Atlantic Coast Pipeline, LLC v. 1.51 Acres, More or Less, in Cumberland County, North Carolina, Located on Parcel Identification No. 0450-29-4949 Identified as Exhibit A in Book 9014, Page 627 et al

Filing 35

ORDER denying 33 Motion for Taxation of Costs. Signed by District Judge Terrence W. Boyle on 2/12/2021. (Stouch, L.)

IN THE UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF NORTH CAROLINA
WESTERN DIVISION
No. 5:18-CV-127-BO

ATLANTIC COAST PIPELINE, INC.,
Plaintiff,

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V.

1.51 ACRES, MORE OR LESS, IN
CUMBERLAND COUNTY, NORTH
CAROLINA, et al.,
Defendants.

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ORDER

This cause comes before the Court on defendants ' motion for taxation of costs and fees
against plaintiff pursuant to Rule 54 and 71.1 of the Federal Rules of Civil Procedure, 15 U.S.C.
§ 717(f), and N.C. Gen. Stat. § 40A-8. Plaintiff has responded and the matter is ripe for ruling.
For the reasons that follow, defendants' motion is denied.
BACKGROUND
On September 18, 2015, plaintiff (ACP or plaintiff) filed an application for a certificate
of public convenience and necessity with the Federal Energy Regulatory Commission (FERC),
seeking permission to construct an approximately 600-mile pipeline and related facilities for the
purpose of transporting natural gas from West Virginia to Virginia and North Carolina. FERC
issued ACP a certificate of public convenience and necessity on October 13, 2017, authorizing
ACP to construct the pipeline. See, generally, [DE 1-2]. In order to construct the pipeline, ACP
needed to acquire both temporary and permanent, exclusive easements on properties along the
FERC-approved pipeline route.
ACP initiated this case by filing a complaint in condemnation pursuant to 15 U.S.C. §
717f(h) and Federal Rule of Civil Procedure 71.1 on March 28, 2018. ACP sought an order

allowing the taking of certain interests in real property, immediate entry and possession of real
property, and the ascertainment and award of just compensation to the owners of interest in the
subject real property pursuant to its power of eminent domain as authorized by Section 7(h) of
the National Gas Act.
On March 10, 2020, the Court granted partial summary judgment in ACP ' s favor on the
issue of whether ACP had a right to condemn defendants' property. Defendants did not contest
that motion. This matter was scheduled for mediation on July 15, 2020. On July 5, 2020, ACP
announced the cancelation of its pipeline project. ACP subsequently filed a notice of voluntary
dismissal on August 17, 2020, pursuant to Rule 71.l(i)(l)(A) of the Federal Rules of Civil
Procedure. The voluntary dismissal was filed prior to ACP acquiring any title or lesser interest in
the subject property and prior to any hearing on compensation. This motion followed.
Defendant landowners seek an order directing ACP to repay them costs and fees as
follows: $3,500 for expert witness fees ; $7,500 for attorney fees ; and $23 ,066.33 for losses
suffered by the defendant landowners due to the unmarketability and inability to use their
property during the pendency of this action.
DISCUSSION
Defendants ask that this Court apply state substantive law to determine their damages.
However, the mere filing of a complaint in condemnation does not amount to a taking. Kirby
Forest Indus., Inc. v. United States, 467 U.S. 1, 16 (1984). Defendants do not argue that ACP

took possession of the property or filed a lis pendens. Although partial summary judgment was
entered in ACP 's favor, the order merely determined the narrow issue of whether plaintiff was
entitled to condemn the subject easements under the Natural Gas Act. [DE 26]. The Court in
Kirby Forest Industries held that "in the absence of an interference with an owner's legal right to

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dispose of his land, even a substantial reduction of the attractiveness of the property to potential
purchasers does not entitle the owner to compensation under the Fifth Amendment." Id. at 15;
see also Fed. R. Civ. P. 71.l(i)(l)(A) (permitting voluntary dismissal where ajust compensation
hearing has not begun, no title or lesser interest has passed, and plaintiff has not taken possession
of the subject property). Accordingly, there has been no taking and just compensation is not
owed. Defendants are therefore not entitled to damages.
Defendants also rely on 15 U.S .C. § 717(f), which provides that the practice and
procedure of a condemnation action under the Natural Gas Act shall conform with a similar
action or proceeding under the law of the state where the property is located. "[T]his state
procedure requirement has been superseded by Rule 71A [of the Federal Rules of Civil
Procedure]." E. Tennessee Nat. Gas Co. v. Sage, 361 F.3d 808, 822 (4th Cir. 2004). Rule 71A,
which preceded Rule 71.1, was intended to provide for a "uniform procedure for all cases of
condemnation . . . and .. . supplants all statutes prescribing a different procedure." Fed. R. Civ.
P. 71.1 , Advisory Committee Notes (1951).
ACP ' s complaint in condemnation was filed solely under its authorization to condemn
provided by the federal Natural Gas Act and the procedures prescribed by Rule 71.1. As
discussed above, Rule 71.1 of the Federal Rules of Civil Procedure provides the procedural rules
that govern federal condemnation actions. Accordingly, North Carolina law governing attorney
fee procedures is not applicable in this action. Irick v. Columbia Gas Transmission Corp., No.
5:07CV00095, 2008 WL 191324, at *3 (W.D. Va. Jan. 22, 2008); see also Chin v. Chrysler LLC,
538 F.3d 272, 277 (3d Cir. 2008) (where "no substantive provision of [a state' s] law was ever
pied," state fee-shifting statutes do not apply).

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The Court is further unpersuaded by defendants' argument that it need adopt North
Carolina' s fee-shifting rules as federal common law. The cases cited by defendants wherein
courts have applied state common law have done so in the context of determining just
compensation, not attorney fees and expenses. See, e.g. , Tennessee Gas Pipeline Co., LLC v.

Permanent Easement for 7. 053 Acres, 931 F.3d 237, 251 (3d Cir. 2019).
Finally, due to the contingency fee arrangement, defendants have likely not actually
incurred any fees and expenses. See N.C. Gen. Stat. § 40A-8(b) (discussing award to the owner
to reimburse reasonable costs and expenses); see also United States v. 431.60 Acres of Land,

More or Less, in Richmond Cty., State of Ga., 355 F. Supp. 1093, 1096 (S .D . Ga. 1973) ("In an
abandoned condemnation, a contingent fee alone would give rise to no ' incurred' obligation
because the contingency did not occur.").
CONCLUSION
Accordingly, for the foregoing reasons, defendants' motion for taxation of costs and fees
against plaintiff [DE 33] is DENIED.

SO ORDERED, this

_li day of February, 2021.

UNITED STATES DISTRICT JUDGE

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