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Valley Rod & Gun Club v. Chesapeake Appalachia, LLC

United States District Court, Third Circuit

June 3, 2013

VALLEY ROD & GUN CLUB, Plaintiffs,


A. RICHARD CAPUTO, District Judge.

Presently before the Court are motions to dismiss Plaintiff Valley Rod & Gun Club's Complaint filed by Chesapeake Appalachia, LLC ("Chesapeake) (Doc. 4) and Anadarko E&P Onshore LLC, formerly Anadarko E&P Company, LP ("Anadarko"). (Doc. 7.) The motions to dismiss will be granted in part and denied in part. Since the Complaint adequately states a misappropriation/conversion claim, Plaintiff will be permitted to proceed on Count II of the Complaint. But, because Count I of the Complaint fails to state a claim upon which relief can be granted, the trespass claim will be dismissed.

I. Background

The facts as alleged in the Complaint are as follows:

Plaintiff Valley Rod & Gun Club, a Pennsylvania not-for-profit corporation, owns acreage and a lodge in Wilmot Township, Bradford County, Pennsylvania. ( Compl., ¶ 1.) Plaintiff executed an Oil and Gas Lease (the "Lease") in favor of Chesapeake's predecessor, Anadarko/Statoil. ( Id. at ¶ 5.) Among other terms, the Lease provides:

Lessor hereby grants, demises, leases and lets exclusively to Lessee the oil and gas, including coalbed methane gas, underlying the land herein leased, together with such exclusive rights as may be necessary or convenient for Lessee, at its election, to explore for, develop, produce, measure and market production from the premises, using methods and techniques which are not restricted to current technology, including the exclusive right to conduct geophysical and other exploratory tests; to conduct dewatering operations upon formations in which Lessee plans to produce coalbed methane gas; to drill, maintain, operate, cease to operate, plug, abandon, and remove wells; to use or install roads, electric power and telephone facilities, pipelines with appurtenant facilities, necessary or convenient for use in the production and transportation of products from the premises and from neighboring lands, and such rights shall survive the term of this agreement for so long thereafter as operations are continued on this Lease or adjacent lands; to use oil, gas, and non-domestic water sources, free of cost, to store gas of any kind underground regardless of the source thereof, including the injecting of gas therein and removing the same therefrom; to protect stored gas; to operate, maintain, repair, and remove material and equipment.

( Lease. ) The Lease and its recitations were also meant to promote public safety, protect environmental features, and to protect the hunting, farming, recreation, and business operations of Plaintiff. ( Compl., ¶ 8.)

Pursuant to the terms of the Lease, Defendants were familiar with the location on the property of a farm, field, forestry and hunting lands, shooting range, and lodge/home, as well as the potential use of a stone quarry, all of which Plaintiff made a substantial investment of time, effort, and money for future profit. ( Id. at ¶¶ 10, 26.) Plaintiff requested Defendants to locate the pad in the southern area of the property away from the quarry stone, farm, fields, shooting range, and hunting lodge. ( Id. at ¶ 11.) The proposed location was unsuitable to Defendants. ( Id. at ¶¶ 13-14.) Defendants instead located the pad within several feet of the quarry stone, and Defendants have damaged the surface farms, fields, lands, forestry, buildings, shooting range, hunting lands, and wetlands of the property. ( Id. at ¶ 12.) At some point in the future, Defendants will begin to operate the gas well and use water, drainage, and land vehicles which will cause further damage to Plaintiff's land, buildings, forest, and wetlands without compensation or permission. ( Id. at ¶ 15.)

Chesapeake, as part of its installation and access to its well pad, obtained a subcontractor to construct roads, drainage, and the pad on Plaintiff's property. ( Id. at ¶ 9.) In constructing the pad, roads, and drainage, Defendants used Plaintiff's stone, fill, rock, trees, and mulch. ( Id. at ¶¶ 12, 16.) The use of these materials was without permission, right, or ownership, and for purposes other than that for which the Lease allowed, intended, or represented. ( Id. at ¶ 25.) Defendants further misappropriated Plaintiff's quarry operations and profits without compensation and at a great expense and loss to Plaintiff. ( Id. at ¶ 27.)

Based on the foregoing events, Plaintiff commenced this action in the Court of Common Pleas of Bradford County, Pennsylvania. (Doc. 1, Ex. A.) The Complaint consists of two counts. Count I asserts a trespass claim against Defendants. ( Compl. ) Count II asserts a claim for misappropriation/conversion. ( Id. )

On March 19, 2013, the action was removed to this Court. Subsequently, on March 26, 2013, both Anadarko and Chesapeake filed motions to dismiss the action pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure. The motions to dismiss are now fully briefed and ripe for disposition.

II. Discussion

A. Legal Standard

Federal Rule of Civil Procedure 12(b)(6) provides for the dismissal of a complaint, in whole or in part, for failure to state a claim upon which relief can be granted. See Fed.R.Civ.P. 12(b)(6). When considering a Rule 12(b)(6) motion, the Court's role is limited to determining if a plaintiff is entitled to offer evidence in support of their claims. See Semerenko v. Cendant Corp., 223 F.3d 165, 173 (3d Cir. 2000). The Court does not consider whether a plaintiff will ultimately prevail. See id. A defendant bears the burden of ...

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