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Pressl v. Appalachian Power Co.

United States District Court, W.D. Virginia, Roanoke Division

October 6, 2015

RICHARD A. PRESSL AND THERESA M. PRESSL, Plaintiffs,
v.
APPALACHIAN POWER COMPANY, Defendant

Page 901

          For Richard A. Pressl, Theresa M. Pressl, Plaintiffs: Ryan Michael Walsh, LEAD ATTORNEY, OPN Law, Roanoke, VA; Steven Craig Wandrei, LEAD ATTORNEY, Radford & Wandrei, P.C., Bedford, VA.

         For Appalachian Power Company, Defendant: Charles Carter Lee, Matthew Patrick Warren Pritts, LEAD ATTORNEYS, WOODS ROGERS PLC, ROANOKE, VA.

Page 902

          MEMORANDUM OPINION

         NORMAN K. MOON, UNITED STATES DISTRICT JUDGE.

         Richard A. Pressl and Theresa M. Pressl (" Pressls," or " Plaintiffs" ) filed this action in state court, pursuant to Virginia Code, § 8.01-184. Appalachian Power Company (" APCO," or " Defendant" ) removed the action to this Court.

         This action arises out of the Pressls' desire to construct a dock on Smith Mountain Lake. Compl. ¶ 6. The construction, APCO argues, is subject to both a flowage easement that APCO holds on the Pressls' property and a license order granted to APCO by the Federal Energy Regulatory Commission (" FERC" ). Mot. to Dismiss 2. APCO claims these rights because it operates the Smith Mountain Hydroelectric Project on the Smith Mountain and Leesville Lakes in Southwest Virginia. Id. At the end of the Complaint, the Pressls asked the state court for the following forms of declaratory judgment:

C. That the Court . . . find that APCO lacks the authority to demand that your plaintiffs relinquish without compensation valuable property rights they and their predecessors in title retained by under the original flowage easement.
D. That the Court further find that APCO lacks the authority to require the plaintiffs to enter into a revocable license agreement as a condition for accessing the waters of Smith Mountain Lake for recreational purposes;
E. That the Court find that APCO has no regulatory authority over the plaintiffs' property which lies below the 800 foot contour beyond those rights defined by the flowage easement, the contemporaneous expressions of the parties, and vested rights to build and own structures to access Smith Mountain Lake for recreational purposes;
F. That the Court find that APCO cannot regulate the size and type of dock that the plaintiffs may construct on their property;
G. That the Court find that APCO cannot regulate how the plaintiffs stabilize the shoreline of their property by requiring them to plant vegetation below the 800 foot contour;
H. That the Court find that APCO cannot regulate whether the plaintiffs may dredge in front of their property to improve any dock which they may construct;
I. That the Court find that the Plaintiffs be allowed to use their property in any manner not inconsistent with the maintenance of a dam and hydro-electric

Page 903

power generation plant operated by APCO.

Compl., pp. 18-19. The matter is now before me upon the Pressls' motion to remand and APCO's motion to dismiss. The Pressls argue that the entire case should be remanded to the Circuit Court for the County of Franklin, Virginia, under 28 U.S.C. § 1447(c) (" if at any time before final judgment it appears that the district court lacks subject matter jurisdiction" ), because the Court lacks subject matter jurisdiction. APCO argues that the complaint should be dismissed because it fails to state a claim upon which relief can be granted under Fed.R.Civ.P. 12(b)(6). For the reasons that follow, the Pressls' motion will be DENIED and APCO's motion will be GRANTED.

         I. Background

         APCO operates the Smith Mountain Hydroelectric Project (" the Project" ) pursuant to a license issued to it by the FERC. The Federal Power Act (" FPA" ), 16 U.S.C. § 791a et seq., vests FERC with the authority to license hydroelectric projects for the use and benefit of interstate and foreign commerce. By an order dated April 25, 1960, FERC issued a fifty-year license to APCO for the Project, thus delegating its duties and responsibilities to APCO. FERC extended this license for an additional ten years by an order issued on December 15, 2009. The Project boundary encompasses the reservoir at Smith Mountain Lake and all lands on the shoreline of the lake lying below a specific elevation, 800 feet above mean sea level (" FMSL" ). When FERC granted APCO the license, it required APCO to acquire title to or the right to use all property necessary to construct, maintain, and operate the Project. Accordingly, APCO has obtained property rights to all Project lands (those below 800 FMSL), and either owns them in fee or has obtained rights of occupancy and use via flowage right and easement deeds. According to APCO, these property rights allow it to enforce the requirements of the FERC license.

         APCO manages the Project in accordance with a Shoreline Management Plan (the " SMP" ), which it developed in 2003. The SMP has been incorporated by and is now a part of APCO's license from FERC. The SMP provides detailed guidelines for managing development within the Project's boundaries. Accordingly, the SMP imposes various restrictions aimed at promoting shoreline stabilization and the protection of aesthetic and environmental quality. Among other things, the regulations address the location, length, height, and maximum size of docks. The SMP further limits what can be constructed between an elevation of 795 and 800 FMSL. Structures located within this zone are limited to those that provide access to a dock, as well as pilings or cables installed for purposes of enhancing the stability of a floating structure.

         The Pressls own a parcel of land on Smith Mountain Lake. Their property is located in Lakeland Park, Gills Creek Magisterial District, Franklin County, Virginia. The Pressls' property consists of 2.663 acres with 1/2 acre, more or less, below the Project boundary of 800 FMSL. APCO had previously obtained easement rights over the Pressls' property pursuant to a Flowage Right and Easement Deed dated April 18, 1960, by and between APCO and the Pressls' predecessors-in-title. The Flowage Right and Easement Deed provide APCO with:

[T]he right to enter upon said premises at any time and from time to time and, at [APCO's] discretion, to cut, burn and/or remove therefrom any and all buildings, structures, improvements, trees, bushes, driftwood and other objects and debris of any and every kind or description which are or may hereafter

Page 904

be located on the portion of said premises below the contour the elevation [sic] of which is 800 feet.
[Pressls have] the right to possess and use said premises [subject to the flowage easement] in any manner not inconsistent with the estate rights and privileges herein granted to [APCO], including (a) the right to cross said land to reach the impounded waters for recreational purposes . . . .

Compl. ¶ 16. Since purchasing the property, the Pressls have sought to construct a dock to access the waters of Smith Mountain Lake. However, APCO has informed the Pressls that it has the ability to control how they use the property below the 800 foot contour level of their property. Specifically, APCO has advised the Pressls that, as a condition for the building of the dock, they must execute an Occupancy and Use Permit (" Permit" ).[1] Compl. ¶ 19 (Permit attached as Compl. Ex. G). Due to this demand and its obligations, the Pressls filed this action seeking declaratory relief.

         II. Legal Standard

         a.Motion to ...


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