PennEast Pipeline Co. v. New Jersey, 594 U.S. ___ (2021)
Under the Natural Gas Act, to build an interstate pipeline, a natural gas company must obtain from the Federal Energy Regulatory Commission (FERC) a certificate of "public convenience and necessity,” 15 U.S.C. 717f(e). A 1947 amendment, section 717f(h), authorized certificate holders to exercise the federal eminent domain power. FERC granted PennEast a certificate of public convenience and necessity for a 116-mile pipeline from Pennsylvania to New Jersey. Challenges to that authorization remain pending. PennEast sought to exercise the federal eminent domain power to obtain rights-of-way along the pipeline route, including land in which New Jersey asserts a property interest. New Jersey asserted sovereign immunity. The Third Circuit concluded that PennEast was not authorized to condemn New Jersey’s property.
The Supreme Court reversed, first holding that New Jersey’s appeal is not a collateral attack on the FERC order. Section 717f(h) authorizes FERC certificate holders to condemn all necessary rights-of-way, whether owned by private parties or states, and is consistent with established federal government practice for the construction of infrastructure, whether by government or through a private company.
States may be sued only in limited circumstances: where the state expressly consents; where Congress clearly abrogates the state’s immunity under the Fourteenth Amendment; or if it has implicitly agreed to suit in “the structure of the original Constitution.” The states implicitly consented to private condemnation suits when they ratified the Constitution, including the eminent domain power, which is inextricably intertwined with condemnation authority. Separating the two would diminish the federal eminent domain power, which the states may not do.
The holder of a FERC certificate of public convenience and necessity to build a natural gas pipeline may exercise the federal eminent domain power to obtain necessary rights-of-way.
SUPREME COURT OF THE UNITED STATES
Syllabus
PENNEAST PIPELINE CO., LLC v. NEW JERSEY et al.
certiorari to the united states court of appeals for the third circuit
No. 19–1039. Argued April 28, 2021—Decided June 29, 2021
Congress passed the Natural Gas Act in 1938 to regulate the transportation and sale of natural gas in interstate commerce. To build an interstate pipeline, a natural gas company must obtain from the Federal Energy Regulatory Commission a certificate reflecting that such construction “is or will be required by the present or future public convenience and necessity.” 15 U. S. C. §717f(e). As originally enacted, the NGA did not provide a mechanism for certificate holders to secure property rights necessary to build pipelines, often leaving certificate holders with only an illusory right to build. Congress remedied this defect in 1947 by amending the NGA to authorize certificate holders to exercise the federal eminent domain power, thereby ensuring that certificates of public convenience and necessity could be given effect. See §717f(h).
FERC granted petitioner PennEast Pipeline Co. a certificate of public convenience and necessity authorizing construction of a 116-mile pipeline from Pennsylvania to New Jersey. Several parties, including respondent New Jersey, petitioned for review of FERC’s order in the D. C. Circuit. The D. C. Circuit has held those proceedings in abeyance pending resolution of this case. PennEast filed various complaints in Federal District Court in New Jersey seeking to exercise the federal eminent domain power under §717f(h) to obtain rights-of-way along the pipeline route approved by FERC. As relevant here, PennEast sought to condemn parcels of land in which either New Jersey or the New Jersey Conservation Foundation asserts a property interest. New Jersey moved to dismiss PennEast’s complaints on sovereign immunity grounds. The District Court denied the motion, and it granted PennEast’s requests for a condemnation order and preliminary injunctive relief. The Third Circuit vacated the District Court’s order insofar as it awarded PennEast relief with respect to New Jersey’s property interests. The Third Circuit concluded that because §717f(h) did not clearly delegate to certificate holders the Federal Government’s ability to sue nonconsenting States, PennEast was not authorized to condemn New Jersey’s property.
Held: Section 717f(h) authorizes FERC certificate holders to condemn all necessary rights-of-way, whether owned by private parties or States. Pp. 6–23.
(a) The United States raises a threshold challenge to the Third Circuit’s jurisdiction below on the grounds that §717r(b) grants the court of appeals reviewing FERC’s certificate order (here, the D. C. Circuit) “exclusive” jurisdiction to “affirm, modify, or set aside such order.” The Court rejects this challenge. New Jersey does not seek to modify FERC’s order; it asserts a defense against the condemnation proceedings initiated by PennEast. The Third Circuit’s decision that §717f(h) does not grant natural gas companies the right to bring condemnation suits against States did not “modify” or “set aside” FERC’s order, which neither purports to grant PennEast the right to file a condemnation suit against States nor addresses whether §717f(h) grants that right. Contrary to the argument of the United States, New Jersey’s appeal is not a collateral attack on the FERC order. Pp. 6–7.
