Here's the cert petition we've been waiting to drop.
If you follow this blog, you know we are all over the issue of the quick-take-by-injunction scheme that private condemnors have cooked up, and which a majority of federal courts go along with.
Here's the issue: can a private condemnor exercising the delegated eminent domain power under the Natural Gas Act may obtain prejudgment possession of the property to be condemned by way of a preliminary injunction, when Congress has not delegated the ability to obtain prejudgment possession?
Knowing nothing else, you might think the obvious answer was "no." When Congress doesn't delegate the power to obtain prejudgment possession, the courts can't grant prejudgment possession. But a host of federal appeals courts have held otherwise. Recently, the Fourth, Sixth, and Eleventh Circuits have joined the Third Circuit in allowing a NGA condemnor to obtain prejudgment possession of property, even though Congress did not delegate the quick-take power in the NGA. These courts agree that there was no Congressional delegation of the quick-take power. But, they reason, that doesn't mean that federal courts cannot grant immediate prejudgment possession under their equitable power to issue Rule 65 preliminary injunctions. Congress didn't expressly prohibit injunctions.
Only the Seventh Circuit has taken a different -- and we believe correct -- approach: because the NGA only delegates the straight-taking power (in other words, possession only follows after determination of compensation, payment, and transfer of title to the condemnor), a Rule 65 injunction cannot compel more than that. (The Ninth Circuit almost gets it right, but still fails to apply the correct reasoning.)
The majority of the circuits, by contrast, are of the opinion that the "substantive" right in a straight-takings case is the question of a private pipeline company's right to take, and thus if the pipeline obtains summary judgment under the NGA's three-part test (see 15 U.S.C. § 717f(h)), then the case is all over but the shouting, and there's no reason not to give the pipeline possession of the property, even if compensation has not been determined, has not been paid, and title has not passed from the owner to the condemnor. The Third Circuit denied en banc review (we filed an amicus brief), as has the Fourth Circuit recently (we also filed an amicus brief in that case).
In our view, those courts have gotten it wrong. The substantive rights in an straight-taking eminent domain case are not embodied in the three statutory factors which a pipeline must show in order to institute a condemnation case. Those only go to its standing as the plaintiff/condemnor. Rather, the substantive right in these cases is ownership, and the adjudicated amount of just compensation which must be actually paid by the condemnor. Only then does title transfer from the owner to the condemnor, and only then does the condemnor obtain the "substantive" right to possession.
The critical indicator of this is the fact that until title transfers, a straight-taking condemnor is free to walk away and to not take the property, if it doesn't like the price which the court determines it must pay. We think the Supreme Court in Kirby Forest Industries, Inc. v. United States, 567 U.S. 1 (1984) got it right when it held that in straight-takings, the condemnor has the "option" to buy the condemned property at the adjudicated price, but is under no obligation to do so.
But the process which the courts have endorsed allows pipelines to possess both the cake (pre-compensation possession), and the ability to eat it (the option to walk away in the future). In the meantime, the injunction has ousted the owners from possession, and taken their right to exclude others without any compensation whatsoever.
Thus, the first cert petition in these cases is now teed up, and the Institute for Justice has stepped in to represent the property owners. The Question Presented:
The Natural Gas Act (15 U.S.C. § 717f(h)) delegates to certain private companies the ordinary eminent domain power: that is, the power to bring a condemnation lawsuit and then buy land at an adjudicated price after final judgment. The Act does not delegate the separate power to take immediate possession of land.
Notwithstanding the Act’s limited delegation, are district courts empowered to enter preliminary injunctions giving private companies immediate possession of land before final judgment in Natural Gas Act condemnations?
Are we going to be filing an amicus in support? Oh yes.
Petition For a Writ of Certiorari, Like v. Transcontinental Gas Pipe Line Co., No. _____ (U.S. Mar. 13, 201...
