Articles, Alerts & Perspectives Archive

Employer Guidance for Workplace Interactions with ICE

Employment and Labor Alert (update from February 4, 2025)

(by Steve Antonelli and Alex Farone)

The Trump administration’s efforts to prioritize immigration law enforcement has resulted in increased activity by U.S. Immigration and Customs Enforcement (“ICE”) and an uptick of questions from employers about how to handle ICE investigations. This article provides guidance to employers for potential interactions with or inspections by ICE at the workplace, including preliminary actions, suggested steps during an ICE visit (whether announced or unannounced), and follow-up recommendations.

There is a common misconception that only employers that specifically seek or intentionally hire unauthorized workers are at risk of a visit from ICE. However, there are multiple avenues by which a generally law-abiding employer may find itself unknowingly employing an unauthorized worker. For example, an individual may have presented the employer with fraudulent documentation for the Form I-9 employment eligibility verification, and the employer may not have realized the document was inauthentic. Or an employer may have lawfully hired a noncitizen with proper employment paperwork but later may forget to reverify the worker’s Form I-9; in this instance, the individual’s work authorization could lapse or expire without the employer noticing.

To the extent an employer’s office or work facility is private property, employers have certain legal rights when faced with an ICE arrival. Employers should become familiar with their rights and best practices in the event of an ICE visit to minimize the risk of inordinate disruption to the workforce or operations, or the unauthorized seizure of company property and information. Employers should seek to balance (1) lawful compliance and cooperation with (2) private property rights and a general duty of care for employees.

Babst Calland recognizes that the topics of immigration enforcement and undocumented persons have been politicized. We therefore offer this guidance objectively, without advocating for any particular position beyond what is legally required.

Recommended Precautionary Actions Before ICE Arrives

Designate Public and Private Spaces

ICE agents can only be present in areas open to the public (such as parking lots, reception areas, lobbies, etc.) without a judicial warrant or specific employer consent. Therefore, employers should clearly identify the boundaries of non-public areas with signs such as “Private” or “Non-Public Area” to avoid ambiguity. Once signs are posted, management should explain these “new” boundaries or designations to the workforce, with special emphasis on its explanation to security guards, receptionists, and other public-facing employees.

Understand the Types of Documents ICE Could Present

With a few exceptions, ICE generally cannot lawfully search persons or private spaces, or seize persons or private property, without certain documentation.[1] As explained below, employers should ensure that key personnel are trained to identify and/or differentiate these documents.

A judicial warrant provides the broadest search and/or seizure rights. A judicial warrant can be either a search warrant or an arrest warrant. A judicial warrant must be signed and dated by a judge or magistrate, and it must describe with particularity the place to be searched and/or the person or items to be seized. A judicial warrant will have the name of a court at the top of the document. Only a valid judicial warrant permits an ICE agent to enter private/non-public spaces at the workplace, and only a valid judicial warrant requires the employer’s cooperation. An employer must strictly comply with a judicial warrant, but it is not required to take any action to assist ICE beyond what is reasonably required by the judicial warrant. For example, an employer can be required to move an employee identified in the warrant into a contained area for questioning, but it cannot be required to sort employees into groups by citizenship status or nationality for an inspection by ICE.

An administrative warrant is much more limited than a judicial warrant. An administrative warrant is signed by an immigration officer, and it allows ICE to arrest a non-citizen suspected of committing immigration violations. An administrative warrant is usually identified as a document “issued by the Department of Homeland Security” and is typically on a Form I-200 or I-205. Notably, an administrative warrant does not give an ICE agent the right to enter private/non-public spaces at the facility unless the employer consents.[2] Additionally, when faced with an administrative warrant, an employer is not required to tell ICE whether the employee named in the warrant is currently working or to bring the employee to the agent (or vice versa).

Alternatively, ICE could present an employer with a subpoena, a notice of inspection, or a notice to appear. A subpoena is a written request for information or documents that provides a certain time limit to respond and does not require immediate compliance. Like a subpoena, a notice of inspection is a document informing an employer that it must produce employees’ I-9 Forms for an audit[3] within 3 business days. A notice to appear is a document directed to an individual instructing them to appear before an immigration judge.

Assign An On-Site Response Coordinator

Employers should assign a particular managerial or supervisory employee at each facility to be the on-site response coordinator who can serve as a single point of contact with ICE in the event that ICE arrives, as well as a back-up coordinator if the designated worker is absent or unavailable. These personnel should be trained to differentiate between the above-described documents, and to understand and be aligned with the employer’s policy for lawful compliance with visits from ICE.

Review Applicable Collective Bargaining Agreements

For any locations that have a unionized workforce, employers should review the applicable collective bargaining agreements (CBAs) proactively to determine whether they require any additional conduct by the employer in the event of an ICE visit. For example, some CBAs might include provisions that give the union the right to be present during any ICE inspections or on-site employee interviews, or require that the employer notify all union employees when ICE agents arrive. Any additional CBA requirements should be implemented with the below recommended actions for facilities with unionized employees.

Recommended Actions If ICE Arrives

*All recommended actions below should be conducted in a calm, professional, and polite manner to prevent escalation of the interaction.*

Notify key personnel – The first step is to immediately notify the facility supervisor, the on-site response coordinator(s), and the employer’s legal counsel. Ask the agents to wait in a specific space or designated location until either a supervisor, on-site response coordinator, or legal counsel arrives to prevent disruption.

Verify agent identify – The response coordinator should clarify whether the agents are police officers or ICE agents and request their names and badge numbers.

Department of Homeland Security (DHS) regulations require ICE agents to, at the time of an arrest, identify themselves as immigration officers with arresting authority if it is “practical and safe to do so.” However, agents are not currently required to provide their name or badge number.
Recently, there has been an increase in reported instances of ICE agents concealing their faces, wearing plainclothes, and/or arriving in unmarked vehicles when making arrests. The DHS Assistant Secretary for Public Affairs has stated to news outlets that ICE agents are utilizing masks and face coverings to protect themselves from increasing threats and online doxing. Employers should be aware of this trend and train the on-site response coordinator to anticipate this possibility.

Verify agent purpose – The response coordinator should ask the agents about the nature of their visit. Common purposes include:

Initiation of Form I-9 Audit – If ICE intends to audit a company’s Form I-9 compliance, ICE must first provide the employer with a Notice of Inspection. This notice document gives the employer at least 3 business days to produce the requested I-9 Forms.[5] Additional productions and procedures will ensue if ICE determines that there are any Form I-9 errors, suspicious documents, or discrepancies, and employers should consult with an immigration attorney for further guidance if this occurs.
Facility Search or “Raid” – ICE can arrive without warning to investigate an employer.
Detention of specific person(s) – ICE can arrive without warning to detain specific person(s).
Fraud Detection and National Security (FDNS) visit – this is an unannounced visit related to an employer’s recent immigration petition(s) where ICE agents conduct compliance reviews to ensure the employer is complying with the terms and conditions of the petition(s). This article does not address such visits, as FDNS visits are only relevant for employers who have had an H-1B or L-1 intracompany transfer petition(s) adjudicated.

Verify documentation – The response coordinator should ask to see a warrant.

If a judicial warrant is provided, the employer should analyze it to determine its scope and ask for a copy of it. Employers are not required to provide access to any area not specified in a judicial warrant.
- If there is an issue with the judicial warrant (i.e. it is not signed, not dated, is missing the correct workplace address, or does not sufficiently describe the premises to be searched or items to be searched for), an employer can accept the warrant but should note its objection so that counsel can challenge the search or seizure later if sufficient grounds exist. To be clear, in this instance, the search or seizure will still occur.
If an administrative warrant is provided, the response coordinator can (but is not required to) state: “I’m sorry, but this is private property. It is company policy not to provide consent or permission to enter private or non-public areas of the facility or to access our information or records without a valid warrant signed by a judge.”
If no warrant of any kind is provided, the response coordinator can (but is not required to) make the same statement.

Use independent judgment if considering voluntary consent.

Employers can decide to voluntarily consent to a search or seizure of employer property by ICE without a sufficient warrant. Moreover, ICE agents are permitted to make statements intended to encourage voluntary consent or to imply that giving consent is required even in circumstances where it is not (such as when the agents do not possess a judicial warrant).
If considering consenting to a search or seizure without a sufficient warrant, employers should use independent judgment to evaluate the totality of the circumstances in addition to any statements made by the agents.
Please note that non-management and non-supervisory employees do not have the authority to act on behalf of an employer to give such consent.

Be respectful, but clear, if exercising the company’s rights.

Never attempt to block an ICE agent’s movements. If an employer believes ICE is exceeding its authority, the response coordinator can voice the employer’s objection and state that the company does not consent, but they should not argue and never physically interfere with the agent’s actions.
If a search is to occur (whether pursuant to a valid warrant, voluntary consent, or over the employer’s objections in the absence of both), ask to be provided with a list of any items seized.
If agents attempt to seize something that is critical to company operations (such as a computer, proprietary information, or an important file), explain why the item is critical to the company’s operations, request a more limited or targeted seizure, and/or ask to make a copy of the information before it is seized.
Employers can notify employees that they have the right to remain silent, but employers cannot instruct employees not to respond to questions. Company representatives should not be confrontational, obstructive, or evasive.
Though ICE agents are not currently required to wear body cameras, employers and employees alike have the right to record an encounter with ICE. Consider recording interactions with ICE agents to clearly document all statements and actions. Efforts to record an encounter should never interfere with the agents’ activities.

Recommended Actions After ICE Visit

Document as much as possible – The response coordinator should interview employees and make a record of the details of the event in an incident report. The report should include details such as the number of agents, a description of what they were wearing, whether the agents kept anyone from moving around the workplace freely, a detailed list of the locations of any search (including smaller spaces such as closed drawers), a detailed description of any property seized, a detailed list of statements made by the employer declining consent or asserting legal rights, and any statements made by the agents.

