Plains All American Pipeline L v. Thomas Cook, 2017 U.S. App. LEXIS 14661

Background

Plains All American Pipeline (Plains) received notice (Oct. 2014) that Delaware would audit its records for unclaimed property, to be conducted by Kelmar Associates, a private auditor retained by Delaware.
Delaware’s Escheats (Unclaimed Property) Law requires holders to file reports and deliver presumed-abandoned property; the Escheator may audit records, hire private auditors, and if records are inadequate, may estimate amounts owed.
Plains refused to comply with Kelmar’s document requests and sued state officials and Kelmar in federal court seeking declaratory and injunctive relief, alleging violations of the Fourth Amendment, Due Process, Equal Protection, Takings, Ex Post Facto, preemption, and void-for-vagueness doctrines; later amended to add conspiracy and other claims.
The District Court dismissed most claims as unripe and dismissed one equal protection claim for failure to state a claim; Plains appealed.
The Third Circuit reviews ripeness/standing and Rule 12(b)(6) de novo, applying the Step-Saver test (adversity, conclusiveness, utility) alongside Abbott/ SBA List ripeness principles.
The Third Circuit affirmed dismissal of Plains’s four facial challenges (estimation provisions and lack of precompliance review) and its as-applied Fourth Amendment claim as unripe, but reversed and remanded the as-applied procedural due process claim challenging Delaware’s appointment of Kelmar for further consideration by the district court.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Facial challenge to estimation provisions: preemption, vagueness, substantive due process	Estimation statute permits arbitrary, constitutionally invalid determinations and conflicts with federal law	Challenges are speculative because estimation occurs only if Delaware finds records inadequate and uses an unspecified method	Unripe: lack of concrete injury and adversity; facial attack requires hypothetical scenarios and factual development
Facial Fourth Amendment claim (no precompliance judicial review of auditor demands)	Statute denies precompliance review of document demands, violating Fourth Amendment protections	No immediate harm because audit/enforcement contingent; statute ambiguous about preenforcement review	Unripe: insufficient adversity and lack of conclusiveness/utility given factual uncertainty about enforcement
As-applied Fourth Amendment claim re: Kelmar’s document requests	Kelmar’s specific requests are overbroad and intrude on Fourth Amendment rights	Audit not enforceable yet; burden of investigation alone does not create Article III injury	Unripe: although factual record exists, audit not enforced; injury not sufficiently imminent
As-applied procedural due process claim re: appointment of private auditor (Kelmar)	Appointment of Kelmar (a self-interested private auditor) deprives Plains of neutral adjudicator; submission to biased decisionmaker is itself a constitutional injury	Appointment is lawful; may be subject to later review; district court said unripe	Ripe: claim challenges completed action (delegation/appointment) and satisfies adversity, conclusiveness, and utility; reversed and remanded for merits consideration

Key Cases Cited

Texas v. New Jersey, 379 U.S. 674 (superseded context) (background on escheat authority)
Marbury v. Madison, 5 U.S. 137 (establishes judicial duty to say what the law is)
Abbott Labs. v. Gardner, 387 U.S. 136 (ripeness: fitness and hardship framework)
MedImmune, Inc. v. Genentech, 549 U.S. 118 (preenforcement declaratory relief standing/ripeness principles)
Susan B. Anthony List v. Driehaus, 134 S. Ct. 2334 (imminence requirement for preenforcement challenges)
Step-Saver Data Sys. v. Wyse Tech., 912 F.2d 643 (3d Cir.) (declaratory judgment ripeness test: adversity, conclusiveness, utility)
Lujan v. Defenders of Wildlife, 504 U.S. 555 (Article III injury must be actual or imminent)
City of Los Angeles v. Patel, 135 S. Ct. 2443 (facial challenges may be inappropriate when statute is ambiguous and requires factual context)
United States v. Salerno, 481 U.S. 739 (facial challenge standard: no set of circumstances test)