Threat to Broadband Expansion

Threat to Broadband Expansion

In Grano v. Rappahannock Electric Cooperative, Judge Moon of the Federal District Court made preliminary rulings about a new Virginia law that allows electric utilities to put broadband cables in existing electrical easements.

The facts are these: A new state law in 2020 granted electric utilities like Rappahannock Electric Cooperative the power to install broadband cables in existing electric line easements, regardless of what the easement deed says. The same law limited the kind of compensation that property owners can receive if that happened. Rappahannock proposed to buy the right to install broadband on the property of John and Cynthia Grano, but couldn’t agree on terms with them. Rappahannock never installed any broadband on the Granos’ property but asserted that it could if it wished.

Judge Moon’s opinion found that the Granos’ claims said many of the right things to move forward in Federal court. For example, Judge Moon decided that the Granos had properly alleged they suffered actual harm when the new law took effect in 2020 and that the new law did not provide an adequate remedy for any harm that they suffered. There is little analysis in the opinion about why the new law – which allows property owners to file a claim for trespass – is inadequate, but the opinion points to the fact that the new law limits the amount of money that property owners can get if they win their case. (Lots of other laws limit the amount of money courts can award for different kinds of cases; Virginia has caps on medical malpractice claims and punitive damages, for instance).

Ultimately, Judge Moon ruled that two of the Granos’ three claims had to be dismissed because Rappahannock did not take any action to exercise its rights under the new law. One peculiar feature of Judge Moon’s ruling is that it says that the third claim should have been dismissed as well, but Judge Moon did not dismiss that claim. The third claim was for unconstitutional impairment of contracts, and footnote 8 points out that such a claim cannot be brought under the federal statute that the Granos used as a basis for their suit. Rappahannock asked the court to dismiss the third claim but for a different reason.

The case continues to move forward. The Virginia Attorney General has filed notice of his intent to intervene as a party in order to defend the law.

Please contact Martin Crim, at mcrim@vfnlaw.com or 703-618-3205 should you have any questions or need assistance.