PennEast Pipeline Co. v. New Jersey

Supreme Court of the United States · 2021 · Federal Courts

Federal CourtsState sovereign immunityFederal eminent domainNatural Gas ActNatural Gas Act15 U.S.C. §717f(h)FERCcertificate of public convenience and necessity

Facts

The Natural Gas Act requires a natural gas company seeking to build an interstate pipeline to obtain from FERC a certificate of public convenience and necessity. In 1947, Congress amended the Act to allow certificate holders that cannot acquire needed rights-of-way by agreement to obtain them through the exercise of eminent domain under 15 U.S.C. §717f(h). FERC granted PennEast a certificate to build a 116-mile pipeline from Pennsylvania to New Jersey, and PennEast then filed federal condemnation actions for rights-of-way along the approved route. Some targeted parcels involved property interests claimed by New Jersey, including possessory interests and conservation easements, and New Jersey asserted sovereign immunity.

Issue

Does 15 U.S.C. §717f(h) authorize a FERC certificate holder to condemn necessary rights-of-way in which a State claims an interest? If so, does state sovereign immunity nevertheless bar a private certificate holder's condemnation action against a nonconsenting State?

Rule

Section 717f(h) delegates to FERC certificate holders the Federal Government's eminent domain power to condemn any necessary rights-of-way, including property in which a State holds an interest. Because the States consented in the plan of the Convention to the exercise of the federal eminent domain power, that power may be exercised through condemnation proceedings brought by the Federal Government's private delegatees against state-owned property.

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One of 10 multiple-choice questions for this case. Pick an answer to see why.

Prairie Junction Gas LLC obtained a federal certificate of public convenience and necessity to build an interstate gas pipeline from Oklahoma into Kansas. After failing to negotiate an easement, Prairie Junction filed a federal condemnation action against land in Wichita in which Kansas holds a conservation easement, and Kansas asserts sovereign immunity.

How should the court rule on Kansas's immunity defense?

Explanation. The majority held that the Natural Gas Act delegates to certificate holders the Federal Government's eminent domain power to condemn necessary rights-of-way, including property in which a State holds an interest. States consented in the plan of the Convention to the exercise of the federal eminent domain power in its entirety, including condemnation proceedings brought by private delegatees. Therefore, sovereign immunity does not bar this suit.