Norfolk Southern Ry. Co. v. Energy Dev. Corp.

• Decision Date: 24 March 2004
• Docket Number: No. CIV.A. 1:03-0307.,CIV.A. 1:03-0307.
• Citation: 312 F.Supp.2d 833
• Court: U.S. District Court — Southern District of West Virginia
• Parties: NORFOLK SOUTHERN RAILWAY COMPANY, Plaintiff, v. ENERGY DEVELOPMENT CORPORATION, William D. Evans, Douglas E. Evans, Eugene R. Evans and Virginia Berliner, Defendants.

312 F.Supp.2d 833

NORFOLK SOUTHERN RAILWAY COMPANY, Plaintiff, v. ENERGY DEVELOPMENT CORPORATION, William D. Evans, Douglas E. Evans, Eugene R. Evans and Virginia Berliner, Defendants.

No. CIV.A. 1:03-0307.

United States District Court, S.D. West Virginia. at Bluefield.

March 24, 2004.

Fred Adkins, John H. Mahaney, Melissa G. Foster, Huddleston Bolen Beatty Porter & Copen, Huntington, WV, for Plaintiff.

Wayne L. Evans, Katz Kantor & Perkins, Bluefield, WV, for Defendants/Third-Party Plaintiffs.

David M. Kersey, Brewster Morhous Cameron Mullins Caruth Moore Kersey & Stafford, Bluefield, WV, for Third-Party Defendant.

DISMISSAL ORDER

FABER, Chief Judge.

For the reasons herein detailed, the court concludes that it lacks jurisdiction over the subject matter of this dispute. Accordingly, the court is obliged to order this matter dismissed sua sponte.

I. Introduction

Plaintiff Norfolk Southern Railway Co. ("Norfolk Southern") commenced this action against Energy Development Corporation ("Energy"), William D. Evans ("Evans"), and the other defendants ("mineral rights defendants") on April 7, 2003. It alleges a federal common law cause of action grounded in the tort of nuisance. Specifically, Norfolk Southern charges that Energy and Evans (Energy's president) have excavated and constructed on property adjacent to its railway without exercising reasonable care. As a result of this, plaintiff claims that the defendants have created a threat of imminent harm to its rail corridor in the form of a landslide that would cover its tracks and could cause a train derailment.

In addition, Norfolk Southern alleges that Energy and Evans (but not the mineral rights defendants) have acted intentionally and recklessly and that Norfolk Southern is thus entitled to punitive damages. Norfolk Southern's suit seeks an injunction, compensatory damages, punitive damages and attorney's fees and costs. Norfolk Southern moved for a preliminary injunction on the same day that it filed suit.

On April 28, 2003, the court granted a preliminary injunction in favor of Norfolk Southern. As a part of this ruling, the court determined that subject matter jurisdiction was proper "in that the matters at issue are before the court on a claim of federal common law nuisance and have a significant connection to interstate commerce." The court has determined that this conclusion was a mistake.

After the court had entered its preliminary injunction, the defendants filed their answer on May 5, 2003. In their answer, they raised eleven defenses in addition to responding to the averments of the complaint. One of the defenses was that Norfolk Southern's claim did not, as pleaded, arise under the Constitution or laws of the United States, and another defense was that the court lacked subject matter jurisdiction. On that same date, the mineral rights defendants separately moved to dismiss pursuant to Rule 12(b)(6) on the ground that the complaint failed to state a claim against them. Thus, although the defendants have raised the issue of subject matter jurisdiction, they have not separately moved for dismissal.¹

On February 24, 2004, the court conducted a hearing to determine whether subject matter jurisdiction exists. At the conclusion of this hearing, the court invited the parties to brief the issue. On March 15, 2004, the court received a letter from Norfolk Southern's counsel indicating that the plaintiffs did not wish to file a brief.

II. Standard of Review

A federal district court is a court of limited jurisdiction and has a duty to dismiss a case whenever it appears that subject matter jurisdiction is lacking. Lovern v. Edwards, 190 F.3d 648, 654 (4th Cir.1999). In determining whether subject matter jurisdiction is proper, the court considers the pleadings as evidence and may also consider matters outside the pleadings. Evans v. B.F. Perkins Co., 166 F.3d 642, 647 (4th Cir.1999). The court has the power to "weigh the evidence and satisfy itself as to the existence of its power to hear the case." Williams v. United States, 50 F.3d 299, 304 (4th Cir.1995) (quoting Mortensen v. First Fed. Sav. & Loan Ass'n, 549 F.2d 884, 891 (3d Cir.1977)). Dismissal for lack of subject matter jurisdiction should be granted "only if the material jurisdictional facts are not in dispute and the moving party is entitled to prevail as a matter of law." Richmond, Fredericksburg & Potomac R.R. Co. v. United States, 945 F.2d 765, 768 (4th Cir.1991).

Federal jurisdiction over the subject matter of a controversy is not called into question simply because a party may ultimately be unable to prevail on its federal claim. Steel Co. v. Citizens for a Better Environment, 523 U.S. 83, 89, 118 S.Ct. 1003, 140 L.Ed.2d 210 (1998). A district court should dismiss an action due to the federal claim's inadequacy only if "the claim is `so insubstantial, implausible, foreclosed by prior decisions of th[e Supreme] Court, or otherwise completely devoid of merit as not to involve a federal controversy' "Id. (quoting Oneida Indian Nation v. County of Oneida, 414 U.S. 661, 666, 94 S.Ct. 772, 39 L.Ed.2d 73 (1974)). Dismissal is improper so long as at least one construction of the Constitution and laws of the United States will sustain the plaintiff's theory of recovery. See id.

