Illinois Extension Pipeline Company LLC v. Thomas et al
Filing
24
OPINION entered by Judge Richard Mills on 03/30/2016. SEE WRITTEN OPINION. the Motion of Plaintiff Illinois Extension Pipeline Company, LLC, to Dismiss the Defendants' Counterclaims (d/e 11 ) is DENIED AS MOOT. The Motion of the Defendants under Rule 56(d) for additional discovery ([d/e 20 ) is DENIED. The Motion of the Plaintiff for Summary Judgment on the Defendants' Amended Counterclaims (d/e 18 ) is ALLOWED. Judgment will be entered in favor of the Plaintiff and against th e Defendants on the Amended Counterclaims. The Plaintiff's Motion for Judgment on the Pleadings (d/e 12 ) is ALLOWED. The Clerk will enter a Judgment declaring that the easement attached to the Plaintiff's Complaint is valid and enforceable according to its terms. Plaintiff Illinois Extension Pipeline Company, LLC, is entitled to all rights set forth therein. Upon entry of Judgment, the Clerk shall terminate the case. (DM, ilcd)
E-FILED
Wednesday, 30 March, 2016 04:29:06 PM
Clerk, U.S. District Court, ILCD
IN THE UNITED STATES DISTRICT COURT
FOR THE CENTRAL DISTRICT OF ILLINOIS
SPRINGFIELD DIVISION
ILLINOIS EXTENSION PIPELINE
COMPANY, LLC,
)
)
)
Plaintiff,
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v.
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FREDERICK J. THOMAS, JR., as Co- )
Executor of the Estates of Frederick J. )
Thomas, Sr., Deceased, and Helen R. )
Thomas, Deceased, and CLARENCE )
D. THOMAS, as Co-Executor of the
)
Estates of Frederick J. Thomas, Sr.,
)
Deceased, and Helen R. Thomas,
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Deceased.
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Defendants.
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NO. 15-3052
OPINION
RICHARD MILLS, U.S. District Judge:
Plaintiff Illinois Extension Pipeline Company, LLC, has filed a
Complaint for Declaratory Judgment pursuant to 28 U.S.C. § 2201. The
Plaintiff seeks a declaration that an easement is valid and enforceable
according to its terms, thereby giving the Plaintiff all the rights set forth
therein. The Defendants have filed Counterclaims. Pending before the
Court are several motions.
The Complaint alleges that because the Parties are of diverse
citizenship and the amount in controversy exceeds $75,000.00, the Court
has jurisdiction over the subject matter pursuant to 28 U.S.C. § 1332.
Venue is appropriate in this district pursuant to 28 U.S.C. § 1391(b)(2)
because the real property that is the subject of this action is situated in the
Central District of Illinois.
Defendants Frederick J. Thomas, Jr., as Co-Executor of the Estates of
Frederick J. Thomas, Sr., Deceased, and Helen R. Thomas, Deceased; and
Clarence D. Thomas, as Co-Executor of the Estates of Frederick J. Thomas,
Sr., Deceased, and Helen R. Thomas, Deceased, filed their Answer,
Affirmative Defense and Counterclaims. Subsequently, the Defendants
filed an Amended Counterclaim for Declaratory Judgment.
I. BACKGROUND
(A)
In Count I of the Complaint, the Plaintiff alleges it is the owner of a
pipeline right-of-way that crosses certain real property located in DeWitt
2
County, which it has denominated as Tract 08-004. Attached to the
Complaint is a certified copy of the 1939 right-of-way grant for the tract.
The Plaintiff alleges it is the current successor to the grantee.
The Plaintiff further asserts that the pipeline right-of-way that crosses
Tract 08-004 is part of a longer right-of-way that was created in 1939 for
the installation of a pipeline between the towns of Hayworth and Patoka,
Illinois. That right-of-way is now commonly referred to as the “Luxor
Line.” The Plaintiff is constructing a new underground pipeline within the
Luxor Line right-of-way for the transportation of crude oil in interstate
commerce. In order to build the new pipeline the Plaintiff intends, in part,
to utilize its Luxor Line easement rights, as provided on the face of the
1939 grant applicable to Tract 08-004.
The Defendants allege the new easement would have expanded the
Plaintiff’s rights beyond what was provided for in the easement at issue.
This is because the new easement creates a safety risk not contemplated by
that easement. Moreover, the Plaintiff cannot expand its rights under the
easement at issue by this action. The Defendants claim the Plaintiff is
3
constrained by its Certificate In Good Standing issued by the Illinois
Commerce Commission (“ICC”) for its proposed new pipeline and does not
have the right to avoid the restrictions contained therein by this action.
