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Rover Pipeline LLC v. 10.055 Acres of Land

United States District Court, N.D. Ohio, Eastern Division

May 9, 2018

ROVER PIPELINE LLC, PLAINTIFF,
v.
10.055 ACRES OF LAND, MORE OR LESS, IN ASHLAND COUNTY, OHIO, et al., DEFENDANTS.

          MEMORANDUM OPINION AND ORDER

          HONORABLE SARA LIOI UNITED STATES DISTRICT JUDGE

         This condemnation matter comes before the Court on the renewed motion of plaintiff Rover Pipeline LLC (“Rover”), pursuant to Rule 71.1(h)(2) of the Federal Rules of Civil Procedure, to appoint a commission. (Doc. No. 599 [“Mot.”].) The motion is opposed (Doc. No. 606 [“Miller Opp'n”]; Doc. No. 607 [“Dush Opp'n”]), [1] and Rover has filed an omnibus reply. (Doc. No. 609 [“Reply”].) Because the character, location, and quantity of the remaining unsettled properties, as well as the interests of justice, do not support the appointment of a commission, Rover's motion is DENIED.

         I. Background

         On February 2, 2017, the Federal Energy Regulatory Commission (“FERC”) issued Rover a certificate of public convenience and necessity (“FERC Certificate”) to construct a gas pipeline that will traverse several states and feed into other interstate and intrastate natural gas pipelines. (Doc. No. 279-2 (FERC Certificate).) The Rover Pipeline Project (“Rover Project”) comprises some 510.7 miles of right of way, 713 miles of pipeline, ten compressor stations and other facilities along a proposed route from certain Marcellus and Utica shale supply areas in West Virginia, Pennsylvania and Ohio to a point of interconnection with the Vector Pipeline, LP system in Livingston County, Michigan, among other interconnections existing nationally and internationally. (Doc. No. 4 (Motion for Condemnation and Immediate Possession), Ex. B, Affidavit of Joey Mahmoud [“Mahmoud Aff.”] ¶ 3.)[2]

         Prior to bringing the present condemnation action, Rover attempted to reach agreements with landowners regarding the easements necessary to facilitate the Rover Project and an appropriate amount of compensation. As part of these negotiations, Rover made written offers to all affected landowners and was able to voluntarily acquire 70% of the necessary easements. (Mahmoud Aff. ¶¶ 19-20; Doc. No. 4, Ex. A, Affidavit of Mark Vedral[3] [“Vedral Aff.”] ¶¶ 4-9.) Plaintiff was unable to reach agreement with approximately 685 individuals who owned affected property located in the Eastern Division of the Northern District of Ohio.

         As a result, on February 6, 2017, Rover filed its verified complaint in condemnation against those landowners who rejected Rover's offer of compensation.[4] The action was assigned to the undersigned jurist, who maintains a courtroom and chambers in the John F. Sieberling Federal Building and U.S. Courthouse located in Akron, Ohio. On February 7, 2017, Rover filed a motion for condemnation and immediate possession.

         This case is one of three filed by Rover in district courts in Ohio that address the Rover Project. The second action was filed in the Western Division of the Northern District of Ohio, and a third action was filed in the Southern District of Ohio. See Rover Pipeline LLC v. 5.9754 Acres of Land, et al., No. 3:17-cv-225 (N.D. Ohio, Western Division) (Carr, J.), filed February 6, 2017 (“Toledo Action”); Rover Pipeline LLC, v. Kanzigg, et al., No. 2:17-cv-105 (S.D. Ohio) (Marbley, J.), filed February 6, 2017 (“Southern District Action”).

         On February 24, 2017, the Court held a hearing on Rover's request for condemnation and immediate possession. Representatives of Rover, its counsel, all affected landowners and, where applicable, their counsel were required to attend. During the hearing, many defendants expressed an interest in negotiating a settlement with Rover. The Court temporarily suspended the proceedings and permitted the parties to explore possible resolution. While no settlements were finalized, Rover represented that it was close to reaching agreement with many property owners. After the hearing, Rover reached settlement with many of the affected landowners. The Court ordered the remaining parties to mediation before Magistrate Judge Kathleen B. Burke on March 6, 2017.[5] (Doc. No. 316.) By the end of the mediation session, the vast majority of landowners had granted Rover the easements it sought in exchange for an agreed amount of compensation.

         On March 9, 2017, this Court, in conjunction with Judge Carr, held a preliminary injunction hearing on this action and on the Toledo Action at the Akron federal courthouse. Once again, Rover's representatives, its counsel, all remaining defendants, and, where applicable, defense counsel were required to attend. At the hearing, Rover announced that it believed that it had reached agreement with all affected landowners regarding the issue of immediate possession.[6] Thereafter, the Court temporarily adjourned the proceedings to afford additional time for negotiations with the landowners present as to compensation. At that time, and in the weeks to follow, Rover came to terms with many other landowners as to the compensation for the takings.

         In the minutes from the preliminary injunction hearing, the Court instructed Rover to “use its best efforts to reach out to counsel for the remaining defendants and/or unrepresented landowners to resolve all outstanding issues of compensation.” (Minutes dated 3/10/2017.) The Court, with the assistance of the magistrate judge, also continued its efforts to assist the remaining parties to reach agreement as to compensation for the condemned properties, holding additional conferences and mediation sessions. In the end, the issue of compensation had been resolved in all but four tracts, owned by four different parties.

         On October 16, 2017, Rover filed the present renewed[7] motion to appoint a commission.[8]The motion requests that a three member panel be instituted to determine the appropriate compensation to be awarded to the property owners of the four remaining tracts of land. The first tract, owned by Robert and Rita Dush (the “Dushes”) and hereinafter referred to as the “Dush Property, ” is the most unique of the properties as it contains a Christmas Tree farm and restaurant. The remaining three properties-the “Sloan Property, ” owned by the Sloan Revocable Trust (“Sloan Trust”); the “Lane Property, ” owned by Robert and Martha Lane (the “Lanes”); and the “Miller Property, ” owned by Carl and Sherry Miller (the “Millers”), respectively-are each used for residential and not commercial purposes. In opposing the motion, the property owners argue that a jury ought to determine just compensation.

         II. Discussion

         At the outset, the Court must address the argument made by the Dushes that the defendant landowners are necessarily entitled under Ohio law to a jury trial on the issue of compensation. The underlying action was filed pursuant to the National Gas Act (“NGA”), which permits:

any holder of a certificate of public convenience and necessity . . . [to] acquire [property] by the exercise of the right of eminent domain in the district court of the United States for the district in which such property may be located, or in the State courts. The practice and procedure in any action or proceeding for that purpose in the district court of the United States shall conform as nearly as may be with the practice and procedure in similar action or proceeding in the courts of the State where the property is situated. Provided, that the United States ...

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