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. e du/thir dc ir c uit_2001/14Filed January 29, 2001

UNITED STATES COURT OF APPEALS

FOR THE THIRD CIRCUIT

No. 00-3387

NE HUB PARTNERS, L.P.,

Appellant

v.

CNG TRANSMISSION CORPORATION; PENN FUEL GAS, INC.; JAMES M. SEIF; GEORGE J. MILLER; MICHELLE A. COLEMAN; THOMAS W. RENWAND; BERNARD A. LABUSKES, JR.

On Appeal from the United States District Court for the Middle District of Pennsylvania (D.C. Civ. No. 99-00082) District Judge: Honorable Yvette Kane

Argued October 6, 2000

BEFORE: NYGAARD, GREENBERG, and COWEN, Circuit Judges

(Filed: January 29, 2001)

Walter A. Bunt, Jr. (argued)

Daniel P. Trocchio Kirkpatrick & Lockhart

535 Smithfield Street Henry W. Oliver Building Pittsburgh, PA 15222Andrew H. Cline

Kirkpatrick & Lockhart

240 North Third Street Harrisburg, PA 17101

Attorneys for Appellant

Stanley R. Geary (argued) Buchanan Ingersoll

301 Grant Street One Oxford Centre, 20th Floor Pittsburgh, PA 15219-1410

Attorney for Appellee CNG Transmission Corporation

Karol L. Newman (argued) Hogan & Hartson 555 13th Street, N.W. Washington, DC 02004-1109

Attorney for Appellee Penn Fuel Gas, Inc.

D. Michael Fisher Attorney General J. Bart DeLone (argued) Deputy Attorney General

Calvin R. Koons Senior Deputy Attorney General

John G. Knorr Office of the Attorney General of Pennsylvania, 15th Floor Strawberry Square Harrisburg, PA 17120

Attorney for Appellees George J. Miller, Michelle Coleman, Thomas W. Renwand, and Bernard A Labuskes, Jr.

2OPINION OF THE COURT

GREENBERG, Circuit Judge.

After detailed examination of numerous technical, s afety, and environmental issues, the Federal Ener gy Regul atory Commission ("FERC") issued a certificate of public convenience and necessity for plaintiff-appellant N E Hub Partners, L.P.'s ("NE Hub") natural gas storage fac ility (the "Facility") in Tioga County, Pennsylvania. The Commonwealth of Pennsylvania may seek to revisit th ose issues in consolidated administrative appeals in it s own permitting process in a costly pr oceeding that wil l delay NE Hub's construction of the Facility. Consequently, N E Hub brought a district court action seeking an injuncti on against the state appellate proceedings in an attem pt to bar aspects of them on federal preemption gr ounds. The district court, however, rejected the claim without reaching its merits, principally on the jurisdictional gr ound t hat it was not ripe for decision before the state pr ocess con cluded. See NE Hub Partners, L.P., No. 1: CA-99-0082 (M.D. Pa. Apr. 7, 2000) ("NE Hub"). We disagr ee with the district co urt on the ripeness issue and accordingly will reverse its ord er dismissing the action and will remand the case for further proceedings.

I. BACKGROUND

A. Factual History1

Since 1995 NE Hub has been seeking a plethora of federal and state permits to construct the Facility . The construction is a substantial undertaking requiring NE Hub to drill through the Oriskany sand formation which contains competing storage facilities owned by Penn Fuel Gas, Inc. ("Penn Fuel") and CNG Transmission Corp. ("CNGT").2 Not surprisingly Penn Fuel and CNGT have

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1. We take the facts we recite mainly from the comp laint which, for purposes of this appeal, should be taken as true an d afforded all favorable inferences. See Standar d of Review, Part III, infra. 2. CNGT now is called Dominion Transmission, Inc. a nd Penn Fuel now is called PPL Gas Utilities Corporation. As a matte r of convenience we

nevertheless continue to refer to them as CNGT and Penn Fuel.

3opposed NE Hub every step of the way before both FE RC

and the Pennsylvania agencies exercising jurisdicti on over the construction.

Because the Facility will store natural gas for use in interstate commerce it is subject to FERC's jurisdi ction and thus its construction requires a certificate of pub lic convenience and necessity (the "Certificate") pursu ant to section 7(c) of the Natural Gas Act, 15 U.S.C. SS 7 17 et seq. ("NGA"). NE Hub applied for the Certificate in Nove mber 1995, but Penn Fuel and CNGT intervened and r eques ted FERC to reject NE Hub's application on a variety of technical, safety and environmental grounds, includ ing a claim that the construction and use of the Facility threatened to damage their own facilities.

FERC reviewed the entire range of technical, safety , and environmental issues relating to the Facility, and, at the instance of Penn Fuel and CNGT, convened a technica l conference on the application in September 1996 at which they raised the following 23 issues relating to the technical, safety, and environmental soundness of the Facility :

(1) Whether NE Hub's Drilling and Construct ion Program, utilizing a large diameter drill bi t, would result in massive mud loss to the Oriskany s and formation;

(2) Whether circulation materials would s a tisfactorily mitigate the mud loss into the surrounding geological strata;

(3) Whether test drilling perfor med on wel l TW-501 indicated that the Drilling and Construction Program would lead to massive fluid loss to the Oriskany sand formation;

(4) Whether NE Hub's Drilling and Construct ion Program had sufficient documentation r elati ng to rates of penetration that could reasonably b e expected from the use of large diameter (28" ) drilling bits to penetrate the Oriskany sand formation;

(5) Whether NE Hub's Drilling and Construct ion Program had properly taken into account frac ture permeability of the Oriskany sand formation;

4(6) Whether NE Hub's Drilling and Construct ion

Program had accounted for the pressur e fluctuations it might encounter during drill ing operations due to existing gas storage facil ities;

(7) Whether NE Hub's Drilling and Construct ion Program would result in cement invasion to t he Oriskany sand formation;

(8) Whether mud loss and cement invasion ca use d by NE Hub's Drilling and Construction Progra m would result in irremediable damage to the deliverability of gas from the CNGT/Penn Fue l Storage;

(9) Whether NE Hub's Drilling and Construct ion Program would lead to increased risk of gas leaks and catastrophic blowouts;

(10) Whether the use of large quantities of loss circulation materials in NE Hub's Drilling a nd Construction Program would cause a `cake' to form across the Oriskany sand for mation and reduce the likelihood of achieving an adequa te

cement bond between the wall of the well and the casing string;

(11) Whether NE Hub's Drilling and Construct ion Program would achieve the turbulent flow required to remove loss circulation material from the Oriskany sand formation and permit the development of an adequate cement bond;

(12) Whether NE Hub's Drilling and Construct ion Program required or contained sufficient contingencies in the event an adequate cemen t bond was not achieved;

(13) Whether NE Hub's Drilling and Construct ion Program included procedures for the use of a cement bond log tool to evaluate the integri ty of the cement bond between the well and casing string;

(14) Whether NE Hub's Drilling and Construct ion Program would lead to fracturing of the casi ng shoe;

5(15) Whether NE Hub's Drilling and Construct ion

Program would lead to overpressuring of shal low formations;

(16) Whether NE Hub's Drilling and Construct ion Program would increase the likelihood of gas loss or gas migration for the CNGT/Penn Fuel

Storage;

(17) Whether NE Hub's Drilling and Construct ion Program would result in salt caver n subside nce;

(18) Whether NE Hub's Drilling and Construct ion Program relied on proper resear ch and data regarding the tensile and compressive streng ths for salt;

(19) Whether NE Hub's Drilling and Construct ion Program relied on proper mechanical integrit y testing of the salt caverns;

(20) Whether NE Hub had failed to consider a lter nate sites for cavern development;

(21) Whether the Sandia National Laboratorie s r eport used in development of the Drilling and Construction Program adequately addressed cavern operating pressures, caver n creep an d subsidence, and rock mechanics;

(22) Whether the geologic conditions at loca tions targeted by NE Hub's Drilling and Constructi on Program were adequate for cavern development ; and

(23) Whether NE Hub should be requir ed to o btain insurance and/or indemnities that would be available to compensate CNGT and/or Penn Fue l for potential losses arising from the constr uction or operation of the Facility.

App. at 20-22.

For the next year and a half FERC, in consultation with NE Hub, Penn Fuel, and CNGT and with the assistance of an outside consulting firm, exhaustively r eviewed NE Hub's proposal for the Facility, taking Penn Fuel's and C NGT's

6objections into account. In connection with this r eview NE

Hub, Penn Fuel, and CNGT led what NE Hub has characterized as "a parade of experts and technical consultants before F.E.R.C." See app. at 24. FERC also made an Environmental Impact Assessment of the Faci lity pursuant to the National Environmental Policy Act, treating

at least seven issues:

(1) Requirements for NE Hub to create more t han the two salt caverns approved by the Certificate ;

(2) Locations of structures and facilities n ecessary for the Facility, including right-of-ways and th e freshwater intake structure;

(3) Whether the Facility could be constructe d and operated with insignificant effects on bodie s of water, including rivers and streams;

(4) Whether NE Hub's erosion and sedimentati on plans were sufficient to minimize impacts on soil and bodies of water;

(5) Whether NE Hub's air pollution control p lans were sufficient to minimize air quality impacts, including impacts from fugitive dust;

(6) Whether NE Hub's water quality managemen t and N.P.D.E.S. stormwater discharge plans were sufficient to minimize impacts on water qual ity;

and

(7) Whether NE Hub's land use and reclamatio n plans were adequate.

See app. at 23. We call these seven issues along wi th the 23

issues enumerated above the "30 Issues". In additio n, FERC considered competitive and market issues.

