N.J. wins appeal in PennEast pipeline case; 3rd Circuit rules private company cannot condemn state-owned lands

In what the state is calling a “major legal victory for New Jersey’s environment,” the U.S. Court of Appeals for the Third Circuit ruled Tuesday that PennEast, a private company, cannot condemn state-owned lands in order to build part of its planned 116-mile natural gas pipeline across New Jersey, Attorney General Gurbir Grewal announced.

The decision reverses an earlier district court ruling that had allowed PennEast to condemn approximately 40 parcels previously and permanently preserved for recreational, conservation and/or agricultural uses through state tax dollars.

Agreeing with New Jersey’s arguments, the Third Circuit held that, under the 11th Amendment of the U.S. Constitution, the state is immune from condemnation lawsuits by private parties, including pipeline companies.

“We will not hesitate to stand up to private companies when their actions violate the law — or, in this case, the U.S. Constitution,” Grewal said in a statement. “From the very beginning, we have made clear that the 11th Amendment prohibits private pipeline companies like PennEast from condemning state properties for private use, and we’re pleased that the Third Circuit agreed with our position. This is great news for New Jersey and the environment.”

In issuing its ruling, the Third Circuit held that the federal Natural Gas Act — which PennEast argued allowed it to condemn all needed properties along the path of its proposed pipeline — does not overcome New Jersey’s sovereign immunity under the constitution.