Hawkeye Land Co. v. ITC Midwest LLC

Decision Date11 August 2015
Docket NumberNo. C 15–3119–MWB.,C 15–3119–MWB.
Parties HAWKEYE LAND COMPANY, Plaintiff, v. ITC MIDWEST LLC and ITC Holdings, Corp., Defendants.
CourtU.S. District Court — Northern District of Iowa

125 F.Supp.3d 885

HAWKEYE LAND COMPANY, Plaintiff,
v.
ITC MIDWEST LLC and ITC Holdings, Corp., Defendants.

No. C 15–3119–MWB.

United States District Court, N.D. Iowa, Central Division.

Signed Aug. 11, 2015.


125 F.Supp.3d 887

Andrew Potter, Hawkeye Land Company, Jon M. McCright, Lynch Dallas Law Firm, Cedar Rapids, IA, for Plaintiff.

Laura Michelle Hyer, Timothy J. Hill, Bradley & Riley, Cedar Rapids, IA, for Defendants.

MEMORANDUM OPINION AND ORDER DENYING IN PART AND GRANTING IN PART DEFENDANTS' MOTION TO DISMISS

MARK W. BENNETT, District Judge.

TABLE OF CONTENTS
I. FACTUAL AND PROCEDURAL BACKGROUNDS 888
II. ISSUES 889
III. DISCUSSION 889
A. Standard Of Review For Motion To Dismiss 889
B. Unreasonable Interference With Private Property 890
C. Tortious Interference With Prospective Economic Benefit 893
D. Malicious Prosecution 895
E. Abuse Of Process 897
F. Claim For Attorneys' Fees 899
G. Whether To Dismiss ITC Holdings From This Litigation 901
IV. CONCLUSION 902
125 F.Supp.3d 888

In this Memorandum Opinion and Order, I address the motion to dismiss filed by the defendants, ITC Midwest LLC (ITC Midwest) and ITC Holdings Corp. (ITC Holdings), on June 11, 2015 (docket no. 6). Defendants move to dismiss, with prejudice, Counts III–VI of the plaintiff's petition, the claim for attorneys' fees, and ITC Holdings from this action.

I. FACTUAL AND PROCEDURAL BACKGROUNDS

Plaintiff Hawkeye Land Company (Hawkeye), is an Iowa corporation that "owns the right to sell easements across active railroad tracks," in certain areas in the Midwest, including Franklin County, Iowa. See Plaintiff's Resistance (docket no. 9), 3; see also Hawkeye Land Co. v. Iowa Utils. Bd., 847 N.W.2d 199, 201 (Iowa 2014). The defendants are ITC Midwest, a Michigan limited liability company, and ITC Holdings, a Michigan corporation. Plaintiff's Resistance Brief at 3. ITC Midwest is an independent electric transmission company, and ITC Holdings is the parent company and sole member of ITC Midwest. See id. at 2–3, 18; see also Hawkeye Land Co., 847 N.W.2d at 201. The present dispute arose in 2009 when the Iowa Utilities Board (IUB) permitted ITC Midwest to use a railroad-crossing statute (crossing statute), Iowa Code § 476.27,1 to construct three 161 kilovolt transmission lines on Hawkeye's property in Franklin County, Iowa. Hawkeye Land Co., 847 N.W.2d at 201.

On August 7, 2009, Hawkeye contested ITC Midwest's actions by filing a complaint with the IUB. Id. An Administrative Law Judge (ALJ) rejected Hawkeye's claims in a proposed decision on October 14, 2010: it "upheld the use of the pay-and-go procedure and denied compensation beyond the $750.00 per crossing." Id. at 201, 205. Hawkeye appealed the ALJ's proposed decision to the IUB. "IUB, asserting interpretative authority over section 476.27, reached the same conclusions in its final decision, and the district court affirmed on judicial review." Id. at 201, 206. Hawkeye appealed, and the Iowa Supreme Court retained the appeal.

The Iowa Supreme Court summarized Hawkeye's contentions on appeal as follows: "[Hawkeye] contends the crossing

125 F.Supp.3d 889

statute does not apply to it or to ITC Midwest, because [Hawkeye] is not a ‘railroad’ and ITC Midwest is not a ‘public utility’ within the meaning of the statute"; $750.00 per crossing of Hawkeye's easement is "not just compensation"; and "the pay-and-go procedure [under the crossing statute] is unconstitutional under the takings clause of article I, section 18 of the Iowa Constitution." Id. After thoroughly analyzing the parties' arguments, the Iowa Supreme Court determined: (1) the IUB lacks interpretive authority as to the crossing statute, Iowa Code § 476.27 ; (2) Hawkeye is a railroad corporation's successor in interest under the crossing statute and, thus, the statute applies to Hawkeye's easement-crossing rights; and (3) ITC Midwest is not a public utility company within the meaning of the crossing statute,2 and thus, it is not permitted to use the pay-and-go procedure. Hawkeye Land Co., 847 N.W.2d at 209, 213, 219. After the case was remanded to the IUB by the district court, the IUB ordered that its prior orders be vacated in accordance with the Iowa Supreme Court's decision. See In re: Hawkeye Land Co. v. ITC Midwest LLC, No. FCU–2009–0006, 2014 WL 4374058, *5–*6 (Iowa U.B. Aug. 29 2014) (slip op.).

Following the Iowa Supreme Court's decision, on June 6, 2015, Hawkeye filed a six-count petition (docket no. 4) in Franklin County, Iowa District Court, against ITC Midwest and ITC Holdings regarding the same three railroad crossings. Hawkeye alleged counts of (1) trespass; (2) unjust enrichment; (3) unreasonable interference with private property; (4) tortious interference with prospective economic benefit; (5) malicious prosecution; and (6) abuse of process. On June 5, 2015, the defendants removed this case to the United States District Court for the Northern District of Iowa (docket no. 1). On June 11, 2015, the defendants filed a motion to dismiss Counts III–VI of Hawkeye's petition, Hawkeye's claim for attorneys' fees, and ITC Holdings from this litigation. Hawkeye filed its resistance brief on June 24, 2015 (docket no. 9), following which the defendants filed their reply brief on July 6, 2015 (docket no. 17).

II. ISSUES

In this Memorandum Opinion and Order, I address whether Hawkeye has stated claims upon which relief may be granted as to its claims for: (1) unreasonable interference with private property (Count III); (2) tortious interference with prospective economic benefit (Count IV); (3) malicious prosecution (Count V); (4) abuse of process (Count VI); (5) attorneys' fees; and (6) relief against ITC Holdings. I also address whether oral...

To continue reading

Request your trial

VLEX uses login cookies to provide you with a better browsing experience. If you click on 'Accept' or continue browsing this site we consider that you accept our cookie policy. ACCEPT