On April 20, 1998, FERC issued the Certificate in a 93- page order. See app. at 39 et seq. The order stated that FERC had exercised its jurisdiction over the Facili ty and found that it could be constructed and operated saf ely. See app. at 24. The order, however, imposed various con ditions on the construction and operation of the Facility, and stated that "NE Hub must comply with the State of Pennsylvania's drilling regulations," app. at 101, and that

7"[r]egulation of underground storage safety is at t he state

level." App. at 66. It also stated:

Any state or local permits issued with r esp ect to the jurisdictional facilities authorized herein must be

consistent with the conditions of this certi ficate. The Commission encourages cooperation between in terstate pipelines and local authorities. However, th is does not mean that state and local agencies, through application of state or local laws, may proh ibit or unreasonably delay the construction or opera tion of facilities[3] by this Commission.4

App. at 109.

Even before FERC issued its order NE Hub had applie d to the Pennsylvania Department of Environmental Protection ("Pa.D.E.P.") for the r equisite state p ermits and thus it was proceeding on parallel regulatory paths . See app. at 25. While Pa.D.E.P. had monitor ed the FERC proceedings, it chose not to seek to intervene in t hem as it could have under 15 U.S.C. S 717n(a) and 18 C.F.R. S 385.214(a)(2). See app. at 25. Penn Fuel and CNGT raised each of the 30 Issues in repeated appearances befor e Pa.D.E.P. but nevertheless on July 17, 1997, Pa.D.E .P. issued the permits NE Hub sought. See app. at 25-26

.

Over the next year Penn Fuel and CNGT filed thr ee appeals protesting issuance of the state per mits w ith the Environmental Hearing Board for the Commonwealth of Pennsylvania ("E.H.B."), which is authorized to hea r such appeals. All the individual defendant-appellees r e maining in this action, i.e., all defendants except Penn Fuel and CNGT, are administrative law judges on the E.H.B., to who m we will refer collectively as E.H.B. In the appeals to E.H.B., which have since been consolidated, see app. at 26, Penn

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3. Presumably "authorized" or a wor d of similar me aning should appear

here.

4. The district court interpreted this language to mean that the Certificate "was conditioned on NE Hub's obtaining any and all necessary state or local permits requir ed to carry out the drilling and construction program." See NE Hub, slip op. at 5. T he parties agree that this interpretation is correct.

8Fuel and CNGT again raised each issue they had adva nced

before FERC, including the 30 Issues, and pr esente d testimony and documentation they had presented to F ERC. See app. at 27. E.H.B. has not decided the appeals but the Pa.D.E.P. permits are valid pending its decision. S ee app. at

1021.

B. Procedural History

On January 15, 1999, NE Hub filed a complaint in th e district court against Penn Fuel, CNGT, E.H.B. and James M. Seif, the Secretary of Pa.D.E.P., asking for a d eclaratory judgment that the NGA preempted the Pa.D.E.P . and E.H.B. review process. NE Hub also requested an order enjo ining the E.H.B. proceedings and "such other r elief as t his Court deems just and proper." See app. at 32. However, NE Hub in the district court and in this court pared the s cope of its requested relief down to the 30 Issues, and renounc ed any claim that the Certificate completely bars state r egulation of the Facility in areas outside the 30 Issues. 5 The complaint also sought a declaratory judgment and injunctive r elief barring Penn Fuel and CNGT from relitigating the 30 Issues

before Pa.D.E.P. and E.H.B. because in NE Hub's vie w this relitigation would amount to an appeal of the FERC order, which they could prosecute only pursuant to 15 U.S. C. S 717r(a). See app. at 32-33.

Secretary Seif settled with NE Hub on June 30, 1999

, stipulating that Pa.D.E.P. lacked authority to regu late the Facility with respect to the 30 Issues, and thus th e district court dismissed him as a party on July 2, 1999. See NE Hub, slip op. at 9; app. at 842-59. All other defen dants, i.e.,

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5. See, e.g., NE Hub's Resp. in Opp'n to CNG Transm ission Corp.'s Mot. to Dismiss at app. at 490 ("[T]he Complaint does no t seek a declaration that NE Hub is not required to comply to any extent with state environmental or safety requirements.. . . NE Hub i nstead seeks a declaration that state authorities may not r egulat e or adjudicate the technical, safety or environmental issues that have already been decided by the federal agency with jurisdiction over such i ssues." (Emphasis added.)); NE Hub's Br. in Opp'n to the E.H.B. Defen dants' Mot. to Dismiss at app. at 748; id. at 750-51; NE Hub's Br. in Opp'n to James M. Seif 's Mot. to Dismiss at app. at 731; id. at 7 34; NE Hub Appellant's

Br. at 20 n.7.

9the appellees here, moved to dismiss the complaint under

Fed. R. Civ. P. 12(b)(1) on a variety of gr ounds, including ripeness, the Eleventh Amendment, abstention, and t he Anti-Injunction Act. The parties agreed to stay the E.H.B. proceedings pending the outcome of this case. See N E Hub, slip op. at 8.

The district court, in a Memorandum and Order dated April 7, 2000, granted the appellees' motions and d ismissed NE Hub's complaint without prejudice. See id. at 21 . The court parsed NE Hub's claim against E.H.B. into two theories of preemption: one claiming pr eemption on ly insofar as the state process conflicted with the Ce rtificate, the other claiming a right to be completely fr ee f rom any state regulation. The court dismissed the action wi th respect to the conflict theory for lack of ripeness because E.H.B. had not yet taken an action that could inter fere with the federal regulations and the court believed that the requirement that NE Hub go through the state review process was not in itself a cognizable har m in the conflict preemption context. See id. at 15-18. The court dis missed the action with respect to the total exemption from regulation theory on the grounds that NE Hub's contentions challenged the terms of the Certificate requiring the obtaining of state permits and thus s hould have been presented to FERC for rehearing under 15 U.S.C. S 717r(a), which precludes judicial r eview of FERC orders prior to rehearing by FERC. See NE Hub, slip op. at 18-19. The court then found that its jurisdiction with r e spect to NE Hub's claims against Penn Fuel and CNGT depended on its jurisdiction over the claims against E.H.B., an d, as the latter was lacking, so was the former. See id. at 1 9-20. Accordingly, it dismissed the action in its entiret y.

NE Hub then timely filed this appeal contending tha t the district court erred in dismissing its pr eemption claim for lack of ripeness. See NE Hub's Br. at 3. NE Hub fur ther contends that it is not challenging FERC's or der a nd thus it argues that the district court erred in holding that this action is barred because it has not sought r eheari ng of the

FERC order.

10II. JURISDICTION

We have jurisdiction over this appeal of afinal jud gment of the district court pursuant to 28 U.S.C. S 1291. 6 The district court had federal question jurisdiction un der 28 U.S.C. SS 1331 and 1337, because the case ar ose un der the Supremacy Clause in Article VI of the United States Constitution, and the NGA.

III. STANDARD OF REVIEW

Our review of a dismissal for lack of ripeness is p lenary. See Philadelphia Fed'n of Teachers v. Ridge, 150 F. 3d 319, 321 (3d Cir. 1998); see also Gould Elecs. v. United States, 220 F.3d 169, 176 (3d Cir. 2000). Mor eover, when, as here, defendants move to dismiss a complaint under Rule 12(b)(1) for failure to allege subject matter juris diction we treat the allegations of the complaint as true and afford the plaintiff the favorable inferences to be drawn from the complaint.7 See Mortensen v. First Fed. Sav. & Loan Ass'n, 549 F.2d 884, 891 (3d Cir. 1977); see also Fed. R. Civ. P. 8(f).

IV. ANALYSIS

A. Ripeness

The Supreme Court stated the purpose and ef fect of the ripeness doctrine in the context of interfering wit h an administrative process in Abbott Labs v. Gardner, 3 87 U.S. 136, 148-49, 87 S.Ct. 1507, 1515 (1967):

[T]o prevent the courts, through avoidance o f

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6. We are not deprived of jurisdiction by reason of the dismissal having been without prejudice. See Black Horse Lane Assoc. , L.P. v. Dow Chem. Corp., 228 F.3d 275, 282-87 (3d Cir . 2000).

7. A challenge to a complaint for failure to allege subject matter jurisdiction is known as a "facial" challenge, and must not be confused with a "factual" challenge contending that the cour t in fact lacks subject matter jurisdiction, no matter what the complaint a lleges, as factual challenges are subject to different standards. See Mortensen v. First Fed. Sav. & Loan Ass'n, 549 F.2d 884, 891 (3d Cir. 1977) ; 5A Wright & Miller, Federal Practice & Procedure S 1350, at 212-18 (Wes t 1990).

11premature adjudication, from entangling them selves in

abstract disagreements over administrative p olicies, and also to protect the agencies from judici al

interference until an administrative decisio n has been

formalized and its effects felt in a concret e way by the challenging parties.

In some circumstances the ripeness requir ement is drawn from Article III limitations on judicial power and in others from prudential limitations. See Suitum v. Tahoe Re gional Planning Agency, 520 U.S. 725, 733 n.7, 117 S.Ct 16 59, 1664 n.7 (1997); see also Ridge, 150 F .3d at 323 n .3 (noting ambiguity over whether ripeness is a pruden tial limitation on federal jurisdiction or is requir ed by the caseor-controversy requirement of Article III of United States Constitution); Travelers Ins. Co. v. Obusek, 72 F.3 d 1148, 1154 (3d Cir. 1995) (same); Armstr ong World Indus. , Inc. v. Adams, 961 F.2d 405, 411 n.12 (3d Cir . 1992) (same ). Ripeness is a matter of degree whose thr eshold is notoriously hard to pinpoint. See, e.g., Maryland C as. Co. v. Pacific Coal & Oil Co., 312 U.S. 270, 273, 61 S.Ct. 510, 512 (1941) ("The difference between an abstract questio n and a `controversy' contemplated by the Declaratory Judgm ent Act is necessarily one of degree, and it would be d ifficult, if it would be possible, to fashion a precise test. . . ."); McCahill v. Borough of Fox Chapel, 438 F .2d 213, 2 15 (3d Cir. 1971) ("The considerations, while catholic, ar e not concrete."); Step-Saver Data Sys., Inc. v. Wyse Tec h., 912 F.2d 643, 646 (3d Cir. 1990) ("it is difficult to d efine the contours of the ripeness doctrine with precision") (footnote omitted)).

