Necec Transmission, LLC v. Bureau of Parks and Lands

• Court: Superior Court of Maine
• Decided: October 21, 2022
• Docket: CUMbcd-cv-21-58
• Status: Unpublished

Opinion

STATE OF MAINE BUSINESS & CONSUMER COURT CUMBERLAND, ss. LOCATION: PORTLAND DOCKET NO. BCD-CIV-2021-00058

NECEC TRANSMISSION, LLC, et ) al., ) ) Plaintiffs & Intervenors, ) ) ORDER DENYING PLAINTIFFS’ v. ) MOTION FOR ) RECONSIDERATION BUREAU OF PARKS AND ) LANDS, et al. ) ) Defendants & Intervenors. )

In the wake of the Law Court’s decision in this case, NECEC Transmission

LLC, et al. v. Bureau of Parks and Lands, et al., 2022 ME 48, 281 A.3d 618, Plaintiffs

(along with Intervenors aligned with Plaintiffs) have asked the Court to reconsider

its Order Denying Plaintiffs’ Motion for Preliminary Injunction. See M.R. Civ. P.

7(b)(5). The Court heard oral argument on October 19, 2022. Plaintiffs argue that the

Law Court has essentially decided the case, and thus this Court should vacate its

prior Order. For the reasons discussed below, the Court disagrees with Plaintiffs’

analysis.

Contrary to Plaintiffs’ arguments, the Law Court did not determine that

Plaintiffs have vested rights to complete construction of the New England Clean

Energy Connect project (the Project); did not determine it is likely that Plaintiffs will

succeed on the merits; and did not otherwise telegraph that Plaintiffs will prevail.

Instead, the Law Court clarified its vested rights jurisprudence, announced a new

1 legal standard for determining the existence of vested rights, and returned the case

to this Court for factfinding: “To be clear, we do not decide whether NECEC

performed substantial construction in good faith according to a schedule that was not

created or expedited for the purpose of generating a vested rights claim.” NECEC

Transmission, 2022 ME 48, ¶ 51, 281 A.3d 681.

Plaintiffs nevertheless focus on the next sentence in the Law Court’s decision:

“Although it appears from the limited record developed in connection with the request

for preliminary injunctive relief that NECEC did so, it is up to the trial court to make

those factual determinations on remand.” Id. Rather than advance Plaintiffs’

argument, however, the quoted language highlights the absence of a vested rights

determination by the Law Court and the need for factfinding.

The Law Court declined to find (or reject) vested rights due to what it

characterized as the limited record developed in connection with the request for

preliminary injunctive relief. That same limited record is what is before this Court.

In that regard, it is worth noting that the record is limited in two ways. First, the

record was developed before the new legal standard was articulated by the Law

Court, and thus the record does not allow resolution of the question now presented.

Second, the record consists only of affidavits and attachments. All parties waived

their right to an evidentiary hearing on the motion for preliminary injunction. As a

consequence, there has not yet been any testimony in this case, and Defendants have

not had any opportunity to probe whether Plaintiffs’ construction schedule was

created or expedited for the purpose of generating a vested rights claim.

2 Since the Law Court did not determine whether Plaintiffs have vested rights

to complete construction of the Project, there is no reason for this Court to reconsider

its analysis of the other three preliminary injunction considerations. Although

Plaintiffs have warned about an approaching tipping point, after which completion of

the Project will no longer be feasible, Plaintiffs have not argued the tipping point will

occur while this case is being litigated in the trial court. This matter is currently on

a fast track for trial in April 2023 and a prompt trial court decision thereafter. At

that point Plaintiffs will either prevail, and be able to resume construction on the

Project, or not. If not, Plaintiffs can appeal and seek an injunction from the Law

Court. See M.R. Civ. P. 62(g) ("The provisions in this rule do not limit any power of

the Superior Court or Law Court during the pendency of an appeal to suspend,

modify, restore, or grant an injunction or to make any order appropriate to preserve

the status quo or the effectiveness of the judgment subsequently to be entered."). It

follows, therefore, that Plaintiffs will not suffer any irreparable injury while this

matter proceeds to factfinding and resolution in the trial court.

For all of these reasons, Plaintiffs' request for reconsideration is denied.

So Ordered.

Pursuant to M.R. Civ. P. 79(a), the Clerk is instructed to incorporate this Order

by reference on the docket for this case.

Dated: 10/21/2022 Michael A. Duddy Judge, Business and Consumer Court

Entered on the docket: 10/21/2022

3 BCD-CIV-2021-00058

NECEC TRANSMISSION, LLC, et al.

Plaintiff(s),

v.

BUREAU OF PARKS & LANDS, et al.

Defendant(s).

Party Name: Attorney Name:

Avangrid Networks, Inc. John Aromando, Esq. NECEC Transmission, LLC Jared Desrosiers, Esq. Joshua Dunlap, Esq. Sara Murphy, Esq. 254 Commercial Street Portland, ME 04101

Bureau of Parks & Lands, Jonathan Bolton, Esq. Maine Dept of Agriculture, 111 Sewall Street Conservation & Forestry 6 State House Station Maine House of Representatives Augusta, ME 04333 Maine Public Utilities Commission Maine Senate

__________________________

Intervenors

Cianbro Corporation Phillip Coffin, Esq. Cyrus Cheslak, Esq. Jeffrey Russell, Esq. PO Box 15215 Two Monument Square Suite 400 Portland, ME 041 H.Q. Energy Services, (U.S.) Inc. Timothy Woodcock, Esq. Andrew Hamilton, Esq. Casey Olesen, Esq. Jonathan Andreau Pottle 80 Exchange Street PO Box 1210 Bangor, ME 04402

Industrial Energy Consumer Group Sigmund Schutz, Esq. One City Center PO Box9546 Portland, ME 04112

Int’l Brotherhood of Electrical Workers Local 104 Benjamin Grant, Esq. 4 Union Park PO Box 5000 Topsham, ME 04086

Maine State Chamber of Commerce Gerald Petruccelli, Esq. 2 Monument Square, Ste 900 PO Box 17555 Portland, ME 04112

NextEra Energy Resources, LLC Christopher Roach, Esq. 527 Ocean Ave, Unit 1 Portland, ME 04103

Natural Resources Council of Maine James Kilbreth, Esq. Thomas B. Saviello David Kallin, Esq. Theresa E. York Jeana M. Mccormick, Esq. Robert C. York Oliver Walton, Esq. Wendy A. Huish 84 Marginal Way, Jonathan T. Hull Suite 600 Christine M. Geisser Portland, ME 04101 STATE OF MAINE BUSINESS & CONSUMER COURT CUMBERLAND, ss. LOCATION: PORTLAND DOCKET NO. BCD-CIV-2021-00058

NECEC TRANSMISSION LLC, et ) al., ) ) Plaintiffs & Intervenors, ) ) ORDER DENYING PLAINTIFFS’ v. ) MOTION FOR PRELIMINARY ) INJUNCTION BUREAU OF PARKS AND ) LANDS, et al., ) ) Defendants & Intervenors. )

On November 3, 2021, Plaintiffs filed a three count Verified Complaint for

Declaratory Judgment. The Verified Complaint seeks to permanently block

retroactive application of the recently enacted ballot initiative which imposes a

geographic ban on the construction of High Impact Transmission Lines in Maine and

imposes new requirements on parties seeking to lease Public Lands. On the same

date, Plaintiffs also filed a Motion for Preliminary Injunction (the “Motion”), seeking

to enjoin the Initiative while this litigation is pending. The Motion has been fully

briefed by Plaintiffs, Defendants, and the many Intervenors. Oral argument on the

Motion was held on December 15, 2021, and the Motion is now ready for resolution.

SUMMARY

The question before the Court is whether, during the pendency of this

litigation, to enjoin (in other words, stay or block) the Initiative approved by the

voters of Maine on November 2, 2021, and scheduled to become law on or about

1 December 19, 2021. The answer to the question requires a careful weighing of four

factors.

As to the legal question at the heart of the dispute, the Court determines that

allowing the Initiative to become law will not violate Plaintiffs’ constitutional rights

or constitutional principles. The vested rights doctrine does not apply, and to the

extent it does, Plaintiffs’ rights to continue building the corridor did not vest. The

Court also concludes the Initiative does not violate Separation of Powers principles

or the Contracts Clause. Plaintiffs have not demonstrated a substantial possibility of

prevailing on the merits. The applicable law, however, is uncertain on many disputed

points. Thus, while the Court is unpersuaded by Plaintiffs’ legal arguments, this case

presents many difficult questions. Plaintiffs have legitimate counter arguments on

all disputed points of law.

But the existence of such counter arguments, even if they were to constitute a

substantial possibility of prevailing on the legal merits, are not enough to stay the

Initiative, because the other factors are determinative. The Court finds that allowing

the Initiative to become law during the litigation will not cause Plaintiffs irreparable

injury. The litigation is moving rapidly, and the Court anticipates it will continue to

do so. The public interest in participatory democracy is paramount and would be

adversely affected by blocking the Initiative. And while the economic harm to

Plaintiffs brought about by delaying construction of the corridor during the litigation

will be substantial, that harm does not outweigh the harm to voter confidence and

participatory democracy that would result from preventing the Initiative from

2 becoming law while this legal challenge is pending. Hence, the Court declines to

prevent the Initiative from going into effect.

This is not a decision the Court reaches lightly given the countervailing

considerations at issue. On the one hand, a major commercial enterprise attempting

to build a large linear project in Maine, and multiple other interested parties, seek to

avoid significant financial losses and protect their investment. On the other hand,

the Initiative’s architects and the people of Maine seek to prevent the disturbance of

Maine lands and impose additional requirements for approval of projects like the one

at issue here. The Court understands and respects the substantial interests and

stakes on each side of the dispute. Resolution of the dispute carries regional and

national implications.

Of course, the Court’s decision on Plaintiffs’ Motion is by no means the last

word. Plaintiffs and supporting Intervenors can file an interlocutory appeal or move

to have the questions of law reported to the Law Court pursuant to M.R. App. P. 24(c).

If the latter, this Court will expeditiously grant the motion to report. Either way, the

questions of law presented by this case are important and “ought to be determined by

the Law Court.” Id. The Law Court may interpret its precedents differently than does

this Court. As but one example, it may be a better reading of the precedent to apply

the vested rights doctrine to consideration of state-wide laws, and to conclude that

the vesting factors are satisfied. If the Law Court determines that allowing the

Initiative to become law works a constitutional violation on any basis, that

determination would likely change the trajectory of the case. On remand (or directly

3 by the Law Court), the finding of a constitutional violation would likely satisfy the

requirement for irreparable harm, supersede the will of the voters, and change the

balance of harms in favor of Plaintiffs. Under those circumstances, staying the

Initiative would be appropriate.

In the meantime, as more fully explained below, the Court denies Plaintiffs’

Motion for Preliminary Injunction. The Court determines that, at this stage of the

proceeding, there is no basis to block the Initiative from going into effect as scheduled.

STATEMENT OF FACTS

Plaintiffs in this action are NECEC Transmission LLC and Avangrid

Networks, Inc. (collectively “Plaintiffs” or “NECEC”). 1 Intervenors in support of

Plaintiffs are Cianbro Corporation, H.Q. Energy Services (U.S.) Inc. (“HQUS”),

Industrial Energy Consumer Group (“IECG”), International Brotherhood of Electrical

Workers Local 104 (“IBEW”), and Maine State Chamber of Commerce. Defendants

are Bureau of Parks and Lands, Maine Department of Agriculture, Conservation and

Forestry, Maine Public Utilities Commission, Maine Senate, and Maine House of

Representatives (collectively “Defendants”). Intervenors in support of Defendants are

NextEra Energy Resources, LLC, Natural Resources Council of Maine, Christine M.

