In our earlier post today, we noted that on the same day last month, the U.S. Court of Appeals for the Fourth Circuit issued two published opinions about the admissibility of evidence in federal eminent domain cases under the Natural Gas Act. 

In our post about the other case, we focused on the admissibility of the owner’s testimony regarding the value of her land, and noted that the second issue in that case — the admissibility of expert valuations — relied on the case we’re delving into in this post, Mountain Valley Pipeline, LLC v. 9.89 Acres of Land, No. 23-2129 (Jan. 27, 2025).

These are takings under Fed. R. Civ. P. 71.1. The district court excluded the valuation opinion of the owner’s appraiser. That opinion might have passed muster for admissibility under Federal Rules of Evidence 702 and Daubert, but the court concluded that “[t]he gatekeeping role of the district court is particularly pronounced in condemnation proceedings under Rule 71.1.” Slip op. at 7.

Two of the three comparable sales relied upon by the owner’s appraiser were of properties not encumbered by a pipeline easement (and here the taking is for a pipeline easement), so the expert was unreliable, held the district court. The court also excluded the owner’s other appraiser on the grounds that his “conceptual subdivision [his opinion of highest and best use] was not ‘legally permitted under the applicable zoning ordinance in the absence of a network of public roads that does not exist.'” Id.

With both of the owner’s appraisers excluded, the condemnor sought summary judgment (its appraiser was the only evidence of value), which the district court granted.

The Fourth Circuit held that the district court abused its discretion by assuming that Rule 71.1 “requires it to exercise greater discretion for excluding evidence than would normally be permitted under the Rules of Evidence. That was error. Courts should apply the Federal Rules of Evidence identically in eminent domain cases as in other cases.” Slip op. at 8.

Analogously, here, the district court apparently conflated Rule 71.1(h) with Rule 702. Relying solely on the First Circuit’s decision in United States v. 33.92356 Acres of Land, the district court concluded that its gatekeeping role in excluding expert testimony under Rule 702 “is particularly pronounced in condemnation proceedings under Rule 71.1.” 9.89 Acres of Land, 2021 WL 4398032, at *4 (quoting 33.92356 Acres of Land, 585 F.3d at 8). With all due respect to the First Circuit, we disagree. Rule 71.1(h) does not alter the Federal Rules of Evidence in eminent domain proceedings. Rather, the court must first apply those Rules to determine the universe of evidence that it will then use to “tr[y] all issues” under Rule 71.1(h)(1).

Slip op. at 9 (footnote omitted).

The Fourth Circuit concluded that “once the district court makes its initial evidentiary determinations pursuant to the normal Rules of Evidence, it can proceed to the Rule 71.1(h) stage, where it must consider all admissible evidence together.” Slip op. at 10 (footnote omitted). The court held that this is an issue of first impression (both in the Fourth Circuit and, apparently, in any federal court), and that the court “must make findings of fact and conclusions of law on the record, as it would in a bench trial.” Slip op. at 11.

Yes, “[g]enuine disputes of material fact are typically left for a jury to resolve. But in eminent domain cases under Rule 71.1(h), the drafters of the Federal Rules of Civil Procedure took some contested factual issues from the jury and gave them to the judge.” Id. Here’s how the court describes how the process should work:

To summarize, a court hearing an eminent domain case should make determinations of evidentiary admissibility using the standard Federal Rules of Evidence. Once it has established the admissible universe of evidence, it may try non-compensation issues under Rule 71.1(h) based on that evidence and should make findings of fact and conclusions of law on the record. The court may grant summary judgment if no genuine disputes of material fact remain. Otherwise, it should exclude evidence inconsistent with its Rule 71.1(h) determinations from the jury trial.

Slip op. at 13-14.

That being established, the court concluded the district court wrongly excluded both of the owner’s appraisers. See slip op. at 14-19.

Mountain Valley Pipeline, LLC v. 9.89 Acres of Land, No. 23-2129 (4th Cir. Jan. 27, 2025)