IN THE IOWA DISTRICT COURT FOR POLK COUNTY

RICHARD R. LAMB, trustee of the

RICHARD R. LAMB REVOCABLE
TRUST, MARIAN D. JOHNSON by her
Agent VERDELL JOHNSON, KEITH D.
PUNTENNEY, LAVERNE I. JOHNSON,
NORTHWEST IOWA LANDOWNERS
ASSOCIATION, HICKENBOTTOM
EXPERIMENTAL FARMS, INC.,
PRENDERGAST ENTERPRISES, INC,
and the IOWA FARMLAND OWNERS
ASSOCIATION, INC.

Case No: CVCV051997

Petitioners,
PETITIONERS BRIEF IN SUPPORT
OF JUDICIAL REVIEW

vs.
IOWA UTILITIES BOARD, A DIVISION
OF THE DEPARTMENT OF
COMMERCE, STATE OF IOWA,
Respondent,
And
DAKOTA ACCESS, LLC,
Indispensable Party.

COMES NOW Richard R. Lamb, trustee of the Richard R. Lamb Revocable

Trust, Marian D. Johnson by her agent Verdell Johnson, Keith D. Puntenney, Laverne I.
Johnson, Northwest Iowa Landowners Association and Iowa Farmland Owners
Association, Inc. (petitioners) through their undersigned counsel and for its Brief in
Support of Judicial Review state as follows:

TABLE OF CONTENTS
I.

TABLE OF AUTHORITIES ............................................................................................................ IV

II.

STATEMENT OF ISSUES PRESENTED FOR REVIEW .......................................................... VII

A.
B.

STANDARD OF REVIEW. ...................................................................................................................... VII

DAKOTA ACCESSS EXERCISES OF EMINENT DOMAIN AUTHORITY - AND THE IUBS GRANTING
OF EMINENT DOMAIN AUTHORITY TO DAKOTA ACCESS - ARE UNCONSTITUTIONAL.............................. VII
C. THE IUBS DETERMINATION THAT IOWA CODE 6A.21 EXTENDS THE POWER OF EMINENT
DOMAIN OVER PETITIONERS AGRICULTURAL LANDS TO INTERSTATE CRUDE OIL PIPELINES SUCH AS
DAKOTA ACCESS WAS ARBITRARY AND CAPRICIOUS BECAUSE IT IS CONTRARY TO LAW. ...................... VIII
D. THE IUBS FAILURE TO FIND THAT DAKOTA ACCESS IS NOT A COMMON CARRIER UNDER IOWA
CODE 6A.22(2)(A)(2) AND THAT ITS CRUDE OIL PIPELINE WAS THEREFORE NOT A "[P]UBLIC USE",
"PUBLIC PURPOSE", OR "PUBLIC IMPROVEMENT" WAS ARBITRARY AND CAPRICIOUS BECAUSE IT IS
CONTRARY TO LAW. .......................................................................................................................................IX
E. THE IUBS CONSIDERATION OF THE ECONOMIC IMPACTS OF THE DAPL WAS ARBITRARY AND
CAPRICIOUS BECAUSE THE IUB IS STATUTORILY PRECLUDED FROM CONSIDERING ECONOMIC
BENEFITS IN DECIDING WHETHER TO GRANT AN ENTITY THE POWER OF EMINENT DOMAIN. ...................... X
F.
THE IUBS CONCLUSION THAT THE DAPL WILL REDUCE THE OVERALL RISK OF CRUDE OIL
SPILLS IN IOWA IS ARBITRARY AND CAPRICIOUS, IRRATIONAL, UNSUPPORTED BY SUBSTANTIAL
EVIDENCE, AND THE PRODUCT OF A DECISION-MAKING PROCESS IN WHICH THE IUB DID NOT
CONSIDER RELEVANT AND IMPORTANT FACTS THAT A RATIONAL DECISION MAKER WOULD HAVE
CONSIDERED. ................................................................................................................................................... X
G. THE IUBS FAILURE TO DENY THE USE OF THE POWER OF EMINENT DOMAIN TO DAKOTA
ACCESS OVER THE PETITIONERS REAL ESTATE RESULTS IN CONTINUING AND MULTIPLE TRESPASSES
UPON THE PETITIONERS PROPERTIES AND REQUIRES THE COURT TO EXTEND EQUITABLE AND
MONETARY RELIEF TO PETITIONERS. ............................................................................................................XI

III. STATEMENT OF THE CASE ........................................................................................................... 1

A.
B.

PROCEDURAL HISTORY ........................................................................................................................... 1

FACTUAL BACKGROUND ......................................................................................................................... 2

IV. ARGUMENT ........................................................................................................................................ 4

A.

STANDARD OF REVIEW .......................................................................................................................... 4

1. Judicial Review of Agency Interpretation of Statutes ........................................................................ 4
2. Judicial Review of Constitutional Rights ........................................................................................... 5
3. Judicial Review of an Agencys Factual Findings ............................................................................. 6
B. DAKOTA ACCESSS EXERCISES OF EMINENT DOMAIN AUTHORITY - AND THE IUBS GRANTING
OF EMINENT DOMAIN AUTHORITY TO DAKOTA ACCESS - ARE UNCONSTITUTIONAL ................................. 7
1. Iowa Code 6A.21(2) and 479B.16 are facially unconstitutional .................................................. 7
2. Legal Background ........................................................................................................................... 11
3. Petitioners as applied challenges to Iowa Code 479B.9 and 479B.16. ...................................... 13
4. The U.S. and Iowa Constitutions give no regard to the degree of invasiveness of a taking. ........... 25
C. THE IUBS DETERMINATION THAT IOWA CODE 6A.21 EXTENDS THE POWER OF EMINENT
DOMAIN OVER PETITIONERS AGRICULTURAL LANDS TO INTERSTATE CRUDE OIL PIPELINES SUCH AS
DAKOTA ACCESS WAS ARBITRARY AND CAPRICIOUS BECAUSE IT IS CONTRARY TO LAW. ........................ 26
1. Agency determinations which are contrary to law are arbitrary and capricious under to Iowa
Code17A.19(10) and require relief by the Court................................................................................ 26
2. Dakota Access reads the exception in 6A.21(2) too broadly. ....................................................... 28
3. Iowa law prohibits Dakota Access from utilizing eminent domain over agricultural land
because Dakota Access is not under the operational or safety jurisdiction of the Board nor is it
otherwise a utility. ................................................................................................................................ 29
4. Dakota Access is not a public utility. ............................................................................................... 32
5. Dakota Access is also not a private utility. ...................................................................................... 35

ii

6. The legislature expressed its intent to prohibit private industry from exercising eminent domain
over agricultural land in its 2006 amendment to Iowa Code 6A.21(2) which struck the exclusion
for agricultural land acquired for industry as that term is defined in Section 260E.2 from its
protections, thereby intentionally protecting agricultural land from private industrial development
by Dakota Access. ................................................................................................................................ 38
D. THE IUBS FAILURE TO FIND THAT DAKOTA ACCESS IS NOT A COMMON CARRIER UNDER IOWA
CODE 6A.22(2)(A)(2) AND THAT ITS CRUDE OIL PIPELINE WAS THEREFORE NOT A "[P]UBLIC USE",
"PUBLIC PURPOSE", OR "PUBLIC IMPROVEMENT" WAS ARBITRARY AND CAPRICIOUS BECAUSE IT IS
CONTRARY TO LAW. ...................................................................................................................................... 41
E. THE IUBS CONSIDERATION OF THE ECONOMIC IMPACTS OF THE DAPL WAS ARBITRARY AND
CAPRICIOUS BECAUSE THE IUB IS STATUTORILY PRECLUDED FROM CONSIDERING ECONOMIC
BENEFITS IN DECIDING WHETHER TO GRANT AN ENTITY THE POWER OF EMINENT DOMAIN ..................... 46
F.
THE IUBS CONCLUSION THAT THE DAPL WILL REDUCE THE OVERALL RISK OF CRUDE OIL
SPILLS IN IOWA IS ARBITRARY AND CAPRICIOUS, IRRATIONAL, UNSUPPORTED BY SUBSTANTIAL
EVIDENCE, AND THE PRODUCT OF A DECISION-MAKING PROCESS IN WHICH THE IUB DID NOT
CONSIDER RELEVANT AND IMPORTANT FACTS THAT A RATIONAL DECISION MAKER WOULD HAVE
CONSIDERED. ................................................................................................................................................. 49

1. Risk Analysis Framework ................................................................................................................ 50

2. Summary of relevant facts from the contested case proceeding ...................................................... 51
3. Legal Analysis of the Facts .............................................................................................................. 55
G. THE IUBS FAILURE TO DENY THE USE OF THE POWER OF EMINENT DOMAIN
TO DAKOTA ACCESS OVER THE PETITIONERS REAL ESTATE RESULTS IN
CONTINUING AND MULTIPLE TRESPASSES UPON THE PETITIONERS PROPERTIES
AND REQUIRES THE COURT TO EXTEND EQUITABLE AND MONETARY RELIEF TO
PETITIONERS. .......................................................................................................................................... 59
1. Dakota Access construction of its pipeline without a valid easement trespasses upon the
petitioners farmlands in two separate categories including: (i) the continuing trespass of the
pipeline itself, plus (ii) the trespass of every barrel of oil which ever travels through the pipeline,
and the respective remedies are an injunction against the pipelines use and requiring its removal,
plus monetary damages based upon any actual use of the pipeline preceding the injunction. ............ 60
2. The Courts precedent in Nichols, Hawkeye Land Co., and Independent Sch. Dist. of Ionia
require the Court to enjoin Dakota Access use of its pipeline upon, and require its removal from,
the petitioners real estate. ................................................................................................................... 66
V.

CONCLUSION ................................................................................................................................... 69

iii

I.

TABLE OF AUTHORITIES

Cases
Alaska Dept. of Environmental Conservation v. E.P.A 540 U.S. 461, 468 - 82 (2004) .......56, 58
American Eye Care v. Dept of Human Services, 770 N.W.2d 832, 835 (Iowa 2009) .........passim
Americo Energy Resources, L.L.C. v. Moore, 2008 WL 3984169 (Tx. Ct. App. 2008) .....passim
ANR Pipeline Co. v. Iowa State Commerce Commn., 828 F.2d 465, 468 (8th Cir. 1987) ........31
Babley v. Vyse & Gatchie, 48 Iowa 481, 483 (1878) ..................................................................61
Berman v. Parker, 348 U.S. 26 (1954) ................................................................................passim
Bd. of R.R. Commrs v. Rosenstein, 252 N.W. 251, 253 (Iowa 1934) ........................................43
Bluegrass Pipeline Company, LLC v. Kentuckians United to Restrain Eminent Domain,
Inc., 478 S.W. 3d 386, 392 (Ky. Ct. App. 2015) rehearing denied (Feb. 2, 2016) .................... 31
Bormann v. Board of Suprs In and For Kossuth County, 584 N.W.2d 309, 313 (Iowa
1998) ...........................................................................................................................................11
Bowman Transp., Inc. v. Arkansas-Best Freight System, Inc., 419 U.S. 281, 285 (1974) .........56
Branstad v. State ex rel., Nat. Res. Commn., No. 14-0205 2015 WL 1546439 at *6 (Iowa
App. April 8, 2015) ..................................................................................................................... 37
Brown v. Bergman, 204 Iowa 1006, 1009, 216 N.W. 731, 732 (1927) ......................................61
Butt v. Iowa Bd. of Med, 12-1118, 2013 WL 2637283 (Iowa Ct. App. June 12, 2013) ...............5
Central South Dakota Co-op. Grazing Dist. v. Secretary of U.S. Dept. of Agriculture, 266
F.3d 889, 894 (8th Cir. 2001) .....................................................................................................56
Circle Exp. Co. v. Iowa State Commerce Commission, 86 N.W.2d 888 (Iowa 1957) ...............45
Citizens to Preserve Overton Park v. Volpe, 410 U.S. 402, 416 (1971).....................................56
Clarke County Reservoir Commission v. Robins, 862 N.W.2d 166, 168 (Iowa 2014).........30, 48
Davis v. State, 682 NW 2d 58, 61 (Iowa 2004) ....................................................................39, 40
Dawson v. Iowa Bd. of Medical Examiners, 654 N.W.2d 514, 518 (Iowa 2002)......................... 6
Dept. of Human Services ex rel. Palmer v. Unisys Corp., 637 N.W.2d 142, 154-155
(2001) ..........................................................................................................................................68
Employers Mut. Cas. Co. v. Chicago and North Western Transp. Co., 521 N.W.2d 692,
693 (Iowa 1994) .......................................................................................................................... 45
Estate of Bockwoldt, 814 N.W.2d at 223 .................................................................................... 35
Estate of Myers, 825 N.W.2d ......................................................................................................35
Estate of Whalen, 827 N.W.2d 184, 194 (Iowa 2013) ................................................................ 35
Gander Mt. Co. v. Cabela's, Inc., No. 04-CV-3125 PJS/RLE, 2007 WL 2026751, at *8 (D.
Minn. July 10, 2007), aff'd, 540 F.3d 827 (8th Cir. 2008) ................................................................ 68
Gartner v. Iowa Dep't of Pub. Health, ____ N.W.2d _____, _____, 2013 WL 1856789
(Iowa May 3, 2013)....................................................................................................................... 5
Harms v. City of Sibley, 702 N.W.2d 91, 97 (Iowa 2005) .................................................... 22, 23
Harvey v. Care Initiatives, Inc., 634 N.W.2d 681, 685 (Iowa 2001)..........................................42
Hawaii Housing Authority v. Midkiff, 467 U.S. 229 (1984) ................................................passim
Hawkeye Land Co. v. Iowa Utilities Bd., 847 N.W.2d 199, 214 (Iowa 2014).....................passim
Hawkeye Land Co. v. Lurens State Bank, 480 NW 2nd 854 (Iowa 1992)...........................passim

iv

IBP, Inc. v. Iowa Employment Appeal Bd., 604 N.W.2d 307, 311 (Iowa 1999) .......................... 6
Independent Sch. Dist. of Ionia v. DeWilde, 243 Iowa 685, 693, 53 N.W.2d 256, 261
(1952) ...................................................................................................................................passim
Iowa Assn of School Boards v. Iowa Dept of Educ., 739 N.W.2d 303, 306 (Iowa 2007) ..passim
Iowa-Illinois Gas and Electric Co. v. Iowa State Commerce Comn, 347 N.W.2d 423,
426 (Iowa 1984) ............................................................................................................................ 3
Kamrar v. Butler, 164 Iowa 293, 297, 145 N.W. 879, 880 (1914) .............................................61
Kelo v. City of New London, Conn., 545 U.S. 469, 505 - 506 (2005) .................................passim
Kinley Corp. v. Iowa Utilities Board, 999 F.2d 354 (8th Cir. 1993) ..........................................30
Kvalheim v. Horace Mann Life Ins. Co., 291 N.W.2d 533 (Iowa 1974) ....................................45
Limits Industrial R.R. Co. v. American Spiral Pipe Works, 151 N.E. 567 (1926)...................... 15
Madrid Home for the Aging v. Iowa Dept of Human Services, 557 N.W.2d 507, 510-11
(Iowa 1996) ...................................................................................................................................5
Mid-America Pipeline Co v. Iowa State Commerce Commission, 114 N.W.2d 622 (Iowa
1962) .....................................................................................................................................37, 44
NextEra Energy Res. LLC v. Iowa Utils. Bd., 815 N.W.2d 30, 44 (Iowa 2012) .......................... 5
Nichols v. City of Evansdale, 687 N.W.2d 562 (Iowa 2004) ...............................................passim
North Iowa Steel Co. v. Staley, 112 NW 2d 355 (Iowa 1961) .................................................... 35
Office of Consumer Advocate v. Iowa State Commerce Comn, 432 N.W.2d 148, 154
(Iowa 1988) .........................................................................................................................passim
Qwest Corp. v. Iowa State Bd. of Tax Review, 829 N.W.2d 550, 557-58 (Iowa 2013) ................5
Renda v. Iowa Civil Rights Comn, 784 N.W.2d 8, 15 (Iowa 2010) ..........................................42
Robinson Township v. Commonwealth of Pennsylvania, 2016 WL 5463054 (Penn. Sept.
28, 2016), No. 104 MAP 2014, 78 - 79 ...............................................................................passim
Ruckleshaus v. Monsanto Co., 467 U.S. 986 (1984) ..................................................................18
Silva v. Employment Appeal Bd., 547 N.W.2d 232, 234 (Iowa Ct. App. 1996) ........................... 5
Soo Line R. Co. v. Iowa Dept. of Transp., 521 N.W.2d 685, 688 - 89 (Iowa 1994) ................... 55
South East Iowa Co-Op. Elec. Assn. v. Iowa Utilities Board, 633 N.W.2d 814, 821 - 22
(Iowa 2001) ................................................................................................................................ 49
Southwestern Illinois Development Authority v. National City Environmental, L.L.C. 768
N.E.2d 1, 8 - 9 (Ill. 2002), cert denied 537 U.S. 880 (2002) ...............................................passim
Standing Rock Sioux Tribe v. U.S. Army Corps of Engineers (September 9, 2016) ......................... 68
State v. Carter, 696 N.W.2d 31, 37 (Iowa 2005) ........................................................................22
SZ Enterprises, LLC v. Iowa Utilities Bd., 850 N.W.2d 441, 447-449 (2014) ....................passim
Wall v. Cty. Bd. of Ed. of Johnson Cty., 249 Iowa 209, 218, 86 N.W.2d 231, 37 (1957) ..........36
Wal-Mart Stores, Inc. v. Caselman, 657 N.W.2d 493, 499 (Iowa 2003) .....................................6
Winnebago Indus., Inc. v. Haverly, 727 N.W.2d 567, 571 (Iowa 2006) ......................................4
Wright v. Midwest Old Settlers and Threshers Assn, 556 N.W.2d 808 (Iowa 1996) .........passim
Statutes
49 U.S.C. 60104(c) ..................................................................................................................30
49 U.S.C. 60101 ....................................................................................................................... 30
Iowa Code 6A.1 ....................................................................................................................... 37
Iowa Code 6A.21 ..............................................................................................................passim
Iowa Code 6A.21(1)(a) ........................................................................................................2, 27
Iowa Code 6A.21(1)(b) ............................................................................................................26
Iowa Code 6A.21(1)(c) ......................................................................................................27, 37
v

