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Eminent Domain

Eminent Domain Prevails Over Sovereign Immunity in Supreme Court Case Both Sides Deserved to Lose

The Court's ruling in PennEast allows the federal government to delegate the power of eminent domain to private firms seeking to condemn state-owned property.

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In today's Supreme Court decision in PennEast Pipeline Co. v. New Jersey, a closely divided 5-4 Supreme Court ruled that the federal government can authorize private firms to use the power of eminent domain to take property owned by state government. PennEast argued that Congress had the authority to use the Natural Gas Act to delegate to private firms the power to use eminent domain to take property to build pipelines. New Jersey (which opposes the construction of the pipeline in question) argued that sovereign immunity prevents Congress from authorizing eminent domain lawsuits by private parties against state governments.

In my earlier post about PennEast, I explained why this is a case both sides deserve to lose. Nothing in today's ruling changes my mind on that score.

The case features an unusual 5-4 alignment. Conservative justices Samuel Alito and Brett Kavanaugh joined the Chief Justice's majority opinion, as also did liberals Sonia Sotomayor and Stephen Breyer. Conservatives Clarence Thomas, Neil Gorsuch, and Amy Coney Barrett were all in dissent, as also was liberal Elena Kagan. Justice Barrett wrote the principal dissenting opinion (joined by all four dissenters), while Gorsuch wrote a separate dissent, joined only by himself and Thomas.

The majority opinion, written by Chief Justice John Roberts, concedes that the states have broad sovereign immunity against lawsuits by individuals, which Congress cannot abrogate. But it claims the power of eminent domain is an exception to that rule, because the states supposedly consented to waiver of sovereign immunity in this field when they ratified the 1787 Constitution:

Since its inception, the Federal Government has wielded the power of eminent domain, and it has delegated that power to private parties. We have observed and approved of that practice. The emi­nent domain power may be exercised—whether by the Gov­ernment or its delegatees—within state boundaries, includ­ing against state property. We have also stated, as a general matter, that "the United States may take property pursuant to its power of eminent domain in one of two ways: it can enter into physical possession of property without au­thority of a court order; or it can institute condemnation proceedings under various Acts of Congress providing au­thority for such takings." United States v. Dow, 357 U. S. 17, 21 (1958). The same is true for private delegatees….

Beginning with the argument that Congress cannot sub­ject States to suit pursuant to its commerce power, it is un­doubtedly true under our precedents that—with the excep­tion of the Bankruptcy Clause… we held that state sov­ereign immunity "restricts the judicial power under Article III, and Article I cannot be used to circumvent the constitu­tional limitations placed upon federal jurisdiction." Id., at 72–73. Seminole Tribe concluded that States' inherent im­munity from suit would be "eviscerated" if Congress were allowed to abrogate States' immunity pursuant to its Arti­cle I powers. Id., at 64.

But congressional abrogation is not the only means of subjecting States to suit. As noted above, States can also be sued if they have consented to suit in the plan of the Convention. And where the States "agreed in the plan of the Convention not to assert any sovereign immunity defense," "no congressional abrogation [is] needed." Allen, 589 U. S., at ___ (slip op., at 8)….

The plan of the Convention con­templated that States' eminent domain power would yield to that of the Federal Government "so far as is necessary to the enjoyment of the powers conferred upon it by the Con­stitution." Kohl, 91 U. S., at 372. As we explained in Cherokee Nation (again quoting Justice Bradley in Stockton),"[i]f it is necessary that the United States government should have an eminent domain still higher than that of the State, in order that it may fully carry out the objects and purposes of the Constitution, then it has it." 135 U. S., at 656…

Despite the majority's grandiose references to "[t]he plan of the Convention," they cite no evidence that anyone at the Constitutional Convention (or at the later state ratifying conventions) ever actually said that the federal government would have a general power to use eminent domain within the states (as opposed to federal territories) – much less that it would have the power to condemn state-owned land specifically. If there was such a plan, it must have been a very carefully kept secret!

As co-blogger Will Baude demonstrated in a pathbreaking 2013 Yale Law Journal article (cited by the dissenters), the dominant view at the time of the Founding and for many years thereafter was that the federal government did not have a general power to use eminent domain within the states. The "plan" referred to by Roberts simply did not exist.