The Plaintiff’s Complaint states that in recent years, there has been
a significant amount of litigation in this Court and the Southern District
of Illinois concerning the continuing validity of the Plaintiff’s Luxor Line
easement rights. The Plaintiff alleges those rights have been upheld in each
case by three different United States District Judges.
As of February 8, 2014, Tract 08-004 was owned by Frederick J.
Thomas and his wife, Helen R. Thomas. Frederick J. Thomas and Helen
R. Thomas have since died testate. The Estates of Frederick J. Thomas, Sr.,
Deceased and Helen R. Thomas, Deceased, remain open and currently hold
title to Tract 08-004. The Co-Executors of both estates are the same:
Frederick J. Thomas, Jr., and Clarence D. Thomas. They are now the
successors to the grantors under the 1939 easement grant applicable to
Tract 08-004.
The Plaintiff asserts that in the first quarter of 2014, it opted to
4
utilize its existing Luxor Line rights to build the new pipeline across Tract
08-004. In May of 2014, Helen R. Thomas refused to acknowledge the
validity of the Luxor Line easement and returned the check to the Plaintiff.
The Plaintiff further contends that on February 5, 2015, a lawyer
purporting to act on behalf of Helen R. Thomas (who had died several
months earlier) sent an email to the Plaintiff’s counsel stating that his client
would not concede the “enforceability of the existing easement,” would not
admit “that the existing Luxor easement is enforceable according to its
terms,” and further stating that “[s]hould there be new litigation, my client
is reserving the right to assert that the existing easement is potentially
unenforceable.”
The Plaintiff filed this action seeking a declaration of its rights under
the Luxor Line easement across Tract 08-004. The Defendant asserts the
Plaintiff waived the right to obtain eminent domain authority for the land
which is the subject matter of this case, claiming at the ICC that it was fully
prepared to rely exclusively on the terms of the easement at issue.
5
(B)
In Counterclaim I, the Defendants-Counterclaimants seek a
declaratory order as to whether the rights created under the original
easement allows the Plaintiff to create a safety risk under the terms of the
easement.
In Counterclaim II, the Defendants-Counterclaimants seek
contract damages based on damages that may result from the construction,
operation or maintenance of such pipelines.
As for the Amended Counterclaims, in Counterclaim I, the
Defendants allege that Plaintiff’s conditional right to construct a second
pipeline on the property is exhausted. In Counterclaim II, the Defendants
assert that Plaintiff’s pipeline project exceeds its rights under the 1939
right-of-way grant. Accordingly, the Defendants-Counterclaimants seek a
declaration that the right-of-way grant at issue does not convey to the
Plaintiff rights sufficient to construct, operate and maintain the Southern
Access Extension (SAX) Pipeline project and that construction, operation
and maintenance of the SAX on the property of the Defendants would
require a new right-of-way with expanded rights.
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II. DEFENDANTS’ MOTION FOR ADDITIONAL DISCOVERY
(A)
The Defendants-Counterclaimants seek a declaration that the 1939
easement cannot be used to construct the SAX because (1) the second
pipeline right under the 1939 easement was already exercised in 1945 and
(2) the SAX project does not conform to the 1939 easement. The Plaintiff
has moved for Summary Judgment on the Amended Counterclaim,
contending (1) that the pipeline right installed in 1945 was not installed
pursuant to the 1939 easement; and (2) under Knight v. Enbridge Pipelines
(FSP) L.L.C., 759 F.3d 675 (7th Cir. 2014), Amended Counterclaim II
should be dismissed because the claims are speculative.
In their Motion pursuant to Rule 56(d) for additional discovery
necessary to oppose the Plaintiff’s Motion for Summary Judgment on the
Defendants’ Amended Counterclaim, the Defendants allege that the
Plaintiffs’ sought declaration will not resolve the issues between the
Plaintiff and Defendant regarding the construction of the SAX. It will only
determine whether or not the 1939 easement is valid and enforceable
7
according to its terms.
Rule 56(d) provides as follows:
If a nonmovant shows by affidavit or declaration that, for
specified reasons, it cannot present facts essential to justify its
opposition, the court may:
(1) defer consideration of the motion or deny it;
(2) allow time to obtain affidavits or declarations or to take
discovery; or
(3) issue any other appropriate order.
