Boerschig v. Trans-Pecos Pipeline, L.L.C., 100317 FED5, 16-50931

Docket Nº:16-50931
Party Name:JOHN P. BOERSCHIG Plaintiff - Appellant v. TRANS-PECOS PIPELINE, L.L.C. Defendant- Appellee
Judge Panel:Before STEWART, Chief Judge, and HIGGINBOTHAM, and COSTA, Circuit Judges.
Case Date:October 03, 2017
Court:United States Courts of Appeals, Court of Appeals for the Fifth Circuit

JOHN P. BOERSCHIG Plaintiff - Appellant


TRANS-PECOS PIPELINE, L.L.C. Defendant- Appellee

No. 16-50931

United States Court of Appeals, Fifth Circuit

October 3, 2017

         Appeal from the United States District Court for the Western District of Texas

          Before STEWART, Chief Judge, and HIGGINBOTHAM, and COSTA, Circuit Judges.


         Texas law allows a natural gas utility to condemn land for "public use." Tex. Util. Code § 181.004; Tex. Const. art. I, § 17(a). Trans-Pecos Pipeline, LLC exercised that authority and initiated a condemnation proceeding to obtain a 50-foot wide permanent right-of-way and easement on John Boerschig's ranch. The ranch is along the route of a 148-mile pipeline Trans-Pecos is constructing in west Texas that terminates at the Mexican border in the middle of the Rio Grande.

         Boerschig contends that by ceding condemnation power to a private company, Texas eminent domain law offends due process. His argument principally relies on the private nondelegation doctrine, a nook of Fourteenth Amendment law long recognized but seldom invoked. The strength of this constitutional challenge is the central question we must decide in reviewing whether a federal court should enjoin the ongoing state condemnation process.


         The pipeline Trans-Pecos is constructing-with the exception of the short section that crosses the Rio Grande and is thus subject to federal authority-is intrastate and thus governed by Texas law. To place a pipeline on land like Boerschig's ranch, Texas requires that the company first try to negotiate with the landowner. Tex. Prop. Code § 21.0113.

         Those negotiations failed, so Trans-Pecos invoked Texas eminent domain power via the following statute: "A gas or electric corporation has the right and power to enter on, condemn, and appropriate the land, right-of-way, easement, or other property of any person or corporation." Tex. Util. Code § 181.004; see also Anderson v. Teco Pipeline Co., 985 S.W.2d 559, 564-66 (Texas Ct. App.- San Antonio, 1998) (discussing the statutory scheme and noting that "courts have determined that a corporation operating a gas pipeline has the power of eminent domain if it devotes its private property and resources to public service and allows itself to be publicly regulated"). For statutes like this one that do not "specifically require[ ] a condemning agency to show the necessity for the condemnation, " courts view the legislature as delegating to the condemning authority the question whether the taking is necessary. Elizabeth M. Bosek, et al., 32 Tex. Jur. 3d Eminent Domain § 103; see Circle X Land & Cattle Co. v. Mumford Indep. Sch. Dist., 325 S.W.3d 859, 864 (Tex. App.-Houston [14th Dist.], 2010). So before exercising its power to condemn, a gas utility must determine that the taking is necessary to further what both the Texas and federal constitutions require-a public purpose. Anderson, 985 S.W.2d at 565 (explaining that the company's board of directors usually makes this finding) (citing Bevley v. Tenngasco Gas Gathering Co., 638 S.W.2d 118, 121 (Tex. Ct. App.-Corpus Christi, 1982, writ ref'd n.r.e.)). In the judicial review that may follow, this necessity determination is "conclusive, absent fraud, bad faith, abuse of discretion, or arbitrary or capricious action." Anderson, 985 S.W.2d at 565.1

         Boerschig brought this lawsuit to stop that state review process, as Trans-Pecos had already initiated the condemnation proceeding. That proceeding begins with a state district court appointing special commissioners who assess the value of the property. See City of Tyler v. Beck, 196 S.W.3d 784, 786 (Tex. 2006). After the commissioners make that award, the condemnor can take control of the property. Tex. Prop. Code § 21.021(a). If objections to the commissioners' award are filed, a case is opened in state court. Tyler, 196 S.W.3d at 786. It is during that judicial phase when the landowner may challenge the utility's finding of a public necessity. See, e.g., Anderson, 985 S.W.2d at 566.

         But before the commissioners issued a ruling from which Boerschig could have sought judicial review, Boerschig filed this federal suit and sought to enjoin the state condemnation proceeding. He asserted that Texas's eminent domain regime violates the Due Process Clause, both because it is a broad delegation of power to a private party and because it fails to provide for a predeprivation hearing.

         The district court did not issue an injunction, holding that the requested relief would violate the Anti-Injunction Act, which prohibits federal courts from enjoining ongoing state proceedings. See 28 U.S.C. § 2283. After the district court ruling, the commissioners issued their valuation of $644, 625, Boerschig filed his objections to the taking in state court, and Trans-Pecos took control of the property. Meanwhile, Boerschig filed this appeal of the federal district court's refusal to enjoin the condemnation proceedings.


         Because Trans-Pecos has completed construction of the pipeline on Boerschig's ranch during the pendency of this appeal, Trans-Pecos believes it is too late for an injunction to issue. It thus asks us to dismiss the appeal as moot. We review questions concerning our jurisdiction-like whether a controversy has become moot-de novo. Harris v. City of Houston, 151 F.3d 186, 189 (5th Cir. 1998).

         A request for injunctive relief generally becomes moot when the event sought to be enjoined takes place. Id. But this rule has a well-established exception: when the defendant completes the act to be enjoined despite having notice of the request for injunctive relief, the plaintiff is not deprived of appellate review if the reviewing court can restore the status quo. Porter v. Lee, 328 U.S. 246, 251 (1946) (noting even then that the exception "has long been established"); see also Moore v. Cons. Edison Co. of New York, Inc., 409 F.3d 506, 510 (2d Cir. 2005) (Sotomayor, J.) (holding that a request for preliminary injunction is not moot when the court has the ability to "offer effective relief"). After the district court denied Boerschig's request for preliminary injunction, Trans-Pecos began construction on the pipeline. But we could, pursuant to the exception in Porter, order that Trans-Pecos return Boerschig's land to its precondemnation state. See Bastian v. Lakefront Realty Corp., 581 F.2d 685, 691-92 (7th Cir. 1978) (holding that an appeal of a denial of preliminary injunction was not moot even when the property at issue had already been sold and leased to third parties, because the court had jurisdiction to compel restoration to the original property owner). Because we could offer this "effective relief, " the controversy is not moot and we can consider the appeal. See Moore, 409 F.3d at 510.


         As the events that have taken place since the district court ruling do not deprive us of jurisdiction, we consider whether an injunction should have issued. The district court denied Boerschig's application under the Anti-Injunction Act, which provides that a "court of the United States may not grant an injunction to stay proceedings in a State court except as expressly authorized by Act of Congress, or where necessary in aid of...

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