Iowa Code 6A.21(2) .........................................................................................................passim

Iowa Code 6A.22 .............................................................................................................passim
Iowa Code 6A.22(1)..........................................................................................................passim
Iowa Code 6A.22(2)(a)(1) - (5) ............................................................................................... 41
Iowa Code 6A.22(2)(a)(2) .................................................................................................41, 46
Iowa Code 6A.22(2)(a)(5)(a) ...................................................................................................48
Iowa Code 6A.22(2)(b) ......................................................................................................47, 48
Iowa Code 6A.25 ....................................................................................................................... 4
Iowa Code 6B.25 ..................................................................................................................... 65
Iowa Code 17A.19 ...........................................................................................................passim
Iowa Code 17A.19(10).............................................................................................................26
Iowa Code 17A.19(10)(f)(1) ......................................................................................................6
Iowa Code 17A.19(10)(f)............................................................................................................6
Iowa Code 17A.19(10)(k), (n) ...................................................................................................7
Iowa Code 260E.2 .............................................................................................................. 38, 39
Iowa Code 476.1 ...............................................................................................................passim
Iowa Code 476.27 .................................................................................................................... 36
Iowa Code 479B.1 ............................................................................................................. 30, 31
Iowa Code 479B.9 ............................................................................................................passim
Iowa Code 479B.16 .........................................................................................................passim
Other Authorities
Degen, The Legislative Aftershocks of Kelo: State Legislative Response to the New Use of
Eminent Domain, 12 Drake J. Agric. L. 325, 344-345 (2007) ................................................... 38
Iowa Legislature, HF 2351 (2006) .......................................................................................passim
Tesoro Alaska Co. v. F.E.R.C., 778 F.3d 1034, 1038 (D.C. Cir. 2015) (In ICA 1(3)............42
Tx. R. App. Pro. 47, Cmt. to 2008 Amend .................................................................................63
United States Congress, H.R. 2029, Pub. L. 114-113, Division O, Title I, Sec. 101
(December 18, 2015) ............................................................................................................33, 54
160 of the Restatement (Second) of Torts (1965) .............................................................. 60, 66
Constitutional Provisions
U.S. Const. Amend. XIV ......................................................................................................11, 22
U.S. Const. Amend. V .........................................................................................................passim
Iowa Const. Art. 1, sec 18 ....................................................................................................passim

vi

II.
A.

STATEMENT OF ISSUES PRESENTED FOR REVIEW

Standard of Review.
Authorities:

Cases
Winnebago Indus., Inc. v. Haverly, 727 N.W.2d 567, 571 (Iowa 2006)
American Eye Care v. Department of Human Services, 770 N.W.2d 832, 835 (Iowa 2009)
Iowa Assn of School Boards v. Iowa Dept of Educ., 739 N.W.2d 303, 306 (Iowa 2007)
Madrid Home for the Aging v. Iowa Dept of Human Services, 557 N.W.2d 507, 510-11
(Iowa 1996)
Silva v. Employment Appeal Bd., 547 N.W.2d 232, 234 (Iowa Ct. App. 1996)
NextEra Energy Res. LLC v. Iowa Utils. Bd., 815 N.W.2d 30, 44 (Iowa 2012)
Gartner v. Iowa Dep't of Pub. Health, ____ N.W.2d _____, _____, 2013 WL 1856789
(Iowa May 3, 2013)
Butt v. Iowa Bd. of Med, 12-1118, 2013 WL 2637283 (Iowa Ct. App. June 12, 2013)
Qwest Corp. v. Iowa State Bd. of Tax Review, 829 N.W.2d 550, 557-58 (Iowa 2013)
IBP, Inc. v. Iowa Employment Appeal Bd., 604 N.W.2d 307, 311 (Iowa 1999)
Wal-Mart Stores, Inc. v. Caselman, 657 N.W.2d 493, 499 (Iowa 2003)
Dawson v. Iowa Bd. of Medical Examiners, 654 N.W.2d 514, 518 (Iowa 2002)
Statutes
Iowa Code 17A.19(10)(f)(1)
Iowa Code 17A.19(10)(f)
Iowa Code 17A.19(10)(k), (n)
B.
Dakota Accesss Exercises of Eminent Domain Authority - and the
IUBs Granting of Eminent Domain Authority to Dakota Access - Are
Unconstitutional.
Authorities:
Cases
Berman v. Parker, 348 U.S. 26 (1954)
Bormann v. Board of Suprs In and For Kossuth County, 584 N.W.2d 309, 313 (Iowa
1998)
Harms v. City of Sibley, 702 N.W.2d 91, 97 (Iowa 2005)
Hawaii Housing Authority v. Midkiff, 467 U.S. 229 (1984)
Kelo v. City of New London, Conn., 545 U.S. 469, 505 - 506 (2005)
Limits Industrial R.R. Co. v. American Spiral Pipe Works, 151 N.E. 567 (1926)
Robinson Township v. Commonwealth of Pennsylvania, 2016 WL 5463054 (Penn. Sept.
28, 2016), No. 104 MAP 2014, 78 - 79Ruckleshaus v. Monsanto Co., 467 U.S. 986
(1984)

vii

Southwestern Illinois Development Authority v. National City Environmental, LLC, 768

N.E.2d 1, 9 (2002)
State v. Carter, 696 N.W.2d 31, 37 (Iowa 2005)
Statutes
Iowa Code 6A.21(2)
Iowa Code 6A.22
Iowa Code 479B.2
Iowa Code 479B.3
Iowa Code 479B.4
Iowa Code 479B.9
Iowa Code 479B.16
Constitutional Provisions
U.S. Const. Amend. V
Iowa Const. Art. 1, sec 18
C.
The IUBs determination that Iowa Code 6A.21 extends the power
of eminent domain over petitioners agricultural lands to interstate crude oil
pipelines such as Dakota Access was arbitrary and capricious because it is contrary
to law.
Authorities:
Cases
ANR Pipeline Co. v. Iowa State Commerce Commn., 828 F.2d 465, 468 (8th Cir. 1987)
Bluegrass Pipeline Company, LLC v. Kentuckians United to Restrain Eminent Domain,
Inc., 478 S.W. 3d 386, 392 (Ky. Ct. App. 2015) discretionary review denied (Feb. 10,
2016)
Branstad v. State ex rel., Nat. Res. Commn., No. 14-0205 2015 WL 1546439 at *6 (Iowa
App. April 8, 2015)
Clarke County Reservoir Commn, 862 N.W.2d at 168
Davis v. State, 682 NW 2d 58, 61 (Iowa 2004)
Estate of Bockwoldt, 814 N.W.2d
Estate of Myers, 825 N.W.2d
Estate of Whalen, 827 N.W.2d 184, 194 (Iowa 2013)
Hawkeye Land Co. v. Iowa Utilities Bd., 847 N.W.2d 199, 214 (Iowa 2014)
Kinley Corp. v. Iowa Utilities Board, 999 F.2d 354 (8th Cir. 1993)
Mid-America Pipeline Co v. Iowa State Commerce Commission, 114 N.W.2d 622 (Iowa
1962)
North Iowa Steel Co. v. Staley, 112 NW 2d 355 (Iowa 1961)
Office of Consumer Advocate 432 N.W.2d at 154
SZ Enterprises, LLC v. Iowa Utilities Bd., 850 N.W.2d 441, 447-449 (2014)
Teamsters Local Union No. 421 v. City of Dubuque, 706 N.W.2d 709, 715 (Iowa 2005)
Wall v. Cty. Bd. of Ed. of Johnson Cty., 249 Iowa 209, 218, 86 N.W.2d 231, 37 (1957)

viii

Statutes
49 U.S.C. 60104(c)
49 U.S.C. 60101
Iowa Code 6A.1
Iowa Code 6A.21
Iowa Code 6A.21(1)(a)
Iowa Code 6A.21(1)(b)
Iowa Code 6A.21(1)(c)
Iowa Code 6A.21(2)
Iowa Code 17A.19(10)
Iowa Code 260E.2
Iowa Code 476.1
Iowa Code 476.27
Iowa Code 479B.1
Iowa Code 479B.16
Other Authorities
Degen, The Legislative Aftershocks of Kelo: State Legislative Response to the New Use
of Eminent Domain, 12 Drake J. Agric. L. 325, 344-345 (2007).
Iowa Legislature, HF 2351 (2006)
United States Congress, H.R. 2029, Pub. L. 114-113, Division O, Title I, Sec. 101
(December 18, 2015)
D.
The IUBs failure to find that Dakota Access is not a common carrier
under Iowa Code 6A.22(2)(a)(2) and that its crude oil pipeline was therefore not a
"[p]ublic use", "public purpose", or "public improvement" was arbitrary and
capricious because it is contrary to law.
Authorities:
Cases
Circle Exp. Co. v. Iowa State Commerce Commission, 86 N.W.2d 888 (Iowa 1957)
Employers Mut. Cas. Co. v. Chicago and North Western Transp. Co., 521 N.W.2d 692,
693 (Iowa 1994)
Harvey v. Care Initiatives, Inc., 634 N.W.2d 681, 685 (Iowa 2001)
Kvalheim v. Horace Mann Life Ins. Co., 291 N.W.2d 533 (Iowa 1974)
Mid-America Pipeline Co. v. Iowa State Commerce Commission, 114 N.W.2d 622 (Iowa
1962)
Renda v. Iowa Civil Rights Comn, 784 N.W.2d 8, 15 (Iowa 2010)
State ex rel. Bd. or R.R. Commrs v. Rosenstein, 252 N.W. 251, 253 (Iowa 1934)
Wright v. Midwest Old Settlers and Threshers Assn, 556 N.W.2d 808 (Iowa 1996)
Statutes
Iowa Code 6A.21
Iowa Code 6A.21(2)
Iowa Code 6A.22

ix

Iowa Code 6A.22(a)(2)

Iowa Code 6A.22(1)
Iowa Code 6A.22(2)
Iowa Code 6A.22(2)(a)(1) - (5)
Iowa Code 6A.22(2)(a)(2)
Other Authorities
Tesoro Alaska Co. v. F.E.R.C., 778 F.3d 1034, 1038 (D.C. Cir. 2015)
E.
The IUBs consideration of the economic impacts of the DAPL was
arbitrary and capricious because the IUB is statutorily precluded from considering
economic benefits in deciding whether to grant an entity the power of eminent
domain.
Authorities:
Cases
Clarke County Reservoir Commission v. Robins, 862 N.W.2d 166, 168 (Iowa 2014)
Hawkeye Land Co. v. IUB, 847 N.W.2d 199, 208 (Iowa 2014)
Office of Consumer Advocate v. Iowa State Commerce Comn, 432 N.W.2d 148, 154
(Iowa 1988)
Statutes
Iowa Code 6A.21
Iowa Code 6A.22
Iowa Code 6A.22(1)
Iowa Code 6A.22(2)
Iowa Code 6A.22(2)(a)(5)(a)
Iowa Code 6A.22(2)(b)
F.
The IUBs conclusion that the DAPL will reduce the overall risk of
crude oil spills in Iowa is arbitrary and capricious, irrational, unsupported by
substantial evidence, and the product of a decision-making process in which the IUB
did not consider relevant and important facts that a rational decision maker would
have considered.
Authorities:
Cases
Alaska Dept. of Environmental Conservation v. E.P.A , 540 U.S. 461, 468 - 82 (2004)
Bowman Transp., Inc. v. Arkansas-Best Freight System, Inc., 419 U.S. 281, 285 (1974)
Central South Dakota Co-op. Grazing Dist. v. Secretary of U.S. Dept. of Agriculture, 266
F.3d 889, 894 (8th Cir. 2001)
Citizens to Preserve Overton Park v. Volpe, 410 U.S. 402, 416 (1971)
Office of Consumer Advocate, 432 N.W.2d at 154 (Iowa 1988)
Soo Line R. Co. v. Iowa Dept. of Transp., 521 N.W.2d 685, 688 - 89 (Iowa 1994)

South East Iowa Co-Op. Elec. Assn. v. Iowa Utilities Board, 633 N.W.2d 814, 821 - 22
(Iowa 2001)
Other Authorities
United States Congress, H.R. 2029, Pub. L. 114-113, Division O, Title I, Sec. 101
(December 18, 2015)
G.
The IUBs failure to deny the use of the power of eminent domain to
Dakota Access over the petitioners real estate results in continuing and multiple
trespasses upon the petitioners properties and requires the Court to extend
equitable and monetary relief to petitioners.
Authorities:
Cases
Americo Energy Resources, L.L.C. v. Moore, 2008 WL 3984169 (Tx. Ct. App. 2008)
Babley v. Vyse & Gatchie, 48 Iowa 481, 483 (1878)
Brown v. Bergman, 204 Iowa 1006, 1009, 216 N.W. 731, 732 (1927)
Dept. of Human Services ex rel. Palmer v. Unisys Corp., 637 N.W.2d 142, 154-155
(2001)
Gander Mt. Co. v. Cabela's, Inc., No. 04-CV-3125 PJS/RLE, 2007 WL 2026751, at *8 (D.
Minn. July 10, 2007), aff'd, 540 F.3d 827 (8th Cir. 2008)
Hawkeye Land Co. v. Lurens State Bank, 480 NW 2nd 854 (Iowa 1992)
Independent Sch. Dist. of Ionia v. DeWilde, 243 Iowa 685, 693, 53 N.W.2d 256, 261
(1952)
Kamrar v. Butler, 164 Iowa 293, 297, 145 N.W. 879, 880 (1914)
Nichols v. City of Evansdale, 687 N.W.2d 562 (Iowa 2004)
Standing Rock Sioux Tribe v. U.S. Army Corps of Engineers (September 9, 2016)
Statutes
Iowa Code 6B.25
Other Authorities
160 of the Restatement (Second) of Torts (1965)
Tx. R. App. Pro. 47, Cmt. to 2008 Amend.

xi

III.
A.

STATEMENT OF THE CASE

Procedural History

The primary question in this case is whether Iowa Code Chapter 6A, the United
States Constitution, and the Constitution of the State of Iowa, each authorize the Iowa
Utilities Board (the IUB or Board) to extend the power of eminent domain to a
private industrial enterprise, which is not a utility, to take the petitioners agricultural
lands for private industrial use in the operation of an interstate crude oil transportation
pipeline.

There is an additional question about whether the Board was arbitrary and

capricious, as set forth in Chapter 17A, in its finding that the crude oil pipeline would
make Iowans safer even though the Board explicitly refused to find that the pipeline
would result in fewer crude oil tanker cars traveling upon our railways.
This case is an appeal from the IUBs March 10, 2016 Final Decision and Order
(the Order) in its docket number HLP-2014-0001. This administrative case comprised
the Boards consideration of issuing a certificate of convenience and necessity and a
hazardous liquid pipeline permit to Dakota Access, LLC (Dakota Access). Dakota
Access is headquartered in Dallas, Texas. When the Order was issued, Dakota Access
was owned by several big oil companies: Energy Transfer Partners, L.P., Sunoco
Logistics, L.P., and Phillips 66. Ord. pp. 66, 101. Presently, Dakota Access is owned by
even more big oil companies: Energy Transfer Partners, L.P., Sunoco Logistics, L.P.,
Phillips 66, Enbridge Energy Partners, L.P., and Marathon Petroleum Corporation. See
App. 52: correspondence from Bret Dublinske to the IUB filed August 4, 2016 under
Filing ID: 2886145 on HLP-2014-0001 identified as Notice of Sale of Minority Interest.
In the Order, the IUB found the presence of a public convenience and necessity, issued a

#2770003

hazardous liquid pipeline permit to Dakota Access, and awarded the power of eminent
domain to Dakota Access pursuant to 479B.16. Order p. 153-159. Dakota Access was
then authorized by law to condemn Pettioners agricultural lands and to construct their oil
pipeline across Iowa, the DAPL.
On August 9, 2016 the petitioners moved this court to issue a stay of the permits
operation. On August 21, 2016, the Court denied their motion without prejudice, pending
consideration by the Board. The petitioners then moved the same of the Board, and on
August 26, 2016 the Board denied the petitioners motion for stay. The petitioners then
renewed their motion with the Court which denied their renewed motion for stay on
August 29, 2016.

Regrettably, the pipeline is now fully constructed across the

petitioners individual farmlands in violation of their Constitutional rights.

B.

Factual Background

The petitioners are agricultural landowners and associations of agricultural

landowners representing the interests of agricultural landowners. Agricultural land
for the purposes of this brief is defined at 6A.21(1)(a). Petitioners Richard Lamb (as
trustee of the Richard R. Lamb revocable trust), Keith Puntenney, Laverne Johnson,
Marian Johnson, by her agent Verdell Johnson are Iowa agricultural landowners.
Petitioners Northwest Iowa Landowners Association (NILA) and Iowa Farmland
Owners Association, Inc. (IFOA) represent similarly situated member-landowners.
Many of them live upon and work land that has been in their family for generations.
They own agricultural lands across Iowa identified in the IUBs Order approving Dakota
Access petition for a hazardous liquid pipeline permit pursuant to Iowa Code ch.

479B. IUB Ord. 4; See generally IUB Ord. 122 - 149, Attachment 1 to the Order.1 The
Order, pursuant to 479B.9 and 479B.16 specifically grants Dakota Access eminent
domain authority over the petitioners agricultural lands identified in the Order.
Petitioners Lamb, Puntenney, and Laverne Johnson and Marian Johnson, by her
agent Verdell Johnson were petitioners in the contested case proceeding before the IUB.
Petitioner NILA is an unincorporated association and represented several Iowa
agricultural landowners in the contested case proceeding. It has standing under IowaIllinois Gas and Electric Co. v. Iowa State Commerce Comn, 347 N.W.2d 423, 426
(Iowa 1984) and 17A.19 to represent the interests of its members before the Board and
the Court. Those members are: Hickenbottom Experimental Farms, Inc., Gary D. and
Linda L. Hammen, Gary D. Hammen as Trustee of the Hammen Family Trust, U/W
Doris E. Hammen, Grandmas Place, L.C., AIM Acres, L.C., and the Judith Anne Lamb
Revocable Trust.2
Petitioner IFOA is an incorporated association that represented several Iowa
agricultural landowners in the contested case proceeding before the IUB. It too has
standing under Iowa-Illinois Gas, 347 N.W.2d at 426 and 17A.19 to represent the
interests of its members in this judicial review action. Those members are: Prendergast
Enterprise, Inc., Arlene Bates and Leona O. Larson, Lowman Brothers, Inc., and Walnut
Creek Limited Partnership.3
The petitioners have now all been subject to the power of eminent domain and
Dakota Access condemnation proceedings pursuant to Chapter 6B. Dakota Access has

See generally App. 41 - 45.

