Michigan vows to seek Line 5 profits if Enbridge defies shutdown order

If Line 5 is still pumping petroleum through the Straits of Mackinac on Thursday, Michigan Gov. Gretchen Whitmer has notified Enbridge Energy, she will consider all resulting profits to be property of the state of Michigan.

That notice, contained in a letter Whitmer and Department of Natural Resources Director Dan Eichinger wrote Tuesday to Enbridge Executive Vice President Vern Yu, offers the first glimpse into Whitmer’s planned response if the Canadian oil giant follows through with a vow to defy state orders to shut down the pipeline.

It comes as Enbridge is also taking fire from the Bay Mills Indian Community, whose executive council has voted to officially banish Line 5 from its territory — a legal action that is considered a punishment of last resort in tribal law.  The tribe is calling upon the federal government to enforce the banishment as part of its legal obligation to protect tribal treaty rights to hunt, fish and gather in ceded territory including the Straits of Mackinac.

Related:

• Enbridge ordered to retrieve 15,000-lb. anchor from Straits of Mackinac
• Fish, propane, cash: Not everyone loves Enbridge generosity in the Straits
• On eve of Line 5 shutdown deadline, Enbridge vows to defy Michigan order
• Is the Line 5 tunnel a bridge to Michigan’s energy future or a bad deal?
• Canadian officials to Michigan Senate: Line 5 shutdown would wreck economy
• Gov. Whitmer offers propane plan for Upper Peninsula after Line 5 shutdown
• With Line 5 closure, a ‘game of chicken’ over how to heat Upper Peninsula

Enbridge spokesperson Ryan Duffy reiterated on Tuesday that, despite Whitmer’s letter and the Bay Mills banishment, Enbridge will keep the pipeline running.

“Our responsibility is to the people of Michigan and the Great Lakes region,” Duffy said.

Last November, Whitmer gave Enbridge six months to stop transporting oil through the Straits, citing fears of a catastrophic oil spill on the dual-span pipeline. The deadline is midnight Wednesday.

After that, the letter states, Enbridge will be trespassing on state property and unjustly enriching itself financially if it continues to operate Line 5 in the Straits.

“To the extent that Enbridge benefits financially from that use and operation after May 12, 2021, it will be liable for unjust enrichment, which will require disgorgement to the State of all profits derived from its wrongful use of the State’s property,” Whitmer and Eichinger wrote.

The pair said they plan to assert that claim as part of an ongoing legal dispute over her shutdown order. If the state prevails in that dispute, they wrote, “Enbridge will be liable to the State for its continued use of the Straits Pipelines after the effective date of the Notice.”

But before the state can make any legal claim to Enbridge’s future profits, the state and Enbridge must settle an ongoing dispute over whether the case will be heard in state or federal court. Michigan has sued the oil giant in state court and Enbridge responded by filing its own suit in federal court.

That means it will likely be months or years before the fate of Line 5 is settled. And it’s likely that, at least for now, the oil will keep flowing.

As the deadline approaches, the pipeline’s supporters and opponents have launched last-ditch efforts to rally public sentiment in their favor.

Petroleum industry groups, Canadian government officials and state officials in Ohio, Louisiana and elsewhere, have spent recent weeks speaking out about the potential economic implications of a shutdown and pleading their case to state and federal officials.

Environmental and other anti-Line 5 groups, meanwhile, have called those talking points a smear campaign that overestimates the potential economic toll of a shutdown while downplaying the risk of a spill on a 68-year-old underwater pipeline that they routinely refer to as a “ticking time bomb.”

They lauded Whitmer’s letter Tuesday as an appropriate step.

“Enbridge is now operating illegally, adding to their long legacy of corporate irresponsibility,” Mike Shriberg, the Great Lakes regional director of the National Wildlife Federation, said in a statement. “They had already lost their social license to operate in the Great Lakes — now they have also lost their legal right.”

Tribal citizens and environmental activists said they will gather in the Straits on Wednesday for the first of two days of protests against the pipeline. On Thursday, they’ll deliver symbolic eviction notices to Enbridge in Lansing and the Straits.

It’s likely any further action will play out in court. 

Attorney General Dana Nessel backed Whitmer's Nov. 13 shutdown order with a lawsuit filed the same day in Ingham County Circuit Court seeking a court order to reinforce the decision. Enbridge countered with a suit of its own in federal court.

The two sides are now engaged in court-ordered mediation while sparring over whether the case should continue in state or federal court.

Tribe turns up heat

While Whitmer warns of sanctions if Enbridge remains defiant, one Michigan tribe has taken its own legal action to evict Enbridge from the Straits, and signaled that it’s time for the federal government to help them enforce the order. 

Leaders of the Bay Mills Indian Community voted Monday night to banish Line 5 from the tribe’s reservation and all of the tribe’s treaty-protected ceded territory, including the Straits of Mackinac.

Considered a punishment of last resort, banishment is a permanent legal action reserved for the worst offenders, said Whitney Gravelle, chairperson of the Bay Mills Indian Community.

“We use it as a way to expel an individual from our territory,” Gravelle said, and that expulsion is permanent. 

But beyond being enforceable within tribal law, the banishment sends a signal to the U.S. government that it can no longer remain silent about Line 5. 

Despite pressure from all sides to weigh in on the Line 5 dispute, President Joe Biden and his administration have remained mostly publicly mum about the pipeline.

Energy Secretary and former Michigan governor Jennifer Granholm told media at a White House briefing Tuesday that “we don’t weigh in on that” when asked about the shutdown order. 

That’s no longer good enough, Gravelle said.

The tribe is calling on “any regulatory body with oversight authority,” from other Native American tribes to the state and feds, to enforce the order. 

Because the federal government is a signatory to the 1836 treaty that gives Bay Mills protected rights to hunt, fish and gather in the Straits and other Michigan lands and waters, the feds have a special obligation to protect those treaty rights.

The U.S. Bureau of Indian Affairs characterizes its obligation to treaty tribes as “a legally enforceable fiduciary obligation on the part of the United States to protect tribal treaty rights, lands, assets, and resources.”

Don’t expect tribal police federal officers to show up at Enbridge’s offices, said Matthew Fletcher, director of Michigan State University's Indigenous Law and Policy Center, but the banishment order comes with potentially hefty legal significance, he said.

The federal government has often stepped in to protect tribal treaty rights, representing tribal interests in lawsuits against state governments, individuals and others in the process

So far, federal officials have not signaled whether they’ll heed the tribe’s call for support. 

A Midwest regional Bureau of Indian Affairs representative reached by Bridge redirected questions about Line 5 to the agency’s national headquarters. Spokespeople there did not immediately respond to a request for comment.

The banishment, which takes effect immediately, is the latest in a host of efforts by Bay Mills to get Line 5 out of the Straits. The tribe has also contested a state permit tied to Enbridge’s plan to replace the pipeline with a tunnel-encased pipe deep beneath the lakebed, has intervened in a case before the Michigan Public Service Commission tied to the tunnel plan, and has submitted amicus briefs in Attorney General Dana Nessel’s state lawsuit seeking to shut down the pipeline. 

Gravelle said she anticipates other Michigan tribes with treaty rights to the Straits could follow suit. All twelve Michigan federally-recognized tribes have passed resolutions opposing Line 5. 

Gravelle said Enbridge has not responded to the banishment.