Property rights supporters are claiming a major victory as a result of a recent Louisiana appeals court decision that concluded the Bayou Bridge Pipeline Co. (BBP) violated the law in building a section of pipeline on privately owned land.
The Third Circuit Court of Appeal in St. Charles awarded each of the property owners involved $10,000 as well as legal fees after it partly reversed and partly affirmed a district court decision. The pipeline construction carried out by BBP, which is a joint venture of Energy Transfer Partners and Phillips 66, took place in the Atchafalaya Basin.
A key issue in the litigation, which could make its way to the state Supreme Court, depending on how the company will proceed, is how energy companies in the state are typically granted eminent domain powers on projects shown to have economic benefits for the public.
“With respect to the concern of impact to economic growth in the state, I don't believe any doubt remains that with respect to this particular case, the company failed to satisfy the existing statutes prior to commencing construction on the subject parcel,” Misha Mitchell, staff attorney for the environmental group Atchafalaya Basinkeeper and a co-counsel for the landowners, told the Louisiana Record in an email.
In addition, economic benefits of pipeline projects need to be seen in a larger context, including potential negative health and environmental effects, according to Mitchell. These may include ongoing climate effects that speed coastal erosion and lead to more severe weather events, she said.
Louisiana energy companies, however, see pipelines as the most efficient and safest way to move large amounts of petroleum to where it’s needed. In addition, the Bayou Bridge Pipeline will cut pollution by reducing the need to transport oil by rail and highways, thereby reducing safety risks as well, according to a previous statement by the Louisiana Oil and Gas Association.
The appeals court, however, concluded that the company violated the property rights of local landowners by moving forward with the project in violation of due-process rights.
“When BBP consciously ordered construction to begin on this property prior to obtaining a judicial determination of the public and necessary purpose for that taking, it not only trampled defendants’ due process rights as landowners, it eviscerated the constitutional protections laid out to specifically protect those property rights,” Judge Jonathan Perry said in his July 16 decision.