The U.S. Court of Appeals for the Sixth Circuit in Cincinnati heard arguments from Enbridge, a Canadian pipeline and energy company, and the state of Michigan Tuesday regarding Governor Gretchen Whitmer’s order to halt the operation of the Line 5 pipelines in the Straits of Mackinac.
In 2020, Whitmer ordered the shutdown of the dual pipelines, which carry petroleum products above the floor of the straits, asserting environmental risks and legal violations. Enbridge has utilized state-owned property to run and transport energy resources thanks to a 1953 easement.
Line 5 pipelines help transport close to 540,000 barrels, or 23 million gallons, of crude oil and natural gas liquids from western to eastern Canada every day. It has spilled 1.1 million gallons of oil over 33 separate incidents since its construction in 1953, according to an analysis of federal data by environmental groups. A four-mile section of Line 5 splits into two parallel lines through the straits connecting Lake Huron and Lake Michigan. Enbridge says that section "has never experienced a leak."
Whitmer stated in her 2020 notice to Enbridge that the easement is being revoked because it violates the public trust doctrine, which says the state is obligated to protect and preserve the waters and lands beneath the Great Lakes. Whitmer said that Enbridge has violated easement conditions and standards of due care for the pipelines.
Enbridge sued Whitmer and the Michigan Department of Natural Resources in federal court in return, arguing that federal commerce and federal pipeline safety laws preempt state regulatory attempts.
Mark Savignac, an attorney for Enbridge, said in court Tuesday that a forced shutdown of the pipelines would violate the Federal Pipeline Safety Act, which prohibits states from enforcing pipeline safety standards, and the U.S.-Canada Treaty that governs cross-border pipelines. That treaty prohibits a public authority in either nation from impeding or interfering with pipelines.
“We brought this suit against the governor to protect our federal rights by enjoining state officials from forcing a pipeline shutdown in violation of federal laws,” Savignac said.
“Federal law prohibits the state from shutting us down based on state law safety standards, which are preempted by federal law. Or federal law prohibits them from shutting us down because the federal treaty with Canada prohibits any public authority in the United States from doing that,” Savignac said.
Tuesday’s arguments centered around whether the U.S. Court of Appeals for the Sixth Circuit should move the case forward considering that there is ongoing state litigation on the ordering of the pipelines’ shutdown.
The 11th Amendment generally protects states from being sued in federal court by private citizens or other states unless the state has consented to the lawsuit, or Congress has explicitly allowed the suit. The policy is in place to maintain state sovereignty and prevent federal courts from interfering in state matters without state permission.
Michigan Attorney General Dana Nessel filed a lawsuit against Enbridge in June 2019 to stop the continued operation of the dual pipelines. The case is ongoing in the Ingham County Circuit Court and is supported by seven indigenous tribes and environmental and business groups.
Because largely identical cases are being heard in both state and federal courts, the Michigan Department of Attorney General has argued that the federal case should be dismissed under an interpretation of a U.S. Supreme Court decision that requires federal courts to defer to parallel state court proceedings.
Michigan Assistant Attorney General Dan Bock said at the Tuesday hearing that the case should be dismissed under the 11th Amendment. He said Michigan has the right to revoke the easement under its current contract due to “specific performance,” or the state’s obligations under a contract.
Bock also said Enbridge’s claims that Michigan cannot revoke the easement amount to a quiet title action, or a suit filed with the intended purpose to settle the title of a property.
“First, Enbridge's claims are barred by the 11th Amendment because they are the functional equivalent of an action to quiet title to state-owned submerged lands,” Bock said. “Second, Enbridge's claims are barred by the 11th Amendment because they seek to compel a state to engage in specific performance of a contract.”
Enbridge argues the precedent of federal courts deferring to state proceedings does not relieve a federal court of its obligation to hear a case and interpret preemptive federal law or interpreting state law. It also states that the precedent is only applicable to specific criminal cases and that the Enbridge case does not fall under its purview.
The Canadian company is seeking a permanent injunction that would forbid the state from revoking or terminating its current easement. Bock said Michigan entered the easement contract and therefore is allowed to terminate the easement.
“It concerns land owned by the state of Michigan, and the right to terminate the easement, expressed in the easement's terms, is held by the state of Michigan itself,” Bock said. “Enbridge seeks a permanent injunction requiring the state to continue to perform its obligations under the contract but argues that that is not specific performance. It clearly is.”
Editor’s note: Enbridge is one of Michigan Public’s corporate sponsors.