Follow-up notifications – The employer should call its legal counsel immediately to discuss next steps. If the workplace is unionized, the employer should notify the union steward that ICE visited the workplace.
Engage and encourage open communication with and among the workforce – Employers should be open and honest with the workforce about what occurred. In addition to individual instances of absenteeism, fear of action by ICE may lead to employees discussing their concerns or voicing disagreement with the employer’s response (or potential response) to ICE. Employers must be aware that certain employee collective action (discussions, protests, other concerted activity, etc.) may be protected under the National Labor Relations Act if it relates to the terms and conditions of employment, even for non-union workers or those who may not be authorized to work in the U.S.

Provide reasonable leave – If ICE detains a worker, consider providing the worker with an unpaid leave of absence during and in the immediate aftermath of the detention. While not legally required, an employer could consider handling the matter in a manner similar to how it might provide or allow leave in the event of a sudden medical issue or other unexpected absence. Failure to provide such comparable leave could give rise to a claim for national origin discrimination. Employers are never, however, required to provide an indefinite leave of absence.

If you have any questions about additional employer guidance concerning workplace investigations by ICE or any other federal or state agency, please contact Alexandra G. Farone at (412) 394-6521 or afarone@babstcalland.com or Stephen A. Antonelli at (412) 394-5668 or santonelli@babstcalland.com.

________________

[1] While police officers are allowed to search and arrest without a warrant in the event of different types of emergencies such as while in “hot pursuit” of a criminal suspect, ICE agents are not police officers (regardless of whether their uniforms say “Police”). ICE agents may not search and seize without a warrant if they are merely in “hot pursuit” of a suspected undocumented person. Under applicable law, this type of warrantless search or seizure by ICE is only permitted if the agent is in “hot pursuit” of an individual who “poses a public safety threat” or who the agent personally observed crossing the border.

[2] One key exception is the “in plain view” principle. With or without a warrant, ICE agents are always allowed to look at anything in “plain view,” including computer screens or papers sitting out on desks, or listen to audible conversations that can be overheard without a listening device. If what the agent sees or hears in “plain view” gives them probable cause that unlawful activity is, has, or will occur, they can search the relevant private area and seize relevant items without a warrant.

[3] The Form I-9 is a document used to verify the identity and employment eligibility of individuals within the United States. Federal law requires employers to create and maintain I-9 Forms and supporting documentation for all employees.

[4] As of the date of this publication, federal legislation has been introduced to require ICE agents to wear a legible identification that displays the employing agency name/acronym and either the agent’s last name or badge number. This proposed bill also would prohibit non-medical face coverings that obscure identity unless the agents are faced with environmental hazards or are engaged in covert operations.

[5] Employers are cautioned against voluntarily consenting to a search or seizure of Forms I-9 if ICE agents do not have a judicial warrant for this information or if the 3-day period after receiving a Notice of Inspection has not yet expired. The Form I-9 rules are nuanced and strict, and it is very common for employers to unknowingly violate a rule due to an unintended error on the forms or in record-keeping. Employers can be subject to monetary fines for substantive violations and any uncorrected technical violations regardless of whether the violation was intentional.

Environmental Quality Board Proposes Changes to Notification Rules for Unauthorized Spills into Waters of the Commonwealth

FNREL Water Law Newsletter

(by Lisa M. Bruderly, Jessica Deyoe and Christina Puhnaty)

On April 5, 2025, the Environmental Quality Board (EQB) published a public notice proposing to amend 25 Pa. Code § 91.33 (relating to incidents causing or threatening pollution). See 55 Pa. Bull. 2589 (Apr. 5, 2025). This proposed rule intends to clarify which unauthorized discharges require immediate notification to the Pennsylvania Department of Environmental Protection (PADEP) but does not change which unauthorized discharge incidents require immediate PADEP notification.

Section 91.33 currently requires the person responsible for an unauthorized discharge to immediately notify PADEP if a discharge results in pollution, creates a danger of pollution of the waters of the Commonwealth, or would damage property. The proposed rule would require a person responsible for unauthorized discharges to either report the discharge to PADEP immediately, or create and retain a written analysis of certain factors determining that an unauthorized discharge does not cause or threaten pollution. A signed statement attesting the document’s accuracy must accompany the documentation if it is provided to PADEP at PADEP’s request. The proposed rule would require analysis of the following factors:

the properties of the substance or substances discharged;
the location or locations involved;
the weather conditions before, during, and after the incident;
the presence and implementation of adequate response plans, procedures, or protocols; and
the duration of the accident or other activity or incident.

If any one of the above factors, or a combination of the factors, can adequately establish that there is no risk of the substance reaching waters of the Commonwealth, no further analysis of the other factors is required to determine whether immediate notification to PADEP is required. The proposed rule also allows the person responsible to choose to report an unauthorized discharge rather than undertaking the evaluation and documentation of the above-listed factors.

The proposed rule also incorporates a federal list of reportable quantities—by referencing 40 C.F.R. § 117.3—that if discharged in a quantity greater than or equal to those reportable quantities, must be immediately reported to PADEP without undergoing analysis of the above factors. While the reportable quantities listed at section 117.3 are not exhaustive of all possible substances that may cause or threaten pollution to waters of the Commonwealth, the quantities listed in the federal regulation are considered large enough by PADEP that an unauthorized discharge involving those quantities of those substances would likely cause or threaten pollution of waters in the Commonwealth, making it appropriate to incorporate in this regulation.

Supreme Court Scales Back Scope of NEPA Review on Some Projects

GO-WV

(by Robert Stonestreet)

Through a unanimous 8-0 decision, the Supreme Court of the United States addressed what it described as “continuing confusion and disagreement in the Courts of Appeals” over the scope of judicial review for claims asserting violations of the National Environmental Policy Act (NEPA). Seven County Infrastructure Coalition v. Eagle County, No. 23-975 (May 29, 2025). In doing so, the Supreme Court clarified that decisions by federal agencies under NEPA are entitled to substantial deference, and courts should not be in the business of second-guessing how agencies weigh competing considerations under NEPA. “The bedrock principle of judicial review in NEPA cases can be stated in a word: Deference.” Additionally, the Supreme Court ruled that NEPA does not compel federal agencies to address the environmental effects of projects separate in time or place from the construction and operation of the proposed project at issue.

Justice Kavanaugh authored the main opinion joined by Justices Alito, Thomas, and Barrett along with Chief Justice Roberts. Justice Sotomayor penned a separate concurring opinion joined by Justices Kagan and Jackson. Justice Gorsuch did not participate in the case.

Rail Project at Issue

In December 2021, the federal Surface Transportation Board approved an application to construct an 88-mile rail line in Utah’s Uinta Basin that would primarily transport crude oil to interstate rail lines and ultimately to refineries along the Gulf Coast.

NEPA required the Board to evaluate environmental impacts of the proposed project and consider potential alternatives to the project that would avoid or minimize those impacts. The Board’s NEPA evaluation was reflected in an Environmental Impact Statement (EIS) spanning more than 3,600 pages. Several non-governmental organizations and a local county filed a legal challenge under NEPA in the District of Columbia Circuit Court of Appeals, alleging that the Board failed to adequately consider the impacts of certain “upstream and downstream” activities that are separate from the proposed rail line. Specifically, the Board did not perform a detailed analysis of (1) increased crude oil development that may occur in the Uinta Basin once the rail line goes into service; or (2) air emissions at refineries along the Gulf Coast associated with processing crude oil extracted from the Uinta Basin.

Court of Appeals Decision

Finding in favor of the challengers, the D.C. Circuit agreed that future crude oil development and refining were “reasonably foreseeable impacts” that the Board should have evaluated. The D.C. Circuit rejected the Board’s position that those effects arose from other projects that were separate in time and space from the rail line and were also beyond the jurisdiction of the Board, which does not regulate crude oil extraction or refining.

Kavanaugh Opinion

The main court opinion makes clear that judicial review under NEPA involves affording substantial deference to the decisions by the federal agencies involved. That is because assessment of environmental effects and feasible alternatives involves “a series of fact-dependent, context-specific, and policy-laden choices.” Thus, courts “should afford substantial deference and should not micromanage those agency choices so long as they fall within a broad zone of reasonableness.” Nevertheless, Justice Kavanaugh observed that “[s]ome courts have strayed and not applied NEPA with the level of deference demanded by the statutory text and this Court’s cases.” In doing so, “NEPA has transformed from a modest procedural requirement into a blunt and haphazard tool employed by project opponents (who may not always be entirely motivated by concern for the environment) to try to stop or at least slow down new infrastructure and construction projects.”

Kavanaugh’s opinion wholly rejects the notion that NEPA requires federal agencies to consider other existing or potential future projects that are separate in space and time from the proposed project under consideration. The opinion observes that NEPA’s focus is the “project at hand – not other future or geographically separate projects that may be built (or expanded) as a result of or in the wake of the immediate project under consideration.” Consequently, “NEPA does not require the agency to evaluate the effects of that separate project.” The Board was therefore “[a]bsolutely correct” in concluding that it need not perform a detailed analysis of the potential for future crude oil development in the Uinta Basin and refining activities along the Gulf Coast.

Lastly, Kavanaugh observed that NEPA litigation should not be a forum for project opponents “to air their policy objections to proposed federal actions.” “Citizens may not enlist the federal courts, ‘under the guise of judicial review’ of agency compliance with NEPA to delay or block agency projects based on the environmental effects of other projects separate from the project at hand.”

Concurring Opinion

The concurring opinion authored by Justice Sotomayor and joined by Justices Jackson and Kagan observes that the Board lacked jurisdiction over potential future crude oil development and refinery activities, and lacked authority to restrict transportation of crude oil on the proposed rail line. Therefore, there was no need for the Board to consider impacts of those activities.

What’s Next?

NEPA has been called one of the most litigated environmental statutes in the United States. This decision should set a higher bar for project opponents to succeed on NEPA claims. The Court made clear that the judiciary should afford substantial deference to how federal agencies weigh the respective impacts and benefits of a proposed project. Whether this pronouncement will prompt developers to move forward with additional projects, and how much deference will actually be afforded by the lower courts, remains to be seen. This decision does not directly affect the legal landscape for challenges brought under substantive environmental statutes like the Clean Water Act, Clean Air Act, or Endangered Species Act, although actions challenging major projects that allege violations of these statutes are often paired with a NEPA claim.

