Northern Natural Gas Company v. L.D. Drilling, Inc. et al

Filing 641

MEMORANDUM AND ORDER Lifting Stay. Signed by Magistrate Judge Kenneth G. Gale on 10/05/17. (Attachments: # 1 Exhibit Defendants' Email, # 2 Exhibit Plaintiff's Email) (df)

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF KANSAS
NORTHERN NATURAL GAS
COMPANY,

)
)
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Plaintiff,
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L.D. DRILLING, INC., et al.,
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Defendant.
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___________________________________ )

Case No.: 08-1405-JTM-KGG

MEMORANDUM & ORDER LIFTING STAY
The undersigned Magistrate Judge entered a Minute Order suspending all
deadlines in this case, by agreement of the parties, on July 24, 2017. (Doc. 638,
text entry.) This stay was entered “in light of recent developments in related
cases.” (Id.) The case was set for a telephone status conference, which was
ultimately held on October 2, 2017, wherein the Court and the parties discussed
whether the stay should remain in effect. Prior to the conference, the parties
supplied the Court with emails detailing their respective positions and discussing
relevant events in related cases. (Docs. 641-1, 641-2.)
Defense counsel stated that at the time the deadlines were suspended, they
were “preparing a petition for hearing and rehearing en banc in the Tenth Circuit
relating to that court’s ruling on ownership and rights to gas underlying
[Defendants’] wells on and after June 2, 2010, the date that FERC issued the

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regulatory certificate authorizing the expansion of [Plaintiff’s] storage field.”
(See Doc. 641-1.) That petition was denied by the Tenth Circuit, but Defendants
have since “filed a motion to stay issuance of the Tenth Circuit’s mandate pending
their petition for a writ of certiorari in the U.S. Supreme Court,” which is currently
pending. (Id.)
Concurrently, in the parallel Kansas state court action, the Pratt County
District Court issued a ruling that denied Plaintiff’s “motion to reconsider, and
affirm[ed] its original order that [Defendants] had the right to operate their wells
after the June 2, 2010[,] FERC Certificate . . . .” (Id.) Plaintiff appealed that order
in August, 2017.
Defense counsel contends that “[w]ith the issuance of the State court order,
there are now Kansas-State and Federal rulings from separate lawsuits that stand in
direct conflict, both addressing identical unresolved issues of Kansas law relating
to [Plaintiff’s] storage field, migrating storage gas, and the rights to and ownership
of that gas.” (Id.) Because of this, Defendants argue the stay should continue –
“the resolution of the condemnation case and, even more importantly, the Pratt
County appeal, will directly affect the parties’ rights in this case.” (Id.)
Defendants continue that
proceeding with the present case will impose significant
financial burdens on all the parties – in particular the
defendants, whose imminent expert expenses will be
substantial. All of those expenses could be for naught
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depending on how the Pratt County case and the
condemnation case are finally resolved. And such waste
will likely be compounded if discovery proceeds at this
time because the experts’ opinions regarding the
producers’ defenses, the producers’ counterclaims, and
Northern’s damages claims are all directly impacted by
who has the right and title to post-June 2, 2010[,] gas.
(Id.)
Plaintiff points to an Order from May 2106 in which the District Court lifted
a stay in this case that had been in effect for five years. (Doc. 641-2.) Therein, the
District Court held that “[t]he pending state case and the Tenth Circuit appeal do
not include claims for nuisance . . ., and they clearly will not ‘resolve’ these claims,
as the court has already pointed out.” (Doc. 561.) Plaintiff also quotes the
following language from the District Court’s February 2016 Order that initially
denied the motion to lift the prior stay:
The court cannot accept defendants’ premise that the
above-described court decisions ‘have effectively
disposed of Northern’s remaining claims.’ The question
of whether Northern had title to storage gas that was in
the Expansion Area after June 2, 2010 (both Judge Belot
and the state court have ruled it did not), may be a factor
in whether a nuisance existed, but it is not necessarily
dispositive of a claim for nuisance under Kansas law.
Both the Tenth Circuit and the Kansas Supreme Court
recognized as much. See L.D. Drilling, Inc., 697 F.3d at
1271-72 (“The state case addressed whether Northern
still had title to the natural gas that migrated several
miles away from the Field. Here, on the other hand, the
issue is whether Defendants’ production from their wells
in the expansion area unreasonably interfered with
Northern’s storing its natural gas in the Field. Therefore,
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the state court’s decision . . . cannot make Defendants’
interference with Northern’s storage field reasonable.”);
ONEOK Field Svcs. Co., 296 Kan. at 928 (noting same
distinction).
(Doc. 550, at 7-8.)
Plaintiff argues that “[y]et another stay will push this matter well beyond ten
years since its initial filing.” (Doc. 641-2.) Plaintiff contends this is unnecessary
because the Tenth Circuit’s opinion “provides the necessary guidance” in the
present case as to whether “ownership of storage gas after issuance of the June
2010 FERC Certificate remains an issue with respect to [Plaintiff’s] nuisance claim
or any counterclaim advanced by [Defendants] . . . .” (Id.)
The District Judge’s prior Order provides clear guidance. This matter
should move forward not withstanding potential developments in related cases
which may be decided for months or years. As such, the stay and agreed
suspension of deadlines (Doc. 638) in this matter is lifted. The parties are directed
to submit to the Court a proposed joint Scheduling Order within three (3) weeks
of the date of this Order.
IT IS SO ORDERED.
Dated this 5th day of October, 2017, at Wichita, Kansas.
S/ KENNETH G. GALE

HON. KENNETH G. GALE
U.S. MAGISTRATE JUDGE

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