Geisser, Wendy A. Huish, Jonathan T. Hull, Thomas B. Saviello, Theresa E. York,

and Robert C. Yorks.

No party requested an evidentiary hearing. All parties opted to proceed based

upon the pleadings, well supported briefs, and oral argument. Accordingly, based

1 Avangrid Networks, LLC, owns NECEC, and is the indirect parent company of Central Maine Power Company (“CMP”).

4 upon the Verified Complaint, briefs, affidavits, exhibits, and stipulations made

during oral argument, the Court finds the following facts based upon a preponderance

of the evidence. Because of the many overlapping chronologies, the presentation of

facts is organized topically to assist the reader. However, the overall sequence of

events is important to the analysis.

Introduction to the Project

In response to requests for proposals for a clean energy supply by

Massachusetts electric distribution companies (“EDCs”), Central Maine Power

Company (“CMP”) and Hydro-Québec proposed the project at the heart of this action

(the “Project”). The Project would transmit power from Québec through Maine and

into Massachusetts. The Project consists of a 145.3-mile-long High Voltage Direct

Current (“HVDC”) transmission line running from the U.S./Canadian border in

Beattie Township, Maine to a new converter station in Lewiston, Maine, which will

connect to an existing substation by a new 1.2-mile High Voltage Alternating Current

transmission line, as well as other network upgrades.

The Project is divided into five segments: (1) 53.1 miles of HVDC line running

along a new corridor from Beattie Township to the Forks Plantation; (2-3)

approximately 92 miles of transmission line along an existing corridor which will be

widened; and (4-5) network upgrades, including a 26.5-mile AC transmission line

from Lewiston to Wiscasset. Segment 1 is the most controversial, as a new corridor

must be cut through commercial timberland. The segment will cross hundreds of

wetlands and waterways as well as bird habitats and vernal pools. Additionally, a

5 300-foot-wide, 0.9-mile-long stretch of Segment 1 of the Project corridor is planned to

cross over public reserved lands, administered by the Maine Bureau of Parks and

Lands (“BPL”), in Johnson Mountain Township and West Forks Plantation.

CMP ultimately transferred its rights and responsibilities in the Project to

Plaintiff New England Clean Energy Connect LLC (“NECEC”), which will construct

and operate the Project. Both CMP and NECEC are subsidiaries of Plaintiff Avangrid

Networks, Inc. (“Avangrid Networks”). Avangrid Networks is a wholly owned

subsidiary of Avangrid, Inc., a publicly traded, sustainable energy company with

approximately $38 billion in assets that operates in twenty-four U.S. States. Its two

primary lines of business are Avangrid Networks, which owns eight electric and

natural gas utilities, including CMP, and serves 3.3 million customers across New

England and New York, as well as Avangrid Renewables, which owns and operates

8.5 gigawatts of electricity capacity in twenty two states.

Permitting

By July 2017, CMP had obtained sufficient control of the proposed Project

corridor to begin seeking the requisite permits for the Project. On September 27, 2017

CMP filed a petition for a Certificate of Public Convenience and Necessity (“CPCN”)

from the Public Utilities Commission (“PUC”), as required for this level of voltage in

a transmission line pursuant to 35-A M.R.S. § 3132. The PUC reviewed the petition

over nineteen months, held six days of evidentiary hearings and three public witness

hearings, and thirty-one parties participated in the proceedings. The PUC granted

the CPCN on May 3, 2019, based on the Commission’s finding that the Project is in

6 the public interest, considering the anticipated reduction in electricity prices,

increased system reliability, and displacement of fossil-fuel energy generation. 2

NextEra Energy Resources, LLC (“NextEra”), an owner of an oil-fired electric

generation facility in Yarmouth, Maine appealed the issuance of the CPCN. On

March 17, 2020 the Law Court denied NextEra’s appeal, thereby affirming the grant

of the CPCN for the Project. 3

In September 2017, NECEC also applied for permits from the Department of

Environmental Protection (“DEP”) under the Site Location of Development Act

(“SLODA”) and Natural Resources Protection Act (“NRPA”), as well as a Land Use

Planning Commission (“LUPC”) Site law Certification of Compliance. 38 M.R.S. §§

480-C, 483-A. In May 2019, the DEP and LUPC began joint hearings on CMP’s permit

applications. Thirty-nine parties participated in the review of the Project, six days of

evidentiary hearings were held, and two days of public testimony were heard. On

May 11, 2020 the DEP approved NECEC’s permits, incorporating LUPC’s

certification, with thirty-eight conditions.

NextEra, the Natural Resources Council of Maine (“NRCM”), and petitioners

residing in the West Forks area appealed the grant of the DEP permits to the

Superior Court and the Maine Board of Environmental Protection (“BEP”). In

November 2020, NRCM and the West Forks petitioners moved the Superior Court for

a stay of the DEP order, and in January 2021, the Superior Court denied the motion,

2 The PUC’s approval of the CPCN spurred the first initiative effort, as will be discussed in a later section. 3 NextEra Energy Res., LLC v. Me. Pub. Utils. Comm’n, 2020 ME 34, 227 A.3d 1117.

7 finding the movants had not established a substantial likelihood of success on the

merits. 4 The appeal of the DEP order to the BEP is still pending. On November 23,

2021 the DEP Commissioner suspended the DEP permits pending the outcome of the

instant motion for preliminary injunction—the suspension will be lifted if NECEC

obtains the injunction or, if the injunction is denied, NECEC prevails on the merits.

See Central Maine Power Co. & NECEC Transmission, LLC, License Suspension

Proceeding, Decision and Order 12 (Me. D.E.P. Nov. 23, 2021).

On September 29, 2017 NECEC applied for a permit from the U.S. Army Corps

of Engineers under Section 404 of the Clean Water Act and then sought further

approval under Section 10 of the Rivers & Harbors Act (together, the “ACE Permit”).

The Corps attended the DEP hearings, considered the evidence before the DEP,

accepted written public comments, held its own public hearing, and considered

relevant evidence under the National Environmental Policy Act. The Corps also

completed an Environmental Assessment (“EA”) for the Project on July 7, 2020 which

included a Finding of No Significant Impact (“FONSI”). The Corps completed an

addendum to the EA on November 4, 2020 and issued the ACE Permit on November

6, 2020. Prior to its issuance, on October 27, 2020, the Sierra Club, NRCM, and

Appalachian Mountain Club (together, “Sierra Club”) sued the Corps, alleging the EA

was insufficient and that the Corps should complete a full Environmental Impact

Statement in its place. On November 11, 2020 the Sierra Club moved for a

preliminary injunction to halt construction of the Project; the motion was denied on

4 NextEra Energy Res., LLC v. Dep’t of Env’t. Prot., Dkt. Nos. KEN-AP-20-27, SOM-AP-20-04 (Me. Sup. Ct. Jan. 11, 2021).

8 December 16, 2020. 5 The Sierra Club filed an emergency appeal, and on January 15,

2021 the First Circuit granted a partial injunction pending appeal, enjoining

construction in Segment 1 of the Project. This temporary injunction was vacated on

May 13, 2021. 6 The Sierra Club lawsuit is still pending in the District Court for the

District of Maine.

On July 17, 2017 CMP applied for a Presidential Permit from the U.S.

Department of Energy as required under Executive Order 10,485, as amended by

Executive Order 12,038 due to the Project’s Beattie Township segment at the

U.S./Canada border. The DOE developed its own administrative record and prepared

its own EA and FONSI. The DOE issued the Presidential Permit on January 14,

2021. 7 Sierra Club then amended its complaint in the pending Sierra Club v. U.S.

Army Corps of Eng’rs to include claims relating to the Presidential Permit.

NECEC has obtained various municipal permits and approvals in accordance

with local requirements, including inter alia shoreland zoning permits, building

permits, rezoning/conditional use approvals, site plan approvals, demolition permits,

and utility location permits. Due to the Project’s construction schedule, permits and

approvals have not yet been acquired from four remaining municipalities which the

Project will need to cross.

5 Sierra Club v. U.S. Army Corps of Eng’rs, No. 2:20-cv-00396-LEW, 2020 WL 7389744 (D. Me. Dec. 16, 2020). 6 Sierra Club v. U.S. Army Corps of Eng’rs, 997 F.3d 395 (1st Cir. 2021). 7 NECEC Transmission LLC, DOE Docket No. PP-438, Presidential Permit (DOE Jan. 14, 2021); New England Clean Energy Connect, DOE/EA-2155, Environmental Assessment (DOE Jan. 14, 2021); New England Clean Energy Connect, Finding of No Significant Impact (DOE Jan. 14, 2021).

9 Public Lands Lease

In 2014, CMP obtained a lease from BPL to construct electric transmission

facilities across public reserved lands in Johnson Mountain Township and West Forks

Plantation. Neither BPL nor CMP had sought approval from the Maine Legislature.

In December 2019, prompted by his concerns about this lease, Senator Russell Black

introduced a bill, LD 1893, which would have reinforced the requirement of legislative

approval and fair market value for leases of public lands by the State. The bill was

subsequently referred to the Agriculture, Conservation and Forestry Committee

(“ACF”), which has oversight authority of BPL.

The ACF held a public hearing on the bill in January 2020 at which Director

Cutko of BPL testified that the Bureau had not sought legislative approval for the

2014 lease to CMP because (i) BPL believed it was authorized to grant the lease under

12 M.R.S. § 1852, and (ii) BPL was not aware of the requirement for PUC to issue a

CPCN prior to the execution of a lease over public land under 35-A M.R.S. § 3132(13).

Then-House Chair Hickman, believing the 2014 BPL lease was a violation of Art. IX,

Sec. 23 of the Maine Constitution, which requires any action that reduces or

substantially alters the use of public lands held for conservation or recreation

purposes to be approved by a two-thirds majority of both houses of the Legislature,

drafted Committee Amendment A to LD 1893. This amendment clarified that the

Project constitutes a substantial alteration of public lands and is thus subject to the

two-thirds vote requirement. In February 2020, the ACF unanimously voted to

recommend that LD 1893, as amended, should pass. However, no vote was taken in

10 either chamber due to the adjournment resulting from the COVID-19 pandemic and

the bill died at the conclusion of the 129th Legislature.

On June 23, 2020 BPL and CMP entered an amended and restated

transmission line lease agreement (“BPL Lease”), assigned to NECEC on January 4,

2021, for a 0.9-mile transmission line corridor through public reserved lands in

Johnson Mountain Township and West Forks Plantation under 12 M.R.S. § 1852(4),

explicitly superseding the 2014 lease for the same. The BPL Lease provides that the

Project “shall be in compliance with all Federal, State and local statutes, ordinances,

rules, and regulations, now or hereinafter enacted which may be applicable to [the

Project] in connection to its use of [the public reserved land].” The BPL Lease also

provides that BPL has the right to request its amendment “if any Lease term is found

not to comply with Maine state law regarding public reserved lands.”

At the end of June 2020, Senator Black filed a complaint in the Superior Court,

seeking judicial review of the Lease and the potential application of Art. IX, Sec. 23

of the Maine Constitution. The Court issued a preliminary ruling on March 17, 2021,

holding that leases executed under 12 M.R.S. § 1852(4) are not necessarily exempt

from legislative approval. The Court on August 10, 2021 issued its final Decision and

Order, reversing the grant of the BPL Lease. 8 BPL and NECEC’s appeal of that

decision is currently pending at the Law Court, during which time the decision’s effect

is stayed under M.R. Civ. P. 62(e). 9 The automatic stay notwithstanding, the Law

8 Black v. Cutko, BCD-CV-2020-29, 2021 WL 3700685, at *5 (Me. B.C.D. Aug. 10, 2021). 9 There appears to be some disagreement among the parties as to the effect of an appeal of a final order of this Court. Pursuant to rule M.R. Civ. P. 62(e), “the taking of an appeal from a judgment shall operate as a stay of execution upon the judgment during the pendency of the appeal.” (Emphasis

11 Court issued an agreed-upon order prohibiting NECEC from building on the leased

property until the legal questions have been resolved.