The Supreme Court in Abbott Labs laid out two

fundamental considerations for determination of a r ipeness question: (1) "the fitness of the issues for judici al decision," and (2) "the hardship to the parties of withholding court consideration."8 387 U.S. at 149, 87 S.Ct. at 1515. In the

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8. Factors relevant to the "fitness" consideration include, but are not limited to, whether the issue is purely legal (as a gainst factual), the degree to which the challenged action is final, whe ther the claim involves uncertain and contingent events that may not occur as anticipated or at all, the extent to which further factual developmen t would aid decision, and whether the parties to the action are sufficien tly adverse. The "hardship" consideration focuses on whether a plain tiff faces a direct and immediate dilemma, such that lack of review wil l put it to costly choices. See Ridge, 150 F.3d at 323.

12context of declaratory judgments, we generally anal yze

ripeness under the threefold rubric of Step-Saver, 912 F.2d at 647, as did the district court here: first, the adversity of the parties' interests; second, the probable conclu siveness of a judgment; third, the practical utility to the parties of rendering a judgment.9 See Pic-A-State Pa, Inc. v. Reno, 76 F.3d 1294, 1298 (3d Cir. 1996).

1. Adversity

NE Hub claims that the state permit pr ocess with r espect to the 30 Issues is preempted but that E.H.B. never theless will continue with that process unless enjoined. In these circumstances, NE Hub's and E.H.B.'s inter ests har dly

could be more adverse.

Nevertheless, the district court held NE Hub's inte r ests insufficiently adverse to E.H.B.'s because:

In order to demonstrate that its claims ar e ripe, NE

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9. The Step-Saver rubric is a distillation of the f actors most relevant to the Abbott Labs considerations. See Ridge, 150 F.3d at 323 n.4. Adversity and conclusiveness apparently ar e subsum ed under the "fitness" prong of the Abbott Labs test, while uti lity is relevant both

to "fitness" and "hardship." Our cases have fit the fa ctors relevant in the Abbott Labs framework into the Step-Saver headings , as follows:

ADVERSITY:

- Whether the claim involves uncertain and continge nt events, or presents a real and substantial threat of harm. See , e.g.,Presbytery of N.J. v. Florio, 40 F.3d 1454, 1466 (3d Cir. 1994).

CONCLUSIVENESS:

- Whether issues are purely legal (as against factu al).

- Whether further factual development would be usef ul.

See, e.g., id. at 1468; T ravelers Ins. Co., 72 F.3 d at 1155.

UTILITY:

- Hardship to the parties of withholding decision.

- Whether the claim involves uncertain and continge nt events.

See, e.g., Travelers Ins. Co. , 72 F.3d at 1155-56.Of course, there may be other factors consider ed i n a ripeness analysis.

13Hub must show that the probability of the EH B

Defendants acting adversely to NE Hub is rea l and substantial . . . . [T]he Environmental Hear ing Board Defendants have not, as yet, taken any actio n or issued any decision potentially conflicting with the 7(c) certificate. Further, it is entirely possibl e that the Environmental Hearing Board will uphold the issuance of the permits by [Pa.D.E.P.] and will never issue any decision conflicting with the federal regula tory scheme.

See NE Hub, slip op. at 15-16.10 This analysis, wh ich focuses on the possible ultimate result of the stat e regulatory process, does not take into account the case law that preemption may operate to spare a party from t hat very process. In fact, the process itself may give rise to adversity so that an action challenging the pr oces s is ripe even before the process concludes. Thus, in Freehol d Cogeneration Associates, L.P. v. Boar d of Regulato ry Commissioners, 44 F.3d 1178 (3d Cir . 1995), we hel d that a preemption challenge to ongoing proceedings befor e the New Jersey Board of Regulatory Commissioners invadi ng FERC's domain was ripe even though "the plaintif f did not challenge the ultimate substantive decision, but ra ther its authority to conduct proceedings":

[T]he issue here is ripe for adjudication. T he proceedings before the [state agency] have b een ongoing for nearly one year. The inter est t hat Freehold seeks to vindicate in this proceeding is the right to be free from `state laws . . . respecting the r ates . . . of electric utilities' and from the expense, de lay, and uncertainty inherent in the administration o f such laws. If, as Freehold insists, the ongoing[s tate agency]

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10. The district court also said NE Hub's claim was "based on the `possibility' that state regulatory officials might enter an order that

would interfere with the regulatory scheme. Pl. Mem. Supp . Prelim. Inj. at 19. That `possibility' constitutes a contingency only, and is insufficient to constitute adversity of interests." See NE Hub, sli p op. at 16. That statement mischaracterizes NE Hub's position which was that the process itself, at least as it related to the 30 Is sues, interfered with

the regulatory scheme. See, e.g. NE Hub's Br. in Opp'n to the E.H.B. Defendants' Mot. to Dismiss at app. at 749-51; NE H ub's Br. in Opp'n to James M. Seif 's Mot. to Dismiss at app. at 731, 73 4.

14proceedings constitute state regulation of u tility rates

and the burdens on Freehold occasioned by th ose proceedings are the kinds of burdens which C ongress intended [certain facilities] to be spar ed, Congress'

mandate would be frustrated if Freehold's ri ght to judicial review were postponed. Ther e is a concrete dispute that has already worked a sever e ha rdship upon Freehold, and a determination of the le gal issue of preemption need not await any further dev elopments

. . . .

Id. at 1189.

In Sayles Hydro Associates v. Maughan, 985 F.2d 451

, 453-54, 456 (9th Cir. 1993), a Califor nia state wa ter board withheld a hydroelectric plant permit because the a pplicant did not supply certain reports and studies. The cou rt held that a claim that the Federal Power Act preempted t he ongoing state permitting process by occupying the f ield of power projects regulation was ripe, explaining as f ollows:

The hardship is the process itself. Pr ocess costs money. If a federal licensee must spend year s attempting to satisfy an elaborate, shifting array of state procedural requirements, then he must borrow a fortune to pay lawyers, economists, accounta nts, archaeologists, historians, engineers, r ecr eational consultants, biologists, and others, with no r evenue, no near-term prospect of revenue, and no certai nty that there ever will be revenue. Meanwhile, polit ics, laws, interest rates, construction costs, and cost s of alternatives change. Undue process may impos e cost and uncertainty sufficient to thwart the fed eral determination that a power project should pr oceed.

Id. at 454. Similarly the court in Middle South Ene rgy, Inc. v. Arkansas Public Service Commission, 772 F .2d 40 4 (8th Cir. 1985), found ripe a claim based on pr eemption and the Commerce Clause against ongoing Arkansas state agen cy proceedings determining whether to void certain int erstate power purchase contracts claimed to be within FERC' s sole jurisdiction. The plaintiff successfully

challenge[d] not the state's ultimate substa ntive decision but its authority even to conduct t he

15contemplated proceeding. It can hardly be do ubted that

a controversy sufficiently concrete for judi cial review exists when the proceeding sought to be enjo ined is already in progress.

Id. at 410-11.

Courts have found insufficient adversity for ripene ss where the chance of the defendant acting against pl aintiff is but a "contingency." See, e.g. , Presbytery of N .J. v. Florio, 40 F.3d 1454, 1464-68, 1470 (3d Cir. 1994) (insuffi cient adversity where state said it would not enfor ce ch allenged law against plaintiff); Armstrong World Indus., 961 F.2d at 413-14 (insufficient adversity between state and pl aintiffs challenging validity of takeover law, because takeo ver of plaintiffs was "contingency which may not occur," i n which case they would not suffer from law). Her e, howeve r, there

is little doubt that E.H.B. will continue with the permit review process, and that the process itself is the alleged

harm.

We recognize that E.H.B. in its pr oceedings has no t yet taken a position on whether it will reconsider the 30 Issues, and if so in what depth. Thus, arguably its interes t is not substantively adverse to that of NE Hub. See Step-S aver, 912 F.2d at 648. Nevertheless, inasmuch as the proc ess creates the adversity and E.H.B. has not disclaimed a right

to reexamine the issues we hold that its inter est is adverse to that of NE Hub. See Supplemental letter brief of E.H.B. at 4, Sept. 13, 2000 ("Because of the structur e an d nature of its adjudicatory function, it is not possible fo r the EHB to determine what issues will be brought to its att ention by CNGT and Penn Fuels in their challenge to NE Hub's permits."). At oral argument befor e us E.H.B. adhe red to that position.

2. Conclusiveness

Conclusiveness is a short-hand term for whether a declaratory judgment definitively would decide the parties' rights. See Step-Saver, 912 F.2d at 648. It also ad dresses the extent to which further factual development of the case would facilitate decision, so as to avoid issuing a dvisory opinions, or whether the question presented is predominantly legal. See Travelers Ins. Co., 72 F.3 d at

161155. In this case, a declaratory judgment would es tablish

that E.H.B. may or may not review and base its perm it decision on a consideration of the 30 Issues, a con clusive

result.