App. 8 - 12 (Affidavit of John Murray).
3 App. 37 - 40 (Membership Identification by Intervenor Iowa Farmland Owners Association, Inc.
(October 7, 2015)).
2

taken possession of easements across their farms pursuant to 6A.25 and constructed its
crude oil pipeline.
IV.
A.

ARGUMENT

Standard of Review

The Court sits in an appellate capacity when ruling on a petition for judicial
review. Winnebago Indus., Inc. v. Haverly, 727 N.W.2d 567, 571 (Iowa 2006). The
district court may reverse, modify, or grant other appropriate relief if substantial rights of
the petitioner have been prejudiced. Id. The Courts standard of review is generally
governed by the Iowa Administrative Procedures Act, codified at Chapter 17A. In this
case, the petitioners seek judicial review in three categories. First, they seek review of
the Boards interpretation of Iowa statutes, the interpretation of which is not clearly
granted to the Board. Second, they seek judicial review of their constitutional claims,
none of which the Board addressed. Third, they seek review of the Boards factual
findings and the validity of the Boards conclusions affecting their substantial rights.
1. Judicial Review of Agency Interpretation of Statutes
The appropriate standard of review of an agencys statutory interpretation
depends upon whether the legislature has clearly vested the agency with the discretion to
interpret the statute at issue. American Eye Care v. Department of Human Services, 770
N.W.2d 832, 835 (Iowa 2009).

When an agency has not clearly been vested with the

discretion to interpret the pertinent statute, the court gives no deference to the agencys
interpretation of the statute. Id. (citing Iowa Assn of School Boards v. Iowa Dept of
Educ., 739 N.W.2d 303, 306 (Iowa 2007)). In that situation, the court will reverse the
agencys decision where the interpretation is based on an erroneous interpretation of the

law. Id. The agency is not entitled to even limited deference where the agency has not
been clearly vested with the discretion to interpret the pertinent statute. Id. The Iowa
Supreme Court has disavowed the concept of limited deference for agency interpretations
within the agencys expertise as set forth in Madrid Home for the Aging v. Iowa Dept of
Human Services, 557 N.W.2d 507, 510-11 (Iowa 1996), noting that concept is no longer
viable under the current version of the Iowa Administrative Procedures Act. Id. at 83536.
2. Judicial Review of Constitutional Rights
The courts constitutional review is de novo. Silva v. Employment Appeal Bd., 547
N.W.2d 232, 234 (Iowa Ct. App. 1996. This court is empowered to make an
independent evaluation based on the totality of the circumstances. Id.
The court gives the agency no deference regarding the constitutionality of the
statute or administrative rule. NextEra Energy Res. LLC v. Iowa Utils. Bd., 815
N.W.2d 30, 44 (Iowa 2012). Determining whether a statute or administrative rule
offends the state or federal constitution is a task entirely within the province of
the judiciary. Id. Thus, we review agency action involving constitutional issues
de novo. Id.
Gartner v. Iowa Dep't of Pub. Health, ____ N.W.2d _____, _____, 2013 WL 1856789
(Iowa May 3, 2013); Butt v. Iowa Bd. of Med, 12-1118, 2013 WL 2637283 (Iowa Ct.
App. June 12, 2013); Qwest Corp. v. Iowa State Bd. of Tax Review, 829 N.W.2d 550,
557-58 (Iowa 2013). A de novo review is appropriate for petitioners claims that the
challenged use of the power of eminent domain is unconstitutional on its face and as
applied. NextEra, 815 N.W.2d at 44.

The Courts constitutional review here is

particularly important because in its Order the Board chose to resolve all issues based
upon statutory grounds and concluded that it did not need to reach the petitioners
constitutional issues. Order, p. 117.

3. Judicial Review of an Agencys Factual Findings

The court is bound by an agencys findings of fact if they are supported by
substantial evidence. IBP, Inc. v. Iowa Employment Appeal Bd., 604 N.W.2d 307, 311
(Iowa 1999). Substantial evidence means the quantity and quality of evidence that
would be deemed sufficient by a neutral, detached, and reasonable person, to establish the
fact at issue when the consequences resulting from the establishment of that fact are
understood to be serious and of great importance. 17A.19(10)(f)(1). In determining
whether a factual finding is supported by substantial evidence, the Court must review
the record as a whole. 17A.19(10)(f). In evaluating an agencys findings of fact, the
Iowa Supreme Court has stated that courts must not simply rubber stamp the agency fact
finding without engaging in a fairly intensive review of the record to ensure that the fact
finding is itself reasonable. Wal-Mart Stores, Inc. v. Caselman, 657 N.W.2d 493, 499
(Iowa 2003), citing, Arthur E. Bonfield, Amendments to Iowa Administrative Procedure
Act at 68 (1998). The Court is required to consider all evidence, including that offered in
opposition to the Boards findings. Wal-Mart at 499 (citing Dawson v. Iowa Bd. of
Medical Examiners, 654 N.W.2d 514, 518 (Iowa 2002)). Thus, this court is required to
assess the evidence before the Board to determine whether its conclusions were supported
by substantial evidence.
A court on judicial review may also reverse agency action if substantial rights of
the person seeking relief have been prejudiced because the action is unreasonable,
arbitrary, capricious or an abuse of discretion, including if the agency action is so
grossly disproportionate to the benefits accruing to the public interest from that action

that it must necessarily be deemed to lack any foundation in rational agency policy.
17A.19(10)(k), (n).

B.

Dakota Accesss Exercises of Eminent Domain Authority - and the

IUBs Granting of Eminent Domain Authority to Dakota Access - are

Unconstitutional
1. Iowa Code 6A.21(2) and 479B.16 are facially unconstitutional
On September 28, 2016, the Pennsylvania Supreme Court issued a decision
sustaining a facial challenge to a Pennsylvania eminent domain statute which had allowed
private corporations to take private property for the propose of storing natural gas
underground.

The statue had allowed a corporation empowered to transport, sell or

store natural gas or manufactured gas in this Commonwealth the right to appropriate an
interest in real property located in a storage reservoir or reservoir protective area for
injection, storage and removal from storage of natural gas. by exercising the states
power of eminent domain. Robinson Township v. Commonwealth of Pennsylvania, 2016
WL 5463054 (Penn. Sept. 28, 2016), No. 104 MAP 2014, 78 - 79.4 In other words, the
question was whether the Constitution allows a private natural gas transporter to use the
states power of eminent domain to take a de facto underground easement from a private
landowner to store the natural gas for future transportation by the corporations
customers?
The Pennsylvania Supreme Court held that the statute facially violated the Federal
and the Commonwealths constitutional taking provisions.
4

It found that the statute

Due to the recentness of the Pennsylvania Supreme Courts decision, Westlaw had not yet updated its
service with the majority opinion at the time of the filing. However, the opinion can be found in full at
http://www.pacourts.us/assets/opinions/Supreme/out/J-34A-2016mo%20%2010282684312019871.pdf?cb=1.

confers a broad power on private corporations to take private property of other

landowners to store natural gas therein.

Id. at 86.

It further held that the

Commonwealth does not claim, nor can it do so reasonably, that the public is the
primary and paramount beneficiary when private property is taken in this manner. Id.
Instead, [the state] advances the proposition that allowing such takings would somehow
advance the development of infrastructure in the Commonwealth. Such a projected
benefit is speculative, and, in any event, would be merely an incidental one and not the
primary purpose for allowing these types of takings. Id.
The Court should apply the U.S. and Iowa Constitutions and the reasoning of
Robinson Township in this case. First, the IUB found that because 6A.21(2) allows,
utilities, persons, companies, or corporations under the jurisdiction of the Iowa utilities
board, to exercise the power of eminent domain over agricultural lands, Dakota Access
may do so because it is a company which the Board found to be under its jurisdiction.
Order, p. 121.

Accordingly, 6A.21(2) would grant the Board a broad power to

deputize any private person, company or corporation under any amount of its jurisdiction
to take agricultural land with the states police power. This is the very same broad power
of private corporations to take private property which the Pennsylvania court found
facially objectionable under the US and Pennsylvania Constitutions.
Similarly, 479B.16 provides, A pipeline company granted a pipeline permit
shall be vested with the right of eminent domain, to the extent necessary and as
prescribed and approved by the board. This includes all pipeline companies moving all
hazardous liquids regardless of the existence of a public purpose. This includes those
transporting, crude oil, refined petroleum products, liquefied petroleum gases,

anhydrous ammonia, liquid fertilizers, liquefied carbon dioxide, alcohols, and coal
slurries. See 479B.2, 479B.3, and 479B.4. Accordingly, any persons, companies,
or corporations under 6A.21(2) moving any of the hazardous liquids itemized in
479B.2 could use the states power to take agricultural land from any landowners
regardless of whether the private industrial enterprise has a public purpose. One wonders
what Iowans are to do with their newfound access to coal slurry transportation. This
broad private access to the states power to take private property for such wide-ranging
private uses is likewise the same broad power conferred upon private corporations to take
private property for private gain which violates the U.S. and Iowa Constitutions as in
Robinson Township (citing Kelo v. City of New London, infra).
Second, the alleged public benefits to Iowans including the pipelines potential
impact on world oil markets (Order pp. 24-25), rail vs. pipeline safety (Order pp. 28-33),
impact on grain shipments (Order pp. 33- 35) and Iowa economic benefits (Order pp. 4147) are speculative and not the primary purpose of the DAPL. Because no Iowa company
extracts or refines oil, the infrastructure of the DAPL is demonstrably less valuable to
Iowans than the infrastructure in Pennsylvania. Pennsylvanians are directly engaged in
the extraction of natural gas from the Marcellus (or other) shales and the storage and
transportation of natural gas. If the benefits are too incidental and speculative for a state
that is meaningfully engaged in the industry, then surely the benefits are even more
attenuated for Iowa, which is not at all engaged in the oil industry.
Third, no matter what quality or quantity of public benefit ever accrues to Iowans,
the primary and paramount beneficiaries of the DAPL will always be its owners: Energy
Transfer Partners, L.P., Sunoco Logistics, L.P., Phillips 66, Enbridge Energy Partners,

L.P., Marathon Petroleum Corporation, and any other oil company taking an interest in
the future. The Court should be under no illusions as to their primary motivation. They
are constructing the DAPL not for the public interest, but for private profits. They are
constructing the DAPL to make hundreds of millions, if not billions of dollars. They will
always be the primary and paramount beneficiaries of their taking of petitioners
farmlands, and their benefit will be grossly disproportionate to the benefits flowing to any
individual Iowan - or even Iowans as a whole - which are mostly speculative and
incidental. As the Illinois Supreme Court found in Southwestern Illinois Development
Authority v. National City Environmental, LLC, positive economic growth in the region
is not enough to justify a taking because, incidentally, every lawful business does this.
768 N.E.2d 1, 9 (2002).
Fourth, the Pennsylvania Supreme Court struck down the statute also because it
covered both corporations which were public utilities and corporations which were not.
See Robinson Township, No. 104 MAP 2014, 84 - 85:
The Commonwealth Court and Appellees strive mightily to read the
language of Section 3241(a) as restricting this taking power to only those
corporations which qualify, statutorily, to be public utilities. Ostensibly
they do so to establish that the conferral of this power should then be
considered beyond constitutional challenge because public utilities have
long been permitted the right to exercise powers of eminent domain.
As petitioners argue in this brief, Dakota Access is not a public utility - nor a private
utility - but is merely a private industrial enterprise. Like the natural gas storage facility
in Pennsylvania, the DAPL is a forced use of another landowners property
unquestionably depriv[ing] that landowner of the use and enjoyment of the subterranean
portion of his property, given that [the pipeline] is now physically occupying it; hence, it
constitutes a de facto taking by the corporation. Id. at 84.

10

Finally, there is no meaningful distinction between an underground natural gas

storage facility where a raw product is stored prior to movement and an underground
pipeline wherein the raw product is in movement.

Both are underground facilities

utilized in the flow of private energy products to the marketplace. Neither have public
customers. Both are invasive subterranean invasions of a landowners property.

Both

affect the use of the adjacent surface and its future development. The use of the power of
eminent domain by each is equally unconstitutional.

The Court should follow the

holding in Robinson Township and find 6A.21(2) and 479B.16 facially

unconstitutional in the broad context of persons, companies, or corporations other than
utilities, and unconstitutional as applied to the petitioners.
2. Legal Background
a. The United States and Iowa Constitutions Public Use Clauses
and relevant statutes.
The Fifth Amendment to the United States Constitution states [N]or shall
private property be taken for public use, without just compensation (emphasis added).
Article I, Section 18 of the Iowa Constitution states: Private property shall not be taken
for public use without just compensation first being made. (emphasis added); see also
Bormann v. Board of Suprs In and For Kossuth County, 584 N.W.2d 309, 313 (Iowa
1998) (quoting the relevant provisions and noting the Fifth Amendments applicability to
the states through the Fourteenth Amendment).
Iowa Code 479B.9 states A permit shall not be granted to a pipeline company
unless the board determines that the proposed services will promote the public
convenience and necessity.

Iowa Code 479B.16 further states that A pipeline

company granted a pipeline permit shall be vested with the right of eminent domain, to

11

the extent necessary and as prescribed and approved by the board. Thus, it follows
that the IUBs finding of public convenience and necessity is necessary for granting
Dakota Access eminent domain authority. However, the constitutional inquiry does not
end there because public convenience and necessity is not always the public use that
the Federal and Iowa Constitutions demand.
b. Public convenience and necessity is not equivalent to public
use as used in the Federal and Iowa Constitutions.
Public convenience and necessity is both a different and lesser standard than
public use for purposes of the exercise of eminent domain. The Illinois Supreme Court
grasped the difference between public use and public purpose5 in Southwestern
Illinois Development Authority v. National City Environmental, L.L.C.:
SWIDA contends that any distinction between public purpose and
public use has long since evaporated and that the proper test is simply to ask
whether a public purpose is served by the taking. While the difference between
a public purpose and a public use may appear to be purely semantic, a distinction
still exists.We agree that these terms are necessarily somewhat loosely defined.
However, that does not mean they are indistinguishable. The term [p]ublic
purpose is not a static concept. It is flexible, and is capable of expansion to meet
conditions of a complex society that were not within the contemplation of the
framers of our constitution. [quoted citation omitted]. However, this flexibility
does not equate to unfettered ability to exercise takings beyond constitutional
boundaries.
768 N.E.2d 1, 8 - 9 (Ill. 2002), cert denied 537 U.S. 880 (2002) (hereinafter
Southwestern Illinois); see also Kelo v. City of New London, Conn., 545 U.S. 469, 505
- 506 (2005)
...Blackstone wrote that the law of the landpostpone[s] even public
necessity to the sacred and inviolable rights of private property... The
Framers embodied that principle in the Constitution, allowing the
government to take property not for public necessity, but instead for
public use Defying this understanding, the Court replaces the Public
Use clause with a [P]ublic [P]urpose Clause.
5

Public purpose is a standard very similar, if not identical, to public convenience and necessity.

12

(Thomas, J. dissenting) (internal citations omitted) (emphasis added).

Thus the IUBs finding of a public convenience and necessity did not alone
warrant the exercise of eminent domain without a public use. The legislature cannot
delegate its entire constitutional authority and that of the courts to the Board.
3. Petitioners as applied challenges to Iowa Code 479B.9 and
479B.16.
Petitioners challenge the constitutionality of 479B.9 and 479B.16 under both
the United States and Iowa Constitutions because the statutes are being applied to allow
Dakota Access to exercise eminent domain over petitioners farmland.

Although

petitioners will herein rebute the safety and economic development rationales in support
of the IUBs determination of public convenience and necessity, even if those
arguments fail, the IUBs Order and Dakota Accesss exercise of eminent domain
authority under 479B.9 and 479B.16 are unconstitutional. The IUBs authorization
and Dakota Accesss exercise of eminent domain are unconstitutional because they fail to
satisfy the Public Use Clauses of the United States and Iowa Constitutions.
a. The Court should adopt the reasoning of the Illinois Supreme
Court in Southwestern Illinois in finding that the IUBs Order and
Dakota Accesss exercise of eminent domain pursuant in Iowa Code
479B.9 and 479B.16 are unconstitutional as applied to petitioners.
The IUB should adopt the reasoning in Southwestern Illinois in finding that
479B.9 and 479B.16 are unconstitutional as applied to petitioners because the facts of the
case are closely analogous and its reasoning is persuasive. In Southwestern Illinois, the
Southwestern Illinois Development Authority (SWIDA) exercised its quick take
eminent domain authority, granted by statute, to condemn National City Environmental,
L.L.C.s (National City) recycling plant which was next door to a racetrack. See

13

generally 768 N.E.2d at 4 - 6. The racetrack wanted National Citys property so that it
could build additional parking facilities to adequately serve patrons. Id. at 4. The
SWIDA found that additional parking facilities would relieve traffic burdens on the
nearby Interstate 55-70 and state highways, promote pedestrian safety, create economic
development, and increase tax revenues. See generally id. at 4 - 6. The SWIDAs
reasoning, rejected by the Illinois Supreme Court, closely mirrors the IUBs reasoning
(e.g. emphasis on public safety, economic development, and tax revenues). See id. at 8.
Though the concept of public use is admittedly elusive (see, e.g. id. at 8), the
Illinois Supreme Court held that public use requires that [t]he public must be to some
extent entitled to use or enjoy the property, not as a mere favor or by permission of the
owner, but by right. Id. at 9 (quoting Gaylord v. Sanitary District, 68 N.E. 522 (1903)
(emphasis added)).6 The IUB claims that the pipeline is open to shippers, and that they
are part of the public too (IUB Ord. 110), but the racetrack at issue in Southwestern
Illinois was also open to the public, though not by right. Southwestern Illinois, 768
N.E.2d at 9. Instead, the Southwestern Illinois court found that the racetrack is a
private venture designed to result not in a public use, but in private profits. Id. The IUB
similarly found that the DAPL is a private industrial enterprise development (IUB Ord.
119), and there can be no mistake that its sole and exclusive purpose is to make
substantial profits for Dakota Access and its partners and investors.
The Southwestern Illinois court further found that though economic development
is an important public purpose, it was insufficient to show a public use because
6

Alternatively, the services of an actual public utility are available to the public by right which is why
utilities have a public purpose. E.g. 476.29(5) ("Each local [telephone] exchange utility has an obligation
to serve all eligible customers within the utility's service territory, unless explicitly excepted from this
requirement by the board.).