(b) The Federal Government has exercised its eminent domain authority since the founding, connecting our country through turnpikes, bridges, and railroads—and more recently through pipelines, telecommunications infrastructure, and electric transmission facilities. The Court has upheld these exercises of the federal eminent domain power—whether by the Government or a private corporation, whether through the upfront taking of property or a condemnation action, and whether against private property or state-owned land. Section 717f(h) falls within this established practice. Pp. 7–12.
(1) Governments have long taken property for public use without the owner’s consent. The United States is no different. While the Constitution and Bill of Rights did not use the term “eminent domain,” the Takings Clause of the Fifth Amendment (“nor shall private property be taken for public use, without just compensation”) presupposed the existence of such a power. Initially, the Federal Government exercised its eminent domain authority in areas subject to exclusive federal jurisdiction. The Court later confirmed that federal eminent domain extended to property within a State. Kohl v. United States, 91 U.S. 367. The Court’s decision in Kohl—which upheld the power of the United States to condemn land in Ohio to construct a federal building—observed that eminent domain was a “means well known when the Constitution was adopted” and that “[t]he powers vested by the Constitution in the general government demand for their exercise the acquisition of lands in all the States.” Id., at 371–372. Kohl involved the condemnation of private land, but the Court subsequently made clear that “[t]he fact that land is owned by a state is no barrier to its condemnation by the United States.” Oklahoma ex rel. Phillips v. Guy F. Atkinson Co., 313 U.S. 508, 534. Pp. 7–9.
(2) For as long as the eminent domain power has been exercised by the United States, it has also been delegated to private parties. The Colonies, the States, and the Federal Government have commonly authorized the private condemnation of land for public works. And in the years following Kohl, the Court confirmed that private delegatees, like the United States, can exercise the federal eminent domain power within the States. In Luxton v. North River Bridge Co., 153 U.S. 525, for example, the Court rejected a landowner’s claim that Congress could not delegate its authority to condemn property necessary to construct a bridge between New York and New Jersey. Congress had the sovereign power to construct bridges for interstate commerce, and the Court confirmed Congress could choose to do so through a corporation. Id., at 530. These powers, the Court noted, could be exercised “with or without a concurrent act of the State in which the lands lie.” Ibid. Early cases also reflected the understanding that state property was not immune from the exercise of delegated federal eminent domain power. See Stockton v. Baltimore & N. Y. R. Co., 32 F. 9 (Bradley, Cir. J.). The contrary position—that a federal delegatee could not condemn a State’s land without the State’s consent—would give rise to the “dilemma of requiring the consent of the state” in virtually every infrastructure project authorized by the Federal Government. Id., at 17. The Court in Cherokee Nation v. Southern Kansas R. Co., 135 U.S. 641, echoed Stockton’s explanation of the superior eminent domain power of the Federal Government when it rejected a challenge to a private railroad company’s exercise of the federal eminent domain power against land owned by the Cherokees. In reaching that result, the Court acknowledged that “the national government, in the execution of its rightful authority, could exercise the power of eminent domain in the several States,” and the Court labeled as “strange” the notion that the Federal Government “could not exercise the same power in a Territory occupied by an Indian nation or tribe.” 135 U. S., at 656–657. Pp. 9–11.
(3) Section 717f(h) delegates to certificate holders the power to condemn any necessary rights-of-way, including land in which a State holds an interest. This delegation of the federal eminent domain authority is consistent with the Nation’s history and this Court’s precedents. FERC’s issuance to a company of a certificate of public convenience and necessity to build a pipeline carries with it the power—if the company cannot acquire the necessary rights-of-way by contract at an agreed compensation—to “acquire the same by the exercise of the right of eminent domain.” §717f(h). This delegation is categorical; by its terms, §717f(h) delegates to certificate holders the power to condemn any necessary rights-of-way, including land in which a State holds an interest. Pp. 11–12.
(c) Respondents contend that sovereign immunity bars condemnation actions against a nonconsenting State. Alternatively, respondents contend that §717f(h) does not speak with sufficient clarity to authorize such actions. The Court rejects each argument, for reasons stated below. Pp. 13–22.
(1) “States’ immunity from suit is a fundamental aspect of the sovereignty which the States enjoyed before the ratification of the Constitution.” Alden v. Maine, 527 U.S. 706, 713. A State may be sued only in limited circumstances, including where the State expressly consents or where Congress clearly abrogates the State’s immunity under the Fourteenth Amendment. A State may also be sued if it has implicitly agreed to suit in the “plan of the Convention,” which is shorthand for “the structure of the original Constitution itself.” Id., at 728. The Court has looked to the plan of the Convention to permit actions against nonconsenting States in the context of bankruptcy proceedings, suits by other States, and suits by the Federal Government. Pp. 13–14.