Furthermore, additional factual development is unnecessary. We need not await the result of the E. H.B. process to ascertain whether a judgment will be con clusive because NE Hub's contention is that the process its elf is preempted as to the 30 Issues regar dless of what t he outcome of a proceeding before the E.H.B. would be as to those issues. Moreover, a determination of whether there is preemption primarily raises a legal issue, a circum stance which facilitates entry of a declaratory judgment. See Pacific Gas & Elec. Co. v. State Energy Res. Conser vation & Dev. Comm'n, 461 U.S. 190, 201, 103 S.Ct. 1713, 172 0-21 (1983) ("The question of pre-emption is pr edominan tly legal, and although it would be useful to have the benefit of [the state's interpretation and application of its r egu lations], resolution of the pre-emption issue need not await that development."); Travelers Ins. Co., 72 F.3d at 1155 (preemption is predominantly legal question conduci ve to declaratory judgment); Freehold Cogeneration Assocs ., 44 F.3d at 1188 (judgment would be conclusive because, inter alia, factual developments at ongoing state pr ocee dings would not add to construction of allegedly pr eempt ive federal statute); cf. Abbott Labs, 387 U.S. at 149, 87 S.Ct. at 1515 (issue ripe for decision because, inter ali a, it is "a purely legal one").

The district court held that a judgment would be

inconclusive because

without knowing whether Commonwealth will ultimately deny project authority and on wha t ground, it is impossible to determine whether its r equirements burden or delay the NE Hub Project to such a n extent so as to be preempted by the 7(c) certificat e.

See NE Hub, slip op. at 16. Again, this statement o verlooks that the state regulatory process itself can be the preempted burden. See discussion, infra, in part IV B of Freehold Cogeneration Assocs., Sayles Hydro Assocs. , and Middle South; see also National Fuel Gas Supply Cor p. v.

17Public Service Comm'n, 894 F.2d 571, 578 (2d Cir. 1 990)

(finding state regulations of gas lines pr eempted for inconsistency with FERC permits because "[e]ven if a [gas] transporter were successful before the[state commis sion], the practical effect would be to under mine the F.E .R.C. approval by imposing the costs and delays inher ent in litigation that must be undertaken without any guid elines as to the limits on the exercise of state authority "); cf. Pacific Gas & Elec. Co., 461 U.S. at 201-02, 103 S. Ct. at 1721 (preemption claim against moratorium on new nuclear power plants ripe because "to requir e the industry to proceed without knowing whether the moratorium i s valid would impose a palpable and considerable har dship on the utilities, and may ultimately work har m on the citizens of California").

3. Practical Utility

Practical utility goes to "whether the parties' pla ns of actions are likely to be affected by a declaratory judgment," Step-Saver, 912 F.2d at 649 n.9, and considers the hardship to the parties of withholding judgment. Se e Freehold Cogeneration Assocs., 44 F .3d at 1189 (di scussing hardship to preemption plaintiff of delay under uti lity prong of Step-Saver). A declaratory judgment "must be of some practical help to the parties. The Declaratory Judg ments Act was enacted to clarify legal relationships so t hat plaintiffs (and possibly defendants) could make res ponsible decisions about the future." Travelers Ins. Co., 72 F.3d at 1155 (quotation and citation omitted).

A holding that the state proceedings ar e preempted obviously would be useful to NE Hub, which would be spared the hardships associated with the E.H.B. proceedings. NE Hub alleges that it is being put to considerable delay and expense by these proceedings in connection with the issues already dealt with by FE RC.11 See, e.g., app. at 981-82. As we stated above, the

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11. This contention is undisputed, and is corr obor ated by the statement of counsel for Penn Fuel at oral argument before th e district court about the expenditures of his own client: "W e spent cert ainly in the seven figures, I would imagine, in litigating these permi ts before the E.H.B." See app. at 957.

18requirement to go through a bur densome process can

constitute hardship for purposes of ripeness. See, e.g., Freehold Cogeneration Assocs., 44 F .3d at 1188-89; Sayles Hydro Assocs., 985 F.2d at 453-56; National Fuel Ga s, 894 F.2d at 578-79; Middle South Ener gy, 772 F.2d at 4 10-411. Resolving the preemption question now also will eli minate the possibility that E.H.B. may overturn the Pa.D.E .P. permits on allegedly preempted gr ounds. Cf. Pacifi c Gas & Elec., 461 U.S. at 201-02, 103 S.Ct. at 1720-21 (uncertainty entailed by existence of state pr oced ures part of harm cognizable in assessing ripeness of pr eemp tion claim); Sayles Hydro Assocs., 985 F .2d at 454 (sam e); but see Ridge, 150 F.3d at 323-26 (uncertainty as to wa y new procedures for determining pension levels would be applied insufficient hardship to ripen due pr ocess claim).

The district court found that there was not a hards hip because (1) the E.H.B. proceedings would not necess arily result in meaningless rehashing of issues, (2) addi tional process cannot constitute ripeness hardship, and (3 ) no state regulation presently stands in NE Hub's way. See NE Hub, slip op. at 17-18.

The first proposition is correct but beside the poi nt: there may be some issues that E.H.B. can consider outside of the 30 Issues. Indeed, NE Hub asks that the proceedings before the E.H.B. be preempted only to the extent of precl uding review of the 30 Issues. Thus, NE Hub does not sugg est that federal preemption precludes E.H.B. from consi dering other issues.12 If the state pr ocess is preempted with respect to the 30 Issues, then undergoing the E.H.B

. process with respect to those issues is a hardship cognizable for preemption purposes, and thus for determining ripeness of NE Hub's preemption claims.

For the second proposition, the district court quot ed two

cases:

[T]he Court has not considered . . . litigat ion cost- saving sufficient by itself to justify revie w in a case that would otherwise be unripe. The ripeness doct rine

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12. We understand that NE Hub expects that review o f any other issues

will be less burdensome than a review of the 30 Iss ues.

19reflects a judgment that the disadvantages o f a

premature review that may prove too abstract or unnecessary ordinarily outweigh the addition al costs of --even repetitive--post-implementation litig ation.

Ohio Forestry Ass'n, Inc. v. Sierra Club , 118 S.Ct . 1665, 1671 (1998).

[T]he burden of participating in further adm inistrative and judicial proceedings . . . do[es] not co nstitute sufficient hardship for the purposes of ripe ness.

Florida Power & Light Co. v. EPA, 145 F.3d 1414, 14 21 (D.C. Cir. 1998). See NE Hub, slip op. at 17. But n either case involved a claim of preemption. When such a cl aim has been advanced, the need to participate in a sta te regulatory process in conflict with federal policy has been recognized as a hardship. See, e.g., Freehold Cogen eration Assocs., 44 F.3d at 1188-89; Sayles Hydro Assocs., 985 F.2d at 453-56; National Fuel Gas, 894 F.2d at 578- 79; Middle South Energy, 772 F.2d at 410-11; cf. First Iowa Hydro-Electric Coop. v. Federal Power Comm'n , 328 U.S 152, 66 S.Ct. 906 (1946) (hydroelectric plant proje ct subject to jurisdiction of Federal Power Commission (FERC's predecessor) need not obtain permit fr om Iowa, des pite law apparently conditioning federal license on complian ce with state laws). Thus, while the district court's quota tions are accurate they are not controlling pr ecedent in the

circumstances here.

Moreover, the extra litigation or administrative bu rden at issue in the cases quoted by the district court was apparently the burden of filing the same lawsuit la ter, not of undergoing an expensive and time-consuming state process. The cases quoted by the district court inv olved challenges to a Plan issued by the United States Fo r est Service and a rule allegedly issued by the Envir on mental Protection Agency, respectively. See Sierra Club, 1 18 S.Ct. at 1668; Florida Power & Light, 145 F .3d at 1416. In both cases, how and even whether the Plan and rule would be applied was unclear; in Florida Power & Light , the court

held the EPA had not even issued a rule. See Florid a Power & Light, 145 F.3d at 1418-19. In Sierra Club, the C ourt stated that requiring a challenger to a rule to eng age in

20post-implementation litigation over the rule does n ot

constitute sufficient hardship to ripen "a case tha t would otherwise be unripe." Sierra Club, 118 S.Ct. at 167 1. Clearly, that holding is hardly controlling when th e plaintiff 's challenge is to the conduct of an admi nistrative process that imposes an ongoing burden.

The district court's third proposition also misses the point that process can constitute hardship. While i t is true that the Pa.D.E.P. permits are valid pending the E. H.B. outcome, it is not a regulation but the r egulatory process that afflicts NE Hub. If the process is pr eempted it is quite immaterial that the effectiveness of the per mits c hallenged has not been stayed. Moreover, if NE Hub goes forwa rd construction of the Facility while the E.H.B. pr oc eedings are pending it may find itself in a difficult situa tion if Penn

Fuel and CNGT are successful before E.H.B.

B. State regulatory process is susceptible of preem ption by conflict or by field occupation.

E.H.B. contends that the cases holding a state r eg ulatory process preempted have involved only field occupati on preemption, and should be so confined and thus preemption principles are not applicable here as, i n E.H.B.'s view, the NGA and FERC have not occupied t he

field. See E.H.B.'s br. at 17-23. The district cour t agreed that this case does not involve field occupation. W e, however, strongly doubt that the district court was correct in this conclusion. See Schneidewind v. ANR Pipelin e Co., 485 U.S. 293, 295 n.1., 300-05, 108 S.Ct. 1145, 114 8 n.1, 1150-53 (1988); Sayles Hydro Assocs., 985 F.2d at 4 53; Pennsylvania Med. Soc'y v. Marconis, 942 F .2d 842, 847 (3d Cir. 1991); Public Utils. Comm'n v. FERC , 900 F.3d 269, 274 (D.C. Cir. 1990). Nevertheless, we need not charact erize definitively the type of preemption implicated here to determine ripeness, which is the only issue before us. To the extent the district court already tacitly has d ecided what type of preemption is involved, on r emand, if it reaches the issue, it should reconsider its decisio n.13

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13. The correct result here with r espect to preemp tion may be that we are dealing with a hybrid situation in which basica lly there is field

21We realize that there would be a r easonable basis for a

holding that process preemption should be applicabl e only when field preemption is implicated. The foundation for the holding would be that unless it is very clear that any result of a state permitting process either will be invali d or redundant a court should not stop the state fr om considering issues that in the absence of pr eempti on would be within state jurisdiction and instead should tru st in the judgment of the state officials not to inter fere u nduly with a federal program.