14

incidentally every lawful business does this [grow and prosper and contribute to
economic growth in the region]. 768 N.E.2d at 9. The Southwestern Illinois court relied
on Limits Industrial R.R. Co. v. American Spiral Pipe Works, 151 N.E. 567 (1926), a case
in which a railroad company was denied the power of eminent domain to expand its
facilities despite having a certificate of convenience and necessity issued by the Illinois
Commerce Commission. 768 N.E.2d at 9. Because the railroads expansion provided
minimal public benefit and principally benefitted the railroad itself and a few other
business entities, its expansion was not a public use, even though it was found to
promote convenience and necessity. 768 N.E. 2d at 9 - 10. In light of the Limits
Industrial R.R. Co. case, the Southwestern Illinois court concluded: Similarly, it is
incumbent on us to question SWIDAs findings as to the parking situation at Gateway
and determine whether the true beneficiaries of this taking are private businesses and not
the public. Id. at 10.
Here the IUB should follow its determination that Dakota Access is a private
industrial enterprise to its only logical conclusion and determine that the only actual
beneficiaries of the DAPL are Dakota Access and its partners and investors. To the
extent Iowans or the public benefit, such benefits are incidental in the same way that
every other viable private industrial enterprise incidentally benefits the public.
b. The IUBs Order and Dakota Accesss exercise of eminent domain
pursuant to Iowa Code 479B.9 and 479B.16 are unconstitutional as
applied to petitioners under Kelo v. City of New London, Conn
i.
The IUB should not consider the majority opinion of Kelo v. City
of New London, Conn. - or the prior eminent domain jurisprudence on
which it relies - in deciding this matter because it is distinguishable and
statutorily pre-empted.

15

In Kelo v. City of New London, Conn., 545 U.S. 469 (2005), a narrow 5-4
majority of the Supreme Court allowed a highly controversial exercise of eminent domain
by the City of New London, Connecticuts New London Development Corporation
whereby it condemned the homes of Susette Kelo and Wilhelmina and Charles Dery.7 Id.
at 475. The Derys had occupied their home together for 60 years, and Wilhelmina was
born in the home in 1918. Id. The petitioners property was to be transferred to a
developer who would then lease the property to Pfizer Inc. or other private entities like a
conference hotel, restaurants, or shopping pursuant to an integrated development plan.
Id. at 474. The development plan also included a public riverwalk, a Coast Guard
museum, a public marina, a state park, residences, and the necessary public
infrastructure. Id. Further, the condemned properties were not outright transferred in fee
simple to private parties, but rather, they were leased to a developer, who would then
lease them to the private entities thereby providing continued local jurisdiction and
control. Id. at 476 n.4, 478 n.6.
Like in Kelo, the IUB and Dakota Access took large swaths of petitioners
farmland for the construction and operation of the DAPL. Unlike the City of New
London in Kelo, Iowa is not a distressed economy8, and the DAPL is not part of an
integrated economic development plan.

See id. at 487.

Kelo is immediately

distinguishable on its face.

Further, the majority opinion in Kelo has been statutorily pre-empted by the Iowa
legislature. The crux of the Kelo majority opinion was its consideration of petitioners

And other similarly situated petitioners.

Iowas unemployment rate of 4.0% as of June, 2016 is tied for fourteenth-best in the nation, according to
the Bureau of Labor Statistics. See http://www.bls.gov/web/laus/laumstrk.htm (last accessed August 1,
2016).
8

16

request that the Court adopt a new bright-line rule that economic development does not
qualify as a public use. Id. at 484. The Kelo majority rejected that argument, noting
that promoting economic development is a traditional and long-accepted function of
government. Id. The Kelo majority further held, There is, moreover, no principled
way of distinguishing economic development from other public purposes that we have
recognized. Id.
The Iowa legislature strongly disagreed. In response, the Iowa legislature adopted
6A.22

in 2006, which statutorily excludes the sort of economic development

arguments used in Kelo (i.e. job creation, tax revenues) from ever being a public use or
public purpose except in narrow exceptions. The Iowa legislature drew a principled
distinction between the taking of private properties that were blighted or slum
properties and the taking of agricultural land, which is statutorily prohibited from being
blighted or slum property.9 When it comes to taking blighted or slum properties,
economic development can be considered a public use or public purpose. 6A.22.
But economic development may never be considered a public purpose or public
use when agricultural lands are being condemned.

Because Dakota Access has

condemned agricultural lands, the Iowa legislature has statutorily excluded the majority
decision in Kelo from having an impact on the outcome of this matter.
Further, the cases that the Kelo majority relies upon are easily distinguished. The
case of Hawaii Housing Authority v. Midkiff, 467 U.S. 229 (1984) dealt with a
circumstance unique to the state of Hawaii: that there was almost no real estate, and what
little there was, was owned by an incredibly small number of people. The Hawaii
legislatures taking of private real estate to redistribute it so that many more people would
9

As discussed supra in this brief.

17

own it had the purpose of eliminating the social and economic evils of a land
oligopoly. Kelo, 545 U.S. at 482 (quoting Midkiff, 467 U.S. at 241 - 42);10 see also
Kelo 545 U.S. at 499 (OConnor, J. dissenting) (observing that in Midkiff just 22
landowners owned 72.5% of the fee simple titles on Hawaiis most populated island,
Oahu.) No one will own or occupy the Dakota Access pipeline easements except Dakota
Access.
In Ruckleshaus v. Monsanto Co., 467 U.S. 986 (1984), the Court allowed the
Environmental Protection Agency to consider data on the environmental impacts of a
pesticide submitted by one pesticide manufacturer in support of a different pesticide
manufacturers application for approval of a chemically similar pesticide, provided
compensation was made to the manufacturer for the use of its data. Id. at 992 - 93. At
issue was a statutory provision that instituted a mandatory data-licensing scheme. Id.
at 992. The Ruckleshaus Court allowed the taking of a companys prior research data on
the grounds that it eliminated costly and duplicative research barriers to enter the
pesticide market and consequently provided for a truly competitive market. Id. at 1015.
Antitrust and monopoly concerns, which are not present here, lay at the root of the
Ruckleshaus Courts public use determination.
In sum, the majority opinion in Kelo is irrelevant for the purposes of resolving
this case.11 The prior cases on which Kelo relies are also easily distinguished and
similarly irrelevant.

Accordingly, the Court should look beyond the Kelo majority

10

The case of Berman v. Parker, 348 U.S. 26 (1954) is also easily distinguished, because it related to
takings of a blighted area of Washington, D.C., in which most of the housing for the areas 5,000
inhabitants was beyond repair. Kelo, 545 U.S. at 480. Since the Iowa legislature has distinguished
between the taking of blighted properties and the taking of agricultural lands, Berman is entirely
inapposite. See also Kelo, 545 U.S. at 498 - 99 (OConnor, J. dissenting) (distinguishing Berman).
11
Justice Kennedys concurrence and the dissent still remain relevant, though.

18

opinion to Southwestern Illinois, discussed supra, and Justice Kennedys concurrence and
the Kelo dissent, discussed infra, in deciding that 479B.9 and 479B.16, as applied to
petitioners, are unconstitutional.
ii.
Iowa Code 479B.9 and 479B.16 Are Unconstitutional as
Applied to Petitioners Because They Are Inconsistent With Justice
Kennedys narrow concurrence in Kelo
The Court should further hold 479B.9 and 479B.16 unconstitutional as applied
to petitioners because they are inconsistent with Justice Kennedys narrow concurrence in
Kelo. Justice Kennedys concurrence should be highly persuasive to the Court, because
although he joined the majority opinion, his concurrence places sharp limits on the
majority opinion.
a.
The legal standard(s) set forth in Justice Kennedys concurrence:
searching rational-basis review or a presumption of impermissible
favoritism.
Justice Kennedy acknowledges that rational-basis review is the appropriate
Constitutional standard in determining petitioners challenge under the Federal
Constitution. Kelo, 545 U.S. at 490 (Kennedy, J. concurring) (This deferential standard
of review echoes the rational-basis test used to review economic regulation under the Due
Process and Equal Protection Clauses.)

However, Justice Kennedys rational-basis

review is not as deferential as one might assume. Instead, Justice Kennedy makes clear,
transfers intended to confer benefits on particular, favored private entities, and with
only incidental or pretextual public benefits, are forbidden by the Public Use Clause. Id.
Justice Kennedy goes on to make clear that A court applying rational-basis review under
the Public Use Clause should strike down a taking that, by a clear showing, is intended to

19

favor a particular private party, with only incidental or pretextual public benefits. Id.
at 491 (Kennedy, J. concurring).
Already, it should be clear that Justice Kennedys rational-basis review of takings
is one with teeth.

He adds A court confronted with a plausible accusation of

impermissible favoritism to private parties should treat the objection as a serious one and
review the record to see if it has merit, though with the presumption that the
governments actions were reasonable and intended to serve a public purpose. Id. at 491
(emphasis added). The Court should note that it, and not the IUB, is to conduct this
analysis.

Justice Kennedy credited the trial court with conduct[ing] a careful and

extensive inquiry into whether, in fact, the development plan is of primary benefit to
the developer, and private businessesand in that regard, only of incidental benefit to the
city. Id. Here, the Court should conduct a similarly careful inquiry as to whether the
DAPL actually is of primary benefit to Dakota Access and its partners and only of a
speculative, incidental benefit to the people of Iowa12, such as in the form of marginally
cheaper gas prices.
Justice Kennedy further argues: There may be private transfers in which the risk
of undetected impermissible favoritism of private parties is so acute that a presumption
(rebuttable or otherwise) of invalidity is warranted under the Public Use Clause. Id. at
493. But, Justice Kennedy agreed with the Court that a presumption of invalidity is
not warranted for economic development takings in general

Id.

Here, because

economic development considerations are statutorily barred in Iowa for the proposed

12

Or if the court determines that out-of-state considerations are relevant whether other US consumers will
benefit given that the DAPL shippers are free to export to foreign refineries.

20

taking of petitioners land, Justice Kennedys proposed presumption of invalidity of

Dakota Accesss takings controls the Courts consideration.
b. Dakota Accesss proposed exercise of eminent domain under Iowa Code
479B.9 and 479B.16, as applied to petitioners, is unconstitutional under Justice
Kennedys concurrence in Kelo
Dakota Accesss proposed exercise of eminent domain under 479B.9 and
479B.16, as applied to petitioners, is unconstitutional when viewed through the
framework of Justice Kennedys concurrence in Kelo. Justice Kennedys analysis of the
prior proceedings in Kelo suggests that he would find Dakota Accesss proposed exercise
of eminent domain as applied to petitioners to be unconstitutional. The key findings for
Justice Kennedy were:

The state of Connecticut made a substantial commitment of public

fundsto the development project before most of the private beneficiaries were
known (id. at 491 - 92);

The developer was chosen from a group of applicants instead of being

handpicked beforehand (id. at 492); and

[O]ther private beneficiaries of the project are still unknown (id.)

Based on these findings, Justice Kennedy felt confident in concluding, that

benefitting Pfizer was not the primary motivation or effect of this development plan;
instead, the primary motivationwas to take advantage of Pfizers presence in order to
yield a measurable benefit to the local public. Id. (quoted citations omitted).
Here, the primary purpose of the DAPL is to benefit Dakota Access, a known
private enterprise, as the IUB has acknowledged, and accordingly, its shareholders and
partners. Dakota Accesss underground presence in Iowa is nothing Iowans or related

21

business can take advantage of now that the DAPL is constructed and buried. The state
government of Iowa has practically no skin in the game, unlike Connecticut in Kelo.
Dakota Access is the only developer, equivalent to one hand-selected beforehand; as a
consequence, neither Iowa nor petitioners could benefit from competition, as in Kelo.
Further, the beneficiaries of the pipeline are known: Dakota Access and its investors and
partners, the nine companies who have agreed to shipping contracts, and potentially a few
walk-up shippers. This is contrary to the taking in Kelo where the additional unknown
private parties who could benefit could be community-based businesses and
entrepreneurs, instead of foreign oil buyers, and where the development included public
goods like a riverwalk, museum, and infrastructure.
The Order fails the searching rational-basis review of Justice Kennedys
concurrence in Kelo and is thus unconstitutional under the Fifth and Fourteenth
Amendments to the Federal Constitution.
c.
The Court should adopt the reasoning of Justice OConnors dissent in
Kelo, afford Iowans greater constitutional protection in eminent domain cases,
and find the IUBs Order unconstitutional soley under Article I, Section 18 of the
Iowa Constitution.
The Court should adopt the reasoning of Justice OConnors dissent in Kelo and
afford Iowans greater state constitutional protections in eminent domain cases. Because
of the similarity between the federal and state takings clauses, federal cases interpreting
the federal provision are persuasive in our interpretation of the state provision. Harms v.
City of Sibley, 702 N.W.2d 91, 97 (Iowa 2005). However, such cases are not binding on
this court regarding our interpretation of the state provision. Id. (citing State v. Carter,
696 N.W.2d 31, 37 (Iowa 2005)).13 Here, the IUB should first look to the Iowa
13

Harms was decided on August 12, 2005, less than two months after the decision in Kelo, which was

22

legislatures swift and explicit rejection of Kelos holding - especially as it applies to

petitioners farms. In light of the legislatures rejection of Kelo, the Court should adopt
the reasoning of Justice OConnors dissent14 in Kelo and find that Dakota Accesss
proposed exercise of eminent domain under 479B.9 and 479B.16 is unconstitutional as
applied to petitioners.
The Kelo dissent starts with the bedrock proposition that to satisfy the Fifth
Amendment, a taking must both be for a public use and just compensation must be
paid to the owner. 545 U.S. at 496 (OConnor, J. dissenting). In contrast to the just
compensation component of the Takings Clause, the Kelo dissent observes: The public
use requirement, in turn, imposes a more basic limitation, circumscribing the very scope
of the eminent domain power: Government may compel an individual to forfeit her
property for the publics use, but not for the benefit of another private person. This
requirement promotes fairness as well as security. Id. at 497 (emphasis added).
The Kelo dissent notes that there are three traditional takings which the Court has
supported as legitimate public uses. The first is when land is taken for public ownership,
such as for a road, a hospital, or a military base. Id. at 497 - 98. The second are
transfers to private parties often common carriers who make the property available for
the publics use--such as with a railroad, a public utility, or a stadium. Id. at 498. Here,
it will do Dakota Access no good to point out that it is a common carrier under federal
law, because the DAPL is not available for the publics use; no Iowan is going to use the

decided on June 23, 2005. Had parties wished to argue the reasoning of the dissents in Kelo as a basis for
affording greater state constitutional protections, they would not have had the opportunity. Further, Harms
was a case about a zoning ordinance, so Kelos reasoning on economic development takings would not
have been applicable.
14
Joined by the late Chief Justice Rehnquist and the late Associate Justice Scalia, as well as Justice
Thomas.

23

DAPL. The nine oil shippers, plus any walk-up shippers needing service and lucky
enough to win a lottery granting them access to the last 10% of the pipelines capacity,
hardly constitute the public in any meaningful understanding of public.15 The third
sort of cases are where in certain circumstances and to meet certain exigencies, takings
that serve a public purpose also satisfy the Constitution even if the property is destined
for subsequent private use. Kelo, 545 U.S. at 498 (OConnor, J. dissenting) (citing
Berman, 348 U.S. 26 and Midkiff, 467 U.S. 229). Having previously distinguished those
cases, this case cannot be said to fall within this third and final category of cases in which
eminent domain has been allowed by the United States Supreme Court.16
The true force of the Kelo dissent lies in this observation:
For who among us can say she already makes the most productive or
attractive possible use of her property? The specter of condemnation
hangs over all property. Nothing is to prevent the State from replacing
any Motel 6 with a Ritz Carlton, any home with a shopping mall, or any
farm with a factoryIf legislative prognostications17 about the
secondary public benefits of a new use can legitimate a taking,
there is nothing in the Courts rule or in Justice Kennedys gloss on that
rule to prohibit property transfers generated with less care, that are less
comprehensive, that happen to result from less elaborate process, whose
only projected advantage is the incidence of higher taxes, or that hope to
transform an already prosperous city into an even more prosperous one.
Id. at 503 - 504. The Court has a chance to distinguish the eminent domain
protections afforded Iowans under its state Constitution by holding that those protections
are greater than the protections afforded Iowans by the Federal Constitution. By adopting
the rationale of the Kelo dissenters, the Court can reaffirm under the Iowa Constitution
15

Merrian-Webster relevantly defines public as of, relating to, or affecting all or most of the people of a
country, state, etc. (http://www.merriam-webster.com/dictionary/public) (last accessed August 1, 2016).
Other definitions like devoted to the general or national welfare and accessible to or shared by all
members of the community are equally unavailing to Dakota Access. See id.
16
As the dissent notes in these cases the extraordinary, precondemnation use of the targeted property
inflicted affirmative harm on society. Kelo, 545 U.S. 499. Here, the farmers use of their agricultural
lands poses no unique harm or threat to society.
17
Or administrative prognostications made pursuant to a delegation of legislative authority.

24

the fundamental principle that Iowas citizens are entitled to the quiet and peaceful
enjoyment of their property.
Echoing these crucial themes, the Kelo dissent concludes:
It was possible after Berman and Midkiff to imagine unconstitutional
transfers from A to B. Those decisions endorsed government intervention
when private property use had veered to such an extreme that the public
was suffering as a consequence. Today nearly all real property is
susceptible to condemnation on the Courts theory.
Any property may now be taken for the benefit of another private party,
but the fallout from this decision will not be random. The beneficiaries
are likely to be those citizens with disproportionate influence and power in
the political process, including large corporations and development firms.
As for the victims, the government now has license to transfer property
from those with fewer resources to those with more. The Founders cannot
have intended this perverse result.
545 U.S. 469, 504 - 505 (OConnor, J. dissenting) (emphasis added).
4. The U.S. and Iowa Constitutions give no regard to the degree of
invasiveness of a taking.
It can be attractive to assume that because the crude oil pipeline is now under the
petitioners farms, the petitioners may continue to farm the surface without much lasting
injury. It can also be attractive to assume that they petitioners should therefore just
acquiesce to Dakota Access and its political allies.

