Olympic Pipe Line Company, a Delaware Corporation v. City of Seattle, a Washington Municipal Corporation

We must decide whether the City of Seattle (“Seattle” or “the City”) can enforce specific provisions of two contracts it has with the Olympic Pipe Line Company (“Olympic”) to provide safety oversight of a hazardous liquid pipeline within Seattle’s city boundaries, despite the apparent federal preemption of hazardous liquid pipeline safety regulation by the Pipeline Safety Improvement Act of 2002, 49 U.S.C. § 60101 et seq. (“PSA”).

After a section of Olympic’s hazardous liquid pipeline exploded in Bellingham, Washington, killing three people and causing extensive environmental damage, Seattle declined to renew Olympic’s franchise for the section of pipeline within the city limits until Olympic complied with the City’s list of pipeline safety demands. If Olympic failed to comply, the City said it would shut down the operation of Olympic’s pipeline within Seattle’s city limits. Declining to comply with Seattle’s demands, Olympic filed suit for injunctive and declaratory relief, asserting that, even though the franchise agreement between Seattle and Olympic arguably included safety oversight provisions, Seattle’s attempt to impose safety regulations pursuant to those provisions was…