Voter Initiatives

On August 29, 2019, a group of voters filed an application for a citizens’

initiative targeting the May 3, 2019 CPCN order, seeking to force the PUC to make

new findings of fact and reverse its decision. On May 12, 2020, after the Law Court

affirmed the Secretary of State’s verification of the petition signatures, thereby

certifying the initiative for public vote in November 2020, Avangrid Networks

challenged the initiative as unconstitutional and sought to bar it from the ballot. See

Avangrid Networks, Inc. v. Sec’y of State, 2020 ME 109, 236 A.3d 882. The Law Court

agreed and on August 13, 2020, just one month after opening briefs were filed on July

14, 2020, held that the initiative was “not legislation” because it required the PUC to

“reverse its findings and reach a different outcome in an already-adjudicated matter.”

Id. ¶ 36.

On or about September 15, 2020, voters filed an application for a second

citizens’ initiative—the one at issue here (the “Initiative”), and the Secretary of State

issued the petition on October 30, 2020. Comporting with the statutory requirements

of 21 M.R.S. §§ 901-907, a group of Maine voters circulated the Petition and obtained

enough signatures to achieve submission of the petition to the electors for

supplied). The text of this rule is clear; what is stayed by the decision to appeal is the enforcement of the Court’s order vacating the BPL lease. As of now, however, the BPL Lease stands as void in the eyes of the law.

12 consideration in accordance with art. IV, section 18(2) of the Maine Constitution. 10

On February 22, 2021, the Secretary of State certified that the proponents of the

Initiative had gathered enough signatures for submission of the Initiative to the

Legislature. The certified petition was printed by the Legislature’s Revisors Office as

LD 1295. 11 A copy of LD 1295 is attached as Exhibit D to Plaintiffs’ Verified

Complaint.

LD 1295 (a copy of which is also attached for convenience to this Order)

proposed a bill with twofold effect, retroactively amending Titles 12 and 35-A of the

Maine Revised Statutes. First, in Section 1, LD 1295 amends BPL’s authority to lease

public reserved lands for certain linear projects by providing that “poles, transmission

lines and facilities, landing strips, pipelines and railroad tracks under this subsection

are deemed to substantially alter the uses of the land within the meaning of the

Constitution of Maine, Article IX, Section 23, and [such a lease] may not be granted

without first obtaining the vote of 2/3 of all the members elected to each House of the

Legislature.” It also states that “this provision applies retroactively to September 16,

2014.”

Second, in Sections 4 and 5, LD 1295 adds three new provisions relating to

electric transmission lines in particular, specifying that (i) “a high-impact electric

10 At least 10% of the total number of votes cast in the gubernatorial election preceding the filing of the petition. Me. Const. art. IV, § 18. 11 When a finalized petition for direct initiative is submitted to the Maine Secretary of State’s Office and certified, the change in law that the petition purports to make is printed by the Maine Legislature Revisors Office as a Legislative Document (“LD”). That LD serves as the initial draft which may be amended, enacted, or rejected by the Legislature in a final vote. Here, the Initiative was printed as LD 1295 for consideration by the Legislature and this is the document from which the ballot question was subsequently drafted.

13 transmission line may not be constructed anywhere in the State without first

obtaining the approval of the Legislature,” with a supermajority needed if the line

uses or crosses public lands; (ii) notwithstanding the prior subsection, construction of

high-impact electric transmission lines in a defined region of Franklin and Somerset

Counties is banned altogether; and (iii) these new restrictions “apply retroactively to

September 16, 2020 and apply to any high-impact electric transmission line the

construction of which had not commenced as of that date.” LD 1295 does not explicitly

mention the Project, but its cumulative effect would be to block completion of the

Project, potentially indefinitely.

Prior to adjournment sine die on March 30th, 2021, the Legislature failed to

act on LD 1295. See Me. Const. art. IV, § 18(2). Accordingly, on April 8, 2021,

pursuant to her Constitutional obligation in the absence of Legislative action on a

direct initiative, the Governor referred the Initiative “to the people at an election to

be held in November” of 2021. Me. Const. art. IV, § 18(3). Pursuant to 21 M.R.S. §

906, the Secretary of State received the Governor’s proclamation and prepared a

combined ballot that sufficiently posed a question to the Maine people regarding the

enactment of LD 1295. The wording of the question reducing LD 1295 to a concise

“yes or no” statement was as follows:

Do you want to ban the construction of high-impact electric transmission lines in the Upper Kennebec Region and to require the Legislature to approve all other such projects anywhere in Maine, both retroactively to 2020, and to require the Legislature, retroactively to 2014, to approve by a two-thirds vote such projects using public land? 12

The decision to reduce LD 1295’s language into a single ballot question was affirmed by the Law 12

Court in Caiazzo v. Sec’y of State, 2021 ME 42, 256 A.3d 260.

14 As with LD 1295, the ballot question does not expressly mention the Project, but

because of the retroactivity provisions, the ballot question applies to the Project.

Avangrid Networks’ parent company Avangrid, Inc. disclosed the Initiative, as

well as the various pending lawsuits related to the Project, in its October 30, 2020 10­

Q report to the Securities and Exchange Commission (“SEC”). Avangrid, Inc. stated

that it “[could] not predict the outcome of this citizen initiative.” The Initiative was

certified for submission to the Legislature on February 22, 2021. In its 10-K report to

the SEC of March 1, 2021, Avangrid, Inc. noted that among “strategic risk factors”

potentially causing delays, budget overruns, or cancellations regarding the Project

were “regulatory approval processes, permitting, new legislation, citizen referendums

or ballot initiatives” which could “have an adverse effect on the success of the [Project]

and our financial condition and prospects.”

Proponents of the Initiative included a political action committee, “No CMP

Corridor,” which repeatedly stated that the purpose of the Initiative was to stop the

Project. After the final wording of the question for the ballot was issued, No CMP

Corridor issued a statement praising the drafting and stated that the people of Maine

will “have the opportunity to vote on the fate of the destructive CMP Corridor.”

Proponents of the Initiative sought public support by emphasizing that a “yes” vote

would block the Project.

On November 2, 2021, the Initiative was approved by a 59% majority of voters.

It is scheduled to take effect on or about December 19, 2021.

Project Expenditures, Operations, and Impacts

15 In 2018, the EDCs selected CMP and Hydro-Québec’s proposal, i.e., the Project,

for delivering clean energy to Massachusetts. Subsequently, CMP and Hydro-Québec,

through its U.S. affiliate H.Q. Energy Services (U.S.) Inc. (“HQUS”), entered

contracts obligating CMP to provide 1,200 MW of transmission services to HQUS and

the EDCs for a period of forty years. HQUS also agreed to sell 1,090 MW of energy to

the EDCs for the first 20 years of the Project. HQUS can use its remaining

transmission capacity, i.e., 110 MW per year for the first twenty years and 1200 MW

for the second twenty years, to sell additional energy into the New England markets,

including Maine.

NECEC anticipated beginning construction of the Project on December 4, 2019.

However, the final permit required for construction, the Presidential Permit, was not

received until January 14, 2021. Consequently, NECEC did not commence clearing

and construction activities in Segments 2-5 of the Corridor until January 18, 2021,

and in Segment 1, apart from public reserved lands, until May 15, 2021. Such delays

in large-scale transmission line projects are common, if not inevitable.

As of the filing of the instant complaint, NECEC has spent nearly $450 million

on the Project, representing 43% of the total cost estimate, and has undertaken

substantial physical construction, including cutting approximately 124 miles of right­

of-way for direct current line, clearing the entire alternating current line corridor,

erecting transmission structures along the Project corridor, and preparing the

converter station site. NECEC anticipates that approximately 97% of the corridor

16 would have been cut by the end of 2021. 13 Continued construction will create

approximately 300 new direct jobs in addition to the roughly 600 direct jobs currently

related to the Project. NECEC believes that the completion of the Project will provide

Maine with lowered electricity costs, improved transmission supply and reliability,

reduced greenhouse gas emissions, $18 million in annual property taxes, and $250

million of value in rate relief, economic development, and education-related benefits.

The current estimate for the total cost of the Project is approximately $1.04 billion.

As for Segment 1, which includes the portion of the Upper Kennebec Region in

which the Initiative seeks to prohibit all high-impact transmission lines and the

public lands subject to the BPL Lease, cutting commenced on May 15, 2021 following

the First Circuit’s vacating of its January 15, 2021 partial injunction of construction

activities in this segment. No cutting, clearing, or associated construction has been

undertaken yet on the public reserved lands. Presently, all work on the Project

corridor is suspended due to the DEP’s suspension of its permits pending the outcome

of the instant motion. Central Maine Power Co. & NECEC Transmission LLC,

License Suspension Proceeding, Decision and Order 11 (Me. D.E.P. Nov. 23, 2021).

Because this Court is not granting a preliminary injunction to stay the Initiative, the

DEP permits will remain suspended until a final disposition of NECEC’s legal

challenge to the Initiative. Id. at 12. The DEP, as part of its order, requires NECEC

to stabilize disturbed soils, spread all piles of wood chips and grindings, and stabilize

13 This estimate was provided before NECEC suspended operations to extend the corridor.

17 off-corridor access roads, as well as backfill or cover uncompleted structure

foundations or bore holes. Id. No new vegetation may be cut. Id.

Plaintiffs originally contractually agreed that the commercial operation date

for the Project would be December 13, 2022. At present, the schedule envisions a

December 13, 2023 commercial operation date, assuming no further delays, with a

contractual deadline of August 23, 2024. NECEC may extend this deadline to August

23, 2025 by posting up to $10.9 million of additional security. Suspending operations

comes at a cost. Without sufficient work, contractors hired for construction activities

on the Project would have to either standby or demobilize and later remobilize. The

approximate cost to standby is $742,000 per week and the approximate cost to

demobilize is $1,542,000. NECEC estimates that an 18-month delay would incur $113

million in additional costs and a 24-month delay would incur $137 million,

representing approximately 11% to 13% of the total project budget.

STANDARD OF REVIEW

A party seeking a preliminary or permanent injunction generally has the

burden of demonstrating that the following four criteria are met:

1. That plaintiff has exhibited a likelihood of success on the merits (at most, a

probability; at least, a substantial possibility);

2. That plaintiff will suffer irreparable injury if the injunction is not granted;

3. That such injury outweighs any harm which granting the injunctive relief

would inflict on the defendant; and

18 4. That the public interest will not be adversely affected by granting the

injunction.

Department of Environmental Protection v. Emerson, 563 A.2d 762, 768 (Me. 1989).

These criteria “are not to be applied woodenly or in isolation from each other; rather,

the court of equity should weigh all of these factors together in determining whether

injunctive relief is proper in the specific circumstances of each case.” Id. The emphasis

a court places on any single criterion can vary depending upon the relative strength

of the other criteria. Id. However, “[f]ailure to demonstrate that any one of these

criteria are met requires that injunctive relief be denied.” Bangor Historic Track, Inc.

v. Dep’t of Agric., Food & Rural Res., 2003 ME 140, ¶ 10, 837 A.2d 129. Where the

public interest is involved, “the court’s equitable powers assume an especially broad

and flexible character.” State v. DeCoster, 653 A.2d 891, 895 (Me. 1995).

Because injunctive relief is an equitable remedy, and thus discretionary, a

court’s denial of the requested relief “must stand unless plainly wrong or based on an

error of law.” Emerson, 563 A.2d at 768 (quoting Crafts v. Quinn, 482 A.2d 825, 830

(Me. 1984)). “[F]act-finding that is a prerequisite for judicial action, such as a finding

of irreparable injury, or lack thereof, is reviewed for clear error.” Bangor Historic

Track, 2003 ME 140, ¶ 11, 837 A.2d 129.

