Wash. Gas Light Co. v. the Prince George's County Council Sitting As the Dist. Council

• Decision Date: 22 March 2011
• Docket Number: Civil Action No. DKC 08–0967.
• Citation: 172 Oil & Gas Rep. 699,784 F.Supp.2d 565
• Parties: WASHINGTON GAS LIGHT COMPANYv.The PRINCE GEORGE'S COUNTY COUNCIL SITTING AS the DISTRICT COUNCIL, et al.
• Court: U.S. District Court — District of Massachusetts

784 F.Supp.2d 565

172 Oil & Gas Rep. 699

WASHINGTON GAS LIGHT COMPANY

v.The PRINCE GEORGE'S COUNTY COUNCIL SITTING AS the DISTRICT COUNCIL, et al.

Civil Action No. DKC 08–0967.

United States District Court, D. Maryland.

March 22, 2011.

Benjamin S. Wechsler, Linda M. Schuett, Midgett Seldon Parker, Jr., Linowes and Blocher LLP, Annapolis, MD, for Plaintiff.Steven M. Gilbert, Prince Georges County Council, Mary Catherine Crawford, Stephen William Thibodeau, Prince Georges County Office of Law, Upper Marlboro, MD, David Eric Pomper, Peter J. Hopkins, Scott H. Strauss, Spiegel and McDiarmid LLP, Washington, DC, for Defendants.

MEMORANDUM OPINION

DEBORAH K. CHASANOW, District Judge.

Presently pending and ready for review in this action seeking declaratory and injunctive relief are the motion for leave to file a third amended complaint filed by Plaintiff Washington Gas Light Company (ECF No. 63) and the motion for summary judgment filed by Defendants Prince George's County Council, sitting as the District Council, and Prince George's County, Maryland (ECF No. 65). The issues are fully briefed and the court now rules pursuant to Local Rule 105.6, no hearing being deemed necessary. For the reasons that follow, Plaintiff's motion for leave to amend will be granted in part and denied in part, and Defendants' motion will be denied as moot.

I. Background

Plaintiff Washington Gas, a District of Columbia and Virginia Corporation, operates a natural gas substation at 2130 Chillum Road in Chillum, Maryland. The site, which was approved for natural gas storage and compression in 1933, is the intersection of several high-pressure natural gas transmission pipelines and several low pressure local distribution pipelines owned and operated by Washington Gas to provide service to customers in Maryland, Virginia, and the District of Columbia. In 2004, Washington Gas sought to construct a liquefied natural gas storage tank at the Chillum site to meet a projected increase in customer demand.

On August 26, 2004, Washington Gas submitted mandatory referral documents to the County, including a description of the proposed new facility and a concept plan. The Office of the Zoning Hearing Examiner for Prince George's County conducted seven hearings between December 2005 and May 2006, and on August 24, 2006, denied Washington Gas's proposal. Washington Gas appealed the decision to the District Council, which issued an Order of Denial. Washington Gas thereafter filed for judicial review in the Circuit Court for Prince George's County. By order dated October 17, 2007, the circuit court determined that the issues were not ripe for review, that Washington Gas failed to exhaust administrative remedies, and that the case should be remanded to the District Council.

Plaintiff's initial complaint was filed in this court on April 16, 2008, asserting claims against Prince George's County Council Sitting as the District Council (ECF No. 1) and was amended with consent shortly thereafter to add Prince George's County, Maryland as a Defendant (ECF No. 14). The first amended complaint asserted three counts: (1) seeking a declaratory judgment that federal and state law preempt local law with respect to LNG facilities (ECF No. 14 ¶¶ 30–35), (2) seeking a declaratory judgment that the local non-binding mandatory referral process is the full extent of local involvement with respect to the proposed LNG storage facilities ( id. ¶¶ 36–39), and (3) seeking an injunction to prevent Defendants from enforcing preempted local laws. ( Id. ¶¶ 40–41). Defendants filed motions to dismiss (ECF Nos. 6 and 23) and Plaintiff filed a motion for summary judgment on all counts. (ECF No. 12). After a hearing on the issues, the court denied Plaintiff's motion for summary judgment and granted the motion to dismiss in part. (ECF No. 32). Specifically the court granted the motion to dismiss count II relating to the local mandatory referral process on abstention grounds.

Plaintiff subsequently filed a second amended complaint and another motion for summary judgment. (ECF Nos. 36 and 40). The second amended complaint, which asserted that it was an interstate facility, included one count seeking a declaratory judgment that all local laws relating to the safety and location of the proposed LNG storage facility were preempted by federal law and an injunction against their enforcement. (ECF No. 36, at 28–33). In the opinion ruling on Plaintiff's motion, this court determined that Plaintiff is not subject to the jurisdiction of the Federal Energy Regulatory Commission (“Commission”) under the Natural Gas Act (“NGA”), instead it is subject to the exclusive jurisdiction of the state in which its gas is consumed, in this case Maryland. (ECF No. 60, at 12). In addition, this court determined that under the Pipeline Safety Act (“PSA”) Plaintiff is an intrastate facility making express preemption, as set forth in 49 U.S.C. § 60104(c), inapplicable. ( Id.).

