Biden admin to be sued by red states over revocation of Keystone XL permit, suit argues president lacks authority

A group of red states will file a lawsuit on Thursday against the Biden administration for revoking the permit for the Keystone XL pipeline, which the president did via executive order on his first day in office, Fox News has learned.

The lawsuit, first obtained by Fox News, is led by Montana and Texas, and backed by 19 other states, including Alabama, Arizona, Arkansas, Georgia, Indiana, Kansas, Kentucky, Louisiana, Mississippi, Missouri, Nebraska, North Dakota, Ohio, Oklahoma, South Carolina, South Dakota, Texas, Utah, West Virginia, and Wyoming. It names President Biden and several of his Cabinet secretaries as defendants.

The lawsuit says that the president in issuing his Jan. 20 executive order and his Cabinet officials in enforcing it are exceeding their authorities under both the Constitution and the Administrative Procedures Act (APA). '

Montana Attorney General Austin Knudsen said the suit is aiming to salvage a project that was a lifeline for his state.

"This pipeline was set to go through six counties in extreme Eastern Montana... five of those counties are already designated as high-poverty counties," he told Fox Business "The project was set to become the largest property taxpayer in all of those counties... That's out the window. Just shy of 4,000 jobs, that's out the window."

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Republicans who supported the pipeline said it was a safe way to transport Canadian oil to refineries in the United States, and was creating American jobs. But Biden said that building oil infrastructure sent the wrong message to the world about how seriously the United States takes climate change.

"The Keystone XL pipeline disserves the U.S. national interest," Biden's order said. "The United States and the world face a climate crisis. That crisis must be met with action on a scale and at a speed commensurate with the need to avoid setting the world on a dangerous, potentially catastrophic, climate trajectory."

Biden added: "The United States must be in a position to exercise vigorous climate leadership in order to achieve a significant increase in global climate action and put the world on a sustainable climate pathway.  Leaving the Keystone XL pipeline permit in place would not be consistent with my Administration’s economic and climate imperatives."

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The red states backing the suit say that the president, however, does not have the authority to revoke the permit because Congress previously authorized the Keystone XL pipeline in a 2011 law. The only exception to that, the suit says, was if former President Barack Obama determined within 60 days that the pipeline was contrary to U.S. national interests. The suit says Obama did not issue a valid determination.

"The President failed to grant the permit or report negative recommendations to Congress within the prescribed time period," the lawsuit says. "President Obama instead purported to deny the Keystone XL permit without concluding it disserved the national interest, complaining that the 60-day time frame prescribed in the statute he signed into law provided an insufficient amount of time to make a national interest determination. This was not an option Congress provided."

The State Department report to Congress that the red states deny the validity of said "the presidential permit for the proposed Keystone XL pipeline be denied and, that at this time, the TransCanada Keystone XL Pipeline be determined not to serve the national interest."

"The decision to provide or withhold permission to construct and operate an oil pipeline across the international border with Canada is a regulation of international and interstate commerce," the states say. "Under the Constitution, the power to regulate international and interstate commerce resides with Congress—not the President."

The Trump administration had previously approved the Keystone XL project before Biden entered office -- making the argument that the president doesn't have discretion to approve or not approve the pipeline a somewhat novel contribution to the debate around it. Knudsen, however, said he has confidence that this argument is based in sound constitutional law.

"I don't consider the Constitution novel at all... Regulation of foreign and interstate commerce is a power reserved to Congress by the Constitution. That means the president's actions here are unconstitutional," Knudsen said. "He can's simply step in and kill an entire multi-nation and multi-state system of commerce here... President Obama had his chance to veto this. Congress expressly authorized this project in 2011... Joe Biden doesn't have veto power over a bill that was passed literally 10 years ago."

The suit also says any discretion claimed by the executive branch, citing laws delegating authority to make regulations to the president and his Cabinet agencies, is illegitimate because restricting fossil fuel transport due to environmental concerns is "a legislative decision."

"To the extent that the President or Cabinet Defendants point to a general authority to regulate the environment or conduct foreign relations actually conferred on them by Congress, such a theory runs afoul of the nondelegation doctrine," the suit says. "Congress may allow the Executive discretion to determine how law should be applied to particular facts. But general, substantive policies governing our nation must be passed by the legislature and signed by the President."

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The states also say that actions by Biden Cabinet secretaries to enforce the Biden order violate the Administrative Procedures Act (APA) as "arbitrary-and-capricious."

"Cabinet Defendants’ actions implicate numerous reliance interests, will lead to thousands of Americans losing their jobs, and have the possibility of depriving States and local governments of millions of dollars in revenues," the suit says. "Yet, far from providing a reasoned explanation for why they are taking their actions, they have not provided any reason at all—even to say that they are acting because the President told them."

The suit was filed in the U.S. District Court for the Southern District of Texas. The states behind it seek to have the courts declare Biden's actions "unconstitutional and unlawful" without "legal effect."

They also ask that the count "enjoin Defendants from taking any action to enforce, implement, or otherwise put into effect the decision revoking TC Energy’s permit to construct and operate Keystone XL cross-border facilities."