If you would like to discuss this decision or NEPA in general, please contact Robert M. Stonestreet at rstonestreet@babstcalland.com or 681.265.1364.

Click here, to view the article online in the July issue of GO-WV News.

Pipeline Safety Regulatory Initiatives Under the Trump Administration

GO-WV

(by Lee Banse)

Introduction

Since entering office, President Trump has issued multiple executive orders seeking to promote the deregulation of American business, improve government efficiency, and unleash American energy.[1] In response, the U.S. Department of Transportation (DOT) and its agency responsible for pipeline safety, the Pipeline and Hazardous Materials Safety Administration (PHMSA), have initiated multiple rulemakings to achieve these objectives. This article will provide a brief overview of the initiatives that will impact operators subject to PHMSA’s pipeline safety regulations. Operators can engage with DOT and PHMSA by providing comments to assist in the deregulatory efforts.

DOT Initiatives

Ensuring Lawful Regulation; Reducing Regulation and Controlling Regulatory Costs Request for Information

On April 3, 2025, citing President Trump’s executive orders related to deregulation and government efficiency,[2] DOT published a request for information (RFI) seeking the public’s input to identify which DOT regulations, guidance, paperwork requirements, or other regulatory obligations can be modified or repealed.[3] The RFI is broad in scope and applies to all DOT programs, including the pipeline safety regulations, and seeks information to help drive future deregulatory rulemakings and initiatives. DOT requested comments on the RFI to be submitted by May 5, 2025, but has also established an email inbox, Transportation.RegulatoryInfo@dot.gov, which remains open on a continuous basis for the public to submit additional ideas on programs suitable for modification or repeal.

Administrative Rulemaking, Guidance, and Enforcement Procedures Notice of Proposed Rulemaking

On May 16, 2025, DOT published a notice of proposed rulemaking (NPRM) to recodify certain DOT administrative procedures and practices in the Code of Federal Regulations (CFR).[4] Known informally as the “Rule on Rules,” the NPRM primarily addresses the process and procedures that control how the DOT performs its core regulatory functions of rulemaking, guidance development, and enforcement. The first Trump administration promulgated a Rule on Rules in 2019,[5] but the Biden administration rescinded nearly all its provisions in 2021.[6] The NPRM would reinstate, update, and expand on the requirements in the first Rule on Rules.

The NPRM includes rulemaking procedures that would apply to all DOT modes for each phase of a rulemaking and would recodify in the CFR provisions related to the DOT Regulatory Reform Task Force (RRTF). The RRTF is responsible for evaluating existing and proposed DOT regulations and providing recommendations to the Secretary of Transportation on whether regulations should be repealed or modified to reduce unnecessary regulatory burdens. Another key proposal in the NPRM includes heightened procedural requirements for rulemakings determined to be economically significant and high-impact (established through an estimation of the costs and job losses attributed to the proposed rule).[7]

For enforcement requirements, the NPRM includes provisions that stress that DOT must use its investigatory powers in a manner consistent with due process, basic fairness, as well as avoiding the use of enforcement as a “fishing expedition” to search for potential non-compliance.[8] The NPRM also proposes to disqualify DOT personnel with personal animus against specific regulated parties from participating in enforcement against those parties, and allows operators to petition the DOT’s Office of General Counsel (OGC) to determine if DOT personnel violated an enforcement rule.[9] If a violation occurred, DOT OGC may, among other relief, remove the responsible DOT enforcement team from the case.[10]

For the first Rule on Rules, the Trump administration directly issued a final rule without providing an opportunity for public comment, because the rule only incorporated internal DOT administrative procedures into the CFR. For this rulemaking, since certain proposals in the NPRM would confer express rights to regulated parties, such as the ability to petition the OGC about DOT violations of enforcement procedures, DOT is seeking public comment. The public comment period for the NPRM closes June 16, 2025. Following the comment period, DOT will begin to evaluate the public comments and work to finalize the rule.

PHMSA Initiatives

Mandatory Regulatory Reviews to Unleash American Energy and Improve Government Efficiency Advance Notice of Proposed Rulemaking

On June 4, 2025, PHMSA published an advance notice of proposed rulemaking (ANPRM) seeking public comment to identify requirements in the pipeline safety regulations suitable for repeal or modification.[11] The ANPRM is broad in scope and requests comments on any PHMSA interpretation, guidance document, or any other material implementing the pipeline safety regulations which are suitable for modification or repeal. Additionally, the ANPRM seeks comment on whether PHMSA should codify in the pipeline safety regulations a requirement to conduct periodic regulatory reviews so that the agency is continuously reviewing and identifying regulations that require modification. Public comment on the ANPRM is due by August 4, 2025.

Liquified Natural Gas Facilities Advance Notice of Proposed Rulemaking

On May 5, 2025, PHMSA published in the Federal Register an ANPRM seeking public comments to help guide amendments to 49 C.F.R. Part 193, the safety standards applicable to liquified natural gas (LNG) facilities.[12]

Citing the growing importance of LNG to the economy and that the current Part 193 requirements incorporate out-of-date industry standards that no longer align with modern LNG operations or facilities, PHMSA requested public comment to understand how best to revise Part 193. Specific topics discussed in the ANPRM include (1) the appropriate means to clarify the scope of PHMSA’s jurisdiction over LNG facilities; (2) whether different types of LNG facilities, e.g., peak shavers and export terminals, should be regulated differently; (3) possible amendments to LNG facility reporting requirements; and (4) how best to update the current industry standards incorporated in Part 193. The public comment period for the ANPRM closes on July 7, 2025.

Repair Criteria Advance Notice of Proposed Rulemaking

On May 21, 2025, PHMSA published an ANPRM requesting public comment on how best to update the agency’s repair criteria in 49 C.F.R. Part 192 for gas pipelines, and in 49 C.F.R. Part 195 for hazardous liquids and carbon dioxide pipelines, as well as updating inspection requirements for in-service breakout tanks.[13] Parts 192 and 195 include repair criteria and remediation timelines for certain pipeline anomalies, such as dents and corrosion. These requirements differ depending on whether the pipeline is subject to Part 192 or 195 integrity management (IM) requirements.

Noting that certain Part 192 or Part 195 repair criteria and timelines had not been updated for an extended period and do not accommodate advances in modern technologies and methods to manage pipeline integrity, PHMSA requested public comment on an extensive list of topics to help guide a future rulemaking to modernize the repair criteria and reduce their current regulatory burden. Certain specific topics in the ANPRM include (1) whether the current repair criteria and remediation timelines provided commensurate safety benefits when measured against compliance costs; (2) whether the current regulations can appropriately accommodate the use of innovative technologies or methods; (3) identification of potential amendments to annual, incident, and safety-related condition reporting; and (4) identification of potential changes to the IM repair criteria for longitudinal seam weld corrosion on hazardous liquid pipelines.[14] The comment period for the ANPRM closes on July 21, 2025.

Public Comments on Interpretation Requests

Apart from new rulemakings, PHMSA has also adopted a new process which allows the public to provide comments on interpretation requests under review by the agency. Under PHMSA’s regulations, any person may file an interpretation request seeking PHMSA’s guidance on the meaning of its regulations or how the regulations would apply in specific circumstances.[15] Previously, PHMSA did not make an interpretation request publicly available until it also published its response. Under the Trump administration, PHMSA now publishes the interpretation requests it receives on its website,[16] and provides a 30-day comment window, so that the public may provide input on how PHMSA should respond. The new process provides operators with notice of pending interpretation requests that may have industry-wide implications and allow operators to participate in the interpretation process.

Conclusion

For pipeline operators, the current focus of DOT and PHMSA to improve efficiency, modernize, and deregulate its programs provides an opportunity to inform DOT and PHMSA’s efforts by providing comments in the rulemaking proceedings. Additionally, operators should be aware that the situation remains dynamic, and it is likely that DOT and PHMSA will continue to add new deregulatory initiatives alongside those already announced. Operators should continue to track DOT and PHMSA activity to determine if there are any new initiatives that they may want to participate in.

Lee Banse is an attorney in Babst Calland’s Washington, D.C. office and a member of the Energy and Natural Resources and Pipeline and HazMat Safety groups. Mr. Banse represents clients in pipeline safety matters before the Pipeline and Hazardous Materials Safety Administration (PHMSA), state agencies, and federal courts. Contact him at lbanse@babstcalland.com or 202-853-3463.

Click here, to view the article online in the July issue of GO-WV News.

________________________________

[1] Exec. Order No. 14,192, “Unleashing Prosperity through Deregulation,” 90 Fed. Reg. 9,065 (Feb. 6, 2025); Exec. Order No. 14,219, “Ensuring Lawful Governance and Implementing the President’s ‘Department of Government Efficiency’ Deregulatory Initiative,” 90 Fed. Reg. 10,583(Feb. 25, 2025); Exec. Order No. 14,154, “Unleashing American Energy,” 90 Fed. Reg. 9,065 (Feb. 6, 2025); Exec. Order No. 14,156 “Declaring a National Energy Emergency,” 90 Fed. Reg. 8,433 (Jan. 29, 2025).

[2] Department of Transportation, “Ensuring Lawful Regulation; Reducing Regulation and Controlling Regulatory Costs,” 90 Fed. Reg. 14,593 (Apr. 3, 2025).

[3] Id.

[4] Department of Transportation, “Administrative Rulemaking, Guidance, and Enforcement Procedures,” 90 Fed. Reg. 20,956 (May 16, 2025).

[5] Department of Transportation, “Administrative Rulemaking, Guidance, and Enforcement Procedures,” 84 Fed. Reg. 71,714 (Dec. 27, 2019).

[6] Department of Transportation, “Administrative Rulemaking, Guidance, and Enforcement Procedures,” 86 Fed. Reg. 17,292 (Apr. 2, 2021).

