In a decision issued February 22, 2012, the United States Supreme Court reversed a decision by the Supreme Court of Montana, which assessed $41 million in "rent" due to the State for river beds used by hydroelectric power plants. Under the "Equal Footing Doctrine," which provides that upon statehood, a State gains title to beds of waters "then navigable." However, any land beneath waters which were not navigable at the time of statehood are retained by the federal government.
The Court rejected the Montana Supreme Court's finding that the various rivers in question, and particularly the portions where the power company made use, were navigable for title purposes, and thus property of the State. The Court applied a segment by segment approach, which the lower Court had deemed inapplicable for "short interruptions" of navigability, and found non-navigable sections of river, including portages, do defeat navigability for title purposes. In other words, the U.S. Supreme Court essentially concluded that a state can't claim title, and charge rent for, sections of its rivers which were not navigable upon statehood, and that no exception for "short interruptions" applies.
The Court distinguished navigability determinations under the equal footing doctrine from navigable waters determinations for admiralty jurisdiction, noting a much more expansive definition of navigable waters for jurisdiction purposes.
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