Fed. R. Civ. P. 56(d). “The Rule places the burden on the non-movant that
believes additional discovery is required to state the reasons why the party
cannot adequately respond to the summary judgment motion without
further discovery.” Sterk v. Automated Retail, LLC, 770 F.3d 618, 628
(7th Cir. 2014) (internal quotation marks and citation omitted). It “is not
a shield that can be raised to block a motion for summary judgment
without even the slightest showing by the opposing party that his
opposition is meritorious.” Davis v. G.N. Mortg. Corp., 396 F.3d 869, 885
(7th Cir. 2005).
The Defendants have attached a declaration seeking additional
discovery. The declaration is signed by Defendants Clarence D. Thomas
8
and counsel and identifies what the Defendants believe is discovery
necessary to oppose the motion for summary judgment.
The Defendants assert the discovery will allow them to demonstrate
that the second line right under the 1939 easement has already been
exercised to construct the 1945 pipeline and, therefore, is not available for
construction of the SAX pipeline.
Moreover, and separately, the
Defendants claim discovery will allow them to demonstrate that the SAX
project is not compatible with the 1939 easement and that its construction,
operation and maintenance will require the parties to negotiate a new
modern easement of the type utilized for the SAX in “greenfield” properties.
(B)
The Plaintiff contends that Defendants lack personal knowledge of
the matters asserted in the declaration. It further alleges that Defendants’
request is essentially a delay tactic. The Plaintiff asserts there simply is no
evidence (1) that the pipeline constructed in 1945 was not constructed
pursuant to the easement executed in 1945, but instead was constructed
pursuant to a preexisting right to build a second pipeline that was granted
9
in the Luxor Line easement executed six years earlier; and (2) that
Plaintiff’s new pipeline violates any unwritten safety requirements behind
the words of the 1939 Luxor Line easement.
The Plaintiff further alleges that Defendants’ counsel, Thomas J.
Pliura, has been “deeply involved” in a number of proceedings concerning
this pipeline since 2007–before the ICC, before multiple state and federal
courts, and before the Seventh Circuit. Although Defense counsel has
extensive knowledge about the details of the project, he has not yet
identified a scintilla of evidence creating a factual dispute which would
preclude summary judgment on the counterclaims.
The Plaintiff alleges the Defendants already have the information they
now claim is necessary to oppose the Plaintiff’s motion for summary
judgment on Count II. Since 2007, Mr. Pliura has represented numerous
landowners in attempting to prevent construction of the pipeline.
Throughout these legal proceedings, Mr. Pliura has received thousands of
pages of discovery relating to the project. Mr. Pliura has represented
landowners in Kelly v. Enbridge (U.S.), Inc., No. 07-3245, 2008 WL
10
2123755 (C.D. Ill. May 15, 2008) (Scott, J.); Enbridge Pipelines (Illinois)
LLC v. Preiksaitis, Mo. 08-cv-2215 (C.D. Ill.) (Baker, J.); Enbridge
Pipelines (Illinois) LLC v. Burris, No. 08-cv-0697-DRH, 2010 WL
1416019 (S.D. Ill. March 31, 2010) (Herndon, C.J.); Enbridge Pipelines
(Illinois) LLC v. Hortenstine, No. 08-cv-842, 2010 WL 3038529 (S.D. Ill.
Aug. 3, 2010); Enbridge Pipelines (Illinois) L.L.C. v. Moore, 633 F.3d 602
(7th Cir. 2011).
The Plaintiff further asserts that Mr. Pliura has played a key role in
two lengthy ICC proceedings, 07-0446 and 13-0446, both of which delved
deeply in to the details of the pipeline project. See In re Illinois Extension
Pipeline Co., L.L.C., No. 07-0446; In re Enbridge Pipelines (Illinois) L.L.C.,
No. 13-0446 (Apr. 29, 2014). The Plaintiff claims that, when his efforts
to block the new pipeline at the ICC failed, Mr. Pliura pursued various
appeals. See Pliura Intervenors v. Illinois Commerce Comm’n, 2015 Ill.
App (4th) No. 140592-U (2015); Pliura Intervenors v. Illinois Commerce
Comm’n, Ill. App. Ct., No. 4-15-0084 (2015); Pliura Intervenors v. Illinois
Commerce Comm’n, 405 Ill. App.3d 199 (2010).