(2) Respondents do not dispute that the NGA empowers certificate holders to condemn private property, but they contend that the same certificate holders have no power to condemn state-owned property under §717f(h). It is argued that the NGA cannot authorize such condemnation actions under the Court’s decision in Seminole Tribe of Fla. v. Florida, 517 U.S. 44, which generally prohibits Congress from using its Article I powers to abrogate state sovereign immunity. But congressional abrogation is not the only means of subjecting States to suit. The States implicitly consented to private condemnation suits when they ratified the Constitution, and respondents’ arguments to the contrary cannot be squared with the Court’s precedents.
Respondents do not dispute that the Federal Government enjoys a power of eminent domain superior to that of the States, or that the Federal Government can delegate that power to private parties. Respondents instead point to the absence of founding-era evidence of private condemnation suits against nonconsenting States to maintain that States did not consent to such suits when they entered the federal system. Respondents would divorce the federal eminent domain power from the power to bring condemnation actions—and then argue that the latter cannot be delegated to private parties with respect to state-owned lands. But the eminent domain power is inextricably intertwined with condemnation authority. Separating the two would diminish the eminent domain power of the federal sovereign, which the State may not do. See Kohl, 91 U. S., at 374. Absent the power to condemn States’ property interests, the only constitutionally permissible way of exercising the federal eminent domain power would be to take property up front and require States to sue for compensation later. State sovereign immunity would not be served by favoring private or Government-supported invasions of state-owned lands over judicial proceedings.
The Court held in United States v. Texas, 143 U.S. 621, that it “does no violence to the inherent nature of sovereignty” for a State to be sued by “the government established for the common and equal benefit of the people of all the States.” Id., at 646. In so holding, the Court did not insist upon examples from the founding era of federal suits against States. Similar structural considerations support the conclusion that States consented to the federal eminent domain power, whether that power is exercised by the Government or its delegatees. The absence of a perfect historical analogue to the proceedings PennEast initiated below does not suggest otherwise. Pp. 14–21.
(3) Finally, respondents argue that even if States agreed in the plan of the Convention to condemnation suits by Federal Government delegatees, the NGA does not authorize such suits with the clarity required by the Court’s precedents. There is no requirement, however, that the Federal Government speak with “unmistakable clarity” when authorizing a private party to exercise its eminent domain power. Pp. 21–22.
938 F.3d 96, reversed and remanded.
Roberts, C. J., delivered the opinion of the Court, in which Breyer, Alito, Sotomayor, and Kavanaugh, JJ., joined. Gorsuch, J., filed a dissenting opinion, in which Thomas, J., joined. Barrett, J., filed a dissenting opinion, in which Thomas, Kagan, and Gorsuch, JJ., joined.
JUDGMENT ISSUED. |
Judgment REVERSED and case REMANDED. Roberts, C. J., delivered the opinion of the Court, in which Breyer, Alito, Sotomayor, and Kavanaugh, JJ., joined. Gorsuch, J., filed a dissenting opinion, in which Thomas, J., joined. Barrett, J., filed a dissenting opinion, in which Thomas, Kagan, and Gorsuch, JJ., joined. |
Argued. For petitioner: Paul D. Clement, Washington, D. C.; and Edwin S. Kneedler, Deputy Solicitor General, Department of Justice, Washington, D. C. (for United States, as amicus curiae.) For respondents: Jeremy M. Feigenbaum, Counsel to the Attorney General, Trenton, N. J. |
Motion of the Acting Solicitor General for leave to participate in oral argument as amicus curiae and for divided argument GRANTED. |
Reply of PennEast Pipeline Company, LLC submitted. |
Reply of petitioner PennEast Pipeline Company, LLC filed. (Distributed) |
Brief amicus curiae of Institute for Justice filed. (Distributed) |
Brief amici curiae of State of Oregon, et al. filed. (Distributed) |
Brief amici curiae of The Council of State Governments, The National League of Cities, The U.S. Conference of Mayors, The International City/County Management Association, and The International Municipal Lawyers Association filed. (Distributed) |
Brief amici curiae of The Council of State Governments, et al. filed. (Distributed) |
Amicus brief of State of Oregon and 18 Other States submitted. |
Amicus brief of The Council of State Governments, The National League of Cities, The U.S. Conference of Mayors, The International City/County Management Association, and The International Municipal Lawyers Association submitted. |
Amicus brief of Institute for Justice submitted. |