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occupation but FERC, by requiring NE Hub to comply with state drilling regulations and indicating that regulation of under ground storage safety is at the state level but providing that state and local authorities

should not prohibit or unreasonably delay the construction or operation of the Facility, effectively has converted the case into a conflict preemption matter. In this regard we point out that even withi n an occupied field federal regulations may tolerate or authorize some exercises of state authority. See First Iowa, 328 U.S. at 167, 66 S.Ct . at 913; cf. National Fuel Gas, 894 F.2d at 579 (noting that though field of interstate gas facility regulation was occupied, FERC could choose to require licensees to obtain state permits).

It is unclear why Judge Nygaard perceives himself a s disagreeing with us on this point, for he believes (a) that field pr eemption applies here, but also (b) "FERC properly exercised its congressi onally delegated authority by requiring compliance with state permit ting procedures," dissent at 28, and (c) he acknowledges the Certific ate's requirement that the results of those permitting pr ocedures "must b e consistent with the conditions [thereof]." Thus, FERC has entire contro l over the occupied field (field occupation), but has allowed the state a regulatory role that it may exercise only insofar as it does not conflic t with FERC's decisions (conflict preemption), which is precisely the hybri d sort of preemption by which the dissent purports to be "especially tr oub l[ed]." Id. at 28.

Judge Nygaard also assigns to us a position that we nowhere take, namely, that the E.H.B. appeals conflict with feder al law only because they "conflict with congressional intent to legisla te exclusively."

Dissent at 34 (emphasis in original). Quite the contrary, w e recognize the possibility that Congress delegated authority to FE RC, and that FERC, in turn has delegated some regulatory authority to the state, which the state may exercise only insofar as it does not conf lict with the decisions already made by FERC. Thus, federal rules would not be exclusive because they would not be the only ones the NE Hub must obey, but some state regulations might still conflict with th e federal regulations.

22Nevertheless, the process preemption cases do not

confine themselves to the field occupation context, nor would such a limitation be wise. Even where afield has not been occupied to the exclusion of state regulation, certain state regulatory acts clearly would conflict with f ederal law, and it is as logical to preempt state pr ocess conc erning such matters as state actions in occupied fields. 1 4 Indeed, even if this is a conflict preemption case, it woul d be quite remarkable to hold that there cannot be pr ocess preemption here inasmuch as Secretary Seif on behal f of Pa.D.E.P. in settling the case recognized that, to the extent that FERC exercised jurisdiction, Pa.D.E.P . "[d]oe s not have jurisdiction to consider and cannot conduct final appealable decisionmaking." App. at 855. This r eco gnition broadly extended to "all construction activities re lated to the [Facility], including the drilling and construc tion of the brining facilities and the technical, safety, and

environmental issues which were raised before and considered by FERC." App. at 846. While this stipul ation may not be binding on the appellees, inasmuch as th e state administrator himself recognizes the pr eemptive ef fect of the NGA and FERC's exercise of jurisdiction, we hav e good reason to recognize that conflict pr eemption princ iples might bar E.H.B. from upholding Penn Fuel's and CNG T's appeal on the 30 Issues.

We also point out that, as the Supreme Court recent ly has emphasized, the different categories of preempt ion are

not

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14. Again, it is unclear why Judge Nygaar d perceiv es himself as disagreeing with us on this point for he "can possi bly envision conflict preemption barring an on-going legal pr oceeding . . . in which the outcome sought by the party opposing preemption is almost certain to

conflict with federal law." Dissent at 35. That is exactly what we hold.

He then says that that is not the case here, because t he E.H.B. might "impose additional requirements on NE Hub that do n ot conflict with the 7(c) certificate." Id. That is unquestionably true but irrelevant because NE Hub does not seek preemption of the entir e stat e process, only of the process with respect to the 30 Issues. W e do not d ecide whether the outcome of the E.H.B. proceedings with r espect to the 30 Issues would clearly so conflict. That is for the district court to decide on remand.

23rigidly distinct. Indeed, field pre-emption may be

understood as a species of conflict pre-empt ion: A state law that falls within a pre-empted field con flicts with Congress' intent (either express or plainly implied) to exclude state regulation.

English v. General Elec. Co., 496 U.S. 72, 79 n.5, 110 S.Ct. 2270, 2275 n.5 (1990); see also Crosby v. National Foreign Trade Council, 120 S.Ct. 2288, 2294 n.6 (2000); Gad e, 505 U.S. at 98, 104 n.2, 112 S.Ct. at 2383, 2386 n.2 (1 992) (plurality opinion) ("Our ultimate task in any pre- emption case is to determine whether state regulation is co nsistent with the structure and purpose of the statute as a whole." (Emphasis added.)); Sayles Hydro Assocs. , 985 F.2d at 456 ("The dichotomy between the two types of pr eemptio n [conflict and field] is not so sharp in practical t erms as the legal categorization makes it appear . . . .").

A comparison of the standards for identifying these two types of preemption15 shows the reason for the blur ring.16 Conflict preemption exists where state law stands a s an obstacle to the accomplishment and execution of the full purposes and objectives of Congress. See e.g., Hine s v. Davidowitz, 312 U.S. 52, 67, 61 S.Ct. 399, 404 (194 1). An occupied field is one in which the federal r egulat ory scheme is "so pervasive as to make reasonable the inferenc e that Congress left no room for the States to supplement it." Rice v. Santa Fe Elevator Corp., 331 U.S. 218, 230, 67 S .Ct. 1146, 1152 (1947). That inference is reasonable whe re any state regulation of the "occupied" subject matter w ould interfere with the purposes and objectives of the f ederal plan: a very similar standard to that for conflict preemption. See, e.g., Ray v. Atlantic Richfield Co ., 435 U.S. 151, 168, 98 S.Ct. 988, 999 (1978) (finding field p reemption of vessel regulations because "a state law in this area . . . would frustrate the Congressional desir e . . .").

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15. We are not concerned here with express preempti on which is another type of preemption.

16. Contrary to the dissent's suggestion, at 31, by no means do we obliterate the distinction between the types of pr eemption, and we recognize the continuing existence of each. W e sim ply note that an instance of preemption need not necessarily be pige onholed into one category or another for purposes of analyzing ripen ess.

24We therefore hold that state r egulatory process ma y be

preempted by conflict with federal law,17 as well a s by field occupation. Moreover, we reiterate that we are quit e unable to understand why, regardless of the type of preemp tion asserted, that a claim that a state administrative process is preempted necessarily cannot be ripe when the alleg ed preemption is of the process itself rather than the possible outcome of the process. We also note that it would be entirely logical in an appropriate case to hold tha t the process is not preempted but to hold later that the result of the process is preempted.

Furthermore, if it is evident that the r esult of a process must lead to conflict preemption, it would defy log ic to hold that the process itself cannot be preempted and tha t a complaint seeking that result would not raise a rip e issue. Thus, in view of the substantial showing her e that E.H.B. by upholding Penn Fuel's and CNGT's position on the 30 Issues might well reach a result that would be pree mpted, the process preemption claim is ripe. Of course, we hasten

to add that we do not state a conclusion on whether the process actually is preempted here for, as even NE Hub recognizes, the district court should make that dec ision on the remand. See Presbytery of N.J. , 40 F.3d at 147 0.18

C. The need for FERC rehearing

Finally we reject the district court's and appellee s' view that NE Hub by bringing this action was circumventi ng

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17. Federal law includes federal regulations, which have no less preemptive effect than federal statutes. See e.g., Capital Cities Cable,

Inc. v. Crisp, 467 U.S. 691, 699, 104 S.Ct. 2694, 2700 ( 1984).

18. Our opinion should not be overread. W e are not holding that any claim of process preemption necessarily is ripe so that the court should consider the preemption claim before the process is completed. It well may be that in a particular case when conflict pr e emption is implicated the court may conclude that it reasonably can be an ticipated that the process will yield a result that is not pr eempted. But in this case we

have an unusual situation in which the state admini strator has stipulated the agency's jurisdiction effectively ha s been preempted, a result which, though not binding on the appellees, if accepted would mean that a successful administrative appeal would lead to a preempted

outcome.

25FERC's rehearing process. In the first place, the d istrict

court reached that conclusion on the err oneous the ory that NE Hub was contending "that Pennsylvania lacks auth ority to subject the NE Hub Project to any regulation whatsoever." NE Hub, slip op. at 18. In fact, NE Hu b does not challenge FERC's requirement that it obtain sta te permits and cooperate with state and local agencies

. Indeed, it has done these things. It simply contend s that the E.H.B. state proceedings are pr eempted but onl y to the extent that they involve the 30 Issues consider ed by FERC. We see nothing in the Certificate or the NGA that p recludes NE Hub's preemption argument and it ther efore foll ows that in making that argument NE Hub is not challenging t he terms of the Certificate. Furthermor e, we do not b elieve that a requirement that a party obtain applicable s tate permits and cooperate with state and local agencies in any way determines the scope of what issues a state administrative agency may consider on an appeal fr om the issuance of the permits.19

V. CONCLUSION

For the foregoing reasons we will r everse the orde r of April 7, 2000, dismissing this action and will r em and the

case to the district court to reinstate this action . On the remand the district court should consider the preem ption argument on the merits unless it upholds another de fense

to this action.

