Special Report: Rover's Condemnation Developments and Sierra Club Weighs-In

After much anticipation, the first signs as to how Rover Pipeline's condemnation litigation may unfold, including the potential impact on the March 31 deadline, have come to light. But the wheels of justice turn slowly and inconsistently, and questions remain as to whether the condemnation process can be completed in time to allow Rover to meet its deadline. Nonetheless, while some courts have made little progress, one, in particular, has. At this point, the critical unknown will likely continue to be determining the outstanding parcels of land where trees must be felled by March 31. And last week permitting constraints seemed to be resolved, this week the Sierra Club identified an apparent inconsistency between the requirements of Rover's Final Environmental Impact Statement (FEIS) and Rover's FERC Certificate Order. The Sierra Club's filing may be the leading indicator of a petition for rehearing. Both of these circumstances should be evaluated closely over the coming days and weeks.

Condemnation Progress

Last Friday, our analysis of Rover's First Two Days in Court elaborated upon settlement attempts in the Northern District of Ohio (Akron), which, during the courtroom proceeding, produced one official settlement, with several more occurring over the past several days. Based on a hearing in the Northern District of Ohio (Toledo) earlier in the week, the judges have decided to consolidate the cases, and set a mediation conference for March 6. Depending upon the outcome of the mediation, the court has slated a preliminary injunction hearing for March 9, with defendant briefs due by March 2 and Rover's response due on March 7. Interestingly, the Akron-based judge, in an apparent effort to better account for the many outstanding easements, ordered Rover to file "two spreadsheets for all defendant properties for which there is not an agreement." Today, the same judge also resolved several outstanding motions, most of which were administrative, except for one granting select defendants' motions for extensions of time to file an answer by April 7.

And while the Northern District of Ohio and other states (see below) have made little progress on resolving the outstanding easements, substantial progress was made today in the Southern District. In fact, just this evening, the court issued a written Order, providing that "the company [Rover] is entitled to an order confirming its condemnation authority and to immediate possession of a significant number (but not all) of the easements sought." The Order does not apply to outstanding 12 parcels that have not yet been served. As a result, the judge ordered Rover to ensure that the 12 landowners are properly served by March 7. And if the negotiations do not lead to settlements for all outstanding parcels, the judge will hold a hearing on March 14.

Other material developments in various federal courts in the three other states in which the Rover Pipeline plans to cross include the following:

• Pennsylvania - Surprisingly, today the court set a trial date of April 20. Before the trial, the court also ordered that the parties file numerous briefs, expert reports, and motions between March 20 and March 27. This is the first trial that we have seen scheduled in the Rover condemnation lawsuits.
  
• Michigan - Few developments have occurred, except for the judge scheduling a status conference on March 6, with a hearing set for March 9.
  
• West Virginia - Hearings are set in several courts for March 2 and 3.
  

Sierra Club Spots an Issue with the FERC Certificate

Surprisingly, during the past three weeks following FERC's Order granting Rover Pipeline's Certificate, no intervenor group has formally expressed its dissatisfaction with the Order. That changed on Monday. The Sierra Club and Freshwater Accountability Project, filed a comment with the FERC that pointed out a potential defect in Rover's FEIS and, thus, the follow-on Certificate Order. And the Sierra Club may, in fact, have a point: the FEIS does state that Rover must use turbine engines as a noise mitigation measure, but the Order requires use of reciprocating engines. (The FERC required the use of turbines in order to avoid the noise disturbances caused by the pulsing vibration from compressor stations driven by reciprocating engines.) In addition to questioning FERC's Order, Sierra Club's comment also calls into question various Ohio EPA delegated Clean Air Act (CAA) permits which involve Rover's applications for compressor permits. As we discussed recently in Clean Air Act Permitting - Pruitt's First Priority? and at the Southern Gas Association conference, CAA permits are a new tool being used by intervenor groups; this is one more example of such a trend.

In any other project not under such extreme time constraints, this would likely not be an issue, but such additional administrative processes here may have an impact. Moreover, this filing could be an indicator of future litigation: the Sierra Club concludes the filing by threatening that if FERC does not require turbines instead of reciprocating engines, it "will be forced to consider what additional legal steps should be taken to enforce the unequivocal commitment to turbine engines expressed in the NEPA document." Depending upon FERC's response (or lack thereof), Sierra Club may file a petition for rehearing at FERC, which it -- or any other intervenor in the Rover Pipeline proceeding -- would need to do by Friday, March 3.

As recently as last week, the Commission re-clarified how it plans to handle Petitions for Rehearing. During the lack of quorum, the Office of the Secretary has the authority to issue a tolling order, which is the placeholder that grants the Commission more time to consider requests for rehearing. Therefore, the Office of the Secretary will continue to issue tolling orders, allowing timely rehearing petitions to be addressed when the Commission again has a quorum.
Today, in other developments, FERC Staff requested concurrence from the Michigan State Housing Development Authority-State Historic Preservation Office on a finding of no adverse effects on the state's historical resources. This may be a sign that FERC is in the process of finalizing several outstanding issues before it can issue the full notice to proceed with construction, perhaps as early as this week.