Here's the opinion in a case we've been following. In Berkley v. Mountain Valley Pipeline, LLC, No. 18-1042 (July 25, 2018), the U.S. Court of Appeals for the Fourth Circuit held that the federal Natural Gas Act allows the Federal Energy Regulatory Commission to delegate eminent domain authority to Mountain Valley, and that any challenges to that authority must be done via the NGA's administrative review process.
Under the NGA, once FERC makes a finding of future public convenience and issues a certificate, a pipeline company like Mountain Valley which has been issued a certificate is automatically transferred the power to take private property as a plaintiff in a federal court condemnation action. The NGA provides for an administrative process to challenge the issuance of a certificate, which begins with the request for a rehearing in FERC. If FERC denies that, the next step is judicial review of the administrative record in a U.S. Court of Appeals.
The plaintiffs in this case had not utilized the administrative process. Indeed, they had filed their challenge in District Court prior to FERC's issuance of the certificate to Mountain Valley. They challenged the constitutionality of the NGA, including the delegation of eminent domain power to private pipelines.
The District Court dismissed the lawsuit for lack of jurisdiction, concluding that the plaintiff property owners could only challenge the takings in FERC via the NGA's administrative procedures. The Fourth Circuit affirmed.
Congress, the court held, divested district courts of jurisdiction to hear these type of cases. You admin law types will no doubt find the details of the court's analysis on pages 7 through 11 endlessly fascinating.
The rest of us will have to be content with the court's consideration of what we viewed as the plaintiffs' core argument: that their challenge to the NGA itself should not have to go through the admin process. Aafter all, an agency like FERC can only apply the law, and cannot pass on the validity of its own governing statute, right? No, according to the court:
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 id. at 184. Specifically, in Thunder Basin, the Supreme Court said that “constitutional claims . . . [could] be meaningfully addressed in the Court of Appeals,” even if the agency could not adjudicate them in the first instance. 510 U.S. at 215. The Supreme Court in Elgin said the same. See 567 U.S. at 15–18. Thus, notwithstanding that Plaintiffs are “attack[ing] the legitimacy of the forum” itself, review is still meaningful, even if it is withheld until first going through an agency that cannot rule on Plaintiffs’ constitutional claims. Bennett, 844 F.3d at 184.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 id. at 184–86. In this way, Bennett, Thunder Basin, and Elgin fatally undercut Plaintiffs’ argument. All three decisions establish that FERC’s inability to resolve Plaintiffs’ constitutional claims does not mean that the statutory scheme deprives Plaintiffs of meaningful judicial review.
Slip op. at 9-10.
In short, a challenge to the constitutionality of the NGA must be considered first by the agency which executes the statute. That seems off to us. FERC is an executive agency, without any power to judge the constitutionality of the statute which it administers. Judges do such things. Or so we thought.
Is there anything to be made of the fact that the Fourth Circuit panel was comprised entirely of Democrat-appointed judges? We're not sure. But we do know this: if we were the plaintiffs here, is there anything to lose by filing a cert petition, especially given the likely shifting climate at the Supreme Court on administrative law?
More background on this case in this report, "Burgeoning legal movement pits landowners against pipelines" (E&E News).