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Additionally, as for sections of the new pipeline that will be built on
new easements acquired through eminent domain, Mr. Pliura has
represented a number of landowners in condemnation cases in state courts
in counties along the route, wherein directed verdicts have been entered
against his clients in DeWitt and Livingston Counties. See May 15, 2015
Final Judgment Order, Enbridge Energy, Limited P’ship v. First Midwest
Land Trust No. 8626 (14 ED 10, et al., Livingston County); June 1, 2015
Final Judgment Order, Enbridge Pipelines (Illinois), L.L.C. v. Hoke (14 ED
3, et al., DeWitt County).
The Plaintiff asserts that, in connection with those proceedings, Mr.
Pliura has deposed or cross-examined John McKay, the Plaintiff’s manager
of land services for the United States, about the details of the project. Mr.
McKay has testified at length about the specific procedures that Plaintiff
will follow during construction of the pipeline, and the pipeline’s potential
effect on the land, including measures taken to ensure that the pipeline will
not interfere with the cultivation of the land.
In the two ICC proceedings, Mr. Pliura represented numerous
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landowners Intervenors. One proceeding included extensive testimony of
Enbridge and ICC Staff witnesses, at which the Intervenors had an
opportunity to cross-examine the witnesses. In the other proceeding, Mr.
Pliura was served with Enbridge’s answers to 78 data requests from ICC
staff and Intervenors, which included information about the safety of the
pipeline and its potential effect on the land, as follows:
•
[A]ll international, federal, state and local permits,
licenses, and other similar types of documents which
Enbridge will be required to obtain in order to construct
its proposed pipeline. (07-0446 Data Request No. 1.6)
•
Information regarding “the type of equipment (safety
equipment, pigs, etc.) that will be needed in conjunction
with the proposed pipeline that will allow the Company to
meet the long term needs of its customers, while also
maintaining compliance with applicable statutes and
regulations.” (07–0446 Data Request No. 1.17.)
•
An explanation of “how the Company plans on fulfilling
the requirements of Section 15-601 of the Public Utilities
Act during the construction and operation of the proposed
pipeline.” (07-0446 Data Request No. 1.25.)
The Plaintiff further notes that both ICC proceedings relied heavily
on the Agricultural Impact Mitigation Agreement (“AIMA”), an agreement
between Enbridge (the Plaintiff’s predecessor) and the Illinois Department
13
of Agriculture containing an in-depth discussion of the extensive “measures
which the Company will implement as it constructs the pipeline across
agricultural land.” The AIMA is part of the record from the ICC’s decision.
Under the AIMA, the Plaintiff must adhere to a number of standards. The
Plaintiff has certain obligations in the event of damage that occurs during
the pipeline’s construction.
These include repair and/or reasonable
compensation.
Upon reviewing the record, the ICC found that Plaintiff’s proposed
route “is reasonable and it is hereby approved” and that “due consideration
in the route selection process was given to minimizing impacts on wetlands
and other environmentally sensitive locations, cultural areas, the number
of properties and landowners affected, major roadways and high density
populations areas.”
To the extent that Mr. Pliura claims he does not know where the
pipeline will be located, the Plaintiff notes that the ICC proceedings verified
the exact location of the pipeline. The 07-0446 order explains:
As more specifically described in Exhibit A to the Application,
the Extension Project’s right-of-way will originate at Enbridge’s
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Flanagan terminal facility and run west-southwest parallel to the
Spearhead Pipeline for approximately 14 miles. At that point,
the route turns south to traverse some 30 miles of agricultural
land east of the Bloomington-Normal municipal area. After
that, the route turns southwest for approximately 10 miles to
run parallel to an existing right-of-way west of the Village of
Downs in McLean County to a junction point with the CIPC
right-of-way west of Heyworth in McLean County. At that
point, the Extension Project will parallel the CIPC right-of-way,
except for the aforementioned necessary deviations, to run
basically south through DeWitt County (west of Clinton) into
Macon County running west of Decatur and continuing into
Christian and Shelby Counties along the CIPC route passing to
the east of Pana into Fayette County and continuing therein
east of Vandalia to enter into Marion County and terminate at
Enbridge’s property north of Patoka, Illinois.
Doc. No. 21, Ex. B, Order, at 55. The Plaintiff further claims that it
produced detailed information disclosing any deviations from the Luxor
Route. In the 13-0446 proceeding, Enbridge Pipelines filed a petition for
eminent domain authority. The ICC authorized Enbridge to seek easement
rights in a manner consistent with the Eminent Domain Act with respect
to those parcels.
Based on the foregoing, the Plaintiff contends Mr. Pliura has all of the
relevant information concerning the details of the pipeline project. Because
he has this massive volume of information, therefore, the Court should
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reject his assertion that he does not have all of the relevant information and
find that no more delay is necessary.
