The Biafora family of businesses has suffered a setback in its court quest to seek damages from Lake Lynn Generation following the summer 2024 drought.
Judge Thomas Kleeh, in the U.S. District Court for the Northern District of West Virginia dismissed the case on Monday for lack of jurisdiction. But he dismissed it without prejudice – meaning the Biaforas could try again in a higher court.
Marina 1 LLC, a Biafora family company doing business as Cheat Lake Marina, filed suit in Monongalia County Circuit Court on Sept. 30, 2024, alleging that before the Labor Day weekend, Lake Lynn deliberately lowered the level of Cheat Lake below the 868-foot minimum in violation of its Federal Energy Regulatory Commission license. This caused various damages, some of them irreparable. Marina 1 sought $50,000 in damages.
Lake Lynn subsequently had the case moved to federal district court.
Marina 1 had asked Kleeh to remand the case back to county court. It alleged Lake Lynn violated its FERC license by lowering the lake level, unreasonably and without notice. But the violation did not violate any federal law meriting consideration in a federal court. The Federal Powers Act grants FERC the ability to issue licenses and set requirements under those licenses.
THE FPA is federal law, Marina 1 said. The FERC license is not federal law. Marina 1’s allegations of strict liability, negligence and breach of contract associated with the request for $50,000 monetary damages rely on state tort law, Marina 1 said, and are a matter for circuit court.
Lake Lynn countered that its FERC license, not state law, sets the standards of care for the operation of its license. “FERC must be given the opportunity to assess if Lake Lynn’s license was violated in the first place.”
During the drought, Lake Lynn argued, it had to choose between three competing FERC license requirements: maintain the summer level of 868-870 feet; maintain a flow rate of 212 cubic feet per second (cfs) into the Cheat River, with an absolute minimum of 100 cfs; and maintain dissolved oxygen at 5 milligrams per liter for the aquatic life.
The company chose to prioritize maintaining the oxygen level over maintaining the lake level. And in July, FERC told Lake Lynn that it did not violate its hydroelectric project license when it responded to low dissolved oxygen levels in July, August and October 2024.
In explaining his decision, Kleeh said Lake Lynn’s license gives it latitude on maintaining the lake level, but not on maintaining the downstream oxygen level in order to preserve the downstream environment.
Noting the Federal Power Act, Kleeh said FERC has the authority to place conditions on its licensed facilities.
“A district court has no power to ‘invalidate or rescind’ any FERC action ‘in a matter which Congress has committed to [FERC’s] exclusive jurisdiction,’” he said.
He continued, “Cheat Lake Marina’s theories of liability are dependent upon a finding that Lake Lynn, when faced with severe drought conditions, should have prioritized the water level instead of the downstream water quality. FERC has already rejected this contention, finding that Lake Lynn’s actions were permissible under the license. Essentially, Cheat Lake Marina is asking the court to rewrite the terms of the FERC license in a way that would force Lake Lynn to prioritize the water level.”
Given that Marina 1’s claims attack Lake Lynn’s FERC license, Kleeh said, his court has no jurisdiction. “When FERC exercises its exclusive authority to issue a license, that license, along with the terms and conditions therein, are only reviewable by federal courts of appeal.”
Kleeh denied Marina 1’s motion to remand the case to circuit court and granted Lake Lynn’s motion to dismiss. Since it was dismissed without prejudice, Marina 1 could file a new case in the Fourth Circuit Court of Appeals.