Later Supreme Court decisions, beginning with Kohl v. United States (1875) eventually ruled that the federal government did have a broad power to use eminent domain, including within the states. Perhaps those decisions should be left undisturbed based on structural or living Constitution considerations, or just simply respect for longstanding precedent. But that's different from saying that the states consented to a broad federal eminent domain power in 1787.

In a 2013 commentary on Will's excellent article, I suggested that the original Constitution might still be interpreted to give Congress a narrowly limited authority to use eminent domain in conjunction with implementing other enumerated powers. But even if I was right about this, it still doesn't show that the states gave some kind of blanket consent to federal delegation of eminent domain power to private parties.

But if the majority opinion rests on a serious flaw, the same is true of the dissent, which relies on a very broad conception of state sovereign immunity:

As a "general rule," Congress cannot circumvent state sovereign immunity's limitations on the judicial power through its Article I powers. Allen v. Cooper, 589 U. S. ___, ___ (2020) (slip op., at 7). Thus, even in areas where Article I grants it "complete lawmaking authority," Congress lacks a tool that it could otherwise use to implement its power:"authorization of suits by private parties against unconsenting States." Seminole Tribe of Fla. v. Florida, 517 U. S. 44, 72 (1996). Consistent with this principle, we have rejected arguments that the Indian Commerce Clause, the Interstate Commerce Clause, or the Intellectual Property Clause allows Congress to abrogate a State's immunity from suit….

We have recognized but one exception to this general limit on Congress' Article I powers: the Bankruptcy Clause. Id., at ___ (slip op., at 7). Based on the "principally in rem" nature of bankruptcy jurisdiction and the "'unique history'" of that clause, we reasoned that States "already 'agreed in the plan of the Convention not to assert any sovereign immunity defense' in bankruptcy proceedings." Id., at ___–___ (slip op., at 7–8) (quoting Central Va. Community College v. Katz, 546 U. S. 356, 377 (2006)). Other than this "good-for one-clause-only holding," we have not held that Article I trumps state sovereign immunity. Allen, 589 U. S., at ___ (slip op., at 9).

This broad view of sovereign immunity is, as Justice Barrett notes, consistent with Supreme Court precedent. But, for reasons I summarized here, it is deeply at odds with the text and original meaning of the Constitution, and the theory of government underlying them. It also goes far beyond the wording of the Eleventh Amendment, which supposedly restored sovereign immunity in reaction to the Court's 1793 ruling in Chisholm v. Georgia. Far from granting the states a general immunity from suits by private citizens, that Amendment only  states that "[t]he judicial power of the United States shall not be construed to extend to any suit in law or equity, commenced or prosecuted against one of the United States by citizens of another state, or by citizens or subjects of any foreign state" (emphasis added).

Barrett does have some good criticisms of the majority's reliance on the states' supposed "consent" in 1787:

The Court relies exclusively on the fact that Congress and the States, like the Colonies before them, have consistently authorized private parties to exercise the right of eminent domain to obtain property for mills, roads, and other public improvements… As the Court notes, Congress did so in the early days of the Republic only within "areas subject to exclusive federal jurisdiction," though we later held that Congress could take property within state boundaries as well…. This history is long and undisputed, and the Court presents it as conclusive evidence on PennEast's side of the ledger.

But the question before us is not whether Congress can authorize a private party to exercise the right of eminent domain against another private party, which is the proposition this history supports. Nor is it whether Congress can authorize a private entity to take state property through means other than a condemnation suit. The question is whether Congress can authorize a private party to bring a condemnation suit against a State. And on that score, the Court comes up dry.

Barrett also offers a good critique of the majority's claim that a win by New Jersey would severely impede valuable pipeline projects. As she points out, the federal government would still have the option of simply condemning the necessary property itself, without delegating the power of eminent domain to private parties. The former might be more cumbersome than the latter, in some situations. But it's far from impossible.

In a separate dissent joined only by Clarence Thomas, Justice Gorsuch argues that New Jersey can claim sovereign immunity based on the specific wording of the Eleventh Amendment, because PennEast is a Delaware corporation, and therefore its eminent domain case against New Jersey qualifies as "a suit in law or equity, commenced or prosecuted against one of the United States by citizens of another state." Gorsuch overlooks the fact that at least two of the five firms belonging to the consortium that owns PennEast are based in New Jersey.

While both the majority and dissent work hard to defend their respective positions, both remain deeply flawed. My perspective on the two sides in this case remains similar to Henry Kissinger's take on the Iran-Iraq War: "It's a pity they can't both lose."