenge to the tolling orders,
18
this case starkly illustrates why a second look by us or by the
Commission is overdue.