Arkansas and 11 other Republican-led states asked the U.S. Supreme Court on Monday to take up a case out of North Dakota involving a dispute between ranchers and an energy company. At issue: whether an energy company that takes land under a federal statute must also pay the landowners’ legal fees.
WBI Energy took a portion of two North Dakota landowners’ property in 2018 to build a pipeline. They took the land under the federal Natural gas act, wich allows private businesses to use the federal government’s eminent domain power for public natural gas infrastructure. The ranchers were paid for their land, but the act doesn’t say whether WBI must also pay the ranchers’ legal expenses.
A District Court judge in North Dakota initially ordered WBI to pay $380,000 in legal fees, but the Eighth circuit Court of Appeals disagreed. They said that becuase WBI used federal eminent domain powers to take the land, a state law that might otherwise obligate the company to cover legal fees doesn’t apply.They also noted that, when the federal government takes land under that same power, they do not have to pay legal fees.
Notably, the Eighth Circuit is the onyl federal appeals court to reach that conclusion.The Third, Fifth, Sixth and Eleventh Circuits have all held that state law applies in such situations.
The ranchers filed a petition in the Supreme Court in August, asking the high court to review the Eighth Circuit’s decision. in a friend-of-the-court brief filed on Monday, 12 states, including Arkansas, echoed support for the ranchers’ position and asked the court to take the case.
In their brief, the states argue that the Natural Gas Act was not intended to displace customary state-law methods for determining “just compensation” in eminent domain proceedings. They say traditional “principles of federalism” support using state law to determine the amount of compensation due, and, because the Natural Gas Act can only be used by private entities, concerns that might prevent applying state law when the federal government takes property do not apply when a private entity does it.
Along with Arkansas, the brief was joined by Alabama, Florida, Idaho, Nebraska, North dakota, south Carolina, South Dakota, Tennessee and Texas. (Arkansas and both Dakotas are part of the Eighth Circuit.) They argue that allowing the eighth Circuit’s decision to stand would upset the balance of power between states and the federal government.
“Under the Eighth Circuit’s decision, landowners in seven states no longer have the benefit of state law property rights that landowners in the rest of the country have,” the states’ brief says.
The court will likely consider the request this fall after WBI responds to the ranchers’ petition in October. Out of the 7,000 to 8,000 petitions to take a case that the Supreme Court receives every year, the court typically grants about 1%. Because the Eighth Circuit’s decision differs from other circuits, however, and because this case deals with questions of individual and states’ rights and also federalism, it would appear to have a better chance of being taken by the high court than a typical case might.