DISCUSSION

The Court’s analysis is organized around the four preliminary injunction

factors and explains why none of the factors are met under the circumstances of this

case.

19 I. Success on the Merits

NECEC raises several legal theories which, it argues, create a substantial

possibility of success on the merits. NECEC posits that the Initiative should be

invalidated because it is unconstitutional as (i) an unlawful deprivation of its vested

rights in the Project; (ii) a violation of separation of powers principles enshrined in

the U.S. and Maine Constitutions; and (iii) an impairment of the Contracts Clause of

the U.S. and Maine Constitutions. 14 The fact that the law at issue was enacted by a

public referendum rather than the Legislature does not alter the requirement that

the law comport with the Constitution. Citizens Against Rent Control/Coal. For Fair

Housing v. City of Berkeley, 454 U.S. 290, 295 (1981). However, “the constitutional

validity of a citizens’ initiative is evaluated under the ordinary rules of statutory

construction” and thus the Initiative carries a “heavy presumption of

constitutionality” which NECEC must overcome. Portland Reg'l Chamber of

Commerce v. City of Portland, 2021 ME 34, ¶ 7, 253 A.3d 586 (quoting League of

14 Intervenor HQUS also raises an additional, independent argument that the Initiative violates the Articles of Separation (“Articles”) which preceded Maine’s statehood and solidified Maine’s separation from the Commonwealth of Massachusetts in 1820. Specifically, they assert that the Articles reserved certain public lots—including the ones subject to the BPL Lease—for certain “beneficial uses” and that the Law Court, in Opinion of the Justices, 308 A.2d 253 (Me. 1973), defined that term broadly to mean “public uses.” Id. According to HQUS—as has been asserted many times by NECEC—the Project is a public use, and thus the Initiative violates the Articles’ provisions. The Court however is unconvinced by this argument and doubts whether HQUS, a non-sovereign party or intended beneficiary, has standing to assert a claim for violation of the Articles. Additionally, HQUS was not an intended third- party beneficiary of the Articles, see, e.g., Davis v. R C & Sons Paving, Inc., 2011 ME 88, ¶ 12, 26 A.3d 787, nor is it likely that an interstate compact such as the Articles creates a cause of action under which private citizens may bring suit. See, e.g., Doe v. Pennsylvania Bd. of Prob. & Parole, 513 F.3d 95, 107 (3d Cir. 2008).

20 Women Voters v. Sec’y of State, 683 A.2d 769, 771 (Me. 1996)). With this guidance in

mind, the Court addresses NECEC’s arguments in turn. 15

A. Vested Rights

NECEC contends that the Initiative deprives it of vested rights in the Project.

Defendants respond first that “vested rights” is not the proper analysis for retroactive

State legislation. Even if it is, argue Defendants, NECEC’s rights did not vest on the

facts of this case. The Court agrees with both propositions, while at the same time

acknowledging that Plaintiffs have legitimate arguments to the contrary, since until

recently the vested rights jurisprudence has been unclear.

1. Vested Rights Analysis Does Not Apply to Retroactive Statutes.

In Norton v. C.P. Blouin, Inc., 511 A.2d 1056, 1061 n.5 (Me. 1986), abrogated

on other grounds by DeMello v. Dep’t of Envtl. Prot., 611 A.2d 985 (Me. 1992), the Law

Court “clarified the proper analysis concerning the retroactive application of

statutes.” State v. L.V.I. Group, 1997 ME 25, ¶ 9, 960 A.2d 690. If the Legislature

15 The Court acknowledges that Defendants have raised a sovereign immunity defense to this suit. Because the Court denies Plaintiffs’ Motion, the Court only briefly addresses the defense. As the Law Court noted in Waterville Indus. v. Finance Auth. of Maine, “a claim against the State will be dismissed unless the State, acting through the Legislature, has given its consent that the present action be brought against it.” 2000 ME 138, ¶ 21, 758 A.2d 986. To date, Maine courts have failed to recognize an exception to sovereign immunity that allows for suit against constitutionally derived branches of government. And, under the multifactored test for determining sovereign immunity recited by the First Circuit in Metcalf & Eddy, Inc. v. Puerto Rico Aqueduct & Sewer Auth., the Maine House and Senate seemingly qualify. 991 F.2d 935, 939 (1st Cir. 1993); see also Reed v. Bd. of Trs., No. CV-08­ 155, 2008 Me. Super. LEXIS 214 (Dec. 4, 2008). However, the context in which this suit arises—an action seeking declaratory judgment regarding constitutionality—muddies the availability of the sovereign immunity defense. Several courts in other states have held that in such cases, sovereign immunity is unavailable as a defense. See Jones v. Bd. of Trs. of Ky. Retirement Sys., 910 S.W.2d 710, 713 (Ky. 1995) (holding legislature immune to constitutional claim “would undermine and destroy the principle of judicial review” and leave “no redress for the unconstitutional exercise of legislative power”); see also Claremont Sch. Dist. v. Governor, 761 A.2d 389, 391 (N.H. 1999); Patel v. Tex. Dep’t of Licensing & Regulation, 469 S.W.3d 69, 75–76 (Tex. 2015). The Court is inclined to agree with this line of cases, because the availability of judicial review here appears to be integral to the constitutional framework, and not subject to a sovereign immunity defense.

21 intends for the provisions of a statute to apply retroactively, 16 the statute must be so

applied “unless a specific provision of the state or federal constitution is demonstrated

to prohibit such action by the Legislature.” Norton, 511 A.2d at 1061 n.5. Here, both

the wording of the Initiative and LD 1295 clearly and explicitly intend for changes in

the law to apply retroactively. There is thus no question of Legislative intent. The

question is whether the doctrine of vested rights necessarily invokes a constitutional

provision such that the retroactivity analysis applies.

The etymology of the vested rights doctrine is confusing. See id. Prior to

Norton, the Law Court appears to have used the phrase “vested rights” as a heuristic

when determining that a retroactive statute is unconstitutional, “without identifying

the source of the constitutional prohibition.” Norton, 511 A.2d at 1061 n.5. Indeed,

the parties have not brought to the Court’s attention any case that expressly grounds

the doctrine on a specific constitutional provision. 17 Rather, the doctrine of vested

rights appears to be an equitable concept, derived by implication from the state and

federal constitutions (but without attribution to any specific provisions), and

developed (especially in the municipal context) through a process of judge-made

constitutional common law. See, e.g., Coffin v. Rich, 45 Me. 507, 514-15 (1858); Baxter

v. Waterville Sewage Dist., 79 A.2d 585, 588 (Me. 1951); Thomas v. Zoning Bd. Of

16 If some provisions of LD 1295 can be characterized as procedural, such as possibly the Initiative’s requirement for two thirds approval by the Legislature, then those provisions might not be considered retroactive. Norton, Inc., 511 A.2d at 1061 n.5. It is unclear, however, whether the procedural- substantive distinction retains any vitality after DeMello. See DeMello, 611 A.2d at 987. No party has addressed the procedural-substantive argument, and the Court does not address it further.

17 At oral argument, Plaintiffs asserted that the doctrine of vested rights, in and of itself, is a fundamental right. Plaintiffs have not brought to the Court’s attention any case expressly holding that vested rights are a fundamental constitutional right, and the Court is not aware of any such case.

22 Appeals, 381 A.2d 643, 647 (Me. 1978); Merrill v. Eastland Woolen Mills, Inc., 430

A.2d 557, 560 n.7 (Me. 1981); cf. Henry Paul Monaghan, Constitutional Common Law,

89 Harv. L. Rev. 1, 10 (1975). As such, the vested rights doctrine cannot be invoked

to defeat the retroactivity provisions of the Initiative.

As clarified in L.V.I. Group, a party seeking to demonstrate the

unconstitutionality of a retroactive state statute must ground its challenge on a

specific provision of the Maine or U.S. Constitutions. 1997 ME 25, ¶¶ 9-16. In Norton,

for instance, the employer argued that retroactively applying a change in the Maine

Workers’ Compensation Act, 39 M.R.S. § 194-B, would “impermissibly impair

contractual rights in violation of Me. Const. art. I, § 11.” Norton, 511 A.2d at 1061

(emphasis added). In L.V.I. Group, the employer mounted attacks on a retroactive

change to Maine’s severance pay statute, 26 M.R.S. § 625-B, based on the Due Process

Clauses of the Maine and United States Constitutions, Me. Const. art. I, § 6-A; U.S.

Const. amend. XIV, § 1; the Takings Clauses of both constitutions, Me. Const. art. I,

§ 21; U.S. Const. amend. V; the Equal Protection Clauses of both constitutions, Me.

Const. art. I, § 6-A; U.S. Const. amend XIV; and several other specific constitutional

provisions. The vested rights doctrine is not similarly based on any specific provision

of the Maine or U.S. Constitutions, and therefore does not apply to the retroactivity

analysis. Plaintiffs have not been divested of constitutionally protected vested

rights. 18

18 Plaintiffs’ and Intervenors’ separate arguments based on Separation of Powers and the Contracts

Clause are addressed later in this Order.

23 Even if the vested rights doctrine is of sufficient constitutional specificity to

apply, it would still not be enough to defeat the clear legislative intent for the

Initiative to apply retroactively. The Initiative is an exercise of state “police power”

to protect the environment. 19 “The exercise of the police power in such cases violates

no constitutional guarantee against the impairment of vested rights or contracts.”

Baxter, 79 A.2d at 589. The Law Court has declared that this rule “is not only

reasonable, but necessary, as a contrary rule would enable individuals by their

contracts, or contractual relations, to deprive the State of its sovereign power to enact

laws for the public health and public welfare.” Id. Even in the municipal context,

which is discussed later, the Law Court recognizes that “all property is held in

subordination to the police power.” Thomas, 381 A.2d at 647.

In reliance on L.V.I. Group, 1997 ME 25, ¶ 15, 690 A.2d 960, Plaintiffs counter

that the Maine Constitution forbids interference with vested rights, and the

gravamen of vested rights challenges is in “due process.” However, the language

Plaintiffs rely on in L.V.I. Group is a passing reference to the employer’s losing

argument under the Declaration of Rights provision of the Maine Constitution, Me.

Const. art I, § 1, not the Court’s analysis of vested rights or the Due Process Clause.

19 The police power of the State to make laws within its territory is “older than any written constitution.

It is the power which the states have not surrendered to the nation, and which by the Tenth Amendment were expressly reserved to the states respectively or to the people.” York Harbor Vill. Corp. v. Libby, 126 Me. 537, 540, 140 A. 382, 385 (1928). The frontiers of the police power are those “expressed or necessarily implied in the Federal Constitution.” Id. When a fundamental right has not been implicated, the Court reviews the validity of a given statute as an exercise of this police power only for a rational basis, requiring no more than that “(1) the police powers be exercised for the public welfare; (2) the legislative means employed be appropriate to achieve the ends sought; and (3) the manner of exercising the power not be unduly arbitrary or capricious.” State v. Haskell, 2008 ME 82, ¶¶ 5-6, 955 A.2d 737 (quotation marks omitted). The Initiative satisfies these criteria.

24 L.V.I. Group does not say that the doctrine of vested rights is synonymous with or

specifically based on the Due Process Clause of either the state or federal

constitutions. Indeed, in L.V.I. Group, unlike here, the employer actually made an

argument based on the Due Process Clause. Even if NECEC had brought a Due

Process Clause challenge, in addition to or as the explicit basis for its vested rights

argument, it would be unavailing. “The retroactive aspects of economic legislation

meet the requirements of the due process clause if enacted to further a legitimate

legislative purpose by rational means.” L.V.I. Group, 1997 ME 25, ¶ 9, 690 A.2d 960.

