Federal Judge Dismissed the Mississippi Water Lawsuit!

U.S. Federal District Court Judge Howard Davidson dismissed the State of Mississippi's lawsuit against the City of Memphis and MLG&W. If you haven't been following this lawsuit, your're not alone. As someone who has been following the suit though, this is HUGE for Memphis. A judgment against the City would have been financially crippling.

Memphis is world renowned for its great water. There is a reason Coors established a plant here. Coors did a national search for locations outside of Golden, Colorado which had water that met their high quality standards. Memphis was one of two or three locations that met Coors hight standards.

The great water comes from the Memphis Acquifer and a geological phenominon known as the Memphis Sands. The Memphis Sands is a deep layer of sand and clay that filters ground water in an increadibly thorough and pure way. Once the water reaches the acquifer several thousand feet down, it's pure, clean water.

The Memphis Acquifer is a pool of water that lies underneath Tennessee, Mississippi and Arkansas. it has been a source of contention in recent years because there are recharge zones in Tennessee and Mississippi where the acquifer comes closer to the surface. it's these recharge zones that feed a lot of the water into the system. Development in North Mississippi and areas to the east of Memphis has threatened these zones.

The lawsuit that got dismissed today was a dispute of a different kind. The State of Mississippi argued that Memphis and MLG&W's water wells were taking a disproportionate amount of the water in the Memphis Acquifer. The theory is akin to oil rights. The law is completely untested. In the United States, we have traditionally had completely seperate water rights schemes. The western states follows water rights law that is much more protective over water rights. The eastern states have traditionally followed water rights law that is much more generous in permitting the use and consumption of water resources. That split in the law has been driven by the scarcity of water out west. Until recently, water was not scare in the east. The droughts of 2007 (recall how low Lake Lanier in Georgia got) have made some reconsider the approach followed in the east. The Mississippi suit essentially argued that Memphis was stealling water from Mississippi and that the western approach should be followed here.

What was so scary about this lawsuit was that Mississippi sought $1 billion dollars in damages for water allegedly improperly taken from the Acquifer. The suit also sought an order moving forward that would have required Memphis to get more water from the Mississippi River. Memphis simply could not afford to pay a $1 billion dollar judgment. Even if we appealed, the fact of a judgment would further destroy our bond rating. If we lost an appeal, the City would like go bankrupt. There just wouldn't be a way around it.

It's hard to understand what motivated Mississippi to really file that suit. We all know that there is some animosity between North Mississippi and Memphis but like it or not, we rely on each other. If Memphis went under, it would hurt North Mississippi. What is more torubling is that the attorneys doing the lion share of the work for Mississippi allegedly took the case on a contingent fee. They thought they were going to make a killing off of Memphis. We don't need that kind of thinking here in this region.

The lawyers for Memphis won dismissal by arguing that this case is really one between the states (Mississippi, Tennessee and Arkansas). The U.S. Consitution says that cases between the states must be brought in the U.S. Supreme Court - not in state court and not in federal district court. Suits between states is one of the rare occassions when the U.S. Supreme has original jurisdiction - meanindg the actual trial is held before them without a jury. Mississippi will undoubtedly appeal the dismissal to the Fifth Circuit. This case may ultimately get tried in the U.S. Supreme Court. At least for today, this is a huge day of the City and for all MLG&W ratepayers.

Here's to hoping that Mississippi will fire it's contingency fee lawyers who have their own interests in mind and that Mississippi, Tennessee, Arkansas, Memphis and MLG&W will get together and reach a resolution of the dispute that's best for all the people of this region.