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19. The dissent characterizes NE Hub's claim as a c hallenge to the terms of the Certificate because the E.H.B. proceeding is one "that FERC implicitly sanctioned." Dissent at 40. But the diss ent does not explain where in the Certificate FERC "implicitly sanctione d" a state proceeding insofar as it deals with measures already disposed of by FERC.

Judge Nygaard states that he and we "disagr ee over who should determine whether the state actions at issue were ` consistent' with FERC's certificate. The Majority believes that FERC delegated that authority to the federal courts. I believe that FER C maintained its discretion." Dissent 32 n.5. Federal agencies do no t "delegate" authority to decide federal constitutional and legal question s to courts; as noted above, at 37, federal court jurisdiction over such matters comes from Congress. We are aware of no authority granting FER C a right of first refusal to decide such questions, nor does Judge Ny gaard proffer any.

26NYGAARD, Circuit Judge, dissenting :

I would affirm the District Court's disposition of N.E. Hub's field preemption claim. Therefor e, I dissent . Central to the Majority's holding is its assertion that"we need not characterize definitively the type of preemption im plicated here." Majority at 21. I believe that characterizin g N.E. Hub's claim is the first and most important issue i n this case. By failing to resolve it, the Majority ignore s binding Supreme Court precedent and unnecessarily complicat es a well-settled area of law. Especially tr oubling are its proposal of a new class of "hybrid" pr eemption, an d its reference to a mysterious "process" preemption.

Congress intended to occupy the field of law at iss ue. Therefore, the disputed appeals ar e subject to fed eral field preemption. Nonetheless, I would affir m the Distri ct Court's decision, because FERC properly exercised its congressionally delegated authority by r equiring c ompliance with state permitting procedures. More importantly, even if FERC overstepped its bounds, the proper course for N.E. Hub would have been to challenge FERC directly unde r the guidelines established by federal statute. Because N.E. Hub failed to do so, I agree with the District Court th at we lack jurisdiction to consider the current claim.

I.

A brief review of the law of preemption is instruct ive. Assuming it has the constitutional power to legisla te in a given area, Congress can preempt state law whenever it intends federal law to control. See Fr eehold Cogen eration Assocs., L.P. v. Board of Regulatory Comm'rs of Sta te of New Jersey, 44 F.3d 1178, 1190 (3d Cir . 1995) ("[T]he application of the preemption doctrine r equires a determination of congressional intent in enacting a federal law."). The key inquiry is congressional intent, wh ich can either be explicit or implied. When it is implied, intent can take one of two forms. First, "[i]f Congress eviden ces an intent to occupy a given field, any state law falli ng within that field is preempted." Silkwood v. Kerr-McGee Co rp., 464 U.S. 238, 248, 104 S.Ct. 615, 621 (1984). Congr ess ional intent to occupy a field can be inferred fr om:

27a `scheme of federal regulation so pervasive as to make

reasonable the inference that Congr ess left no room to supplement it,' `because the Act of Congr es s may touch

a field in which the federal interest is so dominant that the federal system will be assumed to preclu de enforcement of state laws on the same subjec t,' or because `the object sought to be obtained by the federal law and the character of obligations imposed by it may reveal the same purpose.'

Pacific Gas & Elec. Co. v. State Energy Res. Conser vation & Dev. Comm'n, 461 U.S. 190, 204, 103 S.Ct. 1713, 172 2 (1983). Second, if Congress has not occupied an ent ire field, "state law is still preempted to the extent it actually conflicts with federal law, that is, when it is imp ossible to comply with both state and federal law." Id.

In sum, there are three circumstances under which federal law preempts state law: (1) when Congr ess, through explicit statutory language, defines an ar ea in wh ich federal law controls, (2) when Congress implicitly indicate s an intent to occupy a given field to the exclusion of state law, and (3) when federal law actually conflicts with st ate law. See Cipollone v. Liggett Group, Inc., 505 U.S. 504, 516, 112 S.Ct. 2608, 2617 (1992); Buzzard v. Roadrunner Truc king, Inc., 966 F.2d 777, 780 (3d Cir. 1992). We have con sistently analyzed preemption claims according to this framew ork. See Abdullah v. American Airlines, 181 F .3d 363, 3 67 (3d Cir. 1999).

II.

Next, I turn to N.E. Hub's specific claim. In Schne idewind v. ANR Pipeline Co., the Supreme Court held that Co ngress intended to occupy the field at issue.1 See 485 U. S. 293, 308, 108 S.Ct. 1145, 1155 (1988) ("[T]he control of rates and facilities of natural gas companies . . . ar e precisely the things over which FERC has comprehensive authority. "). The Court noted that it "is now well settled[that] Congress

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1. Because Congress failed to describe explicitly t he extent to which the NGA preempts state regulation of natural gas facili ties, the first of the aforementioned circumstances (expr ess preemption) does not apply.

28occupied the field of matters relating to wholesale sales and

transportation of natural gas in interstate commer ce." Id. at 305, 108 S.Ct. at 1153. An overwhelming amount of authority supports this assertion.2 Even in Maritim es & Northeast Pipeline, L.L.C., No. CP97-238-001, 1997 WL 812154, at *8 (F.E.R.C. Nov. 4, 1997), the case mos t heavily relied upon by CNGT and Penn Fuel, FERC noted that "the NGA preempts State and local agencies fr om regulat ing the construction and operation of interstate pipeline f acilities." It is simply beyond peradventure that Congr ess int ended the NGA to occupy the field of law at issue.

Both the Majority and the District Court disagr ee and hold that field preemption does not apply. The Dist rict Court expressly rejected field pr eemption, but non etheless addressed and rejected the claim on its merits. The Majority purports to avoid categorizing the claim, but still implicitly endorses conflict preemption. I believe that field preemption does apply, but I agree with the Distric t Court that the claim fails on its merits. This is an impo rtant question. If field preemption applies but FERC vali dly exercised its authority, we should affir m the Dist rict

Court's decision and not remand the case. Fundament ally, the resolution of this question -- whetherfield pre emption applies -- controls whether this case is r emanded or affirmed. I therefore review the opinions of the Ma jority and

District Court in turn.

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2. See e.g., Interstate Natural Gas Co. v. Federal Power Comm'n, 331 U.S. 682, 690, 67 S.Ct. 1482, 1487 (1947) ("As was state d in the House Committee Report, the `basic purpose' of Congr ess in passing the Natural Gas Act was "to occupy this field in which the Supr eme Court has held that the States may not act."); Pennsylvania Medica l Soc'y v. Marconis, 942 F.2d 842, 847 (3d Cir. 1991) ("The field of mat ters relating to wholesale sales and transport of natural gas in int erstate commerce [has] been occupied by federal legislation."); Publ ic Utils. Comm'n of

State of California v. FERC, 900 F.2d 269, 274 (D.C. Cir. 1990) ("Cases are legion affirming the exclusive character of FERC ju risdiction where it applies . . . under the NGA."); Algonquin LNG v. Lo qa, 79 F.Supp.2d 49, 51 (D.R.I. 2000) ("Congress clearly has manifested an intent to occupy the field.").

29A.

The Majority at first seems to agree with me that f ield preemption should apply. It states that "[t]he dist rict court [held] that this case does not involve field occupa tion. We, however, strongly doubt that the district court was correct." Majority at 21 (emphasis added). The Majority fails to apply field preemption, however, and instead holds that " we need not characterize definitively the type of pr eempti on implicated here to determine ripeness." Majority at 21. In spite of this, I believe that the Majority tacitly does characterize N.E. Hub's claim. It rejects field pre emption and endorses conflict preemption, even though its reasoning assumes that Congress has occupied the fi eld.

The District Court's decision requires us to catego rize the claim in this case, because it addressed N.E. Hub's two preemption "theories" and reached different outcome s for each. The court held that conflict preemption was n ot ripe, but rejected field preemption on separate grounds.3 The Majority states that ripeness "is the only issue be fore us." Majority at 21. The District Court discussed ripene ss only in connection to conflict preemption. Ther efore, t he Majority's opinion, to the extent that it exclusive ly focuses on ripeness, holds that only conflict preemption is at issue.

Furthermore, because courts need only address confl ict preemption in the absence of field pr eemption, see Silkwood, 464 U.S. at 248, 104 S.Ct. at 621 ("If Co ngress has not entirely displaced state regulation over th e matter in question, state law is still preempted to the ex tent it actually conflicts with federal law."), the Majorit y's focus on ripeness tacitly rejects field preemption. If field preemption applied, there would be no reason to analyze the ri peness of the conflict preemption claim.4 In fact, the Ma jority

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3. The District Court explicitly addressed the fiel d preemption claim, "NE Hub's alternative theory, that Pennsylvania lacks a uthority to subject the NE Hub Project to any regulation whatsoever." MemOp . at 18. The court characterized the claim as a direct "challenge to t he express provisions of [FERC's] 7(c) certificate," and found that it la cked jurisdiction

because N.E. Hub should have appealed directly to FERC. Mem Op. at 18. 4. The Majority argues that we need not categorize the preemption claim in order to analyze its ripeness. However , the Dis trict Court only found ripeness lacking in the conflict preemption claim; therefore, we need not address ripeness unless the claim is one of conflic t preemption.

30explicitly holds that N.E. Hub never raised a field

preemption claim. See Majority at 26. Thus, even th ough it "strongly doubt[s] that the district court was corr ect [to reject field preemption]," Majority at 21, the Majo rity rejects

it as well.