This is the lowest level of constitutional scrutiny, and easily met by the Initiative. 20

The Initiative seeks to impose additional environmental protections, and enacting

those protections through supplemental requirements contained in the Initiative is

not unduly arbitrary or capricious.

Plaintiffs also rely on the body of vested rights jurisprudence developed in the

context of municipal land use and zoning. See, e.g., Sahl v. Town of York, 2000 ME

180, 760 A.2d 266; Kittery Retail Ventures, LLC v. Town of Kittery, 2004 ME 65, ¶ 25,

856 A.2d 1183. Unlike the Legislature (or the people of Maine acting through a public

Initiative), municipalities enact zoning laws and local ordinances under their limited

home-rule powers, which are intended to address issues “which are local and

municipal in character.” Me. Const. art. IX, § 1; see also 30-A M.R.S. § 3001. Local

rules and ordinances are not equivalent in authority to state legislation, as the latter

20 It is clear that Plaintiffs have not brought a Due Process Clause challenge, because at oral argument Plaintiffs insisted the vested rights analysis does not require any legitimate purpose/rational means analysis, which are indispensable components of a Due Process challenge.

25 can preempt local regulations either expressly or implicitly. State v. Brown, 2014 ME

79, ¶ 23, 95 A.3d 82. Cases decided in the municipal context, where the enforceability

of a local ordinance is at stake, therefore, have little if any relevance to the analysis

of whether a statute enacted by the Legislature can be applied retroactively.

However, even if the municipal-level vested rights analysis applies, as discussed

below it does not change the outcome.

2. There is No Violation Under a Vested Rights Analysis.

As the vested rights doctrine has been developed in the municipal context,

NECEC posits that the right to build a project vests under two scenarios. First, a

right to build and complete a project vests, even if the law changes, when there has

been (1) actual, physical commencement of significant and visible construction (2)

undertaken in good faith with the intention to continue through and carry it to

completion (3) pursuant to a valid permit. Sahl, 2000 ME 180, ¶ 12, 760 A.2d 266.

Second, according to NECEC, the right to construct a project vests if the lawmakers

seek to prohibit construction in “bad faith” or through “discriminatory enactment.” 21

See Littlefield v. Inhabitants of Town of Lyman, 447 A.2d 1231, 1233 (Me. 1982); cf.

Kittery Retail Ventures LLC, 2004 ME 65, ¶ 25, 856 A.2d 1183. NECEC asserts that

its right to complete the Project vested under both scenarios. The Court, however,

finds to the contrary. Even if the vested rights analysis can be lifted from the

municipal context and applied to a state-wide Initiative, NECEC’s rights did not vest

under either scenario.

At oral argument, Plaintiffs clarified that in their view the bad faith prong works in conjunction 21

with the Sahl factors, not independently. Either way, the outcome here is no different.

26 The Court addresses NECEC’s “bad faith” argument first. NECEC claims that

it has vested rights to complete the Project because of the bad faith or discriminatory

intent reflected in the Initiative. The Court is unwilling to credit the argument. Even

when a small, municipal body enacts an ordinance, it is difficult to demonstrate bad

faith on the part of the governmental body. See Kittery Retail Ventures, LLC, 2004

ME 65, ¶ 25, 856 A.2d 1183. NECEC has not demonstrated bad faith here. When the

voters of Maine cast ballots in a state-wide Initiative, the Court is unwilling to ascribe

bad faith or discriminatory intent on the part of the electorate (or the Legislature for

its role in enacting the Initiative). 22 This is an illustration of why unmooring the

vested rights analysis from its local, municipal application can lead to problems.

Indeed, the Court questions whether as a matter of law it is possible for the citizens

of a democracy to cast votes in a state-wide, public referendum other than in good

faith. Perhaps there are such occasions, but this is not one of them. With regard to

the Project, there is a stark—but legitimate—good faith difference of opinion and

vision between Plaintiffs and Defendants (and the Intervenors aligned on each side

of the dispute). The Court declines to find NECEC’s rights to complete the Project

vested because of bad faith or discriminatory intent on the part of the Maine

electorate.

The Court next turns to consideration of the Sahl factors, but here too the

Court begins its analysis with a discussion of good faith, this time on the part of

22 The Court is also unwilling to accept Plaintiffs’ invitation to find that the five individuals who sought to certify the Initiative were acting in bad faith. These individuals were merely exercising their rights under the direct initiative procedures found in the Maine Constitution, however objectionable their goals were to Plaintiffs.

27 NECEC. One of the Sahl factors requires that construction was commenced in good

faith, by which the Sahl Court means construction was undertaken with the genuine

intention to carry construction through to completion. Sahl, 2000 ME 180, ¶ 12, 760

A.2d 266. There can be no doubt that in this sense, NECEC has proceeded in good

faith. NECEC has spent nearly $450 million on the Project, and the Project is

substantially complete. That is no head fake. Just as the voters of Maine have acted

in good faith, so too has NECEC. Having addressed the element of good faith, the

Court next addresses the remaining Sahl factors.

Circumstances Attending Commencement of Significant Construction

Sahl requires “actual physical commencement of some significant and visible

construction” for rights to vest. Id. The question is when during the timeline to apply

that measure. In some circumstances, it is appropriate to make the determination

“when a municipality applies a new ordinance to an existing permit.” Id. (quoting

Peterson v. Town of Rangeley, 1998 ME 192, ¶ 12 n.3, 715 A.2d 930). Plaintiffs argue

that by whichever Initiative date in their view should be reasonably selected

(February 22, 2021, April 8, 2021, November 2, 2021, or December 19, 2021), they

had commenced substantial physical construction. According to Plaintiffs, this should

settle the matter.

However, the doctrine of vested rights, even in the municipal setting, is an

equitable concept. 23 Kittery Retail Ventures, 2004 ME 65, ¶¶ 24-27. In this sense, Sahl

does not provide inflexible requirements that must be mechanically applied, but

23 At oral argument, the Maine Chamber of Commerce referred to the vested rights doctrine as “constitutional in origin but equitable in nature,” and acknowledged that this is an equity proceeding.

28 rather an example of certain factors that should be considered as the starting point

of the analysis. More broadly, when considering a matter in equity, the totality of the

circumstances must be considered. See Tarason v. Town of S. Berwick, 2005 ME 30,

¶ 14, 868 A.2d 230. Even the Sahl court recognizes that there are circumstances

which limit or otherwise prevent rights from vesting. See Sahl, 2000 ME 180, ¶ 13.

Indeed, the Law Court has held that whether a developer has notice of opposition to

its projects may complicate a “vested rights” argument. In Portland v. Fisherman’s

Wharf Assocs. II, the Court considered the developer’s “knowledge of the contents of

the proposed ordinance and its retroactive provisions” in its determination that the

petitioner “failed to establish any vested rights based on equitable grounds.” 541 A.2d

160, 164 (Me. 1988). Later, in Kittery Retail Ventures, the Law Court again factored

in the developer’s “knowledge of the pending ordinance changes” and again held that

it was “not the case in which equity demands that [the developer] acquire vested

rights.” 2004 ME 65 ¶ 31, 856 A.2d 1183. NECEC’s argument that these cases are

irrelevant because the developers in them had not begun construction at the time

that the changes in the law became pending misses the point. Both Kittery Retail and

Fisherman’s Wharf II stand for the proposition that a developer’s awareness of a

likely change in the law is relevant to the analysis of whether rights will vest upon

the commencement of construction.

At the time NECEC commenced construction of the Project in Segments 2-5 on

January 18, 2021, NECEC was well aware of the staunch opposition the Project faced

from many citizens in Maine. An attempt to launch an initiative to stop the Project

29 in 2020 did not make it onto the ballot due to constitutional violations in the proposed

bill, but the fact that the 2020 initiative collected enough signatures to qualify for a

statewide referendum put NECEC on notice of the public’s desire to effectuate a

change in the law. On October 30, 2020, the Secretary of State issued the petition for

the Initiative relevant to this case, reinforcing the likelihood that the Project would

face legislative roadblocks, especially given the popularity of the 2020 initiative.

NECEC was aware of the second Initiative and admitted in its October 30, 2020 10­

Q report to the SEC that it could not predict the outcome of the referendum. NECEC

commenced construction on January 18, 2021 despite this knowledge (and knowledge

of all the other adverse actions to that date described in the Statement of Facts).

NECEC’s decision to forge ahead with construction in the face of a substantial

possibility that retroactive change negatively impacting the Project could be passed

in the near future was a calculated risk.

On February 22, 2021, the Initiative was certified for submission to the

Legislature. Sometime between October 2020 and March 2021, the text of LD 1295

was released. On March 1, 2021, Avangrid, Inc. disclosed in its 10-K report to the

SEC that “new legislation” and “citizen referendums and ballot initiatives” were

strategic risk factors potentially causing delays, budget overruns, and cancellation of

the Project. On March 17, 2021, this Court issued its preliminary ruling that the

public land leases were not necessarily exempt from legislative approval. On April 8,

2021, the Governor referred the Initiative to the voters for the November election.

Thus, by the time NECEC started construction in Segment 1 on May 15, 2021, its

30 knowledge about a potential change in the law applying retroactively to the Project

was further heightened. NECEC started construction in Segment 1 under intense

risk that a change in the law would have an adverse impact on the success of the

Project. Under the totality of the circumstances, NECEC’s rights to complete the

Project did not vest upon commencement of substantial construction. 24

Valid Permit

Under Sahl, construction must be commenced “pursuant to a validly issued

building permit.” 2000 ME 180, ¶ 12, 760 A.2d 266. Defendants argue that in order

to vest rights, however, the permit in question must be final, meaning that the appeal

period must have run. 25 The Sahl Court was not faced with this question, and the

Law Court appears not to have addressed it.

NECEC argues that the requirement for a valid permit means only that a

developer cannot vest rights to a permit which is illegal at the time of issuance, but

cannot cite a Maine case to support this contention. NECEC points to the West

Virginia case of Harding v. Board of Zoning Appeals, 219 S.E.2d 324, 332 (W.V. 1975),

but that case stands for the unremarkable proposition that rights will not vest

pursuant to permits that were improperly granted. Id. (holding owners of building

24 At oral argument, IECG asserted that denying the Motion would constitute a “flashing red light” to energy companies interested in doing business in Maine. While that may or may not be the case, the visual is useful. Here, the evidence establishes that upon commencement of construction, both in January and May 2021, Plaintiffs themselves were faced with a flashing red light about the risks of proceeding with the Project. 25 Plaintiffs concede that since permits can be vacated on appeal, developers run the risk of proceeding with commencement of construction before the end of the relevant appeal periods (or before the end of litigation appealing grant of the permits). Although Plaintiffs argue that with a permit in hand they are at least shielded from the risk posed by subsequent changes in the law, Plaintiffs tacitly concede that even under their argument, rights do not completely vest upon issuance of a permit.

31 who incurred expenditures in adding apartments to building did not acquire vested

rights because their initial conditional use permit was improperly granted). Harding

cannot reasonably be construed to cabin the analysis to that one scenario.

Contrary to NECEC’s position, at least one trial court in Maine has held that

the right to build under a permit does not vest while that permit is on appeal.

Conservation Law Found., Inc. v. State, No. AP-98-45, 2002 Me. Super. LEXIS 15 at

*11 (Jan. 28, 2002) (holding that vested rights in permit do not exist “simply by virtue

of its issuance because it was challenged in a timely and procedurally correct

fashion”). Courts in other states agree with this approach. See, e.g., Powell v. Calvert

Cty., 795 A.2d 96, 1010 (Md. 2002) (holding that until all necessary approvals are

final, “nothing can vest or even begin to vest”). The case of Donadio v. Cunningham,

277 A.2d 375, 382 (N.J. 1971), is particularly instructive. In Donadio, the McDonald’s

Corporation argued that it attained the equitable right to build a restaurant by

initiating construction immediately following a successful trial over a zoning

ordinance but long before the time for appeal had expired. Id. That court held that it

was in the public interest that “no such overriding rights may be acquired when the

acts relied upon are done prior to the end of the appeal period” and chastised the

McDonald’s Corporation for attempting to “thwart that public interest . . . by winning

an unseemly race.” Id. This Court finds persuasive the approach and reasoning of

these cases. In order to merit protection as a vested right, under the unique facts

presented here, the permits relied upon must be final and not subject to appeal.

