United States District Court, M.D. Pennsylvania
WILLIAM N. EARNSHAW and HELEN A. EARNSHAW, Plaintiffs,
CHESAPEAKE APPALACHIA, L.L.C. and EQUINOR USA ONSHORE PROPERTIES, INC. f/k/a USA ONSHORE PROPERTIES, INC., Defendants.
RICHARD CAPUTO UNITED STATES DISTRICT JUDGE
before me is the Motion to Remand pursuant to 28 U.S.C.
§ 1447(c) (Doc. 8) filed by Plaintiffs William N.
Earnshaw and Helen A. Earnshaw (collectively, where
appropriate, “Plaintiffs”). Plaintiffs commenced
this action against Chesapeake Appalachia, L.L.C.
(“Chesapeake”) and Equinor USA Onshore
Properties, Inc. (“Equinor”) (collectively, where
appropriate, “Defendants”) in Pennsylvania state
court related to the terms of an oil and gas lease.
Defendants removed the action on diversity grounds.
Plaintiffs do not dispute that complete diversity exists, but
they argue that it is unclear from the Complaint and the
Notice of Removal that the jurisdictional threshold is met.
So Plaintiffs conclude that this action should be remanded to
state court. Because complete diversity exists and the record
evidence shows that the amount-in-controversy is in excess of
$75, 000.00, the motion to remand will be denied.
commenced this action by filing a Complaint against
Chesapeake and Equinor on August 1, 2019 in the Court of
Common Pleas of Wayne County, Pennsylvania. (See
Doc. 1, Ex. “A”). The Complaint contains three
causes of action: (1) declaratory judgment (Count I);
unlawful trespass on land (Count II); and breach of contract
pled in the alternative (Count III). (See id.). The
Complaint is silent as to the amount in controversy at issue
in this litigation. (See id., generally).
August 26, 2019, Defendants removed the action to this Court
on the basis of diversity of citizenship. (See Doc.
1, ¶ 7). Specifically, Defendants contend that William
Earnshaw is a Pennsylvania citizen, Helen Earnshaw is a
citizen of Connecticut, Chesapeake's sole member is an
Oklahoma corporation with its principal place of business in
Oklahoma, and Equinor is a Delaware corporation with its
principal place of business in Texas, i.e., that the
parties are completely diverse. (See id. at
¶¶ 8-9, 12-15). Defendants further aver that the
amount in controversy exceeds $75, 000.00. (See id.
at ¶¶ 17-23).
moved to remand this case to the Wayne County Court of Common
Pleas on September 25, 2019. (See Doc. 8,
generally). In their supporting brief, Plaintiffs do
not contest that the parties are completely diverse.
(See Doc. 10, 4). Rather, Plaintiffs argue that
Defendants are unable to demonstrate that the
“combination of the value of the monetary and
declaratory relief” sought in this case is more than
$75, 000.00. (Id. at 9).
filed their opposition to the motion to remand on November 6,
2019. (See Doc. 16, generally). With their
brief, Defendants also submitted declarations from two
Chesapeake employees. (See Doc. 16, Exs.
“A”-“B”). Plaintiffs did not submit a
reply brief within the time permitted by this Court's
Local Rules. See M.D. Pa. L.R. 7.7. As such, the
motion to remand is now ripe for disposition.
to 28 U.S.C. § 1441(a), “any civil action brought
in a State court of which the district courts of the United
States have original jurisdiction, may be removed by the
defendant or the defendants, to the district court of the
United States for the district and division embracing the
place where such action is pending.” 28 U.S.C. §
1441(a). “[T]he party asserting federal jurisdiction in
a removal case bears the burden of showing, at all stages of
the litigation, that the case is properly before the federal
court.” Frederico v. Home Depot, 507 F.3d 188,
193 (3d Cir. 2007) (citation omitted). Removal statutes are
to be strictly construed against removal, and all doubts are
resolved in favor of remand. See A.S. ex rel. Miller v.
SmithKline Beecham Corp., 769 F.3d 204, 208 (3d Cir.
2014) (citation omitted).
their notice of removal, Defendants assert that this Court
has original jurisdiction over the action by way of 28 U.S.C.
§ 1332(a)(1). (See Doc. 1, ¶ 7); see
also 28 U.S.C. § 1332(a)(1) (“(a) The
district courts shall have original jurisdiction of all civil
actions where the matter in controversy exceeds the sum or
value of $75, 000, exclusive of interest and costs, and is
between -- (1) citizens of different States; . . .”).
“For removal predicated upon diversity of citizenship,
a proper exercise of federal jurisdiction requires
satisfaction of the amount in controversy requirement as well
as complete diversity between the parties . . . .”