(C)
The Plaintiff further alleges the Defendants’ assertion that discovery
is needed in order to support their allegation that Plaintiff’s right to
construct a 1939 Luxor Line Easement has already been exercised is in bad
faith. Mr. Pliura raised the issue in an earlier case before Judge Baker, who
found that 1939 easement granted the right to construct two pipelines and,
further, that the tracts at issue were not subject to the 1929 easement or
the 1945 easement. Judge Baker observed that “Attorney Pliura is confused
about, and failed to do a reasonable investigation of, the facts.” See Doc.
No. 1, Ex. E., at 2.
The Court concludes that the discovery the Defendants seek is
speculative and has no basis in the record. Attached to the Defendants’
motion is a document which is dated 1945 and states that the grantors
“hereby grant and convey . . . a right of way and easement . . . giving to the
said grantee the right to lay, operate and maintain one pipeline.” Although
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the Defendants allege they anticipate discovering other documents which
reflect an agreement between the pipeline company and former owners of
the property, they offer nothing but speculation in claiming the information
exists “[u]pon information and belief.”
Courts need not authorize
additional discovery based on nothing more than “mere speculation” that
would “amount to a fishing expedition.” See Davis v. G.N. Mortgage Co.,
396 F.3d 869, 885 (7th Cir. 2005).
The language of the document granting an easement in 1945 is clear.
Accordingly, the Court will not authorize additional discovery based on
nothing more than speculation. The Defendants’ Motion for additional
discovery will be denied.
(D)
The Plaintiff further claims that the additional evidence sought by the
Defendants would not preclude summary judgment on either of the
counterclaims. Counterclaim I concerns the language of an agreement.
Although the Defendants allege additional discovery is needed “to prove
that the 1945 pipeline was installed pursuant to the 1939 easement’s
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second pipeline right and that the 1945 easement is a memorialization of
that installation,” the Defendants have not identified any ambiguous
language. Absent ambiguity, a party may not rely upon extrinsic evidence
as to the intent of an agreement. See Barnett v. Ameren Corp., 436 F.3d
830, 833 (7th Cir. 2006). Accordingly, even if the request was not denied
because of its speculative nature, the Defendants still would not be entitled
to the relief they seek on Counterclaim 1.
The same is true regarding Counterclaim II. It is a claim that the
Plaintiff’s pipeline project exceeds the rights granted under the right-of-way
grant. This claim relates to safety and farmability issues, which are entirely
speculative at this point. See Knight v. Enbridge Pipelines (FSP) L.L.C.,
759 F.3d 675, 677 (7th Cir. 2014) (“The Operator promised to leave the
surface farmable. Failure to keep that promise could be addressed under
the law of contract.”). Accordingly, the Court concludes that the proposed
discovery regarding Count II is not relevant to determining whether there
is a genuine issue of material fact as to the summary judgment motion.
For multiple reasons, the Court concludes that summary judgment is
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warranted on the Defendants’ Amended Counterclaims. In relying on
speculation, the Defendants have not met their burden of showing why
additional discovery is necessary in order to respond to the Plaintiff’s
motion. Additionally, for the reasons stated above, the discovery sought
would not defeat the Plaintiff’s motion for summary judgment.
Accordingly, the Defendants’ motion for additional discovery
pursuant to Rule 56(d) will be Denied.
III. PLAINTIFF’S MOTION FOR SUMMARY JUDGMENT
(A)
Plaintiff Illinois Extension Pipeline Company, LLC seeks summary
judgment on the Defendants’ Amended Counterclaims. In support of the
motion, the Plaintiff notes that Defendants have admitted all of the
allegations of the Plaintiff’s Complaint, including that Plaintiff is the owner
of an existing pipeline right-of-way (the “1939 Luxor Line Easement”) that
crosses Defendants’ land and that the 1939 Luxor Line Easement is valid
and enforceable, as every court that has considered the issue has
determined, including this Court and the Seventh Circuit.
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On July 8, 2009, the ICC issued an order stating that the proposed
SAX Pipeline “is necessary and should be constructed, to promote the
security or convenience of the public.” The ICC authorized the Plaintiff to
construct, operate and maintain the SAX Pipeline. In the order, the ICC
specifically noted that Plaintiff would be utilizing the existing Luxor Line
right-of-way acquired when the Plaintiff’s predecessor merged with Central
Illinois Pipeline Company LLC (“CIPC”).