32 In this case, NECEC acquired the last permit required for construction on the

Project to begin, the Presidential Permit, on January 14, 2021, and began

construction shortly thereafter, on January 18, 2021. Thus, NECEC did commence

construction pursuant to a validly issued permit. However, the Presidential Permit

was not final. Although it was permissible for NECEC to begin construction in

reliance on the Permit, it did so at its own risk because the Permit was timely

appealed. NECEC’s rights to complete construction, insulated from any change in the

law brought about by the Initiative, did not vest.

Of course, although the Presidential Permit was the last permit needed, it was

not the only permit required. NECEC commenced construction while several of the

permits required for the Project were subject to pending appeals by an administrative

agency or court. For instance, the appeal of the DEP order to the DEP is still pending,

and the DEP Commissioner recently suspended the DEP permits pending the

outcome of this litigation. Similarly, the appeal of the ACE Permit is still pending at

the First Circuit. The uncertain outcome regarding the fate of all these permits cuts

against vesting.

There is also the question of the BPL Lease. In Black v. Cutko, the Business

and Consumer Court reversed the grant of the BPL Lease, finding no competent

evidence that BPL fulfilled its statutory and constitutional obligations before issuing

the lease to NECEC. BCD-CV-2020-00009, 2021 WL 3700685, at *5 (Me. B.C.D. Aug.

10, 2021). The language of Sahl, which focuses on vested rights in the context of

changes in zoning and other governmental ordinances, requires a validly issued

33 permit. 2000 ME 180, ¶ 12, 760 A.2d 266. The analysis, however, applies equally well

to the BPL Lease. The BPL Lease is indisputably a critical element in the Project,

and therefore functions equivalently to a permit. As it stands at the moment, the BPL

Lease is considered void. Without the BPL Lease, the Project cannot be completed.

Accordingly, NECEC’s rights to complete the Project will not vest unless or until the

BPL Lease is finally approved. There is no question that NECEC had the right to

begin construction under all these circumstances and did so in good faith. But because

NECEC began work on the Project before all necessary approvals were final, it did so

at the risk that a change in the law would imperil completion of the Project, as

Avangrid acknowledged in its 10-K reports.

Intervenor Maine State Chamber of Commerce argues that if NECEC or any

developer must wait until all permits and approvals are final before rights will vest,

then big, complicated, projects will never be undertaken or completed in Maine. The

Chamber certainly has a well-founded concern, and the Court acknowledges that the

permitting and approval process for the Project has been daunting. But whether the

conclusion reached here will forestall other significant projects, is speculative. 26 Not

26 To be clear about the conclusion on this point, the Court is not saying that final permits are always and everywhere needed to support a vested rights argument, but that in some circumstances they may be—because of the equitable nature of the vested rights inquiry. This case presents such circumstances, and the Court’s analysis is (as it must be) tied to the facts of this case. Equity follows the law, as the Maine State Chamber of Commerce noted at oral argument, but it does not work in a vacuum. A developer’s extensive knowledge about comprehensive efforts to change the law in a way that would adversely impact a project, as the Law Court has said, complicates the vested rights analysis. This does not mean, as Plaintiffs and supporting Intervenors protest, that permits are not worth the paper they are written on. Such a claim would misinterpret the result of this decision. It does mean that if at or around the start of substantial construction developers are aware of events rising to the existential level of “strategic risk factors,” as were Plaintiffs in this case, they might not later be able to claim vested rights without final permits in hand.

34 all big, complicated projects may be met with the widespread public opposition

attendant to this Project. Even here, NECEC may yet prevail and complete the

corridor. And ultimately the Legislature can respond to any undue chilling effect by,

among other steps, streamlining the approval process. On the facts of this case,

however, two out of the three Sahl factors have not been satisfied, and NECEC’s

rights to complete the Project despite subsequent, retroactive changes in the law, did

not vest.

B. Separation of Powers

NECEC also argues that the Initiative violates the separation of powers

principles enshrined in both the United States and Maine Constitutions. See U.S.

Const. arts. I-III.; Me. Const. art. III §§ 1-2. Specifically, NECEC claims that the

Initiative usurps both executive and judicial authority.

“The more that the ‘independence of each department, within its constitutional

limits, can be preserved, the nearer the democratic system of government will

approach the perfection of civil government, and the security of civil liberty.’”

Avangrid, 2020 ME 109, ¶ 24 (quoting Lewis v. Webb, 3 Me. 326, 329 (1825)). Maine

law requires “strict separation of powers between the three branches of government.”

Bossie v. State, 488 A.2d 477, 480 (Me. 1985). Under Maine’s Constitution, the

separation of powers requirement is “more rigorous” than is its federal counterpart.

Id. When determining whether a separation of powers violation has occurred, the

court must ask: “Has the power in issue been explicitly granted to one branch and no

other?” Id. If so, then another branch cannot exercise it. Id.

35 1) The Initiative Does Not Usurp Executive Power.

NECEC’s first argument is that the Initiative’s enactment would usurp the

power of Maine’s executive branch because it voids—or has the effect of voiding—

final executive agency determinations and improperly authorizes the Legislature to

cancel construction of a project already underway. Additionally, NECEC claims that

the Initiative provides an end run around the Maine Constitution’s presentment

requirement by allowing the Legislature to approve a project of the kind

contemplated by the Initiative without offering the Governor the opportunity to veto

that approval. 27

Power to execute law is vested in the Governor. Me. Const. art. V, pt. 1, § 1; In

re Opinion of the Justices of the Supreme Judicial Court Given Under the Provisions

of Section 3 of Article VI of the Constitution (“Opinion of the Justices”), 2015 ME 27,

¶ 5, 112 A.3d 926. In her role as the supreme executive, the Governor is required to

“take care that the laws be faithfully executed.” Me. Const. art. V, pt. 1, § 12; Opinion

of the Justices, 2015 ME 27 at ¶ 5, 112 A.3d 926. The executive branch of Maine’s

government consists of the Governor’s office as well as executive agencies, including

BPL and PUC. See Opinion of the Justices, 2015 ME 27 at ¶ 5, 112 A.3d 926.

In a prior, related decision on the validity of the 2020 initiative, the Law Court

held that legislation cannot direct an executive agency to reverse a particular final

decision as this would unconstitutionally interfere with the agency’s executive

27 As to this last argument, the Initiative requires only that certain linear projects obtain the requisite

approval of the Legislature. Nothing prohibits the Legislature from then presenting the approval to the Governor for a signature or veto.

36 functions. Avangrid, 2020 ME 109, ¶¶ 35-36, 237 A.3d 882. NECEC urges the Court

to find that the Initiative draws from the same poisoned well. It argues that the

Initiative, by retroactively requiring legislative approval of certain types of

construction endeavors which include the Project, effectively reverses the PUC’s

grant of a CPCN, just as the 2020 initiative purported to do, and is unconstitutional

on the same basis as the holding in Avangrid.

The flaw in NECEC’s reasoning is that unlike the initiative addressed by

Avangrid, the present Initiative does not reverse a particular final agency decision.

NECEC objects to the Initiative as squarely targeting the Project and this Court

cannot disagree that the Project was the impetus for and focus of the referendum.

Throughout their campaign, supporters of the Initiative consistently emphasized that

voting for it would block the Project corridor. The advertising in support of the

Initiative was so targeted that a voter would be forgiven for not realizing the law

would have any effect other than obstructing the Project.

But campaign advertising is not the issue. Rather, this Court must look to the

language of the Initiative’s proposed law. It is axiomatic that statutory interpretation

is fundamentally based on a reading of the statute itself. See Stone v. Bd. of

Registration in Med., 503 A.2d 222, 224 n.4 (Me. 1986) (exhorting interpreting court

to “read the statute!”). There is nothing in the plain language of the Initiative that

suggests it is anything other than a statute of general applicability affecting various

linear projects and regulating high-impact electric transmission lines in Maine. 28 It

28 Indeed, LD 1295 does not appear to be different in kind from the original implementing legislation, 12 M.R.S. § 598 & 589-A.

37 does not reverse any specific agency decision but rather places new, retroactive

requirements on a category of decisions. This is supplementation of existing law, not

usurpation of executive power.

It is both legal and logical that a new law may be directly motivated by a given

entity or activity and enacted with the intent of imposing requirements or restrictions

on that entity or activity; so long as the law itself is one of general applicability, it

will not be invalidated for including its target in its effect. See Friends of Cong. Square

Park v. City of Portland, 2014 ME 63, ¶ 15, 91 A.3d 601 (holding it is within scope of

citizens’ initiative power to block sale of city park via legislation creating new

category of land bank property, retroactively including park in question, and placing

new requirements on the disposition of property in the land bank). Motivated by

NECEC’s Project, the people of Maine have expressed their strong desire to safeguard

public lands from linear construction projects. It would be unjust to refuse, as a

matter of course, to apply the new law to the perceived threat which inspired it.

2) The Initiative Does Not Usurp Judicial Power.

The judicial power of this State is vested in the Supreme Judicial Court and

such other courts as the Legislature establishes. Me. Const. art. 4, § 1. A final

judgment by the judiciary in a case is “a decisive declaration of the rights between

the parties, and the Legislature cannot disturb the decision . . . as to the parties in

that action.” L.V.I. Group, 1997 ME 25, ¶ 11 n.4, 690 A.2d 960. NECEC argues that

the Initiative reverses a final judgment by requiring the PUC to vacate a CPCN

already affirmed by the Law Court in NextEra, allowing the Legislature to veto the

38 Project attached to that CPCN, and thereby vacating the holding of NextEra. See

NextEra, 2020 ME 34, ¶ 43, 227 A.3d 1117. But NextEra only addressed the specific

issue of whether the PUC erred procedurally or factually in issuing the CPCN, finding

that it had not. Id. The mere fact that a law impacts a court decision does not equate

to an exercise of judicial power. See MacImage of Maine, LLC v. Androscoggin Cty.,

2012 ME 44, ¶ 27, 40 A.3d 975. Where a piece of legislation has wide effect and is an

expression of public policy, it does not usurp the court’s adjudicatory function. Id. ¶

29.

For broadly the same rationale as explained above in relation to the executive

power, the Initiative is not an unconstitutional usurpation of judicial power. It is

rooted in a policy determination by the people of Maine that the disposition or lease

of public lands requires heightened scrutiny by the Legislature. It does not reverse or

vacate a specific judicial decision but rather imposes additional requirements for a

category of linear projects, including the one for which the PUC issued the CPCN at

issue in NextEra. The Law Court’s holding in NextEra stands. For all of these reasons,

the Initiative does not violate separation of powers principles.

The Court also briefly addresses Intervenor HQUS’ arguments that the

Initiative usurps the judiciary’s constitutional interpretive authority. Specifically,

HQUS posits that the Initiative’s attempt to define the constitutional phrase “uses

substantially altered” found in article IX, section 23, as being inclusive of “high

impact transmission lines, poles, landing strips, pipelines and railroad tracks” usurps

the constitutional interpretive powers reserved for the judiciary. In support, HQUS

39 cites Wagner v. Sec'y of State, 663 A.2d 564, 567 (Me. 1995), which purports to identify

two instances when an initiative exceeds the power the people granted to themselves:

when it usurps (1) the enacting powers of the Legislature; or (2) the interpretive

powers of the judiciary.