However, neither the U.S.

Constitution nor the Iowa Constitution allows takings for private purposes if the taking is
deemed only minimally invasive. There is no such thing as a legally permitted minimally
invasive taking. See Fifth Amendment of the United States Constitution and Article I,
Section 18 of the Iowa Constitution.
Here, Dakota Access has inserted a crude oil pipeline upon petitioners farms. In
one instance the pipeline easement will be as close as 46 feet from petitioner LaVerne

25

Johnsons residence. App. 1 - 2 (Statement of LaVerne Johnson (Aug. 23, 2016)).

Petitioner Johnson will be forced to live with the threat of a nearby pipeline explosion
instantly destroying his residence and possibly killing or injuring the occupants.
Alternatively, a pipeline leak may contaminate any petitioners drinking water or
farmland, rendering their farms uninhabitable and eliminating their ability to pursue their
chosen way of life. They will have to accept the decreased productivity of their soils
including compaction, soil horizon separation, and disruption of surface and subsurface
drainage. App. 22 - 23: Direct Testimony of Thomas Fenton, (October 12, 2015) p.3, ln.
9-23; p. 4 ln. 1-2.

Whatever the Court does, it should not allow Dakota Access to

trivialize the business risks and personal stress that Dakota Access forces upon each
petitioner.

C.

The IUBs determination that Iowa Code 6A.21 extends the power

of eminent domain over petitioners agricultural lands to interstate crude oil

pipelines such as Dakota Access was arbitrary and capricious because it is contrary
to law.
1. Agency determinations which are contrary to law are arbitrary and
capricious under to Iowa Code17A.19(10) and require relief by the Court.
The IUBs determination that 6A.21 did not bar Dakota Access from exercising
eminent domain over petitioners agricultural lands was arbitrary and capricious. See
Office of Consumer Advocate 432 N.W.2d at 154 (agency conclusions are arbitrary and
capricious if contrary to law). Iowa Code 6A.21(1)(b) defines Private development
purposes to mean[] the construction of, or improvement related to, recreational trails,
recreational development paid for primarily with private funds, housing and residential

26

development, or commercial or industrial development. The IUB agrees that the DAPL
is an industrial enterprise development. IUB Ord. 119. Iowa Code 6A.21(1)(c) states
Public use or public purpose or public improvement does not include the authority
to condemn agricultural land for private development purposes unless the owner of the
agricultural land consents to the condemnation. Petitioners farms are all agricultural
lands for the purposes of the statute. 6A.21(1)(a) (defining Agricultural land).
The IUB determined that the above prohibition did not apply because 6A.21(2)
contains a broad exception to the language quoted above, under which Dakota Access
fits. The statute says The limitation on the definition of public use, public purpose, or
public improvement does not apply toutilities, persons, companies, or corporations
under the jurisdiction of the Iowa utilities board in the department of commerce. The
IUB determined that Dakota Access was under its jurisdiction, and accordingly, 6A.21
did not bar Dakota Accesss exercise of eminent domain. IUB Ord. 121 (The Board
considers that the use of the term jurisdiction in 6A.21(2) includes the jurisdiction
granted the Board under Iowa Code chapter 479B to implement certain controls over
hazardous liquid pipelines).
The Boards finding is contrary to law for two reasons. First, the Board wrongly
read utilities, persons, companies, or corporations to be independent and
unrelated words. Because Dakota Access is a LLC, the Board reasoned that it is a
company under its jurisdiction. The Boards mistake was divorcing the generic word
companies from the specific word utilities that begins the list of entities excepted
from 6A.21s prohibitions on the exercise of eminent domain over agricultural lands.
The Boards mistaken interpretation is not entitled to any deference from the Court

27

because there is not an explicit grant of authority to the IUB to interpret 6A.21.
American Eye Care v. Department of Human Services, 770 N.W.2d 832, 835 (Iowa
2009); Iowa Assn of School Boards v. Iowa Dept of Educ., 739 N.W.2d 303, 306 (Iowa
2007).
Second, the question of whether the Boards finding was arbitrary and capricious
depends upon whether the legislature intended to authorize the Board to grant the power
of eminent domain to anyone under its jurisdiction, no matter how tenuous the
jurisdiction. The Boards conclusion about the legislatures intent is not consistent with
the statutes language and applicable canons of statutory interpretation. Therefore, it is
not entitled to deference. American Eye Care, 770 N.W.2d at 835 (Iowa 2009); Iowa
Assn of School Boards, 739 N.W.2d at 306 (Iowa 2007).
2. Dakota Access reads the exception in 6A.21(2) too broadly.
Though petitioners do not agree that Dakota Access is under the jurisdiction of
the IUB, petitioners also contend that Dakota Access must be associated with an utility in
order to be a qualified person, company, or corporation under 6A.21(2). Dakota
Access argues that legislative amendments broadening the exception show that the
legislature intended to include a non-utility like Dakota Access, in the exception.
However, statutory construction reveals that the legislature only intended persons,
companies, or corporations related to or affiliated with a utility (such as their
subsidiaries or affiliates) to be included within the exception.
Dakota Access invites the Court to read utilities, persons, companies, or
corporations in a manner where each word is given meaning without regard to the words
around it. The relevant statutory provision states: This limitation also does not apply to

28

utilities, persons, companies, or corporations under the jurisdiction of the Iowa utilities
boardor to any other utility. 6A.21(2) (emphasis added). Indeed, the words
utilities and any other utility sandwich the words persons, companies, or
corporations under the jurisdiction of the board. That the word utility (singular or
plural) appears three times so closely together, and sandwiches the words which the
Board would read so expansively, clearly indicates that the legislature was specifically
concerned about protecting and promoting the services of utilities in enacting 6A.21(2).
The addition of persons, companies, or corporations to the statute is easily understood
if one considers that utilities have subsidiary entities, which while not technically
utilities, provide necessary service to utilities and are under the IUBs jurisdiction.
The Board should apply the canon of interpretation of ejusdem generis and
interpret the generic words: persons, companies, or corporations to be related to the
specific word of utilities that immediately precedes it. See Teamsters Local Union No.
421 v. City of Dubuque, 706 N.W.2d 709, 715 (Iowa 2005). Because Dakota Access is
not a utility, a subsidiary of a utility, or related to a utility, it does not fall within the
exception in 6A.21(2). The Boards erroneous interpretation of 6A.21 finding that
Dakota Access is entitled to the statutory exemption is not entitled to deference.
American Eye Care, 770 N.W.2d at 835 (Iowa 2009); Iowa Assn of School, 739 N.W.2d
at 306 (Iowa 2007).
3. Iowa law prohibits Dakota Access from utilizing eminent domain over
agricultural land because Dakota Access is not under the operational or safety
jurisdiction of the Board nor is it otherwise a utility.

29

The IUBs determination that Dakota Access was under its jurisdiction is arbitrary
and capricious because it is contrary to law. Iowa courts strictly construe eminent
domain statutes. Clarke County Reservoir Commn, 862 N.W.2d at 168; IUB Ord. 116.
The board does not have its full legislatively prescribed jurisdiction over Dakota Access.
The Boards jurisdiction over hazardous liquid pipelines is prescribed by 479B.1. It
provides:
It is the purpose of the general assembly in enacting this law to grant the utilities
board the authority to implement certain controls over hazardous liquid pipelines
to protect landowners and tenants from environmental or economic damages
which may result from the [1] construction, [2] operation, or [3] maintenance of a
hazardous liquid pipeline or underground storage facility within the state, to [4]
approve the location and route of hazardous liquid pipelines, and to grant rights of
eminent domain where necessary
(emphasis added).
However, having issued an order approving the location and route of an interstate
crude oil pipeline, the Board has no continuing construction, operational or maintenance
control over it given the holding in Kinley Corp. v. Iowa Utilities Board, 999 F.2d 354
(8th Cir. 1993) (Iowa Utilities Board has no jurisdiction over jet fuel pipeline because
Hazardous Liquid Pipeline Safety Act preempted Iowa Code Chapter 479 under the
Supremacy Clause of the United States Constitution); see also 49 U.S.C. 60104(c (a
state authority may not adopt or continue in force safety standards for interstate pipeline
facilities or interstate pipeline transportation.), 49 U.S.C. 60101 (defining pipeline
facility to include hazardous liquid pipeline facilit[ies], which includes oil pipelines).
Strict construction of 6A.21 requires that the IUB have all of its statutory
jurisdiction over Dakota Access and the DAPL, which would necessarily include
jurisdiction related to every factor listed in 479B.1. Partial or shared jurisdiction is

30

insufficient. For example, the Board lacks any jurisdiction over the safe construction,
operation, or maintenance of interstate crude oil pipelines such as the DAPL. It cannot
protect landowners and tenants from any resulting environmental or economic damages,
much less personal injury or death in association with a hazardous liquid pipeline.
Because the Board does not have all of its required authorities and cannot perform all of
its required duties under 479B.1, it is without the relevant jurisdiction required by
6A.21(2). Cf. ANR Pipeline Co. v. Iowa State Commerce Commn., 828 F.2d 465, 468
(8th Cir. 1987) ([section 601, et seq.] leaves nothing to the states in terms of substantive
safety regulation of interstate pipelines, regardless of whether the local regulation is more
restrictive, less restrictive, or identical to the federal standards.). If the legislature had
intended that any jurisdiction was enough it would have said so. Given the absence of
an adjective before the word jurisdiction in 6A.21(2), Clark County Reservoir
requires the court to find that the legislature intended that all of the IUBs jurisdiction
is a prerequisite to granting the power of eminent domain, instead of just any minimal
amount.
The legislature did not intend to allow an interstate hazardous liquid pipeline
company to use the power of the State to force its way under agricultural land and then
not be subject to the Boards safety and maintenance oversight intended to protect the
landowners living in their homes and operating their farms on the surface. See Bluegrass
Pipeline Company, LLC v. Kentuckians United to Restrain Eminent Domain, Inc., 478
S.W. 3d 386, 392 (Ky. Ct. App. 2015) discretionary review denied (Feb. 10, 2016) (We
believe that the legislature only intended to delegate the states power of eminent domain
to those pipeline companies that are, or will be, regulated by the [Public Service

31

Commission]).

Because the IUB erroneously equated partial jurisdiction with full

jurisdiction, as required by a strict construction of 6A.21, it acted arbitrarily,

capriciously and contrary to law in deciding that 6A.21 did not bar Dakota Accesss
exercise of eminent domain over petitioners agricultural lands.
4. Dakota Access is not a public utility.
As a hazardous liquid pipeline company under Chapter 479B, Dakota Access
permit petition does not assert that Dakota Access is a public utility. See Petition for
Hazardous Liquid Pipeline Permit, Docket No. HLP 2014-0001. Iowa Code 476.1
defines public utilities to be those providing electricity, natural gas, water, and
telecommunications services to the public. Dakota Access does not propose to provide
any of these services. It proposes to construct approximately 346 miles of 30 inch
diameter pipeline for the transportation of crude oil. Id. The Iowa Supreme Court has
recently adopted an eight factor test to determine whether a party is a public utility. In SZ
Enterprises, LLC v. Iowa Utilities Bd., 850 N.W.2d 441, 447-449 (2014) the court found
inter alia, the following five factors which are immediately applicable to determining
whether Dakota Access is a public utility: a dedication to public use, [d]ealing with
the service of a commodity in which the public has been generally held to have an
interest, [m]onopolizing or intending to monopolize the territory with a public service
commodity, [a]ctual or potential competition with other corporations whose business is
clothed with public interest and [w]hat the corporation actually does.18
18

The remaining three factors of SZ Enterprises, LLC v. Iowa Utilities Bd, although less applicable here,
are, [a]rticles of incorporation, authorization, and purposes, [a]cceptance of substantially all requests
for service, and [s]ervice under contracts and reserving the right to discriminate is not always
controlling. Regarding these additional factors, the petitioners note that no governing or other documents
filed in this case suggest that Dakota Access seeks public utility status. Dakota Access cannot accept
substantially all requests for service because of its volume capacity limitations. Finally, unlike a public
utility, Dakota Access uses detailed written contracts for every shipper. Although this factor is not

32

The testimony of Dakota Access clarifies that it is not a public utility. Dakota
Access presented the Vice President of Commercial Development for Energy Transfer
Partners, Mr. Damon Rahbar-Daniels for cross examination on November 16, 2015. He
testified that crude oil has no intrinsic value unless refined, and that 100% the crude oil to
be transported through the pipeline is destined to a refinery. App. 18 - 19: Damon
Rahbar-Daniels, Transcript Vol. 1, p. 141: 25; p. 142: 1-10. He also testified that Iowa
has no oil wells or oil refineries. App. 16: Damon Rahbar-Daniels, Transcript Vol. 1, p.
133: 15-17. Having no oil wells or refineries, the Iowa public will not use the Dakota
Access pipeline. Having no intrinsic value, the crude oil transported by Dakota Access
will provide no direct value to Iowans as it passes through our state. Because Iowans
cannot use the crude oil, Dakota Access does not have any Iowa customers or territory.
Mr. Rahbar-Daniels further testified that he is not aware of any technology in the
marketplace that would even allow the tracing of crude oil transported through the
Dakota Access pipeline through a refinery and then back to Iowa in the form of refined
gasoline.

App. 17: Damon Rahbar-Daniels, Transcript Vol. 1, p. 137: 9-15.

Accordingly, the Iowa public does not have any measureable indirect use of the Dakota
Access pipeline. Furthermore, he indicated that Dakota Access has only nine shippercustomers. App. 17: Damon Rahbar-Daniels, Transcript Vol. 1, p. 137: 16-19. Nine
nonresident customers do not evidence a dedication to public use. No one can say that
the Iowa public has an interest in crude oil, particularly given that no one can measure
whether the refined gasoline will ever find its way back to the Iowa market place.
Indeed, the recent enactment of H.R. 2029, Pub. L. 114-113, Division O, Title I, Sec. 101

controlling, it certainly supports the determination that Dakota Access is not a utility.

33

(December 18, 2015) allows U.S. crude oil to be exported to foreign countries for the first
time since 1975. Therefore, there is no assurance that the crude oil traveling through the
Dakota Access pipeline will even be refined in the U.S. for the greater U.S. marketplace.
Quoting Mr. Rahbar-Daniels, Its the shippers who control what they do with their oil,
sir. App. 13: Damon Rahbar-Daniels, Transcript Vol. 1, p. 46: 19-20.
Finally, Mr. Rahbar-Daniels clarified that Dakota Access will not have any Iowa
competitors and will not compete with any Iowa public utilities governed by 476.1
(electricity, natural gas, water and telecommunication services.)
Rahbar-Daniels, Transcript Vol. 1, p. 141: 3-20.

App. 18: Damon

What Dakota Access actually does is

transport crude oil from western North Dakota to Patoka, Illinois. App. 14 - 15: Damon
Rahbar-Daniels, Transcript Vol. 1, p. 106: 3-6 and Damon Rahbar-Daniels, Transcript
Vol. 1, p. 132: 23-24. From Patoka, Illinois the crude oil can go anywhere in the world to
be refined and serve anyone in the world with petroleum products. In SZ Enterprises, the
Court found that a company that installed solar energy systems on customer property and
sold electricity was not like a utility because behind-the-meter electric generation is no
more a utility activity than is a consumers adoption of electricity cost saving measures.
The same can be said for crude oil transportation. There are no Iowa utilities in the
business of transporting crude oil. Crude oil is not even in the stream of commerce with
any activity of an Iowa utility. Crude oil is not processed into or utilized to manufacture
electricity, water, natural gas, or telecommunication services. See 476.1.
Dakota Access is not dedicated to public use, has no monopolized territory, will
not compete with any Iowa utilities, and does not do what Iowa utilities do or otherwise
interfere with Iowa utilities. Additionally, the general public has no direct interest, or

34

measurable indirect interest, in producing, transporting, receiving, or refining crude oil.

Iowans may never receive the refined crude oil products derived from the crude oil of
Dakota Access customers. Because the crude oil is now available for export, there is no
guarantee that the refining and consumption will even occur in the United States. These
factors confirm the fact that Dakota Access is not a public utility under the SZ
Enterprises test. 19
5. Dakota Access is also not a private utility.
The universe of utilities includes only those that are either public or private.
Public utilities include only those that provide one of the four categories of services set
forth in 476.1 (electricity, natural gas, water and telecommunication services). While
interpreting our statutes, the Iowa Supreme Court has often said, The legislative intent is
expressed by omission as well as by inclusion. North Iowa Steel Co. v. Staley, 112 NW
2d 355 (Iowa 1961). In Iowa, we therefore have only four types of utilities. Private
utilities therefore must provide one or more of these same four services, which Dakota
Access obviously does not do. To allow Dakota Access to utilize eminent domain over
the petitioners agricultural land, the Court would have to judicially create a new class of
Iowa utility which it cannot do. This is because [w]e may not extend, enlarge, or
otherwise change the meaning of a statute under the guise of construction. In re Estate
of Whalen, 827 N.W.2d 184, 194 (Iowa 2013) citing In re Estate of Bockwoldt, 814
N.W.2d at 223 (quoting Doe, 786 N.W.2d at 858). Furthermore, policy arguments to
amend the statute should be directed to the legislature. See In re Estate of Myers, 825
19

The U.S. Constitution similarly prohibits the exercise of eminent domain under the mere pretext of a
public purpose, when its actual purpose is to bestow a private benefit. Kelo, 545 U.S. at 478. For the same
reasons that Dakota Access is not a public utility pursuant to the SZ Enterprises standards, the claim that it
serves a public purpose is only a pretext to its actual private purpose of serving investors and private
shippers, thereby prohibiting Dakota Access use of eminent domain.