[7]90 Fed. Reg. 20,956, 20,968 (May 16, 2025).

[8] Id. 20,972-20,973.

[9] Id. 20,976.

[10] Id.

[11] Pipeline and Hazardous Materials Safety Administration, “Pipeline Safety: Mandatory Regulatory Reviews to Unleash American Energy and Improve Government Efficiency,” 90 Fed. Reg. 23,660 (Jun. 4, 2025).

[12] Pipeline and Hazardous Materials Safety Administration, “Pipeline Safety: Amendments to Liquified Natural Gas Facilities,” 90 Fed. Reg. 18,949 (May 5, 2025).

[13] Pipeline and Hazardous Materials Safety Administration, “Pipeline Safety: Repair Criteria for Hazardous Liquid and Gas Transmission Pipelines,” 90 Fed. Reg. 21,715 (May 21, 2025).

[14] Id. 21,717-27,719.

[15] 49 C.F.R. § 190.11(b).

[16] https://www.phmsa.dot.gov/standards-rulemaking/pipeline/interpretations/pending-pipeline-interpretations

Pennsylvania Municipal Vacancies 101

The Legal Intelligencer

(by Michael Korns and Anna Hosack)

With election season just around the corner, Pennsylvania municipalities often face the issue of municipal vacancies. While some municipalities have highly contested elections, others, particularly small boroughs, may struggle to find individuals even willing to serve. Municipalities often have questions regarding the rules for these openings, which follow rules from multiple statutes and codes. To add to the confusion, the rules for filling vacancies differ greatly depending on the type of municipality and the exact timing of when the vacancy occurs. This article provides a broad overview of how vacancies occur, how they are filled, and for how long the new official will serve.

How Vacancies Occur

Vacancies on municipal governing bodies can occur in several ways. Most commonly, they occur due to the death, resignation, or relocation of the elected official. The timing of the vacancy depends on the cause. Where a vacancy occurs by the death of an elected official, the official and operative date of the vacancy is the date of death. Where a vacancy occurs by resignation, the date of the vacancy is either (i) on the date the municipality’s governing body accepts the resignation as a whole by vote at a public meeting or (ii) 45 days from the date the resignation was tendered, whichever comes first. An elected official may withdraw their resignation in writing prior to the governing body’s acceptance, so long as 45 days have not passed.

Relocations are the trickiest vacancies to date, as in those cases, the vacancy occurs when the elected official has established a permanent domicile outside of the municipality. Most commonly, the operative date of vacancy is the date they moved into a new home. However, in other cases, this analysis may be more nuanced, particularly if they continue to own property inside the municipality and it is unclear when they have permanently moved without intent to return. Complicating matters further, the relocating elected official may often choose to submit a letter of resignation. If the letter is submitted before the relocation occurs, then the standard rules for a letter of resignation apply. If it is sent after the relocation, the vacancy should still be dated to when the elected official relocated, and the resignation letter is irrelevant to that analysis.

Filling the Vacancy

Regardless of how the vacancy occurs, from that date, the municipality’s governing body is on the clock. More specifically, the governing body has 30 days to act from the date of the vacancy before the authority to fill the position passes.

How the remaining elected officials of the governing body find a person to fill the vacancy is within the governing body’s discretion. The governing body is not required to advertise the position, hold interviews, or follow any other specific process to fill the vacancy. It is, however, important to note that if a quorum of the governing body is participating in deliberations about the vacancy, those deliberations are subject to the Pennsylvania Sunshine Act, 65 Pa.C.S. §§ 701-716, and must occur at an advertised public meeting to allow for public comment, and the discussion must be listed on the agenda 24 hours in advance. While soliciting and accepting resumes and letters of interest, along with the consideration of multiple candidates, is an advisable best practice, these actions are not legally required.

When filling the vacancy of an elected official at the local municipal level, there is no requirement that the replacement be of the same political party as their predecessor. The only requirement is that the new appointee be eligible to serve in the seat, which means they must be a registered elector in the municipality and meet the residency requirements of the position, which typically requires that they be a resident of the municipality for over a year. If the position is elected by ward, they would also need to meet the residency requirements of that ward. The rules for certain County offices may differ, so always consult your Solicitor regarding any vacancy in your municipality.

Typically, any official action of a municipality requires only a standard majority (i.e., a majority of the members of the governing body at a meeting). However, in some municipalities, the vote must consist of a majority of the entire board, not just those who are in attendance at a meeting. Thus, for a five-person board with a single vacancy, a vote of three elected officials would be required, even if only three are in attendance at the public meeting. If the vote to fill a vacancy results in a tie, the vacancy has not been filled.

If, for whatever reason, the Board is unable to vote to appoint a replacement within 30 days, the next 15 days provide an opportunity for the municipality’s vacancy board to fill the position. At the start of every year, each municipality must appoint a vacancy board chair to serve in this specific capacity. They then chair a meeting with the remaining members of the board. Ideally, this allows them to break any tie and render a decision. If, however, the municipality is still unable to fill the position, then the Court of Common Pleas of the County may fill the vacancy upon the request of the municipality. The Court may also act upon a petition by ten or more qualified electors.

Term of Office

The timing of the vacancy raises one more question. How long does the appointed official serve? This rule is governed by 53 Pa.C.S. § 3132, which designates that an appointed official shall serve until the first Monday in January following the next municipal election that occurs at least 50 days after the date of the vacancy. While awkwardly phrased, this procedure is simple. Municipal appointments run through a calendar year and expire with the swearing in of a successor at a reorganization meeting. A municipal election in Pennsylvania occurs in the fall of each odd-numbered year. What this means in practical terms is that, if a vacancy occurs more than 50 days before the fall municipal election, the appointment will last until the following January, when a new successor is sworn in. That successor will then serve the remainder of the prior official’s term, or a full term if the prior official’s term would have been completed by that point. If, however, the vacancy occurs less than 50 days before the next municipal election, the selection of the successor will be two years forward to the next municipal election.

One final complication, however, concerns the question of how candidates for any special election are named on the ballot. If the vacancy occurs prior to the primary, candidates can be named on the ballot via nominating petitions or papers, as in any other election. If, however, it occurs too late for candidates to appear on the primary ballot, there will be no municipal primary election. Instead, the candidates will be chosen by the major political parties in proceedings governed by their respective bylaws, and there will be no primary to select nominees.

While the above covers the broad outlines of filling a vacancy, this area of law is filled with nuance, and a precise reading of the specific codes must be followed. In addition, coordination with County election bureaus is vital to ensure that the correct positions and terms are listed on the ballot.

Michael T. Korns is senior counsel at Babst Calland Clements and Zomnir, P.C. and focuses his practice primarily on municipal permitting, planning, subdivision and land use, and zoning issues. He is also a member of the firm’s Energy and Natural Resources group. Contact him at 412-394-6440 or mkorns@babstcalland.com.

Anna R. Hosack is an associate at the firm and focuses her practice primarily on municipal, real estate, land use, and zoning law. Contact her at 412-394-5406 or ahosack@babstcalland.com.

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Pipeline Safety Regulatory Initiatives Under the Trump Administration

PIOGA Press

(by Lee Banse)

Introduction

DOT Initiatives

Ensuring Lawful Regulation; Reducing Regulation and Controlling Regulatory Costs Request for Information

Administrative Rulemaking, Guidance, and Enforcement Procedures Notice of Proposed Rulemaking

PHMSA Initiatives

Mandatory Regulatory Reviews to Unleash American Energy and Improve Government Efficiency Advance Notice of Proposed Rulemaking

Liquified Natural Gas Facilities Advance Notice of Proposed Rulemaking

Repair Criteria Advance Notice of Proposed Rulemaking

Public Comments on Interpretation Requests

Conclusion

[2] Department of Transportation, “Ensuring Lawful Regulation; Reducing Regulation and Controlling Regulatory Costs,” 90 Fed. Reg. 14,593 (Apr. 3, 2025).

[3] Id.

[4] Department of Transportation, “Administrative Rulemaking, Guidance, and Enforcement Procedures,” 90 Fed. Reg. 20,956 (May 16, 2025).

[5] Department of Transportation, “Administrative Rulemaking, Guidance, and Enforcement Procedures,” 84 Fed. Reg. 71,714 (Dec. 27, 2019).

[6] Department of Transportation, “Administrative Rulemaking, Guidance, and Enforcement Procedures,” 86 Fed. Reg. 17,292 (Apr. 2, 2021).

[7]90 Fed. Reg. 20,956, 20,968 (May 16, 2025).

[8] Id. 20,972-20,973.

[9] Id. 20,976.

[10] Id.

[12] Pipeline and Hazardous Materials Safety Administration, “Pipeline Safety: Amendments to Liquified Natural Gas Facilities,” 90 Fed. Reg. 18,949 (May 5, 2025).

[13] Pipeline and Hazardous Materials Safety Administration, “Pipeline Safety: Repair Criteria for Hazardous Liquid and Gas Transmission Pipelines,” 90 Fed. Reg. 21,715 (May 21, 2025).

[14] Id. 21,717-27,719.

[15] 49 C.F.R. § 190.11(b).

[16] https://www.phmsa.dot.gov/standards-rulemaking/pipeline/interpretations/pending-pipeline-interpretations

TAKE IT DOWN Act Signed into Law by President Trump

TEQ Magazine

(by Kristen Petrina)

On May 19, 2025, President Trump signed into the law the “TAKE IT DOWN Act (the “Act”). The Act includes data privacy, digital protections, and AI governance requirements of companies to remove deepfakes from “covered platforms”, particularly with a focus on nonconsensual intimate imagery (“NCII”).

The Act, whose acronym stands for “Tools to Address Known Exploitation by Immobilizing Technological Deepfakes on Websites and Networks Act” includes both criminal and civil elements; however, it does not create a new private right of action, rather provides the Federal Trade Commission with the enforcement authority over failures to comply with the notice and removal obligations, which would constitute an unfair or deceptive act or practice under the Federal Trade Commission Act.