The ICC determined that
Plaintiff’s proposed route “is reasonable and it is hereby approved” and that
“due consideration in the route selection process was given to minimizing
impacts on wetlands and other environmentally sensitive locations, cultural
areas, the number of properties and landowners affected, major roadways
and high density population areas.” See Doc. No. 18, Ex. 3, Order at 57.
There are three separate pipelines that run across Tract 08-004.
In 1929, an easement (“1929 Easement”) was granted to The TexasEmpire Pipe Line Company giving the right to “lay, operate and maintain
one pipe line for the transportation of gas and oil” across Tract 08-004.
The pipeline constructed under that easement was a 12" diameter pipeline.
20
The 12" pipeline and the 1929 Easement are currently owned by the
Magellan Pipeline Company, LLC (“Magellan”).
In 1939, the Luxor Line Easement was granted to the Texas-Empire
Pipe Line Company giving the right to “lay, operate and maintain” a
pipeline. The pipeline constructed under the 1939 Luxor Line Easement
was a 10" diameter pipeline (the “Luxor Line”). The Luxor Line was built
in 1939, and has been there ever since. The 1939 Luxor Line Easement
grants the right to “lay, operate and maintain, adjacent to and parallel with
the first, a second pipe line.”
In 1945, a third easement was granted to The Texas-Empire Pipe Line
Company (“1945 Easement”), giving the right to construct and build a
pipeline adjacent to and parallel with the 12" diameter pipeline (not the 10"
diameter Luxor Line) that was already constructed on the property under
the 1929 Easement. Relying on the Affidavit of Barry A. Kendall, a Senior
Right-of-Way Title Agent working on behalf of the Plaintiff, the Plaintiff
alleges the pipeline constructed under the 1945 Easement was a 12"
diameter pipeline adjacent to and parallel with the first 12" pipeline that
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had been installed pursuant to the 1929 Easement. The 12" diameter
pipeline was not constructed pursuant to the grantee’s right to build a
second pipeline under the 1939 Luxor Line Easement. Mr. Kendall reached
this conclusion upon examining the documents that are part of the chain
of title for Tract 08-004.
The Defendants dispute the Plaintiff’s allegation that the 12"
diameter pipeline was not constructed pursuant to the grantee’s right to
build a second pipeline under the 1939 Luxor Line Easement. Moreover,
the Defendants claim they need additional discovery to properly dispute the
allegation. As stated earlier, however, that motion will be denied.
The 1945 Easement makes no mention of the 1939 Luxor Line
Easement.
Like the original 12" pipeline installed in 1929 and the
associated 1929 Easement, the additional 12" pipeline installed in 1945,
together with the associated 1945 Easement, are today owned by Magellan.
On June 23, 2004 Magellan, which was at that time the successor to
the grantee under all three easements, assigned only the 1939 Luxor Line
Easement to CIPC, a predecessor to the Plaintiff.
22
Neither the 1929
Easement nor the 1945 Easement were assigned to CIPC. Instead, those
two easements and their respective 12" pipelines were retained by Magellan,
which continues to own them today.
The right set forth in the 1939 Luxor Line Easement to construct a
second pipeline has not previously been exercised. The Defendants dispute
the assertion but offer no evidence to contest Mr. Kendall’s Affidavit.
(B)
A. Legal standard
Summary judgment is appropriate if the motion is properly supported
and “there is no genuine dispute as to any material fact and the movant is
entitled to judgment as a matter of law.” See Fed. R. Civ. P. 56(a). The
Court construes all inferences in favor of the non-movant. See Siliven v.
Indiana Dept. of Child Services, 635 F.3d 921, 925 (7th Cir. 2011). To
create a genuine factual dispute, however, any such inference must be based
on something more than “speculation or conjecture.” See Harper v. C.R.
England, Inc., 687 F.3d 297, 306 (7th Cir. 2012) (citation omitted).
Summary judgment “is the put up or shut up moment in a lawsuit.” See
23
Springer v. Durflinger, 518 F.3d 479, 484 (7th Cir. 2008). Ultimately,
there must be enough evidence in favor of the non-movant to permit a jury
to return a verdict in its favor. See id.
The Plaintiff asserts it is entitled to summary judgment on both of the
Defendants’ Counterclaims.
(1)
The Defendants contend summary judgment as to Counterclaim I is
not warranted because Mr. Kendall is not qualified to provide an opinion
as to whether the 1945 pipeline was installed pursuant to the second line
right under the 1939 easement. They contend the Affidavit is not based on
personal knowledge in violation of Rule 56 because Mr. Kendall was not
present when the 1945 pipeline was built.
