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Lighthouse Resources Inc. v. Inslee

United States District Court, W.D. Washington, Tacoma

March 26, 2018

LIGHTHOUSE RESOURCES INC., et al., Plaintiffs,
v.
JAY INSLEE, et al., Defendants.

          ORDER ON MOTION OF BNSF RAILWAY COMPANY TO INTERVENE AS PLAINTIFF

          ROBERT J. BRYAN, UNITED STATES DISTRICT JUDGE.

         THIS MATTER comes before the Court on the Motion of BNSF Railway Company to Intervene as Plaintiff. Dkt. 22. The Court has considered the motion and the remainder of the file herein.

         BNSF seeks to intervene as a matter of right under Fed. R. Civ.P. 24(a)(1)(2). BNSF seeks permissive intervention under Fed.R.Civ.P. 24(b)(1)(B) in the alternative. The motion to intervene should be granted on both grounds.

         I. BACKGROUND

         A. Lighthouse Complaint.

         The following factual summary assumes the truth of the allegations of the underlying Complaint filed by the plaintiffs, Lighthouse Resources Inc. and its subsidiaries (collectively, “Lighthouse”).

         This case arises out of efforts by Lighthouse to develop a coal export terminal in Longview, Washington. Dkt. 1 ¶¶5, 16. Lighthouse is a coal energy supply chain company that manages coal mining, transfer by rail and ocean-going vessels, and sale to end users. Id. at ¶¶5, 16, 36. Lighthouse mines mineral assets in Wyoming and Montana for sale in Asian markets. Id. Lighthouse presently ships coal out of an export terminal in Canada, which has increased shipping costs and constrains Lighthouse's ability to fulfill contractual terms and meet market demand, which is increasing. Id. at ¶¶48-50.

         Lighthouse has worked to identify, contract with, and/or develop a new coal export facility since 2009, and it has identified the Millennium Bulk Terminal (MBT) in Longview, Washington, as its preferred west coast site. Dkt. 1 at ¶¶52, 54. MBT weekly receives coal by rail, and the coal is loaded onto trucks for distribution. Id. at ¶62. BNSF provides common carrier service to MBT, which is also capable of receiving trains from Union Pacific. Id. ¶67. Starting in 2012, Lighthouse began the permitting process for the proposed coal export facility at MBT, which has involved approximately two dozen federal and state plans, permits, and approvals. Id. at ¶70.

         All three named defendants, Jay Inslee, Governor to the State of Washington, Maia Bellon, Director of the Washington Department of Ecology, and Hillary Franz, Commissioner of Public Lands (collectively, “the State”), have publicly expressed personal opposition to exporting coal. Dkt. 1 at ¶¶80-98. Under the façade of official state policy, the named defendants have coordinated with Oregon and California to thwart Lighthouse expansion of coal exports. Id. at ¶99-116. Through administrative decisions, the State has effectively “blocked” development of the MBT, by, inter alia, (1) issuing an Environmental Impact Statement (EIS), listing nine unavoidable, significant adverse impacts; (2) denying approval of a sublease between Lighthouse and another company that would allow Lighthouse, as sublessee, to handle coal at MBT; and (3) denying with prejudice Lighthouse's § 401 Clean Water Act (CWA) certification, a prerequisite to obtaining other necessary permits. Id. at ¶¶63, 130, 155, 161, 163. See also, Dkt. 1-1(§ 401 CWA certification), Dkt. 1-2 (DNR denial of sublease). Administrative decisions in part formed the basis for the denial of a Shoreline Permit Application by Cowlitz County. Id. at ¶181. See Dkt. 1-3.

         The Complaint alleges that the State's administrative decisions violate the dormant commerce clause of the United States Constitution, as well as the Interstate Commerce Commission Termination Act (ICCTA), which gives the Surface Transportation Board exclusive authority to regulate rail transportation. 49 U.S.C. §10101 et seq. See City of Auburn v. United States, 154 F.3d 1026, 1030-31 (9th Cir. 1998).

         B. BNSF Complaint.

         BNSF's proposed Complaint in Intervention for Declaratory and Injunctive Relief begins with the same factual premise as the underlying Complaint: the named defendants misused their regulatory powers to prevent coal commerce, including transport of coal by BNSF. Dkt. 22-1 at ¶1, 3. BNSF seeks to join Lighthouse in alleging violations of the dormant commerce clause and the ICCTA. Dkt. Id. at ¶¶16-18. BNSF also alleges that the State violated the foreign affairs doctrine, by interfering with the federal government's national policy on coal resources and exports. Id. at ¶¶19, 119-126.

         BNSF's proposed intervenor complaint alleges standing (Dkt. 22-1 at ¶¶28-30) and jurisdiction (id. at ¶¶20-23).

         II. DISCUSSION

         A. Intervention as a ...


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