In re Briscoe, 448 F.3d 201, 215 (3d Cir. 2006).
Plaintiffs do not dispute that complete diversity exists in
the matter sub judice. (See Doc. 10, 4).
Instead, Plaintiffs challenge whether the amount in
controversy exceeds $75, 000.00 as required for diversity
jurisdiction. (See id. at 4-11).
party has not pled a specific sum of damages in the
complaint, the notice of removal may assert the amount in
controversy. See 28 U.S.C. § 1446(c)(2)(A)(i).
The notice of removal must contain “a plausible
allegation that the amount in controversy exceeds the
jurisdictional threshold.” Dart Cherokee Basin
Operating Co., LLC v. Owens, 574 U.S. 81, 89, 135 S.Ct.
547, 190 L.Ed.2d 495 (2014). “[O]nly when the plaintiff
contests, or the court questions, the defendant's
allegation” is “evidence establishing the
amount” in controversy required by 28 U.S.C. §
1446(c)(2)(B). Id. see also 28 U.S.C.
§ 1446(c)(2)(B) (“If removal of a civil action is
sought on the basis of the jurisdiction conferred by section
1332(a), the sum demanded in good faith in the initial
pleading shall be deemed to be the amount in controversy,
except that -- . . . (B) removal of the action is proper on
the basis of an amount in controversy asserted under
subparagraph (A) if the district court finds, by the
preponderance of the evidence, that the amount in controversy
exceeds the amount specified in section 1332(a).”).
Thus, where, as here, “a defendant's assertion of
the amount in controversy is challenged . . . . both sides
submit proof and the court decides, by a preponderance of the
evidence, whether the amount-in-controversy requirement has
been satisfied.” Dart Cherokee, 574 U.S. at
88, 135 S.Ct. 547. In making this determination, “the
complaint, the notice of removal, and subsequent submissions
related to the motion to remand” can be considered.
Klaphake v. Columbia Gas Transmission, LLC, No.
17-1359, 2018 WL 1736791, at *1 (W.D. Pa. Apr. 11, 2018)
(citation omitted). Such proof can be submitted in the form
of declarations or affidavits. See id. at *3;
see also Ibarra v. Manheim Invests., Inc., 775 F.3d
1193, 1197 (9th Cir. 2015) (“The parties may submit
evidence outside the complaint, including affidavits or
declarations, or other summary-judgment-type evidence
relevant to the amount in controversy at the time of
removal.”). Preponderance of the evidence in this
context has been referred to as “proof to a reasonable
probability that jurisdiction exists.”
Frederico, 507 F.3d at 195 n.6. “[W]here the
plaintiff has not specifically averred in the complaint that
the amount in controversy is less than the jurisdictional
minimum . . . the case must be remanded if it appears to a
legal certainty that the plaintiff cannot recover
the jurisdictional amount.” Id. at 197
(emphasis in original).
opposition to the motion to remand, Defendants submitted
declarations from Courtney Moad (a Chesapeake Staff Landman)
and Brian Lageman (a Chesapeake Project Manager).
(See Doc. 16, Exs. “A”-“B”).
According to Moad, Chesapeake owns 67.5% of the lease for a
54.50 acre parcel owned by Plaintiffs. (See Doc. 16,
Ex. “A”, ¶¶ 4-5). Moad further declares
that between October 2017 and October 2019, Chesapeake has
tendered to Plaintiffs approximately $109, 716.57 in royalty
payments. (See id. at ¶¶ 6-8). Lageman, on
the other hand, states that if Chesapeake was required to
plug the portion of the wellbore that crosses below
Plaintiffs' property, the cost to complete such work
would be substantially greater than $75, 000.00.
(See Doc. 16, Ex. “B”, ¶ 6).
Lageman also declares if Chesapeake was required to plug that
wellbore, it would lose approximately 3, 955 feet of the
wellbore, and the net present value of its lost production
attributed to that footage of wellbore would be substantially
greater than $75, 0000.00 over the anticipated life of the
well at issue. (See id. at ¶¶ 7-8).
on these declarations, Defendants argue that Plaintiffs'
claims individually, as well as in the aggregate, exceed the
jurisdictional threshold. (See Doc. 16, 5). First,
as to the declaratory judgment claim (Count I), Defendants
contend that the value of the object of the litigation,
i.e., the lease, is calculated by looking at the
royalties paid to Plaintiffs, and this amount of royalties
paid by Chesapeake alone (and not considering any such
payments made by Equinor) is well in excess of $75, 000.00.
(See id. at 10-11). In addition, Defendants point to
Lageman's statement that the present value of
Chesapeake's lost production from the well at issue
attributable to 3, 955 ...