The Court is unconvinced that the Initiative does the latter. The statute at

issue in Wagner was much more restrictive than the Initiative here and attempted to

define and limit the number of constitutionally protected classes who are entitled to

equal protection under Maine laws. Id. at 566 n.3. Despite this attempt to define

constitutionally protected classes in full, the Law Court still allowed it on the ballot—

holding that such an exercise did not present the Court with “subject matter beyond

the electorate's grant of authority.” Id. at 567.

In contrast, the Initiative here attempts to do even less than the initiative in

Wagner and, in the Court’s mind, is inclusive. The Initiative merely specifies

structures included within article IX, section 23’s phrasing and does not foreclose the

inclusion of others. Thus, the Court is unpersuaded by HQUS’ argument that the

Initiative usurps the judiciary’s interpretive authority.

C. Contracts Clause

The U.S. and Maine Constitutions both prohibit the impairment of contracts.

U.S. Const. art. I, § 10; Me. Const. art. I, § 11. NECEC argues that the Initiative

unconstitutionally impairs a valid contract for the lease of a 0.9-mile stretch of land

through the West Forks Plantation and Johnson Mountain Township, executed first

in 2014 and amended and restated in 2020. Specifically, NECEC contends that the

40 Initiative’s empowerment of the Legislature to effectively cancel the BPL lease—

should the Legislature not approve it by a 2/3 majority—is an unconstitutional

impairment.

To determine whether the application of a statute results in an

unconstitutional impairment of a contract, Maine courts utilize a three-part test.

American Republic Ins. Co. v. Superintendent of Ins., 647 A.2d 1195, 1197 (Me. 1995)

(citing Energy Reserves Group, Inc. v. Kansas Power & Light Co., 459 U.S. 400, 411

(1983)). The threshold question is whether the law “operates as a substantial

impairment of a contractual relationship.” Id. If so, the State must have “a significant

and legitimate public purpose” for the regulation, such as remedying a broad, general

social problem. Id. (citing Energy Reserves Group, 459 U.S. at 411-412). In addition,

the adjustment of the contracting parties' rights and responsibilities that results from

the new law must be based on reasonable conditions and “of a character appropriate”

to the purpose that justified its adoption. Id. (citing Energy Reserves Group, 459 U.S.

at 412).

As noted earlier, in August 2021, this Court determined that BPL entered into

the 2020 Lease without authority, and thus the Lease is void. The Law Court has

taken the issue up on appeal and if it affirms the Court’s holding, there will have

been no valid lease to impair. Conversely, should the Law Court determine that the

lease is valid, NECEC’s Contracts Clause argument is still hampered by the language

of the BPL Lease, which explicitly provides that NECEC “shall be in compliance with

all Federal, State, and local statutes, ordinances, rules, and regulations, now or

41 hereinafter enacted which may be applicable to [NECEC] in connection to its use of

[the leased public lands]” (emphasis added). The newly enacted Initiative, which

creates additional requirements for construction such as the Project, likely cannot

impair a contract which anticipates such legislation.

The foreseeability of new regulations at the time of contracting also impacts

whether a law can be said to impair a contract. All. of Auto. Mfrs. v. Gwadosky, 304

F. Supp. 2d 104, 115 (D. Me. 2004) (holding that regulation which parties should have

foreseen did not impair contract). Not only is land use heavily regulated at the state

and local level such that new regulations are generally foreseeable, Kittery Retail

Ventures, 2004 ME 65, ¶ 39, 856 A.2d 1183, but NECEC entered the purported BPL

Lease amid intense public scrutiny, legal challenges, and a popular ballot initiative

to block the Project. As of June 23, 2020, the date that the amended and restated

2020 BPL Lease was executed, NECEC was on notice of efforts to stop construction

on the public lands by subjecting the lease to new requirements, and should have

foreseen the potential success of an initiative.

Even where legislation does substantially impair a contract, such impairment

is permissible if it serves a significant and legitimate public purpose. See American

Republic Ins. Co., 647 A.2d at 1197. Courts are reluctant to defer to legislative

judgments of whether the purpose is legitimate and the impairment reasonable and

necessary when the State itself is a party to the contract “because the State’s self-

interest is at stake.” United States Trust Co. v. New Jersey, 431 U.S. 1, 26 (1977); see

Kittery Retail Ventures, LLC, 2004 ME 65, ¶ 38, 856 A.2d 1183. This self-interest is

42 not implicated where, as here, the impairment does not actually accrue financial

benefit to the State. See Seven Up Pete Venture v. Montana, 114 P.3d 1009, 1023

(Mont. 2005) (holding heightened Contract Clause scrutiny inapplicable where voter

initiative “caused the State to forego the opportunity to receive royalty payments,”

meaning its interests as party to contract “were actually diminished” by passage of

initiative). NECEC argues that the State of Maine will allegedly benefit from the

completion of the Project via lowered electricity costs, reduced greenhouse gas

emissions, job creation, and hundreds of millions of dollars of value in rate relief,

economic development, education, and property taxes. It cannot also argue that the

State’s self-interest is implicated by a law which will block the Project.

The Initiative, as a public referendum, represents a democratic expression of

the public’s determination that the additional regulations are in the public interest

and this determination is worthy of the Court’s deference. The citizens of Maine

believe that it is in the interest of the State to restrict high-impact transmission lines

in the Upper Kennebec Region, to provide additional protections to public lands in

the context of certain linear construction projects, and to require stricter scrutiny of

certain transmission line projects. Requiring two-thirds legislative approval of

defined types of construction projects, paralleling Maine’s constitutional condition for

substantial alterations of public land, is an appropriate and reasonable method of

enforcing this public interest. See American Republic Ins. Co., 647 A.2d at 1197; Me.

Const. art. IX, § 23.

II. Irreparable Injury

43 The second factor in the Court’s preliminary injunction analysis is whether

this Court’s failure to grant the requested injunction would result in irreparable

injury to the movant. NECEC rests their assertions of irreparable harm on two

distinct allegations. First, that a prospective constitutional violation constitutes per

se irreparable injury, and second, that the failure to grant an injunction will result in

further delay of the NECEC project, resulting in significant economic harm and

potentially threatening the Project’s completion.

“[P]roof of irreparable injury is a prerequisite to the granting of injunctive

relief." Bar Harbor Banking & Trust Co. v. Alexander, 411 A.2d 74, 79 (Me. 1980).

Irreparable injury is defined as “injury for which there is no adequate remedy at law.”

Stanley v. Town of Greene, 2015 ME 69, ¶ 13, 117 A.3d 600.

A. Constitutional Violation as per se Irreparable Harm

The Court first addresses NECEC’s contention that it will suffer irreparable

harm because of the alleged threat of various constitutional violations. In support of

this contention, NECEC cites case law from other jurisdictions which finds

irreparable injury when a constitutional violation has been alleged. See Gordon v.

Holder, 721 F.3d 638 (D.C. Cir. 2013); Am. Trucking Ass’ns v. City of Los Angeles, 559

F.3d 1046 (9th Cir. 2009); Condon v. Andino, Inc., 961 F. Supp. 323 (D. Me. 1997). As

discussed below, however, all of those cases are distinguishable from the facts

presented here.

In Gordon, the D.C. Circuit Court of Appeals held that the plaintiff had made

a sufficient showing of irreparable injury when he established a prospective violation

44 of a constitutional right. Gordon, 721 F.3d 638 at 653. In that case, the challenged

law threatened the plaintiff’s right to due process because it forced him to pay what

he alleged were unconstitutional taxes, or risk incurring civil and criminal penalties.

Id. The Gordon court reasoned that the alleged constitutional violation, combined

with the threat of criminal and civil liability, was enough to warrant a finding of

irreparable harm. Id.

In Am. Trucking Ass’ns, the 9th Circuit similarly held that a prospective

violation of constitutional rights may constitute irreparable injury. Am. Trucking

Ass’ns, 559 F.3d at 1057. In a similar set of facts to those the Gordon court had before

it, the Am. Trucking Ass’ns court relied not just on the threatened constitutional

violation to come to this conclusion, but also on the imminent threat of civil or

criminal liability that the party seeking an injunction faced. Id.

The District Court for the District of Maine’s decision in Condon is no different

than the aforementioned. While it is true that the Condon court recognized the

jurisprudential practice of finding irreparable injury where a constitutional violation

is alleged, it only found the existence of irreparable injury because the “Plaintiff [was]

faced with the decision of either complying with regulations that are unconstitutional

or violating his Town's laws . . . risk[ing] fines or other penalties.” Condon, 961 F.

Supp. at 331.

The Defendants rebuff NECEC’s assertion of per se irreparable injury where a

constitutional violation is threatened by citing their own set of cases from other

jurisdictions that limit application of Plaintiffs’ per se rule to certain specific areas of

45 constitutional jurisprudence. See Ne. Fla. Chapter of the Ass’n of Gen. Contractors of

Am. v. City of Jacksonville, Fla., 896 F.2d 1283, 1285 (11th Cir. 1990) (“The only

area[s] of constitutional jurisprudence where . . . a . . . [constitutional] violation

constitutes irreparable injury [are] the area[s] of first amendment and right of

privacy jurisprudence.”); Pub. Serv. Co. of N.H. v. Town of West Newbury, 835 F.2d

380, 382 (1st Cir. 1987) (holding that cases equating a threatened deprivation of a

constitutional right with irreparable injury are almost entirely restricted to cases

involving alleged infringements of free speech, association, privacy or other rights as

to which “temporary deprivation is viewed of such qualitative importance as to be

irremediable by any subsequent relief”).

Plaintiffs’ argument fails under either line of cases. This Court has not found

any constitutional violations, threatened or otherwise. Further, although Plaintiffs

raise several ways in which the Initiative may offend certain constitutional

principles, none of the threatened offenses are accompanied by imminent civil or

criminal penalties like in Gordon, Am. Trucking Ass’ns, and Condon, nor are the

alleged violations of the type that other courts have found sufficient to make a

showing of irreparable injury. Although NECEC notes that various executive

agencies may seek to enforce the Initiative’s provisions, the language of the

legislation itself does not suggest any imminent civil action will be brought against

them. Accordingly, Plaintiffs’ alleged constitutional violations do not constitute

irreparable injury per se.

B. Economic Harm and Project Delay

46 The Court next addresses NECEC’s contention that this Court’s failure to

enter an injunction would significantly delay the Project’s timeline and potentially

threaten its completion.

Economic harm is generally not considered sufficient to constitute irreparable

injury, and any alleged injury must be more than merely speculative. OfficeMax Inc.

v. Qwick Print, Inc., 709 F. Supp. 2d 100, 113 (D. Me. 2010). Speculative injury “does

not constitute a showing of irreparable harm.” Merrill Lynch, Pierce, Fenner & Smith,

Inc. v. Bishop. 839 F. Supp. 68, 74 (D. Me. 1993).

In the instant case, the harm NECEC reports it will suffer from an adverse

decision is almost entirely economic in nature and speculative. NECEC asserts that,

should the Initiative take effect on its designated date, each day that this proceeding

progresses corresponds to one day of delay in construction. This delay, the Plaintiffs

assert, would “threaten the cancellation of the Project altogether.” The specter of

undue delay, however, is unsupported by the record, and speculative.

NECEC’s own Motion illustrates the speculative nature of such predictions by

asking the Court to “assume” a two-year delay in construction for the purposes of

demonstrating possible harm. But such an assumption is unreasonable based on the

evidence. The State courts that have considered the various legal challenges and

obstacles to the Project have acted with alacrity, frequently holding hearings and

issuing decisions on a greatly expedited basis. Here, the Court is issuing a decision

on Plaintiffs’ Motion a mere six weeks after Plaintiffs initiated their action, and

47 several days before the Initiative is scheduled to take effect. The Court anticipates

the Law Court will also move swiftly if presented with the case on appeal or by report.