Criminal and Civil Liability

The Act criminalizes the publication of an authentic or computer-generated NCII and outlines penalties for when the images of “intimate visual depiction” as defined in 15 USC 6851(5)(A), of an adult or minor and imposes new obligations on social media and online platforms to respond to requests to promptly remove unlawful NCII. Synthetic or computer-generated NCII, includes the term “digital forgery” meaning “any intimate visual depictions of an identifiable individual created through the use of software, machine learning, artificial intelligence, or any other computer generated or technological means, including by adapting, modifying, manipulating, or altering an authentic visual depiction, that, when viewed as a whole by a reasonable person, is indistinguishable from an authentic visual depiction of the individual.” An identifiable individual includes someone “(i) who appears in whole or in part in an intimate visual depiction; and (ii) whose face, likeness, or other distinguishing characteristic (including a unique birthmark or other recognizable feature) is displayed in connection with such intimate visual depiction.”

Criminal Liability for “Knowingly” Publishing NCII

Involving Adults. The Act prohibits the use of an interactive computer service to knowingly publish an intimate visual depiction of an adult identifiable individual, who is not a minor, if (i) the intimate visual depiction was obtained or created under circumstances in which the person knew or reasonably should have known the identifiable individual had a reasonably expectation of privacy; (ii) what is depicted was not voluntarily exposed by the identifiable individual in a public or commercial setting; (iii) what is depicted is not a matter of public concern; and (iv) publication of the intimate visual depiction is intended to cause harm or causes harm, including psychological, financial or reputational harm, to the identifiable individual. For synthetic or computer-generated digital forgeries, the test is similar, except to establish criminal liability, the depiction would have to be published without consent of the identified individual.
Involving Minors. Under the Act, NCII involving minors, defined as anyone under the age of 18 years, sets forth stricter prohibitions making it unlawful to publish NCII of an identifiable individual who is a minor with the intent to (i) abuse, humiliate, harass, or degrade the minor; or (ii) arouse or gratify the sexual desire of any person.
Consent, Disclosure and Disclosure Exceptions. The Act recognizes that the consent to create an image is not the same as consent to publication, stating that the fact that (i) an identifiable individual providing consent for the creation of an image; or (ii) the identifiable individual disclosure of the intimate visual depiction to another individual does not establish or constitute consent to publication. However, certain exceptions apply to allow for disclosure to law enforcement, professional obligation reporting requirements, or publication of an individual’s own images.

Civil Liability for Failure to Comply with Notice and Removal Requirements

The criminal provisions of the law went into effect immediately, the Act provides, “covered platforms” a year after the date the law went into effect, to develop a process for notice and removal of NCII identified from their platforms within 48 hours of receiving a valid request from an identifiable individual or someone authorized to act on the individual’s behalf. A covered platform means “a website, online service, online application, or mobile application that (i) serves the public or (ii) for which it is the regular course of business of trade or business of the website, online service, online application, or mobile application to publish, curate, host or make available content of nonconsensual intimate visual depictions.” Covered platforms do not include ISPs, email providers, online services that consist primarily of not user generated content, or services for which chat, comment or interactive functionality is directly related to the provision of not user generated content.

A covered platform must provide a clear, easy to understand and conspicuous policy which shall include valid removal request requirements, how to submit a removal request and the removal responsibilities of the platform. A valid removal request must be in writing, with a physical or electronic signature, and include (i) enough information to locate the depiction; (ii) a statement of the individuals’ good faith belief that the depiction was not consensual; and (iii) the requester’s contact information.

Within 48 hours of a valid removal request, the covered platform must remove the intimate visual depiction and make reasonable efforts to identify and remove any known identical copies of such depiction.

The Act gives covered platforms liability protections from claims from content posters based on the covered platforms good faith removal, disabling access to, or removal of, material claimed to be NCII, regardless of whether the intimate visual depiction is ultimately determined to be unlawful or not.

Covered Platform Next Steps

While the removal obligations will not take effect until May of 2026, covered platforms face significant obligations to confirm compliance. Knowledge of the Act allows companies to develop a business model to aid in immediate removal of NCIIs as it must occur with 48 hours. Therefore, companies that host user generated content, should prepare to take the following steps to determine if and how they would need to comply:

Determine if you or your company would be a covered platform.
Determine whether your company has enough resources, proper operating and escalation procedures, and training to implement the Act’s requirements.
Establish a notice process and policy.
Review your data privacy, AI, cybersecurity, document retention and digital governance policies.
Consider engaging professional support to confirm that your company is prepared to comply with the Act’s requirements.

Kristen Petrina is an associate in the Corporate and Commercial and Emerging Technologies groups of Babst Calland. She represents domestic and international clients on a broad range of general corporate and commercial law matters and advises businesses on data privacy and protection and security compliance.

Mo Money Mo Problems: As Noneconomic Damages Awards Continue to Rise, So Do Concerns Over Their Constitutionality

The Legal Intelligencer

(by Casey Alan Coyle)

The music genre hip-hop recently celebrated its 50^th anniversary. According to PBS, “no song announced hip-hop’s entrance into the mainstream louder” than the 1997 single “Mo Money Mo Problems” by Brooklyn-born Rapper Christopher Wallace, better known by his stage names “Notorious B.I.G.” and “Biggie.” https://www.pbs.org/wgbh/americanexperience/features/songs-of-the-summer-1997/. Built on a sample of Diana Ross’s “I’m Coming Out,” the track featured the chorus: “I don’t know what, they want from me/ It’s like the more money we come across/ The more problems we see.” Now, nearly three decades later, that hook captures an emerging trend in the law.

The Fourteenth Amendment’s Due Process Clause “prohibits the imposition of grossly excessive or arbitrary punishments on a tortfeasor.” State Farm Mut. Auto Ins. Co. v. Campbell, 538 U.S. 408, 416 (2003). While this concern precipitated the creation of a framework to assess the constitutionality of punitive damages awards over 30 years ago, no such rubric exists to determine whether compensatory damages awards comport with due process. Pennsylvania litigants are therefore left to challenge excessive compensatory damages awards under the common law. But as noneconomic damages awards continue to grow, so do concerns over their constitutionality, especially where they dwarf the economic damages, if any, awarded. This begs the question: when it comes to noneconomic damages, is it a case of mo money, mo problems?

Compensatory v. Punitive Damages

Compensatory and punitive damages, though typically awarded at the same trial, serve distinct purposes. Compensatory damages compensate for proven injury or loss. They aim to redress the concrete loss that the plaintiff suffered because of the defendant’s conduct and include both economic harm (such as lost wages or out-of-pocket expenses) and noneconomic harm (like mental anguish, pain and suffering, and embarrassment and humiliation). Punitive damages, on the other hand, focus on deterrence and retribution. They have been characterized as “quasi-criminal” or “private fines.” Bert Co. v. Turk, 298 A.3d 44, 58 (Pa. 2023). “Unlike compensatory damages, which serve to allocate an existing loss between two parties, punitive damages are specifically designed to exact punishment in excess of actual harm to make clear that the defendant’s misconduct was especially reprehensible.” Pac. Mut. Life Ins. Co. v. Haslip, 499 U.S. 1, 54 (1991) (O’Connor, J., dissenting).

Compensatory damages awards are presumed valid under Pennsylvania law regardless of their size. To that end, Pennsylvania courts have often stated that large verdicts “are not necessarily excessive verdicts; each case is unique and dependent on its own special circumstances,” Hyrcza v. W. Penn Allegheny Health Sys., Inc., 978 A.2d 961, 979 (Pa. Super. Ct. 2009), adding that reviewing courts are “reluctant to reverse a jury verdict that bears a reasonable resemblance to the damages proven,” Crespo v. Hughes, 167 A.3d 168, 189 (Pa. Super. Ct. 2017). In contrast, punitive damages awards are closely scrutinized by reviewing courts because they “pose an acute danger of arbitrary deprivation of property.” Honda Motor Co. v. Oberg, 512 U.S. 415, 432 (1994). Closer examination is needed because “juries assess punitive damages in wholly unpredictable amounts bearing no necessary relation to the actual harm caused.” Gertz v. Robert Welch, Inc., 418 U.S. 323, 350 (1974).

Because of this concern and to ensure that “the measure of punishment is both reasonable and proportionate to the amount of harm to the plaintiff and the general damages recovered,” in BMW of North America, Inc. v. Gore, the U.S. Supreme Court established a framework—commonly referred to as the “Gore guideposts”—for courts to consider when reviewing the constitutionality of a punitive damages award. 517 U.S. 559, 574–575 (1996). The guideposts are: (1) the degree of reprehensibility of the defendant’s misconduct; (2) the disparity between the actual or potential harm suffered by the plaintiff and the punitive damages awarded; and (3) the difference between the punitive damages awarded by the jury and the civil penalties authorized or imposed in comparable cases. Id. Later, in Campbell, the Court articulated five subfactors that applied to an examination of the first Gore guidepost.

But neither the U.S. Supreme Court nor Pennsylvania’s appellate courts have established a test for evaluating the constitutionality of compensatory damages awards. For its part, the Pennsylvania Supreme Court has simply stated that a compensatory damages award “will not be upset unless it is so excessive as to shock the conscience of the court or it is clearly based on partiality, prejudice or passion.” See, e.g., Bailets v. Pa. Turnpike Comm’n, 181 A.3d 324, 336 (Pa. 2018). But it has not articulated a corresponding standard for determining excessiveness. Amid this void, the Pennsylvania Superior Court has held that reviewing courts may consider the following non-exhaustive factors in assessing whether a verdict is excessive: (1) the severity of the injury; (2) whether the injury is manifested by objective physical evidence or solely revealed by the plaintiff’s’ subjective testimony; (3) whether the injury is permanent; (4) whether the plaintiff can continue with their employment; (5) the size of the plaintiff’s out-of-pocket expenses; and (6) the amount demanded in the plaintiff’s original complaint. See, e.g., Brown v. End Zone, Inc., 259 A.3d 473, 486 (Pa. Super. Ct. 2021).

