Oakland Bulk & Oversized Terminal, LLC v. City of Oakland

During the week of January 15, the federal district court for the Northern District of California held a three-day bench trial in an action challenging the City of Oakland’s prohibition on the transportation and export of coal and petroleum coke to and through a rail and marine terminal for bulk and oversized cargo under development on land owned by the City. The bench trial concerned the terminal developer’s claim that the prohibition breached a development agreement that granted the developer the right and obligation to develop the land. The City argued that the development agreement allowed it to impose regulations on the development based on “substantial evidence” that regulation was necessary to avoid placing occupants, users, or neighbors of the project “in a condition substantially dangerous to their health or safety.” While the developer argued that the City could not rely on concerns regarding the potential for terminal operations to contribute to climate change because climate change is an issue of global scale, the City argued that “the unique, global nature of climate change doesn’t mean communities cannot or should not consider local, incremental contributions to climate change.” The City also cited other public health and safety concerns, including coal dust emissions. Prior to the trial, the court heard oral arguments on whether the City’s prohibition violated the dormant Commerce Clause because it interfered with or discriminated against interstate or foreign commerce. Also at issue in the case is whether the Interstate Commerce Commission Termination Act, the Hazardous Materials Transportation Act, or the Shipping Act of 1984 preempt the City’s action.

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