35

N.W.2d at 8. Similarly, Neither the trial court nor this court can by judicial decision
extend and enlarge the enactments of the legislature. Wall v. Cty. Bd. of Ed. of Johnson
Cty., 249 Iowa 209, 218, 86 N.W.2d 231, 37 (1957). Because the Iowa Legislature has
not specifically prescribed that a crude oil transportation pipeline is a utility in Iowa,
Dakota Access is not a utility and cannot use the power of eminent domain over
agricultural land.
Notwithstanding the conclusiveness of this categorical exclusion, the Board may
consider a recent analogous case. In Hawkeye Land Co. v. Iowa Utilities Bd., 847
N.W.2d 199, 214 (Iowa 2014) the court reviewed de novo the Boards determination that
the entity involved was a public utility under the statute, and reversed that Boards
decision. Rather than transporting crude oil, in Hawkeye Land Co., an independent
transmission company of electricity (ITC) sought to use eminent domain power to run
electrical lines across a railroad at a legislatively set price schedule, known as the
crossing statute, as set out by 476.27. Hawkeye Land Co., 847 N.W.2d at 201. An ITC
furnishes electricity to public utilities which in turn furnish that electricity to the public.
Id at 216. The owner of the railroad easement objected to the use of the crossing statute
because the ITC was not a public utility authorized to avail itself of the crossing statutes
pay-and-go procedure. Id. The court determined, after reviewing the determination of the
Board de novo, that the ITC was not a public utility because it did not furnish any product
directly to the public, and therefore could not avail itself of the eminent domain rights
available to other public utilities under the crossing statute. Id. at 214 (holding ITC is not
a public utility under the definition prescribed by 476.1, or under the more broad
definition under the crossing statute).

36

Here, Dakota Access would accept crude oil from producers in North Dakota and
transport it to a pipeline hub in Illinois. App. 14 - 15: Damon Rahbar-Daniels, Transcript
Vol. 1, p. 106: 3-6 and Damon Rahbar-Daniels, Transcript Vol. 1, p. 132: 23-24. It does
not deal in a commodity in which the public has an interest, furnish a consumable
product, or furnishing any product or service to the public. It is not a utility, public or
private.
The purpose of allowing public utilities the right to avoid the statutory limitation
on eminent domain found in 6A.21(2) is the state policy favoring affordable energy,
water, and communications services to Iowans. Hawkeye Land Co. v. Iowa Utilities
Board, 847 N.W.2d 199, 214 (Iowa 2014); cf. Mid-America Pipeline Co v. Iowa State
Commerce Commission, 114 N.W.2d 622 (Iowa 1962) (holding, prior to enactment of
479B and 6A.21, that the granting of a permit to a private corporation to operate a
proposed pipeline for private purposes was beyond the pale of constitutional authority
where it was solely for private purposes, and without the showing of public necessity or
convenience.). Dakota Access will not furnish electricity, water, or communications
services to Iowa. Dakota Access is a sophisticated, private entity transacting business
with other sophisticated, private entities. Its rates are not regulated by the Board, it is not
selling its product directly to Iowans, and its business is not clothed in the public interest.
Therefore, it would defeat the intention of the legislature in enacting the agricultural land
limitation of 6A.21(2) to allow any and every private entity who seeks eminent domain
authority through the Board to avail itself of the ability to condemn the agricultural
property of private individuals. The exception contained in 6A.21(2) should not be
allowed to swallow the rules contained in 6A.1 and 6A.21(1)(c). See e.g. Branstad v.

37

State ex rel., Nat. Res. Commn., No. 14-0205 2015 WL 1546439 at *6 (Iowa App. April
8, 2015) (We are mindful that the exception should not be interpreted to swallow the
rule.). In codifying the exception for agricultural land, the legislature expressed a policy
against use of the eminent domain power to seize agricultural real property except for
very limited purposes, such as to provide for use by public utilities and other entities
providing necessary, public services to the general Iowa populace.
6. The legislature expressed its intent to prohibit private industry from
exercising eminent domain over agricultural land in its 2006 amendment to Iowa Code
6A.21(2) which struck the exclusion for agricultural land acquired for industry as that
term is defined in Section 260E.2 from its protections, thereby intentionally protecting
agricultural land from private industrial development by Dakota Access.
After the U.S. Supreme Courts 2005 decision in Kelo, the legislature acted to
protect farms from private development in 2006. The legislature passed HF 2351 (2006)
on May 3, 2006. It was subsequently vetoed by Governor Vilsack on June 2, 2006. The
legislature thereafter overrode the Governors veto in a special session of the General
Assembly, and HF 2351 became law on July 14, 2006.20 Among other things, HF 2351
(2006) amended the first sentence of 6A.21(2) to prohibit the condemnation of
agricultural land acquired for industry as that term is defined in Iowa Code 260E.2
as follows:
The limitation on the definition of public use, public purpose, or public
improvement does not apply to a slum area or blighted area as defined in section
403.17, or to agricultural land acquired for industry as that term is defined in
section 260E.2, or to the establishment, relocation, or improvement of a road
pursuant to chapter 306, or to the establishment of a railway under the supervision
of the department of transportation as provided in section 327C.2, or to an airport
20

See Degen, The Legislative Aftershocks of Kelo: State Legislative Response to the New Use of Eminent
Domain, 12 Drake J. Agric. L. 325, 344-345 (2007).

38

as defined in section 328.1, or to land acquired in order to replace or mitigate land

used in a road project when federal law requires replacement or mitigation.
When construing Iowa statutes, Iowa courts, consider the previous state of the
law, circumstances surrounding the statute's enactment, and the text both before and after
the amendment.

Davis v. State, 682 NW 2d 58, 61 (Iowa 2004). Our precedent

instructs the Court to, examine amendments with an eye toward determining the
legislative design which motivated the change. Id. When an amendment to a statute
adds or deletes words, a change in the law will be presumed unless the remaining
language amounts to the same thing. Id. Accordingly, by striking the former language
of 260E.2, the legislature intended that the limitation on the definition of pubic use,
public purpose, and public improvement expressly should apply to agricultural land
acquired for industry as that term is defined in 260E.2. In other words, industry may
not exercise eminent domain over agricultural land. Under Chapter 260E, the Iowa
Industrial New Jobs Training Act provides funds to eligible businesses for employee
training at Iowas community colleges. For purposes of determining eligible businesses,
260E.2 defines Industry to mean:
a business engaged in interstate or intrastate commerce for the purpose of
manufacturing, processing, or assembling products, conducting research and
development, or providing services in interstate commerce, but excludes retail,
health, or professional services
(emphasis added).
Here, Dakota Access is an industry proposing to provide crude oil transportation
services in interstate commerce.21 By providing 6A.21(2) to protect agricultural land
from condemnation by industries providing services in interstate commerce, the

21

There appears to be no real issue that the hazardous liquid pipeline proposed by Dakota Access is an
industrial enterprise development for purposes of Iowa Code 6A.21(1)(c). Order, p. 119.

39

legislature intended to protect the petitioners agricultural lands from private industrial
developers such as Dakota Access.22
When applying Davis v. State, and considering the circumstances surrounding
the statute's enactment supra, it is also important to consider the timing of the 2006
amendment to 6A.21(2). It happened immediately in response to the U.S. Supreme
Courts 2005 decision in Kelo v. City of New London, discussed supra. In Kelo, the US
Supreme Court allowed a Connecticut city to take homes from individual homeowners in
order to allow a private developer to utilize the space. In response, not only did our
legislature pass HF 2351 in its very next legislative session, the legislature over-road the
Governors veto in order to make HF 2351 (2006) the law of Iowa. There cannot be a
more assertive expression of the legislatures commitment to protect agricultural land
from private industrial development.

Because Dakota Access is a privately funded

private industry providing services to customers in interstate commerce, not including

Iowans, the legislature has protected the petitioners agricultural lands from Dakota
Access use of the States power of eminent domain.
Even if there were a public convenience and necessity to support the permit, the
Board should have found 6A.21 to prohibit the use of the power of eminent domain over
the petitioners agricultural lands. The intersection of 479B.16 and 6A.21 would
nonetheless have allowed Dakota Access to exercise the power of eminent domain over
all types of Iowa lands that are not agricultural lands.
22

The legislature also added new Iowa Code 6A.22 to our laws as a corollary to the changes at 6A.21(2)
with the enactment of HF 2351 (2006). Among other things 6A.22(2)(b) specifically excludes privately
owned or privately funded commercial or industrial development from the definition of public use or
public purpose or public improvement. Accordingly, and in addition to the special protection for
agricultural land afforded by 6A.21(2), the legislature intended that privately funded industry such as
Dakota Access not exercise the power of eminent domain in Iowa.

40

D.

The IUBs failure to find that Dakota Access is not a common carrier

under Iowa Code 6A.22(2)(a)(2) and that its crude oil pipeline was therefore not a
"[p]ublic use", "public purpose", or "public improvement" was arbitrary and
capricious because it is contrary to law.
Iowa law places limitations on the exercise of eminent domain authority in
addition to the limitations in section 6A.21. 6A.22(1). If Dakota Access exercise of
eminent domain survives petitioners challenge under 6A.21, then it must not also
survive the additional limitations under 6A.22. Most broadly stated, the additional
limitations set forth in 6A.22 are that the authority of an acquiring agency to condemn
any private property through eminent domain may only be exercised for a public purpose,
public use, or public improvement. 6A.22(1). The statute then defines public use,
public purpose, or public improvement as one or more of the following. listing
five instances, which are:
(1) The possession, occupation, and enjoyment of property by the general public
or governmental entities.
(2) The acquisition of any interest in property necessary to the function of a public
or private utility, common carrier, or airport or airport system.
(3) Private use that is incidental to the public use of the property, provided that no
property shall be condemned solely for the purpose of facilitating such incidental
private use.
(4) the acquisition of property pursuant to chapter 455H.
(5) (a) The acquisition of property for redevelopment purposes and to eliminate
slum or blighted conditions inan urban renewal area designated as a slum or blighted
area.
6A.22(2)(a)(1) - (5).

41

The DAPL plainly does not fit under categories (1), and (3) - (5). The parties
disagree with respect to whether Dakota Access fits under the second exception. Dakota
Access has maintained throughout the proceedings related to petitioners request for a
stay that it is a common carrier. It has mislead the court and claimed that petitioners have
conceded this point. That is not true. Petitioners have only conceded that Dakota Access
is a common carrier for purposes of federal law, as all pipelines, public or private, are
common carriers under the Federal Interstate Commerce Act.23 However 6A.22 does
not incorporate the federal definition or provide any definition of common carrier.
Accordingly, the Court should look to Iowas common law to determine if Dakota Access
is not a common carrier for the purposes of 6A.22. Wright v. Midwest Old Settlers and
Threshers Assn, 556 N.W.2d 808 (Iowa 1996) (Iowa law adheres to a common law test
for determining whether a particular conveyance is a common carrier or a private
carrier.) It is not.
When a term is not defined, the Court looks to the ordinary and common
meaning of the term. Harvey v. Care Initiatives, Inc., 634 N.W.2d 681, 685 (Iowa
2001) (citations omitted). Furthermore, we construe statutory language consistent with
our case law and the common law. Id. Additionally, All parts of the statute will be
considered together, and we will not give undue importance to any single portion.
Renda v. Iowa Civil Rights Comn, 784 N.W.2d 8, 15 (Iowa 2010). Here, neither the
ordinary and common meaning of common carrier supports a finding that Dakota
Access is a common carrier, nor does a holistic reading of 6A.22(a)(2).

23

See Tesoro Alaska Co. v. F.E.R.C., 778 F.3d 1034, 1038 (D.C. Cir. 2015) (In ICA
1(3), common carrier is defined to include all pipe-line companies. (emphasis in
original)).
42

First, the Court should note that the IUB made no determination as to whether
Dakota Access is a common carrier. The term appears nowhere in the Order. In Iowa,
[i]t is a question of law for the court to determine what constitutes a common carrier, but
it is a question of fact whether, under the evidence in a particular case, one charged as a
common carrier comes within the definition of that term and is carrying on its business in
that capacity. Wright, 556 N.W.2d at 810 (quoting State ex rel. Bd. of R.R. Commrs v.
Rosenstein, 252 N.W. 251, 253 (Iowa 1934)).

Because the IUB, not the Court, is

responsible for finding facts24, the Court cannot substitute its judgment for the IUBs and
make an initial finding of fact as to whether Dakota Access is a common carrier based on
the voluminous record. The Court can only supply the legal definition of a common
carrier.
Second, if the Court reaches this issue without remand, it should conclude that
Dakota Access is not a common carrier. Iowa law has defined a common carrier as one
who undertakes to transport, indiscriminately, persons and property for hire. Wright,
556 N.W.2d at 810 (emphasis added). This vague definition is further clarified: We
have ruled that the distinctive characteristic of a common carrier is that it holds itself out
as ready to engage in the transportation of goods or persons for hire, as public
employment, and not as a casual occupation. [Citation omitted]. A common carrier
holds itself out to the public as a carrier of all goods and persons for hire. Id. This does
not describe Dakota Access. Dakota Access has only nine pre-determined shippers who
will use up to ninety percent of the DAPLs capacity. Federal regulation forces it to save
up to ten percent of its capacity for the benefit of others that qualify. These are called
walk-up shippers. Because it discriminates against walk-up shippers who only get ten24

As Dakota Access so frequently points out, the IUBs factual determinations are given great deference.

43

percent of capacity, but who are otherwise in the same class as its nine preferred shippers
who get ninety-percent of capacity, it is not a common carrier under the nondiscriminatory common law requirements of Wright v. Midwest Old Settlers and
Threshers Assn, supra.
Further, oil pipelines may only serve the producers in the limited geographic area
in which the pipeline originates, in this case in another state that does not even share a
border with Iowa, and that narrow, foreign, group of corporations does not - and cannot constitute the public to whom a common carrier must hold itself out at common law.
In its briefing on the petitioners motion for a stay, Dakota Access has conceded that if it
were constructing the DAPL to transport its own oil, i.e. for its own private purpose, it
could not exercise eminent domain under Iowa law. (DAPL Br. on Motion for Stay 49
(citing Mid-America Pipeline Co. v. Iowa State Commerce Commission, 114 N.W.2d 622
(Iowa 1962)).

Dakota Access then reads pure dicta in the case which says the

commissions record shows[] that Northern intends to handle only its own products by
pipe line and is not a common carrier of such products (Mid-America, 114 N.W.2d at
624) to imply that a pipe line could be a common carrier under Iowa law by merely
handling the products of at least two customers (DA Br. on Motion for Stay 49 - 50).
Dakota Access ignores that Mid-America dealt with an intrastate pipeline running
from Pacific Junction, Iowa, to Des Moines. 114 N.W.2d at 623. Thus, Iowans and
Iowa businesses would have been served by the pipeline, had it held itself out to them.
Here, the public would be a very narrow number of foreign oil producers in Northwest
North Dakota. Iowa courts have not considered whether a small, discrete number of
potential shippers, who only produce a singular product for shipment in a mode of

44

transportation designed for shipping only one product, constitute the public at common
law.25 Thus, this is a case of first impression.
The Court should hold that the public to whom a common carrier must hold
itself out to must be, at least in part, Iowan citizens or businesses.26 All of the leading
Iowa cases involving the determination of whether a party was a common carrier and
their liability relate to those carriers provisions of services to Iowan citizens or
businesses. See generally Wright, 556 N.W.2d 808 (patrons of the Old Threshers festival
in Mt. Pleasant, Iowa), Employers Mut. Cas. Co. v. Chicago and North Western Transp.
Co., 521 N.W.2d 692, 693 (Iowa 1994) (question of whether railroad company, who
contracted with the Iowa Limestone plant in Alden Iowa was a common carrier),
Kvalheim v. Horace Mann Life Ins. Co., 291 N.W.2d 533 (Iowa 1974) (question of
whether tour guide transporting Iowan citizens by car to tourist cites was a common
carrier under a life insurance contract governed by Iowa law), Circle Exp. Co. v. Iowa
State Commerce Commission, 86 N.W.2d 888 (Iowa 1957) (question of whether agency
was correct to classify freight shipping serving Northeast Iowa service as common, rather
than private, carrier)).

Alternatively, pipeline companies serving Iowa utilities are

common carriers under Iowa common law. It is easy to conclude that in authoring
6A.22, the legislature intended to extend eminent domain to such pipeline companies in
order to cooperate with the eminent domain powers of Iowa utilities under 6A.21(2).

25

Crude oil pipeline transportation is hardly common or allowing multiple product types to be shipped by
the public at large. For example, Iowa regulations require railways to furnish suitable cars to any and all
persons who may apply therefor, for the transportation of any and all kinds of freight. I.C.A. 327D.3
(emphasis added).
26
Justice Thomas dissent in Kelo opines that grist mills open to the public were a common carrier. His
point is that the public in the state in which the grist mill was opened would have access to it. Nothing
about this suggests that Justice Thomas would agree that Iowans should have their farmland taken so an
extremely small number of oil producers in North Dakota may utilize farms for oil pipeline. The weight of
his jurisprudence, including his Kelo dissent, strongly suggests otherwise.

45

Finally, the Court should look to the surrounding terms in 6A.22(2)(a)(2) to

determine that Dakota Access is not a common carrier as used in that statute. That subsection also applies to public or private utility[ies] and airport[s] or airport system[s].
Both utilities and airports serve the broader Iowa public.

To remain true to the

legislatures intent, the Court should interpret common carrier in 6A.22 under
common law to mean those carriers holding themselves out to Iowan citizens, utilities,
and businesses. This does not include those serving a select few and qualifying oil
producers in North Dakota. The interpretation of common carrier advocated by Dakota
Access would render the term inconsistent with all of the surrounding terms in our
statute, and thus, legislative intent.

E.

The IUBs consideration of the economic impacts of the DAPL was

arbitrary and capricious because the IUB is statutorily precluded from considering
economic benefits in deciding whether to grant an entity the power of eminent
domain
With respect, the IUBs consideration of the economic impacts of the DAPL was
arbitrary and capricious because the IUB considered the (alleged) economic benefits of
the DAPL without consideration of Iowa law that precludes such considerations. Office
of Consumer Advocate v. Iowa State Commerce Comn, 432 N.W.2d 148, 154 (Iowa
1988) (Arbitrary and capricious are practically synonymous; both mean an agency
decision taken without regard to law or the facts of the case. (emphasis added)) 6A.22
imposes limitations in addition to [those] in Section 6A.21. Thus, the IUB and the
Court must construe the statutory limitations on the exercise of eminent domain found in
6A.21 and 6A.22 separately.