The Noneconomic Damages Dilemma

The test fashioned by the Superior Court may prove useful for assessing the excessiveness of a verdict consisting entirely of economic damages. But its utility is less clear in cases involving noneconomic damages, to which just three of the six factors seemingly apply (specifically, the first, second, and third). Indeed, without considering the relationship between the noneconomic damages and the economic damages awarded and comparable cases involving similar noneconomic damages awards, judicial review of a noneconomic damages award would seem illusory. And absent meaningful judicial review, nothing stops a jury from awarding punitive damages under the guise of noneconomic damages, thereby eluding constitutional review.

Two recent cases highlight this concern. In Caranci v. Monsanto Co., No. 210602213 (Phila. Cnty. Ct. Com. Pl.), a husband and wife filed a products liability action against Monsanto, alleging the husband’s use of Roundup caused him to develop non-Hodgkin’s lymphoma. The jury found the product was defective and awarded the couple $25 million in compensatory damages and $150 million in punitive damages. However, because the couple withdrew their request for economic damages, the compensatory damages consisted entirely of noneconomic damages. On appeal, the Superior Court panel applied the above six-factor test and found that the verdict was not excessive. Caranci v. Monsanto Co., ___ A.3d ___, 2025 WL 1340970, at *16 (Pa. Super. Ct. May 8, 2025). In doing so, however, the Court did not address the fifth and sixth factors. The panel also did not respond to Monsanto’s contention that the compensatory damages award was significantly higher than other large products-liability verdicts involving serious illnesses in Pennsylvania and compensatory damages awards against Monsanto in other jurisdictions—considerations required under the third Gore guidepost and, in any event, ones that would seem to be part and parcel of an assessment of whether a verdict shocks the conscience. And beyond summarily dismissing it as “mere conjecture and not grounds for relief,” id., the panel did not address Monsanto’s argument that the $25 million noneconomic damages award contained a punitive element given the couple’s withdrawal of their request for economic damages and the attendant due process concerns.

More recently, in Gill v. ExxonMobil Corp., No. 200501803 (Phila. Cnty. Ct. Com. Pl.), a husband and wife filed a products liability action against ExxonMobil and other defendants, alleging the husband developed acute myeloid leukemia from supposed years-long exposure to multiple products. The jury found for the couple and awarded them $725 million in compensatory damages consisting solely of noneconomic damages. ExxonMobil filed a post-trial motion, arguing that the verdict was excessive, among other things. Notably, ExxonMobil contended that “[t]he size and nature of the compensatory damages presents constitutional issues related to Due Process and excessive fines under both the Pennsylvania and United States Constitutions, despite punitive damages not being an element of available damages to Plaintiffs. Indeed, the extraordinary damages award here cannot be understood as anything [other] than a punitive damages award in disguise.” (Def. Exxon Mobil Corp.’s Br. in Supp. of Mot. for Post-Trial Relief at 52 n.34.) The trial court denied the motion. In its ensuing Rule 1925 opinion, the court acknowledged that “at trial there was no economic harm alleged, and … only noneconomic harm was considered by the jury” (Op. at 351), which would seem to weigh in favor of a finding of excessiveness. Likewise, the court noted that the plaintiff demanded the jurisdictional threshold—$50,000—in the original complaint (id.), meaning the noneconomic damages award exceeded the demand by a factor of 14,000. Nonetheless, the trial court reiterated its belief that the jury verdict was not excessive.

What’s Next

Monsanto filed a reargument application in Caranci on May 22, 2025, and merits briefing before the Superior Court will begin on June 23, 2025, in Gill. But regardless of the outcome of those appeals, they have brought to the fore the due process concerns posed by large verdicts involving noneconomic damages. Only time will tell if Biggie was right.

——————–

Casey Alan Coyle is a shareholder at Babst, Calland, Clements and Zomnir, P.C. He focuses his practice on appellate law and complex commercial litigation. Coyle is also a former law clerk to Chief Justice Emeritus Thomas G. Saylor of the Pennsylvania Supreme Court. Contact Coyle at 267-939-5832 or ccoyle@babstcalland.com.

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Paid Sick Leave Increases in Pittsburgh: Compliance for All

Employment and Labor Alert

(by Janet Meub and Steve Antonelli)

Employers that have a presence within the city limits of Pittsburgh should be aware of upcoming changes to the city’s paid sick leave law. Currently, the City of Pittsburgh’s Paid Sick Days Act requires businesses within the city limits to provide one hour of sick leave for every thirty-five hours worked. For businesses that employ fifteen or more employees, this requirement is capped at forty hours per year. For businesses with fewer than fifteen employees, the cap is twenty-four hours per year.

On June 10, 2025, Pittsburgh City Council voted unanimously to amend the law. Effective January 1, 2026, barring any legal challenges, the Act will permit employees to earn up to thirty more hours per year at a faster rate. Specifically, employees will earn one hour of paid sick leave for every thirty hours worked. The annual caps will increase to seventy-two hours of paid sick leave for employers with more than fifteen employees and forty-eight hours for businesses with fewer than fifteen employees.

All employers, not just those within the City of Pittsburgh, should routinely confirm that they are in compliance with local laws. In particular, they should ensure that their human resources department and third-party payroll vendor are aware of recent changes to local laws, like this one. They should also update policy documents and/or employee handbooks accordingly.

Babst Calland’s Employment and Labor Group can assist employers that are subject to the Act by helping them evaluate eligible employees and hours worked and structuring a sick leave policy that complies with the Act. For more information about the Act’s requirements and how Babst Calland can assist you, please contact Janet K. Meub at (412) 394-6506 or jmeub@babstcalland.com or Stephen A. Antonelli at (412) 394-5668 or santonelli@babstcalland.com.

Amidst EPA’s Reconsideration, PADEP Publishes Proposed State Plan for Greenhouse Gas Emissions from Existing Oil and Natural Gas Facilities

Environmental Alert

(by Gary Steinbauer and Gina Buchman)

On May 31, 2025, the Pennsylvania Department of Environmental Protection (PADEP) published notice of opportunity for public comment on its Proposed State Plan for 40 CFR Part 60, Subpart OOOOc Emissions Guidelines for Greenhouse Gas Emissions from Existing Crude Oil and Natural Gas Facilities in the Pennsylvania Bulletin. 55 Pa.B. 3810.

PADEP is obligated to undertake this rulemaking pursuant to section 111(d) of the Clean Air Act and its implementing regulations, which require states to establish, implement, and enforce standards of performance for existing sources of a pollutant for which emission guidelines have been issued the United States Environmental Protection Agency (EPA). In March 2024, EPA published Standards of Performance for New, Reconstructed, and Modified Sources and Emissions Guidelines for Existing Sources: Oil and Natural Gas Sector Climate Review. 89 Fed. Reg. 16820 (Mar. 8, 2024). This rule, referred to by some as the “Methane Rule,” established new New Source Performance Standards regulating greenhouse gases (GHGs) and volatile organic compounds (VOCs) emissions for the Crude Oil and Natural Gas source category that begin construction, reconstruction, or modification after December 6, 2022 (referred to as OOOOb) and emission guidelines for states to use in developing, submitting, and implementing state plans to establish standards of performance to limit GHG emissions (in the form of methane) from sources existing as of December 6, 2022 in the Crude Oil and Natural Gas source category (referred to as OOOOc). OOOOb and OOOOc are very similar as it relates to methane reduction. States, industry trade groups, and oil and gas companies have challenged the Methane Rule, and these challenges are pending before the D.C. Circuit Court of Appeals.

States can either adopt EPA’s model emission guidelines as their state plan or develop their own standards that are equally as or more stringent than the federal model rule. States may apply standards less stringent than those included in OOOOc by taking into consideration the remaining useful life (RULOF) of the regulated sources in their plans. PADEP has chosen to largely adopt EPA’s model OOOOc emissions guidelines as its Proposed State Plan, while also seeking comments on whether RULOF should be considered in establishing a standard of performance in its State Plan “for any facility or class of facilities that would be regulated.” As of the date of this Alert, PADEP must submit its state plan to EPA by March 9, 2026, with compliance deadlines in 2029.

A copy of the Proposed State Plan is available on the DEP eLibrary. The Proposed State Plan is 193-pages and includes various appendices. The Department will accept written comments on the proposed plan for a 60-day comment period, which closes on July 30, 2025. In addition, the Department is holding seven public hearings on its proposal in June and July, where the public can provide comments on the proposal. Further information regarding these hearings and registration can be found on the Department’s website.

Less than one week after the Department opened its Proposed State Plan for comment, the federal Office of Management and Budget received what it describes as the EPA’s interim final rule to extend deadlines in OOOOb and OOOOc. In the past, EPA has issued interim final rules for rules related to the Agency’s organization, procedure, or practice. These interim final rules typically become effective upon publication in the Federal Register or 30 days after publication and provide a relatively short period for submission of public comments. EPA has followed prior interim final rules with a final rule that considers and responds to comments submitted on the interim rule. Although EPA’s interim final rule that is undergoing review by OMB has not been released to the public, it may extend the current March 9, 2026 deadline for the Department to submit the Proposed State Plan to EPA under 40 C.F.R. § 60.5362c.

Babst Calland’s Environmental Practice Group is closely tracking PADEP’s Proposed State Plan and EPA’s pending interim final rule, and our attorneys are available to provide strategic advice on how these actions may affect the oil and gas industry in Pennsylvania and can assist with drafting and submitting comments on PADEP’s proposal. For more information or answers to questions, please contact Gary Steinbauer at (412) 394-6590 or gsteinbauer@babstcalland.com, Gina Buchman at (202) 853-3483 or gbuchman@babstcalland.com, or your Babst Calland relationship attorney.

Strength in Structure: Job Descriptions, Performance Evaluations, and Disciplinary Writings

Legal Intelligencer

(by Morgan Madden and Steve Antonelli)

In the ever complex and evolving landscape of employment law, some of the most effective compliance tools are not found in case law or federal regulations but in routine and consistent documentation. Job descriptions, performance evaluations, and disciplinary writings are three foundational tools that can play a crucial yet often underestimated role in shaping and defending employers’ decisions. These documents are not standalone checkboxes, rather their effectiveness lies in their interconnectedness. Job descriptions lay the groundwork for expectations, performance evaluations track whether and how those expectations are met, and disciplinary writings memorialize any shortcomings or failures to meet them.

