Louisiana Record

Wednesday, October 16, 2019

Court substantially limits damages in pipeline erosion case

By Glenn Minnis | May 13, 2018

NEW ORLEANS – A federal court judge has limited the damage award to landowners suing one of the country’s largest pipeline companies for land erosion damage to just $1,104.  

U.S. District Judge Jane Triche Milazzo rendered her ruling earlier this month, essentially reaffirming a 2017 court decision that stipulated Tennessee Gas Pipeline Co. LLC and Southern Natural Gas. Co. LLC, both subsidiaries of Kinder Morgan, and the privately owned High Point Gas Transmission LLC and High Point Gas Gathering LLC, should only be held responsible for restoring less than 10 acres of wetlands damaged over the last six-plus decades.

The attentively watched proceedings are viewed by some as perhaps setting a precedent in other similarly situated cases now being litigated across the state.

In the case before Milazzo, court documents show that the plaintiffs sought a restoration plan where the cost for repairs were set to exceed $30 million.

In rendering her verdict, the judge ruled, "at the time the parties entered into the aforementioned agreements, defendants, and the oil industry in general, were aware that the failure to maintain the pipeline canals would result in erosion of the land and widening of the canals. Accordingly, the damage at issue here was foreseeable."

In her final analysis, Milazzo added she was convinced all the damage stemmed from a combination of natural forces, among them boat wakes, currents, and wind.

"The court finds that no maintenance activity would have prevented this natural edge erosion from taking place," she said, adding that as a result, she adopted the expert's estimates of lost acreage in determining damages.

Finally, in awarding damages, the judge ruled that only 5.52 acres were incapable of being restored and should be compensated at the market value rate of $200 per acre.

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U.S. District Court for the Eastern District of Louisiana