46

The IUB acknowledged that it must consider[]whether Iowa Code 6A.21

and 6A.22 limit the Boards authority to grant eminent domain to a pipeline company
granted a permit to construct a hazardous liquid pipeline pursuant to Iowa Code chapter
479B. IUB Ord. 119. Yet, the IUB did not fully analyze the prohibition on considering
economic development under 6A.22.
Iowa Code 6A.22(1) limits the authority of an acquiring agency to condemn
any private property through eminent domain to a public purpose, public use, or public
improvement.

The statute also defines public use, public purpose, or public

improvement. See generally 6A.22(2). The legislature then determined that Except
as specifically included in the definition in paragraph a,

public use or public

purpose or public improvement does not mean economic development activities

resulting in increased tax revenues, increased employment opportunitiesprivately
owned or privately funded commercial or industrial development. 6A.22(2)(b).
This section is fatal to the IUBs Order because the IUB found that There
appears to be no real issue that the hazardous liquid pipeline proposed by Dakota Access
is an industrial enterprise IUB Ord. 119. The IUB further found that the economic
benefits associated with the construction, operation, and maintenance of the proposed
pipeline are substantial. IUB Ord. 109. The Board credited the proposed construction
with the creation of [t]housands of construction jobs and the [l]ong termgenerat[ion
of] substantial tax revenues andat least 12 permanent jobs. IUB Ord. 109. However,
the IUB is statutorily precluded by 6A.22(2)(b) from considering increased tax
revenues and increased employment opportunities in deciding whether to grant
Dakota Access, the acquiring agency, eminent domain authority. As the IUB agrees,

47

this statute, as one related to the delegation of eminent domain power, should be strictly
construed. IUB Ord. 116 (citing Hawkeye Land Co. v. IUB, 847 N.W.2d 199, 208 (Iowa
2014) and Clarke County Reservoir Commission v. Robins, 862 N.W.2d 166, 168 (Iowa
2014)) .
Strict construction of 6A.22 requires the following determinations:

Dakota Access is an acquiring agency given the authorityto

condemn any private property through eminent domain. 6A.22(1); see also
Dakota Access Br. in Supp. of Mot. to Dismiss 3 (Iowa Code 6A.22(1)
provides the general rule that an acquiring agency (a status granted to Dakota
Access by the Iowa Utilities Board) may condemn any private property through
eminent domain.)

Dakota Access, as the acquiring agency may only use eminent domain

to condemn private property for a public purpose, public use, or public

improvement. 6A.22(1).

Economic benefits, including job creation, employment opportunities, and

increased tax revenues may not be considered -- because they are statutorily
precluded -- in determining whether an exercise of eminent domain is for a
public use, public purpose or public improvement 6A.22(2)(b).27

Therefore, the IUBs determination that the (alleged) economic benefits of

the DAPL supports a finding of public convenience and necessity is arbitrary

and capricious because the IUB may not make that determination as a matter of
law.
27

Except in the case of property acquired for redevelopment purposes and to eliminate slum or blighted
conditions pursuant to 6A.22(2)(a)(5)(a) which was the specific application of the power of eminent
domain in Kelo to which the legislature was responding with the adoption of HR 2351 (2006).

48

Instead of carrying significant weight in the statutory balancing test for

determining whether the proposed pipeline will promote the public convenience and
necessity, (IUB Ord. 109 - 110), this factor must carry no weight as a matter of law.
Having shown that IUBs findings of economic benefits are arbitrary and capricious, the
IUB must vacate the parts of its Order granting Dakota Access the authority - including
eminent domain authority - to build the DAPL.
F.

The IUBs conclusion that the DAPL will reduce the overall risk of

crude oil spills in Iowa is arbitrary and capricious, irrational, unsupported by

substantial evidence, and the product of a decision-making process in which the IUB
did not consider relevant and important facts that a rational decision maker would
have considered.
The IUB sought to balance the costs and the benefits of the DAPL in deciding to
issue the permit for Dakota Access to construct the pipeline. IUB Ord. 108 (citing South
East Iowa Co-Op. Elec. Assn. v. Iowa Utilities Board, 633 N.W.2d 814, 821 - 22 (Iowa
2001)). The IUB determined that two factors weigh heavily in favor of granting a
permit. IUB Ord. 109. The first factor was that the proposed pipeline represents a
significantly safer way to move crude oil from the field to the refinery when compared to
the primary alternative, rail transport.

Id. The Board also found that if it is built,

this pipeline will reduce the overall risk of crude oil spills, both in Iowa and elsewhere.
IUB Ord. 32 - 33. However, these conclusions do not follow from any other finding of
fact in the IUBs Order. Fatal to its safety determinations, the IUB asserted that The oil
is going to be produced and shipped as long as the market demands it... Id.

49

1. Risk Analysis Framework

As just discussed, the IUB determined that the DAPL Pipeline should be
constructed because it was safer than the alternative means of transporting oil through
Iowa: by rail car. IUB Ord. 109. The IUB found that the DAPL Pipeline would make
Iowans more, not less safe. IUB Ord. 32 - 33. However, its conclusion relies on the
premise that if the DAPL goes into operation, then there wil be fewer crude oil tank cars
on our rails. Then it refused to find that its own premise is true. The IUB should
evaluated its safety findings through the following qualitative risk framework:

Presently, approximately 40,000 rail cars of crude oil travel through Iowa

each year. IUB Ord. 29 (citation omitted). That is equivalent to 74,000 barrels
per week. IUB Ord. 31. This poses an existing baseline risk to Iowans that is
convenient to term X.

If the DAPL is built, it will carry a capacity of somewhere between

320,000 and 570,000 barrels per day. The DAPL has an anticipated incident rate
of one-fourth to one-third the incident rate of railway transport of petroleum
products. IUB Ord. 32 (finding that other pipelines have this lesser incident rate
relative to rail transport). Thus, the DAPL would introduce a new source of risk
to Iowans they do not presently face (the probability of an underground incident
magnified by the volume of oil being shipped). This poses a new risk to Iowans
that is convenient to term Y.

Thus, for Iowans to be safer, the introduction of risk Y would have to

offset the present risk X that rail-car transportation of oil poses to Iowans. It
could do so by reducing present rail transportation levels or by slowing the

50

increase of future rail transportation levels. It would be helpful to term this offset
risk X prime (X). If that offset occurs, by reducing existing rail car traffic or
by slowing the growth of future rail car traffic, then that offset must still outweigh
the risk Y that the DAPL introduces.

If the DAPL will not have any impact on the amount of oil transported by

rail car across Iowa in a year, then the introduction of the DAPL to Iowa would
make Iowans less safe, because they would face existing risk X, plus the new
DAPL risk Y, for a total risk of X + Y.

If the DAPL will reduce, or slow the growth of, the amount of oil

transported by rail car across Iowa, then Iowans will face a new risk equation of
X+Y. If X+Y is greater than X (X+Y >X), and Iowans will still be less safe. If
X + Y is less than X (X+Y < X), then Iowans will be safer.28
For the IUBs public safety rationale to hold water, its reasoning in the Order
must conclude that the DAPL will result in Iowans facing less risk in aggregate.
Petitioners contend, as explained in depth below, that the IUBs findings in its Order are
insufficient to allow it to reach this conclusion and, if anything, support the opposite
conclusion.

Accordingly, the IUBs public safety conclusions are arbitrary and

capricious, unsupported by substantial evidence, irrational, and the product of a decisionmaking process that failed to articulate a clear risk analysis.
2. Summary of relevant facts from the contested case proceeding
a.
Oil pipelines are safer than transporting oil by rail car, but
pipelines are still dangerous.

28

More safe in relation to volume or per-barrel risk, but not more safe in relation to the probability that
an incident will be timely discovered, i.e. discovery risk.

51

The IUB found that, according to the United States Department of Transportation
(USDOT), pipelines are shown to have between one-third and one-fourth the incident
rate of railway transport of petroleum products. IUB Ord. 32. However, according to
the same USDOT data, significantly more oil is shipped more miles by pipeline than by
rail. Id. Accordingly, it is not surprising that the total amount of oil leaked by
pipelines is higher. Id. (emphasis added) The only reasonable conclusion to be drawn
from the IUBs findings is that the construction of the DAPL will introduce a significant
additional element of risk into the lives of Iowans and especially petitioners, under whose
farms the DAPL will run. This magnitude of this risk is significant because of the
increased volumes of oil transported by the DAPL: very large amounts of oil risk leaking
or spilling underground, contaminating petitioners farms and the broader environment.
Thus, the risk Y established in the risk framework above indisputably exists.
b.
The IUB refused to find that the DAPL would reduce the
amount of oil transported through and across Iowa by rail car.
Dakota Access argued that the DAPL would reduce the amount of oil transported
through and across Iowa by rail car, but the IUB repeatedly refused to make such a
finding. IUB Ord. 32 (The pipeline may or may not reduce rail shipments of crude
oil) Dakota Access argued that the DAPL, by transport[ing] crude oil that might
otherwise be shipped by rail, reliev[es] rail capacity to ship other goods including
grains produced in Iowa.

IUB Ord. 33.

However, the IUB found that Dakota

Accesss witness acknowledged that there is no guarantee that rail transportation of crude
oil will be reduced if the pipeline is built. IUB Ord. 35. Most fatal to the IUBs safety
reasoning, it instead found, based on the testimony of Dakota Accesss witness, It is
possible that Bakken production will increase instead. If that happens, then the impact of

52

the proposed pipeline on the availability of rail transport may be non-existent. Id.
(internal citation omitted) (emphasis added). Accordingly, there is no factual basis for
the IUB to conclude that a decreased risk, X-prime (X) in the above risk-analysis will
result from the construction and operation of the DAPL.
c.
The IUBs conclusion that the DAPL will measurably
reduce the risk Iowans face from the transportation of oil across Iowa is
arbitrary and capricious, irrational, and unsupported by substantial
evidence because, if anything, the DAPL will increase the risks Iowans
face from the transportation of oil.
A reasonable person would find that the facts presented in the contested case
proceeding support the conclusion that the DAPL will not measurably reduce the risk
Iowans face from the transportation of oil across the state. If anything, the DAPL will
only increase the risk Iowans face from the transportation of oil across the state. The
IUB affirmatively found other facts which would cause a rational person to conclude that
oil shipments across Iowa by rail cars will not decrease should the DAPL become
operable.
The IUB found that the market will get the maximum amount of Bakken oil as
market demand will allow. IUB Ord. 32, 109 (both quoted supra). The IUB heard
credible testimony, cited in its Order, that presently the market is getting approximately
40,000 rail cars of crude oil travel[ing] through Iowa each year. IUB Ord. 29 (citation
omitted). That is equivalent to 74,000 barrels per week. IUB Ord. 31. One of two things
is more likely: either the market only wants 74,000 barrels of Bakken oil per week, or the
market wants more, but 74,000 barrels per week is, on average, the maximum capacity
railroad operators have for shipping oil by rail across Iowa.

53

Based on Dakota Accesss advocacy to the IUB, and common-sense inference, it

cannot be true that the market wants only the 74,000 barrels of oil per week shipped
across Iowa. Dakota Accesss proposed pipeline will carry a capacity of somewhere
between 320,000 and 570,000 barrels per day. Whatever its capacity, Dakota Access
has represented that [c]rude oil producers have signed take or pay contracts for 90
percent of the capacity of the proposed pipeline, the maximum capacity that FERC will
allow Dakota Access to permit. IUB Ord. 110. The remaining 10 percent of the
capacity will go to walk up or casual shippers. Id. Dakota Access anticipates that the
demand for this remaining 10 percent of capacity will be so great that it may have walkup supply that exceeds the pipelines remaining capacity, requiring it to allocate that
capacity by lottery. The lottery losers will still need to ship their oil. With the pipeline
full, the shippers who lost the lottery for access to the 10% walk-up capacity will need to
utilize the present method of rail shipping. The IUB was right to avoid concluding that
the DAPL will decrease the amount of oil being shipped by rail car.
Further, the IUB found that Dakota Access could not guarantee that Bakken oil
would not be sold to foreign markets, at least from time to time[I]t has always been
possible that the oil carried by the proposed pipeline will be sold into overseas
markets. IUB Ord. 25. The IUB also found that [d]uring periods of lower domestic
demand the oil will be more likely to be sold to foreign markets. Id. Indeed, the recent
federal enactment of H.R. 2029, Pub. L. 114-113, Division O, Title I, Sec. 101
(December 18, 2015) allows U.S. crude oil to be exported to foreign refineries.
A rational person, when reviewing these facts, would reach the following
conclusions:

54

The 74,000 barrels per week of oil presently transported across Iowa does

not represent the markets total demand for Bakken oil.

Instead, market factors such as the relative market price of crude oil net of

rail transportation cost, a limited capacity of rail cars, whether caused by: a lack
of suitable cars, competition with other rail shippers, or inability to add additional
rail transportation capacity is presently limiting the ability of oil producers to
satisfy the markets demand for Bakken oil.

Even if oil shipped by the DAPL satisfied domestic demand - itself a

dubious proposition that the IUB did not find as fact and that is unsupported by
the evidence cited by the IUB in its Order - foreign demand would require
additional Bakken oil in excess of the DAPLs capacity if Bakken oil was priced
below world market prices. In this regard, the markets combined domestic and
foreign demand for Bakken oil is inelastic or fixed. As such, the volumes shipped
by the DAPL, plus present rail shipping methods, are unlikely to fully satisfy the
world markets demand.

Accordingly, the operation of the DAPL, even at its maximum capacity,

will not significantly reduce the amount of Bakken oil transported across Iowa.
3. Legal Analysis of the Facts
The IUBs Order is arbitrary and capricious if it is taken without regard to the
law or facts of the case. Soo Line R. Co. v. Iowa Dept. of Transp., 521 N.W.2d 685, 688
- 89 (Iowa 1994) (citing Office of Consumer Advocate, 432 N.W.2d at 154). The United
States Supreme Court offers further guidance:

55

Under the arbitrary and capricious standard the scope of review is a narrow one.
A reviewing court must consider whether the decision was based on a consideration of
the relevant factors and whether there has been a clear error of judgmentAlthough this
inquiry into the facts is to be searching and careful, the ultimate standard of review is a
narrow one. The court is not empowered to substitute its judgment for that of the agency.
Bowman Transp., Inc. v. Arkansas-Best Freight System, Inc., 419 U.S. 281, 285
(1974) (quoting Citizens to Preserve Overton Park v. Volpe, 410 U.S. 402, 416 (1971));
Accord: Central South Dakota Co-op. Grazing Dist. v. Secretary of U.S. Dept. of
Agriculture, 266 F.3d 889, 894 (8th Cir. 2001) , Office of Consumer Advocate, 432 N.W.
at 154 (Iowa 1988) (Arbitrary and capricious are practically synonymous; both mean
an agency decision taken without regard to the law or the facts of the case.) The
agency must articulate a rational connection between the facts found and the choice
made. Bowman, 419 U.S. at 285 (quoted citation omitted).
Here, the IUB acted arbitrarily and capriciously because there is no caused
connection between the facts that the IUB found and its public safety conclusions. The
IUB determined that the DAPL would make Iowans safer if less oil is shipped by rail.
However, it then expressly refused to find that the DAPL would reduce the amount of oil
transported by rail across Iowa.

Most on point is the case of Alaska Dept. of

Environmental Conservation v. E.P.A.; in this case, the EPA considered Alaskas

Department of Environmental Conservations (ADEC) determinations as to what
constituted best available control technology (BACT) for a zinc mine whose electric
generators discharged significant amounts of air pollution. See generally 540 U.S. 461,
468 - 82 (2004) (summarizing the background facts and ADECs administrative process).

56

The Alaskan agency, ADEC, initially determined that a technology known as

selective catalytic reduction (SCR) was the BACT and economically feasible. Id. at
476. The zinc mine (Cominco) resisted and claimed that a technology Low NOx was
the BACT. Id. at 475. ADEC eventually changed its determination as to the BACT and
agreed with the mine that Low NOx was the BACT, even though it had made no
judgementas to the impact of[SCR] on the operation, profitability and
competitiveness of the Red Dog Mine. Id. at 479 (quoted citation omitted). Yet ADEC
also concluded that SCR imposed a disproportionate cost on the mine[and] on a
cursory review,requiring SCR for a rural Alaska utility would lead to a 20% price
increase, and thatSCR came at a significantly higher cost. Id.
The EPA found several flaws with the Alaskan agencys action. The EPA found
that the Alaskan agency acted arbitrarily, capriciously and unreasonably and blocked the
Alaskan agencys action. Id. at 482 (ADEC failed to provide a reasoned justification for
its elimination of SCR as a control option), 490 - 91 (Only when a state agencys
BACT determination is not based on a reasoned analysis,may EPA step in.EPA
adhered to that limited role here, explaining why ADECs BACT determination was
arbitrary and contrary to ADECs own findings.), 497 (so read, the [EPAs]
comments and orders adequately ground the determination that [the Alaskan agencys]
acceptancewas unreasonable given the facts [the Alaskan Agency] found.)

The

Supreme Court affirmed the EPAs findings.

The facts found by the IUB cannot support a finding that construction of the
DAPL will reduce the risk Iowans face from the transportation of oil across the state.
Accordingly, the Court should find the IUBs public safety determinations to be arbitrary,

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capricious, unreasonable, and unsupported by substantial evidence for the same reasons
the EPA and the Supreme Court found ADECs BACT determinations to be arbitrary and
unreasonable.
The IUB made no finding that the operation of the DAPL would reduce rail
shipments of crude oil.

