Judge dismisses oil pipeline lawsuit

District Judge Carl Petersen ruled that Iowa law spells out the IUB's authority to grant eminent domain, and the landowners must first follow the board's procedures for hearing challenges before asking for court action.

"Iowa Code Chapter 479B grants the IUB the authority to consider applications for hazardous waste pipelines and grants of eminent domain therefrom. As such, petitioners are required to exhaust the administrative remedies under the doctrine of exhaustion," Petersen said in his ruling, filed Oct. 20 in Cherokee County District Court.

The landowners will continue to seek to protect their rights, Lamb said in a news release from the owners' attorney, William Hanigan, of Des Moines.

"Although we’re disappointed about the court’s decision to dismiss our case, we remain resolute about our rights as landowners," Lamb said. "We believe that eminent domain should be unavailable for Dakota Access. We’re evaluating the current situation and keeping our options open."

The IUB has set a public hearing in Boone beginning on Nov. 12 and scheduled to last through Dec. 2. After that hearing, the IUB will decide whether the proposed pipeline will "promote the public convenience and necessity." The board will also decide whether, and to what extent, Dakota Access may be allowed to exercise eminent domain, said Don Tormey, IUB manager of customer services and communications.

Anyone who disagrees with the IUB decision may then ask the district court to review it.

Tormey said there is no deadline for the board to issue its decision once the public hearing is completed.

Dakota Access, a subsidiary of Dallas-based Energy Transfer Partners L.P., seeks to build a 1,100-mile pipeline transporting crude oil through four states from western North Dakota's Bakken region to a shipping terminal in Patoka, Illinois. The pipeline route would cross Iowa diagonally from the northwest to the southeast, covering 346 miles through 18 Iowa counties, including Sioux, O'Brien, Cherokee, Buena Vista and Sac.

Dakota Access in January filed for a hazardous liquids pipeline permit with the IUB. The company estimates it will spend $200 million to acquire easements for about 2,000 tracts of land.

The landowners had argued in their suit, filed in July, that if forced to sell through eminent domain, they would lose negotiating power with Dakota Access, resulting in a lower purchase price, and that the easements would change and damage the value of their land.

Petersen ruled that the IUB, which along with Dakota Access had asked that the lawsuit be dismissed, has power to hear those objections and protect landowners' interests in obtaining fair market purchase prices and damages.