Background

Leonard Hoffmann and other North Dakota ranchers faced condemnation proceedings when WBI Energy Transmission, Inc. invoked its federal eminent domain authority under Section 7 of the Natural Gas Act to acquire pipeline easements across their properties. The landowners retained counsel to negotiate just compensation for the takings, ultimately incurring $383,300 in legal fees during the valuation proceedings. Under North Dakota state law governing condemnation actions, prevailing landowners may recover reasonable attorney's fees from condemning authorities.

The Dispute

The central legal question is whether Natural Gas Act § 7, which authorizes interstate natural gas pipeline companies holding FERC certificates to exercise federal eminent domain power, implicitly preempts state fee-shifting statutes that would otherwise allow landowners to recover attorney's fees in condemnation proceedings. The Eighth Circuit held that federal law displaces North Dakota's state fee-shifting statute, leaving the ranchers responsible for their own substantial legal costs despite the condemnation proceeding. This ruling created or deepened a circuit split on whether NGA § 7 condemnation actions must follow the federal American Rule—under which each party bears its own attorney's fees absent explicit statutory authorization—or whether state procedural rules governing condemnation, including fee-shifting provisions, survive federal preemption analysis.

Procedural Posture

The Supreme Court granted certiorari on June 29, 2026, signaling the Court's recognition that the circuit split requires resolution. The conflict implicates fundamental questions about the interplay between federal eminent domain authority delegated to private pipeline companies and state property rights protections.

Implications for Practitioners

The Supreme Court's resolution will have immediate financial consequences for both interstate pipeline developers and landowners across multiple jurisdictions. If the Court reverses the Eighth Circuit and permits state fee-shifting statutes to operate in NGA § 7 condemnations, pipeline companies will face substantially higher condemnation costs in states that authorize fee recovery for landowners in eminent domain proceedings. Conversely, if the Court affirms that federal law preempts state fee-shifting provisions, landowners nationwide will bear their own attorney's fees when challenging federal pipeline condemnations, potentially creating significant barriers to effective representation in valuation disputes.