The Defendants’ argument is without merit. They offer no evidence
that only someone who was present more than 70 years can offer an
opinion as to what occurred. The Court concludes that, as the Plaintiff’s
Senior Right-of-Way Title Agent, Mr. Kendall has the requisite
qualifications and experience to examine easement documents that are part
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of the public record. Mr. Kendall’s Affidavit is consistent with the public
records and is uncontested.
The Plaintiff is entitled to summary judgment on the Defendants’
Counterclaim that Plaintiff’s right to construct a second pipeline under the
1939 Luxor Line Easement has already been exercised to construct a 12"
pipeline, which exists on the Defendants’ property. Accordingly, summary
judgment will be allowed as to Counterclaim I.
(2)
The Defendants also seek summary judgment on Counterclaim II
because the project is too “unsafe” to ever be constructed under the
language of the 1939 Luxor Line Easement. The Defendants allege the SAX
Pipeline project “creates a safety risk exceeding any reasonably
contemplated safety risk at the time the easement was made” and that such
“safety risk” is “incompatible with farming and activities normally
associated with farming of the land and imposes burdens upon the land and
the landowner not present nor anticipated in 1939 when the right-of-way
grant was executed.”
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The Court does not have the authority to alter the Parties’ agreement
and insert a provision regarding safety. The Court presumes that the
project will comply with any all federal pipeline safety regulations and any
state law regulations, if applicable. To the extent that Defendants are
asserting another “farmland safety” claim, such a claim is not justiciable for
the reasons articulated by the Seventh Circuit. See Knight, 759 F.3d at
677. If the land is no longer “farmable” due to the construction of the
pipeline, the Defendants will have a contract remedy. That is an issue for
another day.
As the Plaintiff alleges, however, the Court has no legal or factual
basis to enter a declaratory judgment barring the construction of the SAX
Pipeline project because it may violate an unwritten pipeline safety
standard that is “implicit” in the 1939 Luxor Line Easement.
The Plaintiff’s Motion for Summary Judgment as to the Defendants’
Amended Counterclaims will be Allowed. Judgment will be entered in favor
of Plaintiff Illinois Extension Pipeline Company, LLC, on both of the
26
Defendants’ Amended Counterclaims.1
IV. PLAINTIFF’S MOTION FOR JUDGMENT ON THE PLEADINGS
(A)
The Plaintiff has moved under Rule 12(c) for judgment on the
pleadings. Based on the allegations in the Complaint and the Defendants’
admissions, the Plaintiff alleges it is entitled to judgment on the pleadings.
Accordingly, the Plaintiff asks the Court to enter judgment declaring that
the easement attached to the Complaint as Exhibit A is valid and
enforceable according to its terms and gives Plaintiff Illinois Extension
Pipeline Company, LLC, all rights set forth therein.
The Defendants question whether a motion under Rule 12© is
appropriate or whether a motion for summary judgment is a more
appropriate vehicle. In most cases, it is a defendant that seeks judgment on
the pleadings under Rule 12(c).
The Seventh Circuit has stated, “If the facts are uncontested (or the
Because the Amended Counterclaims were the operative Counterclaims
before the Court, the Plaintiff’s Motion to Dismiss the Defendants’ initial
Counterclaims will be Denied as moot.
1
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defendants accept plaintiffs’ allegations for the sake of argument), it may
be possible to decide under Rule 12(c); if the parties do not agree, but one
side cannot substantiate its position with admissible evidence, the court
may grant summary judgment under Rule 56.” Richards v. Mitcheff, 696
F.3d 635, 638 (7th Cir. 2012).
(B)
Here, the facts are undisputed, though the Defendants have listed five
“clarifications” in their Answer. As the Plaintiff alleges, however, Federal
Rule of Civil Procedure 8(b) does not provide for a party to answer by
clarification. A party must admit or deny the allegations or state that it
lacks sufficient information to answer the assertion. See Fed. R. Civ. P.
8(b)(1), (5). Rule 8(b)(6) provides that allegations that are not denied are
admitted. Each of the Plaintiff’s allegations has been admitted by the
Defendants either expressly or by the failure to deny.
In Clarification A the Defendants allege, “The new easement sought
by IEPC would have expanded the rights of IEPC beyond what was
provided for in the easement at issue.” Because a new easement is not at
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issue in this case, the clarification does not affect the Defendants’
admissions of the allegations in the Complaint.