The proper use and maintenance of these documents can bolster compliance with key employment statutes. In the event of litigation, these records almost always become central to the body of evidence considered by a factfinder. Employers that use them regularly and consistently are often in a far stronger position to defend against claims and to demonstrate legitimate, nondiscriminatory reasons for adverse employment actions.

Job Descriptions: The Foundation of Employment Expectations

Job descriptions are more than administrative formalities—they define the who, what, and why of a role. A well-crafted job description outlines an employee’s essential functions, required qualifications, and reporting relationships. As an employer’s expectations change, so too should corresponding job descriptions. For example, how many employers allowed remote/hybrid work before March 2020?

Accurate and up to date job descriptions benefit both employers and employees because they help guide hiring decisions, compensation structures, and employee development. They can also play a pivotal role in litigation. They help delineate essential job functions and impact whether an employee’s accommodation request is reasonable in an ADA case, and they have a significant bearing on whether a position is exempt from overtime laws in a wage and hour case, to name a few examples.

To be legally useful and operationally effective, job descriptions should: (1) use objective, clear language that describes observable duties and requirements; (2) align with actual work performed, not just idealized roles or inherited templates; and (3) be updated regularly to reflect pertinent changes in the role.

Written Performance Evaluations: The Roadmap of Employee Progress

Performance evaluations are the primary method by which employers track and communicate an employee’s progress toward fulfilling the expectations set forth in the job description. Just as is the case with job descriptions, specificity and consistency in evaluations and performance reviews are critical.

Evaluations that praise (or criticize) an employee in vague or overly broad terms can create problems later when and if disciplinary action becomes necessary. Specific feedback about an employee’s performance is worth far more than general qualifiers – both in terms of employee engagement and success, and potential claim defensibility. For example, if a performance review simply states that an employee is “exceeding” or even “meeting” expectations, it could become difficult to justify a subsequent adverse employment action absent a clear record of interim performance problems. Instead of general praise, or criticism, employers should aim to evaluate performance as specifically as they can.

While formal performance reviews occur periodically (often annually), evaluation of employees’ performance should be fluid and ongoing. Informal or interim reviews, which can provide a more dynamic view of performance, are particularly useful when issues arise mid-year. It is possible for an employee to have a strong annual review followed by a drop in performance, and employers should refrain from waiting for the balance of the year to address the regression. An informal or interim review (and documentation thereof) can help right the proverbial ship by helping the employee to address the shortcoming and improve their performance and by putting the employer in position to support a negative review or defend an adverse employment action that follows a positive formal review.

In litigation, inconsistent performance evaluations can damage an employer’s credibility and can even allow a plaintiff to argue that an employer’s stated reason for an adverse employment action is pretextual.

To ensure evaluations serve both legal and operational goals, employers should: (1) tie evaluation criteria to the duties in the job description; (2) train managers on how to write effective evaluations that are honest, objective, and constructive; and (3) complete evaluations promptly and review them for consistency with other employment records.

Disciplinary Records: The Anchor of Employment Decisions

In the event of litigation, whether before a judge or an arbitrator, disciplinary documentation is often the most scrutinized aspect of the employment record with exceedingly high evidentiary value. It serves as the employer’s front-line defense as to both the explanation for and timing of the adverse employment action, as well as the evidence of any prior notices and opportunities to improve. Disciplinary records can also play a key role in other adversarial proceedings such as unemployment compensation hearings and union grievances, where the employer may have to justify that a termination or suspension was for either willful misconduct or just cause, respectively. In those settings, disciplinary records should be especially robust and involve specific language and allowances as the supporting documentation often serves as the tipping point in these matters.

Progressive discipline policies are an excellent tool in guiding disciplinary decisions. They allow employers to document each step taken – verbal warnings, written warnings, improvement plans, and suspensions – to demonstrate fair and consistent disciplinary actions.

Effective disciplinary documents should follow some basic principles. They should be issued promptly following the performance shortcoming or incident giving rise to the discipline. They should also: (1) refer to expectations set forth in the job description and/or previous performance evaluations; (2) contain details and be free from emotional or subjective language; and (3) demonstrate consistency across employees in similar circumstances.

Each of these three tools – job descriptions, performance evaluations, and disciplinary records – serves a distinct purpose. When aligned, they form a comprehensive and cohesive employment record that benefits both employers and employees by setting expectations, tracking performance, and documenting corrective actions. Strategically aligning these tools establishes a fair and transparent employment framework. For employees, it promotes understanding of expectations and how performance is measured. For employers, it builds a documented history that is invaluable both in day-to-day management of an operationally effective workforce, and in the event of litigation.

Employers should not wait for a lawsuit to evaluate their HR documentation practices. Instead, they should regularly review their job descriptions and align those documents with current duties and expectations so that performance evaluations can be conducted consistently.

By treating these basic HR documents as a strategic defense rather than administrative chores, employers can significantly reduce legal exposure while promoting a culture of clarity, fairness, and accountability.

Morgan M. Madden is an associate in Babst Calland’s Public Sector, Energy and Natural Resources, and Employment and Labor groups and focuses her practice on land use, zoning, planning, labor and employment advice, and litigation. Contact her at mmadden@babstcalland.com.

Stephen A. Antonelli is a shareholder in the Employment and Labor and Litigation groups of Babst Calland. His practice includes representing employers of all sizes, from Fortune 500 companies and large healthcare organizations to non-profit organizations and family-owned businesses. He represents clients, in all phases of employment and labor law, from complex class and collective actions and fast-paced cases involving the interpretation of restrictive covenants, to single-plaintiff discrimination claims and day-to-day human resources counseling. Contact him at santonelli@babstcalland.com.

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Natalie Baughman Joins Babst Calland’s Washington, DC Office

Babst Calland announced that Attorney Natalie Baughman has joined the firm’s Washington, DC office as a shareholder and member of its Environmental practice group.

Natalie Baughman has a deep expertise in CERCLA site remediation, particularly in complex, multi-party cleanups involving decades of contamination. Her practice also includes representing clients in enforcement actions, environmental litigation, and permitting and compliance matters arising under the Clean Water Act, Safe Drinking Water Act, and state environmental laws.

Prior to joining Babst Calland, Ms. Baughman worked in the U.S. Department of Justice’s Environmental Enforcement Section and the District of Columbia’s Department of Energy and Environment, where she oversaw the agency’s work on the CERCLA cleanup of the Anacostia River and numerous other contaminated sites. Ms. Baughman has represented clients in administrative and civil judicial enforcement cases in both government positions.

Ms. Baughman earned her B.S. from Northwestern University in 2002. She received her J.D. from the University of Maryland School of Law in 2009.

Ms. Baughman is admitted to practice in the District of Columbia and Maryland.

Legislative & Regulatory Update

The Wildcatter

(by Nikolas Tysiak)

Cavallo Mineral Partners LLC v. EQT Production Company, 2025 WL 800433 (Pa. Super., March 13, 2025). In this case, landowner Des Moine Field conveyed his 200 acre tract in Washington Twp., Greene County, PA to the McChesneys in 1990, using the following language: “ALSO EXCEPTING AND RESERVING, for the benefit of Grantees, his heirs and assigns, all oil and gas not previously excepted, reserved or conveyed, together with the right to mine and operate for the same . . .” (emphasis added). Field eventually purported to convey his oil and gas rights to Cavallo Mineral Partners. The McChesneys leased their oil and gas rights to EQT, which eventually included these interests in an oil and gas production unit. Cavallo eventually brought a quiet title declaratory action suit, alleging ownership of the oil and gas rights. EQT (and other co-defendants) eventually won on procedural grounds following competing motions for summary judgment, and the suit was dismissed without prejudice. In that decision, the court pointed out that Cavallo still had claims that could be made regarding the apparent Scrivener’s Error regarding the use of the term “grantees” in the reservation, and Cavallo was instructed to amend its complaint accordingly, which it failed to timely do. Instead, it further appealed the underlying case on procedural grounds. The Superior Court found that Cavallo could only succeed on its procedural claims if it were likely to succeed on the merits of its case. The court determined, based on the existing claims and record, that Cavallo was unlikely to succeed on the merits because the deed from Fields to the McChesneys did not properly except or reserve the oil and gas rights for the benefit of Fields or his heirs, successors and assigns. The attempted appeal was therefore quashed, but it appears that Cavallo is still able to amend its complaint to argue for a scrivener’s error reformation of the 1990 deed.

Antero Resources Corporation v. Pike, 914 S.E.2d 757 (W. Va. Inter. Ct., 2025). In this case, landowners excepted and reserved oil and gas from under 2 tracts, totaling 97 acres, in 1895. By 1942, the oil and gas became divided as follows: Rufus G. Fordyce, Edna L. Fordyce and Margaret Fordyce Pike (as joint tenants with the right of survivorship) – ½ interest; Daisy G. Broadwater – ½ interest. In 1949, Rufus, Edna and Daisy conveyed their interests in the 97 acres to Dora Jewell. The 1949 deed makes no reference to the interest of Margaret F. Pike, or to the deed where she acquired her interest. In 1976, successors to Jewell leased the oil and gas under the land, which eventually came into the possession of Antero Resources. Various wells were apparently timely drilled under the terms of the lease. Antero brought suit in 2019, seeking a declaratory judgment, asking the court to find that the successors to Jewell had effectively adversely possessed the 97 acres as against the potential interests of Margaret Fordyce Pike and her heirs at law. The Pike heirs counterclaimed, alleging intentional trespass, conversion, and demanding forfeiture of Antero’s oil and gas infrastructure. The trial court found Antero had not established that the non-Pike heirs and successors had successfully adversely possessed the Pike heirs’ oil and gas rights, as the requirements of ouster, specifically the right under ouster to receive actual notice of such ouster, had been fulfilled. The Intermediate court disagreed with this, citing caselaw indicating that actual notice of an ouster is not affirmatively required, but instead constructive notice can be relied upon IF the adverse possession is clearly in opposition and detriment to the rights of party to be deemed ousted (i.e., clear exclusive possession in an open, hostile and notorious manner). The intermediate court therefore overturned the trial court decision and remanded the case for additional proceedings in the trial court.