Motion of United States for leave to participate in oral argument and for divided argument submitted. |
Brief of respondent New Jersey Conservation Foundation filed. (Distributed) |
Brief of respondents New Jersey, et al. filed. (Distributed) |
Motion of the Acting Solicitor General for leave to participate in oral argument as amicus curiae and for divided argument filed. |
CIRCULATED |
Record requested. |
SET FOR ARGUMENT on Wednesday, April 28, 2021. |
Brief amicus curiae of Columbia Gas Transmission, LLC filed. |
Brief amicus curiae of Energy Equipment and Infrastructure Alliance filed. |
Brief amici curiae of United Association of Journeymen and Apprentices of the Plumbing and Pipe Fitting Industry of the United States and Canada, AFL-CIO, et al. filed. |
Brief amici curiae of The Chamber of Commerce of the United States of America and the Pennsylvania Chamber of Business and Industry filed. |
Brief amici curiae of Pennslvania Manufacturers' Association and the New Jersey Business & Industry Association filed. |
Brief amicus curiae of United States filed. |
Brief amici curiae of Marcellus Shale Coalition and Pennsylvania Independent Oil & Gas Association filed. |
Brief amici curiae of Interstate Natural Gas Association of America, American Gas Association, American Petroleum Institute filed. |
Blanket Consent filed by Respondent, State of New Jersey; NJ Department of Envrionmental Protection, et al. |
Joint appendix (two volumes) filed. |
Brief of petitioner PennEast Pipeline Company, LLC filed. |
Joint appendix (two volumes) filed. (Statement of cost filed). |
Blanket Consent filed by Respondent, New Jersey Conservation Foundation |
Joint motion to set the briefing schedule GRANTED. Petitioner's brief on the merits will be filed on or before March 1, 2021. Respondents briefs on the merits will be filed on or before March 31, 2021. The reply brief will be filed in compliance with Rule 25.3. |
Joint motion to set the briefing schedule filed by the parties. |
Blanket Consent filed by Petitioner, PennEast Pipeline Company, LLC |
Petition GRANTED. In addition to the question presented by the petition, the parties are directed to brief and argue the following question: Did the Court of Appeals properly exercise jurisdiction over this case? The case will be set for argument in the April 2021 argument session. |
DISTRIBUTED for Conference of 1/22/2021. |
Supplemental brief of respondents State of New Jersey; NJ Department of Envrionmental Protection, et al. filed. |
Brief amicus curiae of United States filed. |
The Solicitor General is invited to file a brief in this case expressing the views of the United States. |
DISTRIBUTED for Conference of 6/25/2020. |
Reply of petitioners PennEast Pipeline Company, LLC filed. (Distributed) |
Letter waiving the 14-day waiting period for the distribution of the petition for a writ of certiorari pursuant to Rule 15.5 filed. |
Waiver of right of respondent New Jersey Conservation Foundation to respond filed. |
Brief of respondents State of New Jersey; NJ Department of Envrionmental Protection, et al. in opposition filed. |
Motion to extend the time to file a response is granted in part; the time is extended to and including June 2, 2020, for all respondents. |
Motion to extend the time to file a response from May 13, 2020 to June 12, 2020, submitted to The Clerk. |
Response to motion from petitioner PennEast Pipeline Company, LLC filed. |
Response Requested. (Due May 13, 2020) |
DISTRIBUTED for Conference of 4/17/2020. |
Waiver of right of respondent New Jersey Conservation Foundation to respond filed. |
Waiver of New Jersey Conservation Foundation of right to respond not accepted for filing. (March 24, 2020) |
Brief amici curiae of United Association of Journeymen and Apprentices of the Plumbing and Pipe Fitting Industry of the United States and Canada, AFL-CIO, et al. filed. |
Brief amicus curiae of Columbia Gas Transmission, LLC filed. |
Brief amici curiae of Pennslvania Manufacturers' Association, et al. filed. |
Waiver of right of respondents State of New Jersey; NJ Department of Envrionmental Protection, et al. to respond filed. |
Brief amicus curiae of Consumer Energy Alliance filed. |
Brief amici curiae of The Chamber of Commerce of the United States of America and the Pennsylvania Chamber of Business and Industry filed. |
Brief amici curiae of Interstate Natural Gas Association of America, American Gas Association, American Petroleum Institute filed. |
Brief amicus curiae of Energy Equipment and Infrastructure Alliance filed. |
Brief amicus curiae of Marcellus Shale Coalition and Pennsylvania Independent Oil & Gas Association filed. |
Brief amicus curiae of Industrial Energy Consumers of America filed. |
Blanket Consent filed by Petitioner, PennEast Pipeline Company, LLC. |
Petition for a writ of certiorari filed. (Response due March 23, 2020) |
Application (19A836) granted by Justice Alito extending the time to file until March 4, 2020. |
Application (19A836) to extend the time to file a petition for a writ of certiorari from February 3, 2020 to March 4, 2020, submitted to Justice Alito. |