The Supreme Court of Pennsylvania Unanimously Finds Defendant Has Eminent Domain Power in Tioga County De Facto Takings Litigation

Chimicles Schwartz Kriner & Donaldson-Smith LLP is representing property owners in Tioga County, Pennsylvania, who allege to have been subjected to a de facto taking of their subterranean oil and gas rights by UGI Storage Company (“UGI”), a public utility with the power of eminent domain.

In November 2009, UGI filed an application with the Federal Energy Regulatory Commission (“FERC”) to, among other things, take ownership and to operate the Meeker Storage Field – an underground natural gas storage facility – and create a 3,000-foot protective buffer zone around this storage area.  The buffer zone, which encompasses some 2,980 acres, is designed to prohibit fracking and drilling operations that could come too close to UGI’s underground storage areas.  In October 2010, FERC issued an order partially certifying the buffer zone and indicating that UGI would need to meet certain requirements, including providing proper notification to affected property owners in the buffer zone, before FERC would give UGI final authority to fully implement this buffer zone.  The Plaintiffs in these lawsuits allege that in the ensuing twelve years, UGI has not provided required notice to property owners about its proposed buffer zone and how the buffer zone has adversely impacted owners’ rights and the values of properties located in the buffer zone. Plaintiffs also allege that UGI has yet to pay just compensation to property and property rights owners within the buffer zone.

After a number of appeals, the Pennsylvania Supreme Court issued a unanimous landmark ruling on November 29, 2021, that clarified the distinction between de facto and de jure takings and found that UGI possessed the power of eminent domain with respect to our clients’ properties.  The Supreme Court remanded the cases to the Commonwealth Court for further proceedings.  The case is active and ongoing.