The opinion recognized that this determination did not necessarily end the preemption inquiry but noted that because Plaintiff's second amended complaint was premised on the incorrect assertion that Plaintiff's facility was an interstate one to which express preemption applied, it had failed to allege any facts identifying specific provisions of Prince George's county law that it claimed were preempted, or any facts relating to the scope of preemption between the PSA, Maryland law and local law. ( Id. at 16).

During the course of these proceedings, plaintiff has variously claimed to be both an interstate and an intrastate entity. At this point, it seeks to file a third amended complaint, restating some rejected theories, attempting to assert additional facts to shore up other theories, and to assert an entirely new theory based on the dormant commerce clause. Plaintiff argues that the primary purpose of the TAC is to make additional allegations in the areas identified as absent from the SAC in the court's March 26, 2010 opinion. (ECF No. 63–1, at 3). Plaintiff's amended complaint does not omit its prior claims premised on the theory that its facility is an interstate one, however, but it does plead “[in] the alternative, Washington Gas is an intrastate pipeline facility within the meaning of 49 U.S.C. § 60101(a)(9).” ( See, e.g., ECF No. 63–5 ¶ 18).¹ The TAC also includes sections detailing safety standards promulgated in the Code of Maryland Regulations (“COMAR”) that incorporate the federal regulations for LNG facilities, ( id. ¶¶ 22–28), and the local Prince George's County laws and regulations with which its facility cannot comply. ( Id. ¶¶ 34–39). The TAC also includes a new count II seeking a declaratory judgment and injunctive relief premised on the theory that the Prince George's County laws violate the dormant Commerce Clause. ( Id. ¶¶ 50–56).

Defendants oppose Plaintiff's motion for leave to amend. (ECF No. 64). They have also filed a motion for summary judgment on Plaintiff's second amended complaint, in the event that the court denies Plaintiff's motion for leave to amend. (ECF No. 65).

II. Motion For Leave To File Third Amended ComplaintA. Standard of Review

Under Federal Rule of Civil Procedure 15(a)(2), “a party may amend its pleading only with the opposing party's written consent or the court's leave. The court should freely give leave when justice so requires.” Denial of leave to amend should occur “only when the amendment would be prejudicial to the opposing party, there has been bad faith on the part of the moving party, or the amendment would be futile.” Johnson v. Oroweat Foods Co., 785 F.2d 503, 509 (4th Cir.1986). However, a motion to amend should be made as soon as the necessity for altering the pleading becomes apparent. Deasy v. Hill, 833 F.2d 38, 40 (4th Cir.1987).

The standard for futility is the same as a motion to dismiss under Fed. R.Civ.P. 12(b)(6). See Perkins v. United States, 55 F.3d 910, 917 (4th Cir.1995) (amendment is futile if the amended claim would fail to survive motion to dismiss). “Leave to amend should be denied on the ground of futility only when the proposed amendment is clearly insufficient or frivolous on its face.” Cappetta v. GC Servs. Ltd. P'ship, No. 3:08CV288, 2009 WL 482474 at *4 (E.D.Va. Feb. 24, 2009) (citing Davis v. Piper Aircraft Corp., 615 F.2d 606, 613 (4th Cir.1980); Oroweat Foods Co., 785 F.2d at 510).

B. Analysis

Plaintiff contends that no basis for denying its request for leave to amend is present here. Plaintiff argues that there is no potential for prejudice or evidence of bad faith from its request because the TAC merely adds theories of recovery to the facts already pled and discovery has not yet occurred. (ECF No. 63–1, at 5). Plaintiff also argues that its request is not futile because the TAC clearly states a claim upon which relief can be granted.

Defendants oppose the motion and argue that leave to amend should be denied. Defendants argue that in the TAC Plaintiff seeks to re-allege preemption claims that this court has already rejected as a matter of law or which Plaintiff has abandoned. Defendants also argue that the claims are futile. In addition, Defendants argue that the new dormant Commerce Clause claim is unexplained, fails to satisfy the pleading requirements in Fed.R.Civ.P. 8, and would be futile. (ECF No. 64, at 4–5).

1. Allegations Asserting Federal Preemption of Local Laws Pertaining to Interstate LNG Facilities

Defendants argue that leave to amend should be denied with respect to all of Plaintiff's allegations asserting that the facility is an interstate one because the court has already rejected this argument and declared that the facility is intrastate.

Defendants rely on the law of the case doctrine; a doctrine which provides that “when a court decides upon a rule of law, that decision should continue to govern the same issues in subsequent stages in the same case.” Columbus–America Discovery Grp. v. Atl. Mut. Ins. Co., 203 F.3d 291,...