Even in the unlikely event the litigation moves at the pace forecast by

Plaintiffs, and begins to bump up against or threaten the contractual deadline of

August 23rd, 2025, Plaintiffs do not adequately explain why they cannot amend the

current agreement or negotiate a new contractual deadline for Project completion.

NECEC itself has noted that such delays in transmission line projects are “common,

if not inevitable.” The land beneath the proposed corridor is not going anyplace.

While Plaintiffs stand to lose significant financial investment should they

ultimately be unsuccessful, the Court is not convinced that a failure to enjoin the

Initiative from taking effect in the short term will result in irreparable injury. The

Plaintiffs have failed to establish any per se, non-speculative, and non-economic harm

that will result from denying them an injunction while this litigation is pending.

III. Balancing of Harms

The third prong of a Court’s review of a request for injunctive relief is a

balancing of the harms that either party will face from an adverse result. Put simply,

this Court must determine who will suffer more harm: NECEC if an injunction is not

entered, or Defendants if NECEC’s request is granted. 29

The moving party bears the burden of establishing that its alleged irreparable

harm outweighs any harm the granting of an injunction would cause to other parties.

29 Here, since Defendants consist of public agencies and legislative bodies, the Court considers harm to the public as synonymous with harm to Defendants. See, e.g., Nken v. Holder, 556 U.S. 418, 435 (2009).

48 Alliance for Retired Americans, 2020 ME 123, ¶ 11, 240 A.3d 45. At the outset of this

analysis, the Court notes that Plaintiffs’ potential success is weakened by the Court’s

conclusion that they will not suffer irreparable injury. See, e.g., Pie v. Cotton St. Dev.,

No. CV-07-198, 2007 Me. Super. LEXIS 115 at *6, (Me. Super. Ct. June 12, 2007)

(holding that because the movant had failed to establish irreparable injury, they also

failed to establish that “any harm [the plaintiff] might suffer . . . outweighs the impact

that the injunction would have on [the defendant]”).

In their Motion, the Plaintiffs allege that the “likely cancellation of a billion

dollar project”—the apparent result of a failure to enter an injunction—outweighs the

harm that would be caused to the Defendants by withholding enactment of the

Initiative. They also detail the negative climate impact of failing to grant an

injunction, alleging that not doing so would worsen an already grave climate crisis.

Intervenors supporting the Project raise similar allegations and detail the

particularized harm they—and the stakeholder groups they represent—would

incur. 30

In response, Defendants raise their own arguments focused primarily on the

direct environmental impact that continued construction will have on the land the

Project runs through. They also raise concerns about the deprivation of Project

30 Intervenor Industrial Energy Consumer Group alleges that enactment of the Initiative will upset

the public’s confidence in Maine’s utility regulatory paradigm and will hinder the effort to fight climate change. Intervenor Maine State Chamber of Commerce claims that if the Initiative takes effect, it will discourage future investment in similar permit heavy projects. Intervenor International Brotherhood of Electrical Workers asserts that the Initiative will end employment for some of its members and stymie future employment because investors will avoid funding projects like the NECEC. Intervenor Cianbro makes several supporting arguments and also claims that the Corridor will have a direct impact on their construction business and their involvement in future projects like NECEC.

49 benefits to the Maine people should an injunction be entered, construction completed,

and the Initiative found constitutional. In this scenario, the Defendants assert that

what would result is a constructed, non-operational corridor without the

corresponding bargained-for benefits aimed at enhancing the energy consumption

experience for Mainers.

The Court appreciates the impassioned advocacy of all parties involved but, in

this case, finds that the harm from issuing a preliminary injunction would outweigh

the harm of denying NECEC’s request. To understand this conclusion, context is

important. To decide the Motion, this Court’s charge is to balance the equities in the

short term, not to balance them in the long term. The question now is not whether

climate change or direct construction poses a greater environmental threat; nor is the

question what impact the Initiative will have on future economic investment in

Maine. The question is whether, during the likely short lived litigation period, the

harm from entering or refusing to enter a preliminary injunction will be worse.

With the relevant time frame in mind, the Court notes that the preliminary

injunction factors are not considered in isolation from each other. The Court has

already determined that Plaintiffs have not demonstrated a substantial possibility of

prevailing on the merits, and that Plaintiffs will not suffer irreparable injury (in the

short term). The Court further finds that if Plaintiffs are allowed to complete

construction of the Project while the litigation is pending—and then lose—the

existence of a completed, non-operational corridor would inflict at least some harm

on the environment. Under all of these circumstances, without the State’s highest

50 court first having a chance to weigh in, the blow that granting an injunction would

deal to the public’s confidence in Maine’s direct initiative process and the institution

of participatory democracy further tips the scales. Accordingly, the balance of the

harm falls in favor of Defendants.

IV. Public Interest

The fourth and final consideration in the Court’s preliminary injunction

analysis is the effect granting the injunction will have on the public interest. The

public interest factor asks this Court to “inquire whether there are public interests

beyond the private interests of the litigants that would be affected by the issuance or

denial of injunctive relief.” Everett J. Prescott, Inc. v. Ross, 383 F. Supp. 2d 180, 193

(D. Me. 2005) (citing United States v. Zenon, 711 F.2d 476 (1st Cir. 1983)). Here the

answer is resoundingly affirmative.

The broad purpose of Maine’s direct initiative process is to encourage the

people’s engagement in participatory democracy. Allen v. Quinn, 459 A.2d 1088, 1102

(Me. 1983). The process, governed by article IV, section 18 of Maine’s Constitution,

became effective on January 6th, 1909, and represented a “fundamental change in

the existing form of government in so far as legislative power was involved.” Farris

ex rel. Dorsky, 143 Me. 227, 230, 60 A.2d 908 (1948). Previously, the power to legislate

had been vested only in the House of Representatives and the Senate, but by the

thirty-first amendment to Maine’s Constitution, the “sovereign which is the People

[took] back . . . a power which the people vested in the Legislature when Maine

51 became a State.” Id. at 231. “The significance of this change must not be overlooked.”

Id.

In the instant case, the Plaintiffs’ request for an injunction asks this Court to

block the enactment of a ballot initiative dutifully presented to the 130th legislature

and voted through by the Maine electorate after the Legislature’s failure to act. Thus,

in the Court’s view, the people of Maine have declared their interest in this

litigation. The public’s directive, as announced by 59% of Maine voters, is clear: enact

LD 1295, i.e., the Initiative, by way of ballot question one. A decision to issue an

injunction foreclosing the Initiative’s enactment would directly affect this public

interest. Accordingly, an analysis of the fourth preliminary injunctive factor again

supports a denial of NECEC’s request.

CONCLUSION

For the reasons set forth herein, the Court concludes that Plaintiffs have not

satisfied their burden to demonstrate that all four criteria necessary for a preliminary

injunction have been satisfied. To the contrary, the Court concludes Plaintiffs have

not shown any of the criteria to be met. Consequently, Plaintiffs have not established

their entitlement to a preliminary injunction. Plaintiffs’ Motion for Preliminary

Injunction is denied.

Pursuant to M.R. Civ. P. 79(a), the Clerk is instructed to incorporate this Order

by reference on the docket for this case. So Ordered.

Dated:_______________ ______________________________ Michael A. Duddy Judge, Business & Consumer Court

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PLAINTIFFS' VERIFIED COMPLAINT FOR DECLARAT9RY JUDGMENT AND INJUNCTIVE RELIEF /- "'\

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Be it enacted by the People of the State of Maine as 'follows: Sec. 1. 121\ffiSA §1852, sub-§4; as enacted by PL 1997, c. 678, § 13 and amended by PL 2013, c. 405, Pt. A, §24, is furj:her amended to read: 4. Lease of public reserved land for utilities and rights-of-way. The bureau may lease the right, for a term not exceeding 25 years, to: A. Set and maintain or use poles, electric power transmission and telecommunication transmission lines and facilities, roads, bridges and landing stri~s; B. Lay and maintain or use pipelines and railroad tracks; and . C. Establish and maintain or use other rights-of-way. Any such poles, transmission lines and facilities, landing strips, pipelines and railroad tracks w1derthis subsection are deemed to substantially alter the uses of the land wi~n the meaning of the Constitution of Maine, Article IX, Section 23, and a lease or conveyance for the purpose of constructing and operating such poles, transmission ·lines and facilities, landing strips, pipelines and railroad tracks under this subsection may not be granted without first obtaining the vote of 2/3 of all the members elected to each House of the Legislature. Notwithstanding Title I, section 302 or.any other provision of law to the contrary, this subsection applies retroactively to September 16, 2014. Sec. 2. 35-A l\ffiSA §3131, sub-§4-A, as enacted by PL 2009, c. 655, Pt. A, §3, is amended to read: · · 4-A. High-impact electric transmission line. "High-impact electric transmission line" means a transmission line greater than 50 miles in length that is not located in a statutory corridor, as defined in sectioa 122, subsection I, paragraph F 4, or a petitioned corridor, as defined in section 122, subsection 1, paragraph D 1, and that is: A. Constructed to 1ransmit direct current electricity; or B. Capable of operating at 345 kilovolts or more and: (1) Is not a generator interconnection transmission facility as defined in section 3132, subsection 1-B; and (2) Is not constructed primarily to provide electric reliability, as detenninecl by the commission. Sec. 3. 35-A lVIRSA §3132, sub-§6-A, as enacted by PL 2009, c. 655, Pt. A, §5, is amended to read: 6-A. High-impact electric transmission line; certificate of public convenience and necessity. The commission shall evaluate and render a· decision on any petition for a certificate of public convenience and necessity for a high-impact transmission line 4n accordance with section 122, subsectioa 1 D. Sec. 4. 35-A MRSA §3132, sub-§6-C is enacted to read:. 6-C. High-impact electric transmission line; legislative approval. In addition to obtaining a certificate of public convenience and necessity, a high-impact electric transmission line may .not be constructed anywhere in the State without first obtaining the

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approval of the Legislature, except that any high-impact electric transmission line crossing or utilizing public lands designated by the Legislature pursuant to Title 12, section 598-A is deemed to substantially alter the land and must be approved by the vote of 2/3 of all the members elected to each House of the Legislature_. Sec.. 5. 35-A MRSA §3132, sub-§6-D is enacted to read:: . 6-D. High-impact electric transmission line; geographic prohibition. Notwithstanding subsection 6-C, a high-impact electric transmission line may not be constructed in the Upper Kennebec Region. For the purpose of this subsection, "Upper Kennebec Region" means the approximately 43,300 acres of land located between the Town of Bingham and Wyman Lake, north along tlie Old Canada Road, Route 201, to the Canadian border, and eastward from the Town of Jackman to encompass Long Pond and westward to the Canadian border. in Somerset County·and Franklin County. Sec. 6. 35-A MRSA-§3132, sub-§6-E is enacted to read: 6-E. Retroactivity. Notwithstanding Title 1, section 302 or any other provision of law to the contrary, subsections 6-C and 6-D apply retroactively to September 16, 2020 and apply to any high-impact electric transmission line the construction of which had not commenced as of that date.

SUMMARY This initiated bill requires the approval of the Legislature for the construction ofhigh- impact electric transmission lines and provides that high-impact electric transmission lines crossing or utilizing public lands must be approved by-2/3 of all tlie members elected to each House ·of the Legislature. This initiated bill also prohibits the construction of high- impact electric transmission lines in the Upper Kennebec Region. These provisions apply retroactively to September 16, 2020, the date of filing of this initiative. This initiated bill also requires the approval of 2/3 of all the members elected to each House of the Legislature for any use of public lands for transmission lines and facilities and certain other projects. This provision applies retroactively to September 16, 2014.

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