Miller v. Bunting, 2025 Pa. Super. 80 (April 8, 2025). This involves a suit where the plaintiff claimed ownership of coal rights under a tract of land containing 14.1219 acres pursuant to a deed that purportedly clearly excepted and reserved such coal rights. The Superior Court noted that the language of the deed clearly reserved such coal rights. In addition, the court produced a lengthy analysis of the intent of the parties regarding the coal rights and further concluded that the plaintiffs’ claims to the coal were “without merit.” Later, the court entertained the plaintiffs’ claim regarding Doctrine of Merger argument, where it was claimed that the coal estate and the surface estate merged under the ownership of the plaintiffs’ grantors, causing the plaintiffs’ to receive such coal rights by their deed. The court rejected this argument, pointing out that the Doctrine of Merger in Pennsylvania “is now practically extinct,” and can only occur under equitable grounds as necessary to prevent injustice. In other words, the parties involved must intend for a merger of titles to occur. The court further pointed out that traditionally, merger involves a greater estate subsuming a lesser estate. In this case, the two estates involved, covering the surface and the coal rights, were both for “fee simple” and neither estate could be construed as greater or lesser than the other. Finally, the court found that “expert reports” on interpretation of deeds is irrelevant as an issue of fact, because the meaning of deeds is strictly a matter of law for a court to decide. The orders granting summary judgment for the defendants below were affirmed.

Golden Eagle Resources II, LLC v. EQT Production Company, 2025 WL 874413 (Pa. Super. Ct. March 20, 2025). This suit involves the interpretation of competing clauses in an oil and gas lease regarding settling disputes. The lease from Golden Eagle to EQT’s predecessor included a clause requiring arbitration of disputes. However, the associated addendum to the lease allowed the parties to bring suit in any appropriate court. In addition, the addendum indicated that any conflict between the lease document form and the addendum should be settled in favor of the addendum. Golden Eagle made several arguments regarding the interplay of these clauses, but ultimately the court determined that the language of the addendum controlled, and no arbitration could be compelled. The court was particularly influenced by the fact that Golden Eagle had instigated the suit, implying that the more appropriate time to seek arbitration would have been before the filing of their lawsuit, and not on appeal.

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Supreme Court Significantly Scales Back Scope of NEPA Review for Infrastructure Projects

Environmental Alert

(by Robert Stonestreet)

Rail Project at Issue

Court of Appeals Decision

Kavanaugh Opinion

Concurring Opinion

What’s Next?

If you would like to discuss this decision or NEPA in general, please contact Robert M. Stonestreet at rstonestreet@babstcalland.com or 681.265.1364.

POWERING THE FUTURE: How Our Region Can Lead America’s Data Center Development

Pittsburgh Business Times

(by Moore Capito featuring Matt Smith)

With the surge of artificial intelligence, the demand for data centers to support that computing power is growing fast. “One of the challenges is that we as human beings and as businesses require so much more computing power than we ever have,” said A.A. Moore Capito, a shareholder specializing in energy and emerging technologies with the law firm Babst Calland. “That growth has continued consistently over the past 50 years, but at this current moment, we are seeing an exponential increase in demand.”

Yet, with this rapid growth comes significant challenges as businesses compete for power and land. With a wealth of energy resources, affordable land, and proximity to densely populated areas, this region is right in the thick of the trend.

Capito recently joined Allegheny Conference on Community Development Chief Growth Officer Matt Smith in the Pittsburgh Business Times offices for a conversation about the opportunities and challenges for the region, when it comes to data center growth.

Surging demand for power

Data centers are energy giants. They require a massive amount of power to process information, particularly as artificial intelligence capabilities expand. In February, Goldman Sachs Research predicted global power demand from data centers will increase 50 percent by 2027 and up to 165 percent by the end of 2029.

This spike in demand is forcing businesses and industry to rethink how to power their operations. Traditional reliance on the energy grid alone may no longer suffice.

“What I would consider the biggest challenge today is providing the power to sustain the growth that we need,” Capito said.

“A lot of these folks in the tech sector are saying we can’t rely on the grid anymore. We have to find alternative ways to power these very necessary components of our business and life, frankly, in today’s age.”

Because it offers several alternatives to the power issue, the region is positioned to attract data center projects, Smith and Capito said.

“Interestingly, we do a lot of work in our region with nuclear companies that are really at the cutting-edge of small modular reactors (SMRs), micro reactors, some even larger,” said Smith, noting how nuclear and natural gas combined can solve our energy shortage.

In a move that made international headlines, Constellation Energy and Microsoft announced plans last fall to restart a unit of the Three Mile Island nuclear plant to power the tech company’s data center use for 20 years. And Amazon Web Services is reported to be buying a data center campus in Salem Township in Westmoreland County that is collocated with a nuclear power generation plant.

Nuclear is far from the only option. Capito said Pennsylvania, West Virginia and Ohio’s rich natural gas resources have been underleveraged in data center planning so far.

“A lot of these developers see it as a nuclear play, but we know that doesn’t happen fast,” he said, which means they need an energy source to bridge that gap. “It’s got to be natural gas, and that is why we have an incredible opportunity here.”

There are a number of collaborative projects in play that lean on the region’s natural gas resources, Smith said.

In April, for example, Homer City Redevelopment and Kiewit Power Constructors Co. announced plans to turn what had once been the largest coal-burning power plant in Pennsylvania into a natural gas-powered data center campus. The new Homer City Energy Campus will deliver up to 4.5 gigawatts of power to support AI-driven hyperscale data centers.

Similarly, Liberty Energy Inc., Imperial Land Corp. and Range Resources have created a strategic alliance to support the development of a power generation facility within the Fort Cherry Development District in Washington County to serve data centers, industrial facilities and other high-energy-use businesses in Pennsylvania.

Finding ready-to-go sites

To attract AI and data center developers, this region doesn’t just offer abundant energy that can be drawn upon; it also has “ready-to-go” sites where projects can start quickly and operate efficiently, unique higher education assets like Carnegie Mellon University and the University of Pittsburgh, and access to key North American markets.

“It’s like walking into a hotel room,” Capito said. “You want the bed made. You want the towels on the rack, and you want the remote right beside you. You want it ready to go. And that’s the same way that developers want it.”

Our industrial legacy is serving us well in this regard. Southwestern Pennsylvania is already home to ample industrial sites tied to the power grid. These well-connected locations offer developers the infrastructure they need to hit the ground running.

“Because of our rich legacy of manufacturing and industrial strengths in Southwestern Pennsylvania, we have a lot of sites, we have abundant energy resources, and we have a highly skilled workforce,” Smith said. “We also have a lot of those sites specifically tied into the grid. This region will lead the way in ensuring our nation is energy dominant.”

Another example of seizing our region’s opportunity is the recent request by the Allegheny Conference and more than 20 organizations to the U.S. Department of Energy’s Office of Policy for using DOE land for AI infrastructure that would support data center demand and the administration’s goals.

We’re seeing the attractiveness of the region’s assets in recent moves by manufacturers that support the energy industry’s supply chain, Smith and Capito said.

Mitsubishi Electric Power Products Inc., for example, is building an $86 million manufacturing facility and testing lab in Beaver County, where it will make gas-insulated and vacuum circuit breakers, an important component for modernizing electric grids.

And the Switzerland-based power grid technology company Hitachi Energy has announced a $70 million expansion of its three manufacturing facilities in Westmoreland County. It makes high-voltage technologies, including switchgears, circuit breakers, generator circuit breakers and other products needed in power grids. Pennsylvania is supporting the expansion with a $184,000 Pennsylvania First grant and a $145,000 WEDnetPA grant to train employees.

That’s good news for the industry, which will need a steady, reliable supply of parts, Smith said.

“The reason you’re seeing this is that there is a huge power generation demand coming and large-scale investment is needed to meet that demand. Southwestern Pennsylvania is positioned to address that looming demand for power,” he said. “We stand at the center of energy resources and building the component parts that are essential to the grid supply chain.”

Cutting red tape

Business-friendly regulation is also giving this region an edge, Smith and Capito said.

Dealing with the regulatory environments and local, state and federal government to navigate those regulations can be very difficult, said Capito.

The PA Permit Fast Track Program, for example, has streamlined permitting for large economic development and infrastructure projects that require multiple permits from different agencies. And in March, Gov. Josh Shapiro proposed a state energy siting board to reduce red tape even further.

“One of the things that is of the utmost importance, if not the most important, for AI and data centers is speed,” Smith said. “Developers want to get the projects started quickly and want to get the projects done fast.”

Capito said he sees things speeding up at the federal level, too, thanks to President Donald Trump’s desire to invest heavily in AI.

“This is a critical industry,” Capito said. “It is a big national security component, managing the information flow of all of these systems that we have running that control essentially everything that you see and touch and feel every single day.”

Moore Capito is a shareholder at Babst Calland, where he represents clients in all phases of complex corporate, commercial and real estate transactions, and entity, joint venture, and partnership structuring and formation, and general business matters. His practice also focuses on counseling energy clients in various transactional matters of natural gas assets, joint developments, leasing, and operations. Moore also assists companies in navigating the complex legal landscape of emerging technologies, including data center development, ensuring projects are compliant with relevant laws and regulations.

Matt Smith serves as Chief Growth Officer of the Allegheny Conference on Community Development. In this role, Matt leads the Conference’s economic development efforts with a focus on growth of the regional economy through the attraction and retention of business investment and talent. He is also responsible for the organization’s local, state and federal policy and advocacy efforts, which are strategically oriented toward increasing economic competitiveness and accelerating growth opportunities regionwide.

Business Insights is presented by Babst Calland and the Pittsburgh Business Times.

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