Instead, the Majority suggests that we have a "hybr id situation" in which "there is field occupation but FERC . . . has converted the case into a conflict preemption m atter." Majority at 21-22 n.13. I disagree with this charac terization for two reasons. First, neither law nor logic sugge sts the existence of such a thing, and second, for r easons I explain more fully in Section II.B., supra, FERC does not h ave the authority to abdicate its congressionally delegated authority.5 In addition, I fail to see how this "hybrid" differ s practically from pure conflict preemption considering that FERC "has converted the case into a conflict pr eemption matt er." Majority at 21-22 n.13 (emphasis added). If a "hybr id" preemption claim carries with it a differ ent stand ard, the Majority does not describe what it might be. For th ese reasons, I believe that the Majority, in spite of i ts language to the contrary, tacitly did categorize N.E. Hub's claim as conflict preemption, and the District Court must ap ply that doctrine upon remand.

The Majority offers two additional arguments to sup port its position: (1) field and conflict preemption ove rlap and are difficult to distinguish, and (2) the existence of a legal process can form the basis of a field or conflict p reemption

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5. The Majority believes that FERC delegated its occupation of the field, at least in part, to the states. Ther efore, any "conflicts"

that arose could form the basis of a conflict pre emption claim in

federal court. The important difference between us i s that I believe FERC continued to maintain its ultimate authority . Because it continued to occupy the field, it maintained its discr etion to interpret the terms of its 7(c) certificate. If an alleged "conflict" arose, it

was up to FERC to determine if the certificate had been violated. Our

review

of such a decision would be the same as our r eview of any other action by an administrative agency in an occ upiedfield. In sum, the Majority and I disagree over who should dete r mine whether the

state actions at issue were "consistent" wit h FERC's certificate.

The Majority believes that FERC delegated that a uthority to the federal

courts. I believe that FERC maintained its d iscr etion.

31claim. See Majority at 24-25. When r eviewed carefu lly,

neither support the Majority's holding; in fact, bo th ironically assume that Congress has pr eempted the field.

First, the Majority argues that it need not charact erize N.E. Hub's claim, because field and conflict pr eem ption are not "rigidly distinct," see English v. General Elec . Co., 496 U.S. 72, 79 n.5, 110 S.Ct. 2270, 2275 n.5 (1990), 6 implying, based upon its definitions, that field an d conflict preemption are indistinguishable. T echnically, all forms of federal preemption can be described as (and meet th e definition of) conflict preemption,7 for the simple reason that preemption only occurs when a state action con flicts with congressional intent.8 In spite of its extreme ly broad definition, however, conflict preemption does not r efer to the entire range of all federal preemption. Instead, co urts use the term quite narrowly -- it applies when a state regulation conflicts with federal law in a non-occu pied field.9 See Silkwood, 464 U.S. at 248, 104 S.Ct. at 621 ("I f Congress has not entirely displaced state regulatio n over the matter in question, state law is still pr eempt ed to the extent it actually conflicts with federal law.").

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6. The Supreme Court footnote from which the Majori ty derives its argument nonetheless explicitly upheld the thr ee c ategories of preemption. See English, 496 U.S. at 79 n.5, 110 S. Ct. at 2275 n.5 ("[B]ecause we previously have adverted to the thre e-category framework, we invoke and apply it here.").

7. According to its broad definition, conflict pree mption applies whenever a state regulation "actually conflicts with federal law, that is, when it

is impossible to comply with both state and federal la w, or where the state law stands as an obstacle to the accomplishment of the full purposes and objectives of Congress." See Silkwood, 464 U.S. at 248, 104 S.Ct. at 621 (citations omitted); see also e.g., English, 49 6 U.S. at 79, 110 S.Ct. at 2275 (citations omitted).

8. Courts have identified, and labeled, thr ee form s of federal preemption (express, field, and conflict preemption) that vary according to their scope. According to the Supreme Court,"[f]requently , the preemptive `label' we choose will carry with it substantive im plications for the

scope of preemption." Gade v. National Solid W aste Mgmt. Ass'n, 505 U.S. 88, 104 n.2, 112 S.Ct. 2374, 2386 n.2 (1992).

9. Conflict preemption in an occupiedfield would be unnecessary and duplicative, because all state regulation is barred by field preemption.

32The Majority fails to make this distinction. It com pares

the definitions of conflict and field preemption an d argues that field preemption is simply a presumption of co nflict preemption over an entire area of law.10 Because al l three categories of federal preemption technically fall w ithin the definition of conflict preemption, any state regula tion (or judicial proceeding, as in this case) subject to fi eld preemption would also be barred under the technical definition of conflict preemption. See English, 496 U.S. at 79, 110 S.Ct. at 2275 (defining conflict pr eemptio n, in part, to apply when "state law `stands as an obstacle to the accomplishment and execution of the full purposes a nd objectives of Congress' ").

However -- and this is the critical point -- in thi s case, the only reason that the challenged state actions ( the appeals) satisfy the definition of conflict pr eemp tion is because Congress has preempted thefield. The Majori ty never asserts that the appeals at issue make it"imp ossible to comply with both state and federal law," but mer ely that they frustrate congressional intent to legislate ex clusively in this area. In other words, as the Majority phrases it, conflict preemption holds because the state proceed ings "interfere with the purposes and objectives of the federal plan." Majority at 24. The "federal plan," I suppos e, refers to Congress' intent to occupy the field at issue. T hus, the Majority's argument, when closely scrutinized, goes something like this: (1) Congress preempted the fie ld, and (2) the appeals at issue constitute state action wi thin that field; therefore, (3) the appeals conflict with con gressional intent to legislate exclusively. The Majority's r e asoning implicitly recognizes that Congress intended to occ upy the field at issue. As such, I would affix the pr oper "label" to N.E. Hub's preemption claim. When a state law"confl icts" with "the purposes and objectives" of Congr ess to occupy a given field, courts label it field, notconflict, pr eemption.11

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10. See e.g., English, 496 U.S. at 79 n.5, 110 S.Ct . at 2275 n.5 ("[F]ield preemption may be understood as a species of confli ct preemption: A state law that falls within a preempted field confl icts with Congress' intent (either express or plainly implied) to exclu de state regulation.").

11. In a footnote, the Majority claims that "by no means do we mean to obliterate the distinction between the types of pr eemption, and we

33The Majority's second argument further underscores its

implicit recognition that Congress has pr eempted t he field.12 The Majority argues that it need not classify the c laim at issue, because either field or conflict pr eemption can bar a legal process such as the appeals in this case.13 S ee Majority at 23 ("[T]he process pr eemption cases do not confine themselves to the field occupation context. "). The Majority cites no case in which any court has held that conflict preemption bars an unfinished legal proces s with

an indeterminate outcome. I too was unable tofind s uch a

case.14

The only scenario in which I can possibly envision conflict preemption barring an on-going legal proce eding is one in which the outcome sought by the party opposi ng preemption is certain to conflict with federal law. In other words, for conflict preemption to apply, the relief sought by CNGT and Penn Fuel would have to conflict totally w ith FERC's 7(c) certificate. This is not the case. It i s entirely possible that the Environmental Hearing Boar d coul d, as a result of the appeals at issue, impose additional

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recognize the continuing existence of each." Majori ty at 24 n.16. However, if we need not classify the pr eemption cl aim in this case, in spite of Supreme Court precedent explicitly holding that Congress has occupied the field, I fail to see how the distincti on retains any force.

12. For the remainder of this dissent, I r efer to conflict preemption in

the manner that courts apply it (in a non-occupied fiel d) rather than according to its sweeping definition, which encompa sses all forms of federal preemption.

13. I assume that when the Majority uses the ter m "process preemption," it is referring to a federal preemption claim based upon an ongoing legal process. Unlike conflict or field preemption, "proc ess preemption" is not a term of art; in fact, a Westlaw search revealed t hat no federal court

has

ever used the term.

14. The Majority relies upon two unsupported assert ions: (1) its own belief that "certain regulatory acts clearly would conflict with federal law, and it is as logical to preempt state pr ocess conc erning such matters as state actions in occupied fields," and (2) a statem ent by the administrator of the Pennsylvania Department of Env ironmental Protection that the agency lacked jurisdiction to " conduct final appealability decisionmaking" in this matter . Majo rity at 23.

34requirements on N.E. Hub that would not conflict wi th the

7(c) certificate.15

In sum, the Majority purports to avoid categorizing N.E. Hub's claim. In reality, however, it r ejects field preemption and requires the District Court to apply conflict p reemption upon remand, even though its reasoning assumes that Congress has occupied the field. Accor ding to the Supreme Court, conflict preemption should be applied only i f "Congress has not entirely displaced state regulati on over the matter in question" explicitly or thr ough impl ied field preemption. Silkwood, 464 U.S. at 248, 104 S.Ct. at 621. In this case, the overwhelming weight of Supreme Court precedent indicates that Congress intended the NGA to occupy the field at issue. As a result, I disagree with the Majority's approach and would instead applyfield preemption.

B.

The District Court addressed the classification iss ue explicitly. It held that field preemption does not apply, because FERC had affirmatively limited its own juri sdiction. It noted that "[a]lthough the Natural Gas Act might be read to completely preempt any state regulation of the t ransport, storage and sale of natural gas in interstate comme r ce, FERC has interpreted its jurisdiction under the Nat ural Gas Act to allow for some state regulation." MemOp. at 13. In effect, the District Court held that FERC r efused to occupy the given field and instead partially delegated its

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15. The Majority states that conflict pr eemption b ars "the process with respect to the 30 Issues," because its outcome is " almost certain to conflict with federal law." Majority at 23 n.14. In practice, I seriously doubt that a court could effectively isolate state proceedings likely to lead to conflicting outcomes from those that could possibly lead to "additional requirements . . . that donot conflict with the 7(c)

certificate." Majority at 23 n.14. Forcing courts to do so would in effect require them to predict the outcomes of unfinished legal proceed ings in separate jurisdictions. I suspect that this difficulty expla ins why courts have widely refused to apply conflict preemption to bar an ongoing state process, and have instead relied uponfield preempti on when it is appropriate.

