United States District Court, N.D. Ohio, Eastern Division
Laura D. Urban, et al., Plaintiffs,
Federal Energy Regulatory Commission of the United States of America, et al., Defendants.
ORDER AND DECISION (RESOLVING DOCS. 6, 24, 28,
R. ADAMS JUDGE.
14, 2017, this Court referred the Plaintiffs' motion for
a preliminary injunction (Doc. 6) to Magistrate Judge Burke
for a report and recommendation. On August 7, 2017,
Magistrate Judge Burke issued a Report and Recommendation
(“the Report”) that this Court deny the motion
for a preliminary injunction. Plaintiffs objected to the
Report, and Defendants responded to those
objections. In analyzing the motion, Magistrate Judge
Burke noted that it was necessary to also review the
parties' arguments regarding dismissal when considering
the request for injunctive relief. As such, the Report also
contains an analysis that applies to the Federal Energy
Regulatory Commission's (“FERC”) motion to
dismiss (Doc. 24) and Nexus Gas Transmission, LLC's
(“Nexus”) motion to dismiss. Doc. 28.
Accordingly, the Court will resolve all three motions herein.
are a group of property owners that assert that they will be
negatively impacted by a natural gas pipeline that Nexus
seeks to build. As such, they filed suit on May 12, 2017 and
sought injunctive relief. In their request, Plaintiffs
contend that there is error in the Final Environmental Impact
Statement issued by FERC and that Nexus proceeded under the
wrong section of the Natural Gas Act. The Report, however,
does not reach the merits of these contentions. Instead, the
Report concludes that this Court lacks subject matter
jurisdiction over the complaint in its entirety.
7 of the Natural Gas Act grants FERC the jurisdiction to
approve or deny the construction of interstate natural-gas
pipelines. See 15 U.S.C. § 717f. Before any
such pipeline can be built, FERC must grant the developer a
“certificate of public convenience and necessity,
” id. § 717f(c)(1)(A), also called a
Section 7 certificate, upon a finding that the project will
serve the public interest. See id. § 717f(e).
FERC is also empowered to attach “reasonable terms and
conditions” to the certificate, as necessary to protect
the public. Id. A certificate holder has the ability
to acquire necessary rights-of-way from unwilling landowners
by eminent domain proceedings. See id. §
717f(h). Any party to a proceeding under the Act who is
“aggrieved” by a FERC order may petition for
review of that order in a Federal Circuit Court of Appeals,
provided that they first seek rehearing before FERC.
Id. § 717r(a)-(b).
Sixth Circuit has described this process as follows:
The Natural Gas Act sets forth a highly reticulated procedure
for obtaining, and challenging, a FERC certificate to build
an interstate pipeline. A party aggrieved by such an order
may apply for rehearing before FERC. 15 U.S.C. §
717r(a). And no entity may seek judicial review of a FERC
order unless it first sought rehearing from the agency.
Id. Once FERC concludes the rehearing, the aggrieved
party may petition for review either in the D.C. Circuit or
in the circuit where the natural gas company is located or
has its principal place of business[.] 15 U.S.C. §
717r(b); R.2 at 3 (the pipeline company is a Delaware LLC and
has its principal place of business in Texas). The relevant
court of appeals thereafter has ‘exclusive'
jurisdiction ‘to affirm, modify, or set aside
[FERC's] order in whole or in part.' 15 U.S.C. §
717r(b); see also 15 U.S.C. § 717r(d)(1).
Exclusive means exclusive, and the Natural Gas Act
nowhere permits an aggrieved party otherwise to pursue
collateral review of a FERC certificate in state court or
federal district court.…
that FERC has issued its final order and now that the coal
companies have appealed that order to the D.C. Circuit, the
matter lies within that court's exclusive jurisdiction.
15 U.S.C. § 717r; see also Williams Natural Gas
Co. v. City of Oklahoma City, 890 F.2d 255, 262 (10th
Cir. 1989). The coal companies thus may not seek what
amounts to a second round of collateral review of
FERC's order here. See Williams Natural Gas
Co., 890 F.2d at 262.
Am. Energy Corp. v. Rockies Express Pipeline LLC,
622 F.3d 602, 605-606 (6th Cir. 2010) (emphasis added). The
Tenth Circuit stated that 15 U.S.C. § 717r(b)
“vests exclusive jurisdiction to review all decisions
of the Commission in the circuit court of appeals . . . there
is no area of review, whether relating to final or
preliminary orders, available in the district court.”
Consolidated Gas Supply Corp v. Federal Energy
Regulatory Commission, 611 F.2d 951, 957 (10th Cir.
1979) (internal citations omitted).
herein seek to avoid the conclusion that appears compelled by
the reasoning expressed by the Sixth Circuit. Specifically,
Plaintiffs contends that this litigation was filed prior to
the issuance of a Certificate and that 15 U.S.C. § 717u
must be read to confer jurisdiction upon this Court. Section
717u reads in part: “The District Courts of the United
States and the United States courts of any Territory or other
place subject to the jurisdiction of the United States shall
have exclusive jurisdiction of violations of this chapter or
the rules, regulations, and orders thereunder, and of all
suits in equity and actions at law brought to enforce any
liability or duty created by, or to enjoin any violation of,
this chapter or any rule, regulation, or order
thereunder.” This Court, however, agrees that the
“highly reticulated procedure” detailed by the
Sixth Circuit “would be entirely undermined if unhappy
parties could come to district courts” prior to the
issuance of a Certificate to avoid that process. Lovelace
v. United States, Case No. 15CV30131 (D.Mass. Feb. 18,
the Court finds no error in the Report's conclusion that
the Leedom exception is not invoked under the facts
presented herein. As the Report properly notes, the
Leedom exception allows for Court review in limited
circumstances despite an otherwise comprehensive statutory
scheme of review. Greater Detroit Res. Recovery Auth v.
U.S. E.P.A., 916 F.2d 317, 323 (6th Cir. 1990).
“In order to bring a case within the exception, it must
be shown that the action of the agency was a patent violation
of its authority or that there has been a manifest
infringement of substantial rights irremediable by the
statutorily prescribed method of review.” Id.
Plaintiffs' contentions are that FERC improperly
delegated safety regulation to another agency and improperly
permitted Nexus to pursue a certificate as an interstate
pipeline rather than an export pipeline. Neither argument
demonstrates a “patent violation of authority.”
Rather, both simply represent claims that FERC improperly
exercised its discretion in evaluating the circumstances
before it. Those claims are precisely the type of claims that
can and should be reviewed in compliance with the regulatory
scheme set forth in the Natural Gas Act.
found no merit in Plaintiffs' objections and finding
itself in agreement with the logic espoused in the Report,
the Court hereby ADOPTS the Report in its entirety. Based
upon that adoption, the motion for preliminary injunction
(Doc. 6) is DENIED. Moreover, based upon the above, both
motions to dismiss for lack of subject matter jurisdiction
(Docs. 24 and 28) are GRANTED. This matter is hereby
dismissed for lack of subject matter jurisdiction.
 The Court later allowed briefing on
the impact of the issuance of the Certificate by FERC.
Plaintiffs' motion to file their brief instanter ...