In Clarification B the Defendants allege, “The Proposed operation of
the new pipeline exceeds the scope of the easement at issue because it
creates a safety risk not contemplated by said easement.” As the Plaintiff
contends, this assertion is not responsive to any allegation in the
Complaint. Additionally, the Court addressed this issue in connection with
Count I of the Defendants’ counterclaims. This clarification does not affect
the Defendants’ admissions of the allegations in the Plaintiff’s Complaint.
In Clarification C the Defendants claim, “IEPC cannot expand its
rights under the easement at issue by this action.” The Plaintiff is simply
seeking a ruling that the 1939 easement is “valid and enforceable according
to its terms,” and is not seeking to expand its rights. Accordingly, the
clarification is not responsive to any allegation in the Complaint.
In Clarification D the Defendants allege, “IEPC is constrained by its
Certificate In Good Standing issued by the Illinois Commerce Commission
for its proposed new pipeline and does not have the right to avoid the
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restrictions contained therein by this action.” As the Plaintiff notes, there
is no issue in this case concerning the ICC’s orders. The Plaintiff would not
be precluded from enforcing its easement on the Defendants’ land even if
there was no ICC order concerning the new pipeline. If the Defendants
believe the Plaintiff has violated the ICC’s order, they can raise the issue
before the ICC. The clarification does not respond to any allegation in the
Complaint.
In Clarification E the Defendants claim, “IEPC waived the
right to obtain eminent domain authority for the land which is the subject
matter of this case, claiming at the ICC that it was fully prepared to rely
exclusively on the terms of the easement at issue.” As the Plaintiff alleges,
this case does not concern eminent domain authority. Therefore, the
clarification is not responsive to any allegation in the Complaint.
Additionally, the Defendants have pled an “affirmative defense”
asserting that the 1939 easement “has become now a narrow easement
established by use prior to ownership by [IEPC], which is something less
than 20' in width.” The Defendants requested “that any declaration by the
Court define the width of the easement and furthermore, require IEPC to
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confine its construction inside said width.” As the Plaintiff contends, this
is not a defense to any claim in its Complaint, which seeks a declaration
that the 1939 easement attached thereto “is valid and enforceable according
to its terms and gives Illinois Extension Pipeline Company, LLC, all the
rights set forth therein.” To the extent that Defendants are asking the
Court to alter the width of the easement in a manner inconsistent with its
terms, the Court lacks the authority to grant such relief.
The Plaintiff claims it is not seeking the right to do anything not
allowed by the easement. Even if the width of the easement had been
decreased, that would not affect the validity of the easement and the
Plaintiff would still be seeking the same relief.
Accordingly, the affirmative defense does not preclude the Court from
entering judgment on the pleadings in favor of the Plaintiff on the ground
that Defendants have admitted every allegation in the Complaint.
Because the Defendants have admitted every allegation in the
Plaintiff’s Complaint, the Plaintiff is entitled to judgment on the pleadings.
Accordingly, the Plaintiff’s Motion pursuant to Rule 12(c) will be allowed.
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Judgment will be entered in the Plaintiff’s favor and against the
Defendants, declaring that the Luxor Line right-of-way grant is valid and
enforceable according to its terms, as stated in Exhibit A to the Plaintiff’s
Complaint. Plaintiff Illinois Extension Pipeline Company, LLC, is entitled
to all rights as provided in the easement.
Ergo, the Motion of Plaintiff Illinois Extension Pipeline Company,
LLC, to Dismiss the Defendants’ Counterclaims [d/e 11] is DENIED AS
MOOT.
The Motion of the Defendants under Rule 56(d) for additional
discovery [d/e 20] is DENIED.
The Motion of the Plaintiff for Summary Judgment on the
Defendants’ Amended Counterclaims [d/e 18] is ALLOWED. Judgment
will be entered in favor of the Plaintiff and against the Defendants on the
Amended Counterclaims.
The Plaintiff’s Motion for Judgment on the Pleadings [d/e 12] is
ALLOWED.
The Clerk will enter a Judgment declaring that the easement attached
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to the Plaintiff’s Complaint is valid and enforceable according to its terms.
Plaintiff Illinois Extension Pipeline Company, LLC, is entitled to all rights
set forth therein.
Upon entry of Judgment, the Clerk shall terminate the case.
ENTER: March 30, 2016
FOR THE COURT:
s/Richard Mills
Richard Mills
United States District Judge
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