35responsibilities to the states. The Majority seems to endorse

this conclusion hesitantly in a footnote, ter ming this case a "hybrid" situation. See Majority at 21 n.13.

The District Court's analysis, and the Majority's r eference to it, is flawed. Admittedly, Chevron v. NRDC, 467 U.S. 837, 842-43, 104 S.Ct. 2778, 2781-82 (1984), often r equ ires courts to defer to an agency's statutory interpr et ation, and

we have held that Chevron defer ence extends to an agency's interpretation of its own jurisdiction. See Puerto Rico Mar. Shipping Auth. v. Valley Freight Sys., Inc., 856 F. 2d 546, 552 (3d Cir. 1988) ("This rule of defer ence is ful ly applicable to an agency's interpretation of its own jurisdicti on."). However, courts need only defer to an agency when t he intent of Congress is unclear. See Chevron, 467 U.S . at 842- 43, 104 S.Ct. at 2781-82 ("If the intent of Congr e ss is clear, that is the end of the matter.").16 Here, as previo usly discussed, the intent of Congress to occupy the ent ire field is, and has been for decades, clearly established b y the Supreme Court. As a result, FERC could not limit it s jurisdiction in the face of contrary, clear congr e ssional intent. See id. at 843 n.9, 104 S.Ct. at 2781 n.9 ( "The judiciary is the final authority on issues of statu tory construction and must reject administrative constru ctions which are contrary to clear congressional intent.")

.

Furthermore, based upon my reading of Maritimes, FE RC did not intend to restrict its jurisdiction. See 19 97 WL 812154, at *8. Quite the contrary - it exer cised i ts wideranging jurisdiction in order to requir e that natu ral gas companies comply with state regulations as a condit ion to granting a 7(c) certificate. After reaffir ming the NGA's preemption of state and local regulation, FERC stat ed that "as a matter of policy, . . . the Commission has im posed upon applicants a requirement that they cooperate w ith

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16. See also Neal v. United States, 516 U.S. 284, 2 95, 116 S.Ct. 763, 769 (1996) ("Absent . . . compelling evidence bearing o n Congress' original intent, our system demands that we adhere to our pr ior interpretations of statutes."); Maislin Indus., U.S., Inc. v. Prima ry Steel, Inc., 497

U.S. 116, 131, 110 S.Ct. 2759, 2768 (1990) ("Once we hav e determined a statute's clear meaning, we adhere to that determin ation under the doctrine of stare decisis, and we judge an agency's later interpretation

of the statute against our prior determination of the statute's meaning.").

36State and local authorities." Id. (emphasis added). FERC did

not limit its own jurisdiction, but rather used its authority to implement a policy objective. If it had, in fact , abdicated its jurisdiction, it would have been unable to impo se state regulations upon anyone.

It is undisputed by both the Majority and the Distr ict Court that Congress intended federal law to occupy the

entire field at issue. Because neither FERC nor thi s Court have the discretion to contravene clear congr essio nal intent, field preemption should apply. The ripeness of N.E. Hub's conflict preemption claim is ther efore irrel evant.

III.

Finally, I address the merits of N.E. Hub'sfield preemption claim. First of all, it is clearly ripe. We require that a claim satisfy three elements in or der to be ripe for decision: "adversity of the interests of the partie s, conclusiveness of the judicial judgment and the pra ctical help, or utility, of that judgment." Step-Saver Dat a Systems, Inc. v. WYSE Technology, 912 F.2d 643, 647 (3d Cir. 1990). All three are satisfied. The state pr oceedings the mselves constitute an injury establishing adversity of inte r est. See Sayles Hydro Assocs. v. Maughan, 985 F .2d 451, 454 (9th Cir. 1993) (holding that in the field preemption co ntext, "[t]he hardship is the process itself.").17 A decre e indicating that FERC's 7(c) certificate preempted all state re gulation of N.E. Hub's project would be "conclusive" under any definition of the term, see Step-Saver , 912 F.2d a t 648, and it would be "useful," because it would allow N.E. H ub to proceed with its project. See id.

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17. See also Freehold, 44 F.3d at 1189 (holding tha t a field preemption claim was ripe because "the plaintiff did not chall enge the state's ultimate substantive decision, but rather its autho rity to conduct proceedings."); Middle South Ener gy, Inc. v. Arkan sas Pub. Serv. Comm'n, 772 F.2d 404, 410-11 (8th Cir. 1985) (claim ripe wh ere the plaintiff "challenges not the state's ultimate substantive de cision but its authority to even conduct the contemplated proceeding. It can hardly be doubted that a controversy sufficiently concr ete for judic ial review exists when the proceeding sought to be enjoined is alr eady in progress.").

37Apparently, the District Court agreed that if field

preemption applied, N.E. Hub's claim was ripe. Afte r a lengthy and unnecessary discussion of the ripeness of the conflict preemption claim, it moved immediately to the merits of the field preemption claim (without discu ssing its ripeness). The court held that the claim failed on its merits:

NE Hub's alternative theory, that Pennsylvan ia lacks authority to subject NE Hub Project to any r egulation whatsoever, must also fail on jurisdictional grounds. Such an attack constitutes a challenge to th e expr ess provisions of the 7(c) certificate issued by FERC to NE Hub, which clearly contemplate and even dire ct NE Hub's compliance with state regulation. As p ointed out by Defendants CNGT and Penn Fuel in their mo tions to dismiss, the Court lacks jurisdiction over s uch a challenge to the 7(c) certificate, as NE Hub failed to apply to FERC for a rehearing of its April 2 9, 1998 Order issuing the 7(c) certificate.

MemOp. at 18-19 (citations omitted). I agree with t he Court's reasoning and outcome, but it would be help ful to elaborate further. FERC's 7(c) certificate required compliance with state and local regulations. Specif ically, it

stated that:

Any state or local permits issued with r esp ect to the jurisdictional facilities authorized herein must be

consistent with the conditions of this certi ficate. The Commission encourages cooperation between in terstate pipelines and local authorities. However, th is does not mean that state and local agencies, through application of state or local laws, may proh ibit or unreasonably delay the construction or opera tion of facilities by this Commission.

J.A. at 109. The District Court interpreted this la nguage to require that N.E. Hub obtain "any and all necessary state or local permits required to carry out the drilling and construction program." MemOp. at 5. In addition, th e 7(c) certificate also contained a number of mor e specif ic provisions that required compliance with individual state regulations. See MemOp. at 14-15.

38FERC's discretion in granting a 7(c) certificate is farreaching. Section 717f(e) of the NGA pr ovides that , "[t]he Commission shall have the power to attach to the is suance of the certificate and to the exercise of the right s granted

thereunder such reasonable terms and conditions as the public convenience and necessity may requir e." 15 U.S.C. S 717f(e). Under this authority, FERC r equired com pliance with state and local regulations as long as they di d not "prohibit or unreasonably delay the construction or operation of [the] facilities." J.A. at 109. FERC d id not abdicate its jurisdiction; it exercised it.

This interpretation is consistent with FERC's discu ssion of state regulations in Maritimes, 1997 WL 812154, at *8. In that case, FERC described its "requir ement" tha t applicants cooperate with state and local authoriti es as being something it had "imposed" as "a matter of po licy." Id. A plain reading suggests that FERC was simply exerc ising its wide jurisdiction over the field, requiring app licants to comply with state and local regulations that impose additional, non-conflicting measures. W ere an actu al conflict to arise, FERC noted that its decisions wo uld

control.

FERC could have required, subsequent to its S 717f( e) authority, that applicants comply with conditions i dentical to those found in state regulations. It is unclear why, and indeed N.E. Hub has failed to argue that, r equirin g compliance with state regulations that impose poten tially non-conflicting conditions would be outside FERC's authority. Even if it were, as the District Court h eld, N.E. Hub's proper course would have been to challenge th e validity of FERC's 7(c) certificate by seeking a r ehearing within thirty days of its issuance. See 15 U.S.C. S 717r(a).

It failed to do so. N.E. Hub cannot now collaterall y attack FERC's authority under S 717f(e) by challenging a s tate appellate process that FERC implicitly sanctioned. See City of Tacoma v. Taxpayers of Tacoma, 357 U.S. 320, 335 -36, 78 S.Ct. 1209, 1218-19 (1958); Williams Natural Gas Co. v. City of Oklahoma City, 890 F.2d 255, 262 (10th Cir. 1989) ("[A] challenger may not collaterally attack the va lidity of a prior FERC order in a subsequent proceeding . . . w hether the collateral action is brought in state court or federal court.").

39IV.

I would affirm the District Court's decision based upon its disposition of the one legitimate claim at issu e - N.E. Hub's argument that the state proceedings at issue are field preempted by FERC's 7(c) certificate. Field preempt ion does apply, but FERC exercised its wide-ranging authorit y to require compliance with state regulations. Because N.E. Hub failed to challenge FERC's authority dir ectly, it cannot now challenge the 7(c) certificate in this Court. T he District Court properly held that it lacked jurisdiction ove r the claims at issue, and as a result, N.E. Hub's claims were properly dismissed.

A True Copy:

Teste:

Clerk of the United States Court of Appeals

for the Third Circuit

40