Canada: Line 5 lawsuit should pause until treaty talks with U.S. are complete

The Canadian government is asking again that the litigation between Michigan and Canadian oil company Enbridge pause as officials from both countries hold talks about the potential of a Line 5 shutdown.

Michigan and Enbridge are currently awaiting a decision from a federal judge on which court — state or federal — will preside over the state’s lawsuit to enforce Gov. Gretchen Whitmer’s Line 5 shutdown order. That order took effect on May 12, but Enbridge has refused to comply without the backing of a court order. Oil continues to flow through the 68-year-old pipelines under the Straits of Mackinac despite Whitmer’s continued warnings.

On June 1, the government of Canada submitted a brief of amicus curiae on behalf of Enbridge. It argued that the court should take into account the 1977 Treaty between Canada and the United States, consider the treaty issues presented by a Line 5 shutdown and ultimately prevent the “premature” enforcement of Whitmer’s shutdown order.

The 1977 Treaty, signed by former President Jimmy Carter, set forth agreements between the parties as related to transit pipelines that travel through both countries.

On June 21, the Canadian government’s counsel submitted a filing to update the court on those treaty talks and again ask that the litigation be held in abeyance.

“The international implications of the proposed shutdown have been raised by the Prime Minister of Canada with the President of the United States,” writes attorney Gordon Davies Giffin on behalf of the Canadian government. “They have also been the subject of discussions between the Foreign Minister of Canada and the United States Secretary of State, the Justice Minister of Canada and the United States Attorney General, the Natural Resources Minister of Canada and the United States Secretary of Energy as well as the Transport Minister of Canada and the United States Secretary of Transportation.

“These discussions, along with interventions to the Department of State and the White House by the Ambassador of Canada have resulted in the establishment of a bi-lateral process in which representatives of the two countries are meeting biweekly to address the potential shutdown, including in the context of the 1977 Treaty,” Giffin continued.

He noted that the state of Michigan previously argued against Canada’s request for abeyance. In its June 2 reply brief, the state said “there is no evidence that negotiations under the Treaty itself are in progress.”

Attorney General Dana Nessel’s office did not immediately return a request for comment.

Giffin writes in response to the state’s argument that, while the 1977 Treaty’s dispute resolution mechanism could still be formally invoked, this is not necessary to “conduct official and meaningful consultations” between Canada and the United States regarding the treaty.

“Canada continues to believe that it would be contrary to the interest of both Canada and the United States, and contrary to the intent of the Treaty, for court proceedings relating to the shutdown to proceed while this diplomatic process is ongoing,” Giffin wrote.

Enbridge spokesperson Ryan Duffy said Tuesday that the company is “appreciative” of Canada’s “strong position on this issue.”

“It’s clear based on the Canadian Government’s filing of an amicus brief that the litigation is an important issue for Canada. In their brief, the Government reminded the Judge that discussions are occurring on a government to government basis. They also were clear in their brief that the US federal court is the correct court to hear the case, not a state court,” Duffy said.

There are no remaining deadlines or hearings in the case. It is unclear when Judge Janet Neff will make a ruling, and whether Canada’s arguments may factor into her decision.

If the state succeeds, the State of Michigan v Enbridge lawsuit will be sent back to the 30th Circuit Court and Whitmer, Nessel and the Department of Natural Resources (DNR) will have the upper hand.

If Neff rules in Enbridge’s favor, the lawsuit will be heard in federal court. Since Enbridge intends to lean heavily on federal statutes and international commerce arguments to win, the oil company would have the advantage in that case.