ROBERT A. LINCOLN and MARY O. LINCOLN, Plaintiffs,
MAGNUM LAND SERVICES, LLC, et al., Defendants.
A. RICHARD CAPUTO, District Judge.
Presently before the Court are motions to dismiss filed by Defendant Belmont Resources, LLC ("Belmont") (Doc. 18), Defendant Magnum Land Services, LLC ("Magnum") (Doc. 21), and Defendants Chesapeake Appalachia, LLC and Chesapeake Energy Corporation (collectively "Chesapeake") and Statoil USA Onshore Properties Inc. ("Statoil") (Doc. 13). This diversity action concerns a disputed oil and gas lease covering land owned by Plaintiffs Robert and Mary Lincoln. Plaintiffs allege state law quiet title and slander of title claims against the moving Defendants as well as Defendant Sinclair Oil & Gas Co. ("Sinclair"). For the reasons below, the moving Defendants' motions will be granted.
I. Factual Allegations
Plaintiffs allege the following in their First Amended Complaint (Doc. 11, Ex. B):
At all relevant times prior to 2008, Plaintiffs owned in fee simple three separate parcels of land, totaling approximately 191 acres, in Tunkhannock Township, Wyoming County, Pennsylvania ("the Property"). ( Id. at ¶ 12.) In or about February 2008, Magnum offered in writing to lease Plaintiffs' oil and gas rights and explore for gas on the Property. ( Id. at ¶ 39.) On or about February 26, 2008, Plaintiffs made a counteroffer by significantly revising, signing, and returning the written oil and gas lease to Magnum. ( Id. at ¶¶ 40-42.)
On or about March 26, 2008, Mr. Lincoln advised two Magnum agents, Paul Burgess and Scott Schaffer, by phone that he was withdrawing the counteroffer and confirmed with them that Plaintiffs had not received any documentation indicating that Magnum accepted their counteroffer. ( Id. at ¶ 43.) The following day, he e-mailed Burgess, Schaffer, and a Magnum supervisor to follow up on and confirm the prior day's conversation. ( Id. at ¶ 44.) On March 31, 2008, Schaffer called Plaintiffs to inquire into how Plaintiffs' changes to the lease would affect Magnum's rights and ask if Plaintiffs would accept a higher signing bonus from Magnum in exchange for dropping their amendments to the lease and signing it in its original form. (Doc. 11, Ex. B at ¶¶ 45-46.) Although it never accepted the counteroffer or contested Plaintiffs' revocation of the counteroffer, Magnum sent Plaintiffs a check, dated May 14, 2008, for $71, 362.50. ( Id. at ¶¶ 47-49.) Plaintiffs voided the check and returned it to Magnum by registered mail on May 17, 2008. ( Id. at ¶ 50.)
On August 26, 2008, Plaintiffs leased their oil and gas rights to the Property to Chief Exploration and Development LLC ("Chief"). ( Id. at ¶ 17.) Chief recorded the lease with the Wyoming County Recorder of Deeds on October 2, 2008, but surrendered the lease on January 30, 2009. ( Id. at ¶¶ 17, 20.)
On August 3, 2009, Magnum recorded Plaintiffs' February 2008 counteroffer as an oil and gas lease ("the Lease") with the Wyoming County Recorder of Deeds. (Doc. 11, Ex. B at ¶ 14.) Magnum subsequently assigned the Lease, which notes a "lease date" of February 26, 2008 and states that it is effective as of October 17, 2008, to Belmont on August 24, 2009. ( Id. at ¶ 21.) This assignment was recorded on September 30, 2009. ( Id. ) Belmont then assigned 50% of its interest in the Lease to Sinclair on August 24, 2009; this assignment was recorded on November 9, 2009. ( Id. at ¶¶ 23-24.) Sinclair and Belmont assigned their portions of the Lease to Chesapeake; these assignments were recorded on November 16, 2009 and November 18, 2009, respectively. ( Id. at ¶¶ 25-26.) Chesapeake then assigned 32.5% of its interest in the Lease to Statoil, which was recorded on May 19, 2010. (Doc. 11, Ex. B at ¶¶ 27-28.)
In September 2009, Mr. Lincoln visited the office of the Wyoming County Recorder of Deeds and learned that Magnum had recorded and assigned the Lease. ( Id. at ¶¶ 107-109.) He believed that the Lease and assignments cast a cloud on Plaintiffs' title and would prevent them from joining the Wyoming County Landowners Group, which was negotiating a collective oil and gas lease with Chesapeake at the time. ( Id. at ¶¶ 101-111.)
On September 13, 2010, Plaintiffs filed an Affidavit Affecting Title to Real Estate with the Wyoming County Recorder of Deeds. ( Id. at ¶ 62.) Plaintiffs' Affidavit, which clarified that the Lease was actually a counteroffer that was revoked prior to Magnum recording the Lease, put Defendants on notice of the Lease's false nature and that they were clouding Plaintiffs' title to the Property. ( Id. at ¶¶ 62-64.) On December 13, 2010, Plaintiffs mailed the Affidavit to Chesapeake, along with a request that Chesapeake sign a quitclaim deed granting its interests in the Property and its oil and gas back to Plaintiffs. ( Id. at ¶ 65.)
On September 28, 2011, Chesapeake and Statoil, who were the current lessees of the Property's oil and gas rights under the Lease, filed a Release and Surrender of Oil and Gas Lease ("Release") regarding the Property with the Wyoming County Recorder of Deeds. (Doc. 11, Ex. B at ¶¶ 29-31.) In light of this Release, no other Defendants have a basis to assert a claim to the Lease or the Property's oil and gas rights. ( Id. at ¶ 32.)
Plaintiffs bring quiet title and slander of title claims against Defendants. Defendants have created and continue to create a cloud on Plaintiffs' title to the Property by knowingly and maliciously filing various instruments of record asserting false claims of title to the Property. ( Id. at ¶¶ 1-2, 59-60, 68-69.) These instruments are false because they omit material facts-that the Lease recorded by Magnum is invalid and nothing more than a revoked counteroffer. ( Id. at ¶¶ 3-4.) Magnum knew that the Lease was invalid at the time of recording, and all other Defendants were notified of the Lease's invalidity by Plaintiffs' Affidavit. ( Id. at ¶¶ 59-64.) Yet, each Defendant that has not filed a Release continues to knowingly and maliciously publish false statements daily by not removing its instruments from the public record kept in the Wyoming County Recorder of Deeds. (Doc. 11, Ex. B at ¶¶ 66-69.) Plaintiffs seek: a declaration that the Lease and any assignment concerning it is and ...