IUB Ord. 32 (The pipeline may or may not reduce rail

shipments of crude oil) This finding is analogous to ADECs acknowledgement that

no judgment [could then] be made as to the impact of [SCRs] cost on the operation,
profitability and competitiveness of the Red Dog Mine. Alaska Dept. of Environmental
Conservation, 540 U.S. at 498. Despite this finding, ADEC made the fatally unfounded,
arbitrary, and unreasonable determination that SCR would threaten both theMines
unique and continuing impact on the economic diversity of northwest Alaska and the
mines world competitiveness. Id.
Similarly, the IUB made what it should now view as a fatally arbitrary and
unreasonable determination that the DAPL will make Iowans safer instead of less safe, as
it was made without regard to the facts it found and without regard to substantial
evidence. IUB Ord. 32. If the IUB cannot determine that the DAPL will reduce rail
shipments of crude oil across Iowa, then it cannot reasonably determine that introducing
the DAPL and its associated risks will constitute a safety advantage to the people of
Iowa. Id. Even if shipping of oil by rail may be less safe than shipping oil by pipeline on
a barrel-per-mile basis, the IUB failed to make any finding that the DAPL would reduce
the number of barrels shipped by rail car across Iowa either by slowing or stopping
increases in oil shipments by rail over present levels or by reducing present levels of oil
shipments by rail. Without such a finding, the IUBs conclusion that the DAPL will

58

improve the safety of Iowans is arbitrary, irrational, and not based on substantial
evidence. The only conclusion the IUB can reach, based on facts as it found them, is that
the existing risk X from rail car transportation of oil will continue unabated, while a new
risk Y from the DAPL pipeline will be introduced, leaving Iowans, and especially
petitioners, vulnerable to the greater risk of X + Y.
The Court should determine that the first prong of the IUBs finding of public
convenience and necessity is arbitrary and capricious, unreasonable, and not supported
by substantial evidence. The Court should invalidate its Order and Dakota Accesss
permit for this reason. This quantitative risk analysis should consider the impact the
DAPL will have on the quantity of oil shipped across Iowa by rail, quantify both any
decrease in risk resulting from less oil being shipped across Iowa by rail and the
affirmative risk of a pipeline incident. It should consider that though the probability of
such an incident is less, the volume of oil it ships is significantly greater, making the
magnitude of probable harms significantly greater. The Court should order the IUB to
exercise its unique expertise and competence to actually weigh the quantified risks so that
it can make a reasoned and factual determination grounded in substantial evidence about
the DAPLs impact on the safety of Iowans. The IUB should rescind the DAPL permit if
a quantitative risk assessment finds that DAPL ultimately makes Iowans less safe and not
safer.
G.

The IUBs failure to deny the use of the power of eminent domain to

Dakota Access over the petitioners real estate results in continuing and multiple
trespasses upon the petitioners properties and requires the Court to extend
equitable and monetary relief to petitioners.

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1. Dakota Access construction of its pipeline without a valid easement

trespasses upon the petitioners farmlands in two separate categories including: (i) the
continuing trespass of the pipeline itself, plus (ii) the trespass of every barrel of oil which
ever travels through the pipeline, and the respective remedies are an injunction against
the pipelines use and requiring its removal, plus monetary damages based upon any
actual use of the pipeline preceding the injunction.
As of this date, the pipeline has been constructed and installed upon the farmland
of all of the petitioners. When the court finds that Dakota Access is without a valid
easement upon these farmlands because it was not entitled to use the States power of
eminent domain, the court must then craft a remedy. Iowa law requires injunctive relief
and removal of the pipeline because monetary damages at law are an inadequate remedy.
It also requires that the petitioners be compensated for Dakota Access actual unlawful
use of the pipeline upon their properties.
In Hawkeye Land Co. v. Lurens State Bank, 480 NW 2nd 854 (Iowa 1992) the
Iowa Supreme Court considered a case where a bank owned abandoned underground
petroleum tanks located upon an abandoned leasehold. Id. at 855. The landowner asked
the court it issue an injunction requiring the bank to remove the petroleum tanks. The
court found for the landowner. It applied the trespass law of 160 of the Restatement
(Second) of Torts (1965):
A trespass may be committed by the continued presence on the land of a *857
structure, chattel, or other thing which the actor or his predecessor in legal interest
has placed on the land
(a) with the consent of the person then in possession of the land, if the actor fails
to remove it after the consent has been effectively terminated, or

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(b) pursuant to a privilege conferred on the actor irrespective of the possessors

consent, if the actor fails to remove it after the privilege has been terminated, by
the accomplishment of its purpose or otherwise.
Id. (Emphasis added). The court cited comment (e) of clause (a) thereto for the
law of continuing trespasses resulting from the continuing presence of the abandoned
petroleum tanks. It provides:
The intentional violation of such a duty of removal constitutes a continuing
trespass for the entire time during which the actor is under a duty to remove the
thing, and gives the possessor of the land a series of independent causes of action
for trespass unless and until the actor disseises the possessor.
The court found that injunctive relief is required in cases of continuing trespass by
chattel. The court held:
We have generally recognized these legal principles in trespass by chattel
situations involving encroaching fences and encroaching livestock. See Brown v.
Bergman, 204 Iowa 1006, 1009, 216 N.W. 731, 732 (1927) (fences); Babley v.
Vyse & Gatchie, 48 Iowa 481, 483 (1878) (livestock).
Our cases recognize the propriety of granting injunctive relief as an alternative to
damages in situations of continuing trespass. Independent Sch. Dist. of Ionia v.
DeWilde, 243 Iowa 685, 693, 53 N.W.2d 256, 261 (1952); Kamrar v. Butler, 164
Iowa 293, 297, 145 N.W. 879, 880 (1914).
The facts resulting in injunctive relief for the landowner in Independent School
Dist. of Ionia v. De Wilde, supra, are very similar to the Dakota Access case. A neighbor
to the school had installed a lateral sewage drainage pipeline beneath school property.
He had erroneously relied upon the invalid consent of the school board where the law
required a vote of the electors of the school district to convey an interest in school
property. 53 N.W.2d at 260. Citing its trespass precedent, the court found, Where acts
may cause irreparable injury, where a multiplicity of suits will be avoided, or where acts
of trespass are constantly repeated, but the injury resulting from each act is trifling, relief

61

in equity will be granted, because of the inadequacy of the legal remedy (emphasis
added). Id. at 261-262.
The Independent School Dist. of Ionia court rejected arguments that Dakota
Access has made in this case claiming that damages of landowners resulting from buried
pipelines are trivial. It found:
The school district has a legal right to manage its property in its own way. It is not
possible to foresee what situation might arisewhere the school district would
want to make changes, either in the topography of the school grounds or in its tile
drain. In addition in case the school desired to make an excavation where the tile
went across its property it would require some expense to do so. From a reading
of the record it can readily be inferred that the DeWilde tile went across the
school yard as being the shortest and least expensive way to the road ditch.
53 N.W.2d at 262.
Here, the holding in Hawkeye Land Co. directs this court to recognize that
without a valid easement, Dakota Access pipeline is committing a series of continuing
trespasses upon the landowners farmlands unless and until it removes its invalidly
authorized pipeline. It further informs the court about the propriety of injunctive relief as
an alternative to damages in the case of continuing trespasses by chattel. The holding in
Independent School Dist. of Ionia advises the court that notwithstanding Dakota Access
incorrect belief about the validity of its easement, equitable relief is required because the
legal remedy is inadequate no matter how trifling each independent trespass may seem to
Dakota Access. Else the petitioners will be required to bring multiple damage suits
during the life of the pipeline. It further advises that, far from trivial, the legal rights of
the petitioners to manage their properties in their own ways are important and require the
Courts protection.

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The holding in Independent School Dist. of Ionia is distinguished from the courts
later holding in Nichols v. City of Evansdale, 687 N.W.2d 562 (Iowa 2004). In Nichols,
there had been a mutual mistake. Neither the city as the seller nor Nichols as the buyer of
a bare residential lot was aware about the presence of a buried lateral sewage drainage
pipeline across one end of the lot. Following discovery, Nichols sought an injunction
requiring the city to remove the pipe, but the court awarded only money damages. The
court found that because Mr. Nichols original intent to build a smaller home was not
thwarted by the location of the pipeline, he was not entitled to equitable relief.
Here, there is no mistake about the presence of the pipeline as in Nichols. Instead,
the only mistake is about the validity of the authority to construct the pipeline given from
the IUB to Dakota Access as was the case of the invalid authority from the school board
in Independent School Dist. of Ionia. Likewise, the petitioners intent to always manage
their farmlands in their own ways is evident beginning with their initial intervention in
the IUBs proceedings through the present. Accordingly, the court must apply the Iowa
Supreme Courts holding in Independent School Dist. of Ionia and require Dakota Access
to not use its invalid easement and to remove its pipeline from the petitioners farmlands.
This is not the first time that a court has considered the question of whether to
enjoin the use and require the removal of an unauthorized crude oil pipeline. The Texas
Court of Appeals considered the question of a crude oil pipeline constructed without a
valid consent in Americo Energy Resources, L.L.C. v. Moore, 2008 WL 3984169 (Tx. Ct.
App. 2008). See also Tx. R. App. Pro. 47, Cmt. to 2008 change (All opinions and
memorandum opinions in civil cases issued after the 2003 amendment have precedential
value.) In Americo Energy Resources, a crude oil pipeline company having an easement

63

over the landowners ranch subsequently constructed a shortcut pipeline across an area of
the ranch to which the easement did not extend. This pipeline allowed Americo to
transport oil and gas to the compressor station while avoiding the circuitous route
previously used. Id. at 1. The ranch owner sought an injunction for removal of the
pipeline and damages associated with construction of the shortcut pipeline. Id. at 2.
The pipeline company argued that because the presence of the pipelines personnel on the
unauthorized areas of the ranch was only temporary, the trespass also was only
temporary, and the ranch owner was only entitled to monetary damages. Finding for the
rancher and noting the lack of a valid easement, the court held:
Because we have concluded that the shortcut pipeline constituted a trespass on
Wheeliss property, an additional trespass occurs each time oil or gas is
transported using the shortcut pipeline.
Id. To remedy the trespass, the Americo Energy Resources court found, An
injunction is the proper remedy to restrain repeated or continuing trespasses where the
remedy at law is inadequate because of the nature of the injury, or the multiplicity of
actions necessary to obtain redress. Cf. Independent School Dist. of Ionia v. De Wilde,
53 NW 2d at 262 (1952).
The court is presented at this point with a dilemma. How can it provide relief to
the petitioners with the pipeline having already been constructed upon them? Of course,
Dakota Access asserts that there is no trespass. It will also assert that if there were a
trespass, then money damages based upon diminution in value are the extent of
appropriate damages pursuant to the holding in Nichols, supra. It will then assert that
because condemnation proceedings under Chapter 6B are now complete, notwithstanding
appeals of damage awards, each petitioner has already received diminution in real estate

64

value damages pursuant to 6B.25 even though Chapter 6B does not apply.
Accordingly, Dakota Access will argue that there is nothing for the court to do at this
point, even in the face of a continuing trespass by the pipeline and multiple trespasses by
the crude oil. Such would largely invalidate the courts purpose under 17A.19 and its
authority over this petition for judicial review.
As set forth above, the petitioners disagree with Dakota Access and contend that
the pipeline itself must be removed.

However, the court must also consider the

additional, inevitable, and continuing trespasses of the barrels of crude oil which Dakota
Access would transport through its pipeline and beneath the petitioners farms. Although
one might incorrectly apply the holding in Nichols and conclude that money damages
remedy the trespass of the actual pipeline, the Nichols decision did not address the
question of the multiple trespasses of the pipelines contents. The Nichols decision
suggests that the sewer pipeline was in use based upon the citys attempt to acquire a
voluntary utility easement and its litigation over ownership. Nichols at 566.

The court

in Nichols did not consider whether the sewage traveling through the pipeline was
chattels, or things under 160 of Restatement Second (1965), each transiting unit of
which is an additional trespass under the holding in Americo Energy Resources.

This

court must address these multiple trespasses.

Furthermore, the personnel of Dakota Access will be required to trespass upon the
petitioners lands every time that they physically enter upon the petitioners property to
maintain the pipeline. See Nichols fn. 2 at 574 (In any event, if the City needs to go
onto the Nichols property to maintain the sewer lines without being liable for trespass, it

65

must either purchase an easement from the Nichols or condemn an easement under the
procedure set forth in Iowa Code chapter 6B.).
Accordingly, the court must consider the three categories of separate trespasses
including the pipeline, its contents, and Dakota Access maintenance personnel all
invalidly authorized to transit through or upon the petitioners lands by the invalid
easements. Although one might incorrectly find that the diminution in value is adequate
to compensate for the trespass of the actual pipeline, such does not address or redress the
multiple and continuing trespasses of the transiting crude oil or the trespasses of
maintenance personnel. The court must find that an injunction plus monetary damages
are necessary to relieve and compensate the petitioners for any trespassing oil and
intruding personnel. The court must enjoin the use of the segments of the pipe passing
through the petitioners farms, even if somehow the Court does not require removal of
the pipe.
2. The Courts precedent in Nichols, Hawkeye Land Co., and
Independent Sch. Dist. of Ionia require the Court to enjoin Dakota Access use of its
pipeline upon, and require its removal from, the petitioners real estate.
The Nichols court adopted the Restatement (Second) of Torts 936(1) regarding
the issuance of an injunction to enjoin a trespass. Specifically, the following factors are
considered in determining whether to enjoin a tort:
(a) the nature of the interest to be protected,
(b) the relative adequacy to the plaintiff of injunction and of other remedies,
(c) any unreasonable delay by the plaintiff in bringing suit,
(d) any related misconduct on the part of the plaintiff,
(e) the relative hardship likely to result to defendant if an injunction is granted and
to plaintiff if it is denied,
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(f) the interests of third persons and of the public, and

(g) the practicability of framing and enforcing the order or judgment.
Nichols at 572.
Application of these elements requires enjoining Dakota Access trespasses. The
nature of the interest to be protected is protection from continuing and multiple
trespasses. The relative [in]adequacy to the [petitioners] of remedies other than an
injunction are described above and in Hawkeye Land Co. v. Lurens State Bank, supra and
Independent Sch. Dist. of Ionia v. DeWilde, supra . The petitioners timely filed their
petition on May 27, 2016 following the IUBs ruling upon the motion to reconsider of the
Sierra Club. The petitioners have committed no related misconduct. The claim of
Dakota Access that petitioners were negligent in seeking their temporary stay, makes no
difference now that the pipeline is constructed upon their lands. Denying an injunction
will deny the petitioners of their legal rights provided by Independent Sch. Dist. of Ionia
v. DeWilde, 53 N.W.2d 256, 262 (1952) (The school district has a legal right to manage
its property in its own way to make changes, either in the topography of the school
grounds or in its tile drain. In addition in case the school desired to make an excavation
where the tile went across its property it would require some expense to do so.)
Alternatively, Dakota Access has known of the petitioners objections to the
presence of its pipeline upon their properties since their original interventions in IUBs
docket number HLP-2014-0001. At any time previous to the issuance of the Order,
Dakota Access could have sought a declaratory order from the Board pursuant to 17A.9
about the validity of its use of eminent domain. At any time prior to commencing
construction of its pipe, it might have sought a similar determination from the Court
under 6A.24(2). Or, it might have waited for a determination from this Court under

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17A.19. Instead, it chose to commence an accelerated construction schedule and take its
chances with this court and the courts review of the petitioners claims. Dakota Access
poor choice of litigation strategy should not prevent or delay the petitioners receipt of
injunctive relief. See, e.g., Gander Mt. Co. v. Cabela's, Inc., No. 04-CV-3125 PJS/RLE,
2007 WL 2026751, at *8 (D. Minn. July 10, 2007), aff'd, 540 F.3d 827 (8th Cir. 2008) (It is
not the job of this Court or the magistrate judge to protect a party from its litigation strategy
decisions and concluding, Cabela's must live with the consequences of its litigation
strategy.). Dakota Access has charged forward, but at its own risk. Indeed, this risk has

already come home to roost some in relation to the recent decision of the Army Corps of
Engineers and the Justice Department to delay construction near Lake Oahe in North
Dakota. See App. 53 - 54: Joint Statement from the Department of Justice, the Department
of the Army and the Department of the Interior Regarding Standing Rock Sioux Tribe v. U.S.
Army Corps of Engineers (September 9, 2016).29

Previously, in its resistance to the petitioners motion for stay, Dakota Access
claimed its own lost profits, liquidated contractual damages, and the lost employment of
its contract construction workers.

At this point, given that pipeline construction is

complete upon the petitioners, the liquidated damages and contract labor are irrelevant to
an injunction benefiting petitioners. Because Dakota Access was not entitled to exercise
the states power of eminent domain, it will be unjustly enriched if petitioners are denied
an injunction. See Dept. of Human Services ex rel. Palmer v. Unisys Corp., 637 N.W.2d
142, 154-155 (2001)(the elements are: (1) defendant was enriched by the receipt of a
benefit; (2) the enrichment was at the expense of the plaintiff; and (3) it is unjust to allow
29

The Court may take judicial notice of this joint decision of the United States Army Corp of Engineers and
United States Department of Justice.

68

the defendant to retain the benefit under the circumstances). The interest of the public in
the operation of the pipeline, if any, does not warrant denying the petitioners injunction.
If Dakota Access exercise of eminent domain was improper, then constitutional
deference and public policy require protection of the interests of the minority landowners
over that of the general public. Finally, there is nothing impracticable about enjoining the
use of a pipeline and requiring its removal. Dakota Access knew how to put it in, so it
must know how to take it out.
V.

CONCLUSION

The petitioners respectfully request that this Court reverse the Boards Order
granting Dakota Access the use of the states power of eminent domain over their
agricultural lands.

The Boards Order in this regard was based on erroneous

interpretations of law; is unsupported by substantial evidence; and was unreasonable,

arbitrary, capricious and an abuse of discretion. Based on the authority and arguments set
forth herein, the petitioners also pray that the Court enjoin Dakota Access from using its
illegal easements over their lands, require the removal of its pipeline from their lands,
require Dakota Access to fully restore those lands pursuant to 479B.20, and require that
Dakota Access thereafter not further trespass upon their lands in any way. If Dakota
Access has shipped any oil across the petitioners lands, then petitioners also pray that the
court remand the matter to the Board with instructions to hold an evidentiary hearing to
determine the monetary amount of trespass damages for such crude oil transportation.
Finally, the petitioners ask that the Court grant such further and additional relief as the
Court deems equitable under the circumstances.

69

Dated this 30th day of September 2016.

Respectfully Submitted,
/s/ William E. Hanigan
William E. Hanigan, AT0003284
DAVIS, BROWN, KOEHN, SHORS &
ROBERTS, P.C.
215 10th Street, Suite 1300
Des Moines, Iowa 50309-3993
Telephone: (515) 288-2500
Facsimile: (515) 243-0654
Email: billhanigan@davisbrownlaw.com
ATTORNEY FOR PETITIONERS

PROOF OF SERVICE
I hereby certify that the foregoing document was automatically served
electronically on all parties registered with the Electronic Filing System on
September 30, 2016.
Signature: /s/ William E. Hanigan

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