III. Analysis

A. The Well Pleaded Complaint Rule

Jurisdiction is proper under the federal question statute, 28 U.S.C. § 1331, only when a plaintiff's complaint "sets forth a federal question." King v. Marriott Int'l Inc., 337 F.3d 421, 424 (4th Cir.2003). The federal question must arise from the plaintiff's claim statement, rather than "anything alleged in anticipation or avoidance of defenses" that may later be raised. Id. (quoting Taylor v. Anderson, 234 U.S. 74, 75-76, 34 S.Ct. 724, 58 L.Ed. 1218 (1914)). Federal question jurisdiction lies where federal law creates the plaintiff's cause of action or where the claim "necessarily depends on resolution of a substantial question of federal law." Columbia Gas Transmission Corp. v. Drain, 191 F.3d 552, 557 (4th Cir.1999) (quoting Franchise Tax Bd. v. Constr. Laborers Vacation Tr., 463 U.S. 1, 27-28, 103 S.Ct. 2841, 77 L.Ed.2d 420 (1983)).

B. The Federal Common Law of Nuisance

The federal courts have recognized a protected legal entitlement from certain types of nuisance that, because it redresses federal instead of state interests, should be determined by reference to uniform federal law. See Illinois v. Outboard Marine Corp., 619 F.2d 623 (7th Cir.1980) ("The same day the Supreme Court decided Erie it laid the groundwork for a `specialized common law.' Since that time courts have fashioned federal common law `when there is an overriding federal interest in the need for a uniform rule of decision or where the controversy touches basic interests of federalism.'" (quoting Illinois v. Milwaukee, 406 U.S. 91, 105 n. 6, 92 S.Ct. 1385, 31 L.Ed.2d 712 (1972)), rev'd on other grounds, 453 U.S. 917, 101 S.Ct. 3152, 69 L.Ed.2d 1000 (1981)). The redress of nuisance by resort to federal law originally traces to the country's need for a legal mechanism to address the effects of interstate pollution. See Missouri v. Illinois, 180 U.S. 208, 21 S.Ct. 331, 45 L.Ed. 497 (1901).

Under federal law, nuisance is an equitable action for which there are in many ways "no fixed rules." Illinois v. Milwaukee, 406 U.S. 91, 107-08, 92 S.Ct. 1385, 31 L.Ed.2d 712 (1972). The essential elements of the tort are that "the defendant is carrying on an activity that is causing an injury or significant threat of injury to some cognizable interest of the complainant." Illinois v. Milwaukee, 599 F.2d 151, 165 (7th Cir.1979), rev'd on other grounds, 451 U.S. 304, 101 S.Ct. 1784, 68 L.Ed.2d 114 (1981). The focus of inquiry is reasonableness: whether or not a nuisance exists depends upon an examination of all relevant factors to determine whether a particular grievance is in fact an unreasonable invasion of the plaintiff's entitlement. See Illinois v. Milwaukee, 406 U.S. at 104-06, 92 S.Ct. 1385.

Because the context of the early federal nuisance decisions was environmental pollution that migrated across state lines, there has been some degree of confusion as to whether nuisance is actionable under federal law in a non-environmental context. A number of decisions indicate that whether nuisance is actionable at federal law depends on the gravity of the federal interests involved and the need for a uniform body of law. Under such a view, federal nuisance claims are obviously cognizable outside the context of interstate environmental pollution. See Banco Nacional de Cuba v. Sabbatino, 376 U.S. 398, 426, 84 S.Ct. 923, 11 L.Ed.2d 804 (1964) ("Principles formulated by federal judicial law have been thought by this Court to be necessary to protect uniquely federal interests."); Nat'l Audubon Soc'y v. Dept. of Water, 869 F.2d 1196, 1201 (9th Cir.1988) (federal common law exists for purposes of nuisance claims where "a federal rule of decision is `necessary to protect uniquely federal interests'" (quoting Banco Nacional, 376 U.S. at 426, 84 S.Ct. 923)); Outboard Marine, 619 F.2d at 628 (7th Cir.1980) (allowing federal nuisance claim for intrastate pollution because interest vindicated is national interest in navigable waters); Nat'l Sea Clammers Ass'n v. City of New York, 616 F.2d 1222, 1233 (3d Cir.1980) (essential requirement is "an overriding federal interest in uniformity"), rev'd on other grounds, Middlesex County Sewerage Auth. v. Nat'l Sea Clammers Ass'n, 453 U.S. 1, 101 S.Ct. 2615, 69 L.Ed.2d 435 (1981); Reserve Mining Co. v. EPA, 514 F.2d 492, 521 (8th Cir.1975) (plaintiff must complain of interstate pollution to air or water or must show some type of interstate health hazard).²

The Supreme Court's decision in Illinois v. Milwaukee discussed the bases of federal nuisance and took from Banco Nacional the proposition that "where there is an overriding federal interest in the need for a uniform rule of...