Important Case Update: SCOTUS rules that private parties can condemn state-owned property under federal Natural Gas Act

Today’s blog post is from one of my Bay Area Eminent Domain Partners, Kara L. DiBiasio.  You can learn more about Kara and her practice by clicking on her name.

This term, in PennEast Pipeline Co. v. New Jersey, the United States Supreme Court ruled that PennEast Pipeline Co., a private party, could initiate eminent domain proceedings against New Jersey for condemnation of state-owned property. 

PennEast sought to construct a 116-mile natural gas pipeline from Pennsylvania to New Jersey.  PennEast was granted a certificate of public convenience and necessity for the project.  Pursuant to the Natural Gas Act, this certificate authorizes its holder to exercise federal eminent domain power to complete the project. 

New Jersey objected to the project and moved to dismiss PennEast’s suit to condemn its state-owned property, claiming sovereign immunity. 

In an opinion by Chief Justice Roberts, the high court sided with PennEast, holding that Section 717(h) of the Natural Gas Act authorizes certificate holders to “condemn all necessary rights-of-way, whether owned by private parties or States.”  (Emphasis added.)  In response to New Jersey’s sovereign immunity argument, the Court held that while States are generally immune from suit, they surrendered this immunity from the exercise of the federal eminent domain power when they ratified the Constitution.

Justices Breyer, Alito, Sotomayor, and Kavanaugh joined the majority opinion.  Justice Gorsuch filed a dissenting opinion in which Justice Thomas joined.  Justice Barrett also filed a dissenting opinion in which Justices Thomas, Kagan, and Gorsuch joined. 

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