Zadeck Succession et al v. Vandiver Treme et al

Filing 57

MEMORANDUM RULING re 33 MOTION for Summary Judgment on Prescription, 34 MOTION for Summary Judgment on Defendants Conveyance Claim, 51 MOTION to Strike 47 Reply to Response to Motion. Signed by Magistrate Judge Kayla D McClusky on 9/15/2022. (crt,Miletello, A)

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UNITED STATES DISTRICT COURT
WESTERN DISTRICT OF LOUISIANA
SHREVEPORT DIVISION
DONALD ZADECK SUCCESSION, ET AL.

CASE NO. 5:21-CV-00323

VERSUS

MAGISTRATE JUDGE KAYLA D.
MCCLUSKY

CRYSTAL JEAN VANDIVER TREME, ET
AL.

MEMORANDUM RULING
Before the undersigned 1 are two motions for summary judgment filed by Plaintiffs the
Succession of Donald Zadeck (“Zadeck”), Zadeck Interests, LLC (“Zadeck Interests”), and the
Zadeck Energy Group, Inc. (“Zadeck Energy”) (collectively, “Plaintiffs”). [docs. #33, 34].
Defendants Crystal Jean Vandiver Treme (“Treme”) and Rebecca Lynn Vandiver (“Rebecca
Vandiver”) (collectively, “Defendants”) oppose both motions. [docs. #41, 42].
For the reasons assigned below, Plaintiffs’ motion for summary judgment on prescription
is granted in part and denied in part. The motion is granted to the extent that Plaintiffs contend
that Defendants’ claims are prescribed. The motion is denied as to costs. Plaintiffs’ motion for
summary judgment on conveyance is denied as moot. As the Court did not reach the substantive
merits of the motion for summary judgment on conveyance, Defendants’ motion to strike is also
denied as moot.

1

With the consent of all parties, the District Court referred the above-captioned case to the
undersigned magistrate judge to conduct all further proceedings and entry of judgment pursuant
to 28 U.S.C. § 636(c).

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I.

FACTUAL BACKGROUND

This action arises out a dispute related to nine individual mineral leases 2 (together, the
“Mineral Leases”) in the Belle Bower Field in DeSoto Parish, Louisiana. [doc. #41, p. 4]. In 1979,
Donald Zadeck (“Zadeck”) personally owned a working interest in the Mineral Leases—a 100%
working interest in the Mineral Leases from the base of the Paluxy formation to the surface and a
50% working interest in the Mineral Leases below the Paluxy formation. [doc. #45-2 ¶ 1].
In 1980, Zadeck completed the Harrison Brown No. 1 well in the Upper Hosston formation,
located below the Paluxy formation on a unit encompassing four of the nine Mineral Leases (the
“Upper Hosston Unit”). Id.; [doc. #41, p. 5]. By 1990, Zadeck owned a 41.625% working interest
in the Mineral Leases below the Paluxy formation, having conveyed an 8.375% working interest
to parties not involved in the instant suit. [doc. #34-1, p. 2]. At that time, Zadeck Energy acquired
a 50% working interest in the Mineral Leases below the Paluxy formation and took over as operator
of Harrison Brown No. 1 well. Id. Accordingly, in 1990, working interests in the Mineral Leases
below the Paluxy formation belonged 50% to Zadeck Energy, 41.625% to Zadeck personally, and
8.375% to other parties not involved in this action.
By 1992, production from Harrison Brown no. 1 well on the Upper Hosston Unit had
ceased. [doc. #34-1, p. 2]. In May 1993, Zadeck Energy recompleted the Harrison Brown no. 1
well in the Pettet formation, located below the Paluxy formation on a recompleted unit
encompassing two of the nine Mineral Leases. Id.; [doc. #41, p. 6].

2

A mineral lease is a contract which gives the lessee the right to explore for and produce
minerals. LA. R.S. § 31:114; see Davis v. Meagher Oil & Gas Props., Inc., 8-CV-1638, 2010
WL 819403, at *2 (W.D. La. Mar. 4, 2010).
2

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Around May 1993, Defendants claim that their father, Douglas Vandiver (“Vandiver”),
operations manager for Zadeck Energy, was conveyed a five-percent working interest in the
Mineral Leases as compensation for the recompletion of the Harrison Brown No. 1 well. [doc.
#41, p. 9]. Plaintiffs, on the other hand, claim that Vandiver had a five-percent working interest
in Harrison Brown No. 1 well itself—not the Mineral Leases. [doc. #34-1, p. 6-7].
Defendants concede that Vandiver never recorded his alleged working interest in the
Mineral Leases, and there is no writing evidencing a conveyance. [doc. #41, p. 10; doc. #34, p.
12]. Zadeck Energy, however, has accounting records crediting Vandiver with a five-percent
working interest in Harrison Brown no. 1 well. Id. Vandiver received payments associated with
that working interest and made payments to Zadeck Energy for his proportionate share of the costs
for Harrison Brown no 1. well. [doc. #41, p. 10]. 3 When Zadeck Energy later transferred all its
well operations to Titan Land and Mineral, LLC, its affiliate, Louisiana Energy Consultants, Inc.,
(“LECI”), continued to recognize Vandiver’s five-percent working interest in the Harrison Brown
no. 1 well. [doc. #41, p. 12]. Vandiver and his heirs continued to pay proportionate shares of the
costs and continued to receive revenue from LECI based on their proportionate share. 4 Id.

3

Neither Plaintiffs nor Defendants have any accounting records for years before 2004. [doc. #41,
p. 6; doc. #34-1, p. 6]. Zadeck Energy kept division of interest (“DOI”) files for each of the wells
that it operated that would show the various ownership interests in the wells. [doc. #41, p. 9].
Defendants point out that the DOI for the Harrison Brown no. 1 well is the only DOI that Zadeck
Energy cannot locate. Id. Records beginning in 2004 reflect that Vandiver and, later, Defendants
were paid a share of revenue associated with a five-percent interest in Harrison Brown no. 1 well
from 2004 to 2012, when production from Harrison Brown no. 1 well ceased. [doc. #34-1, p. 7].

4

Vandiver and his heirs received payments for revenue and bills for costs associated with Harrison
Brown no. 1 well until late 2012, when it was determined the well was probably no longer capable
of commercial production. [doc. #34-1, p. 10]. In 2011 and 2012, Zadeck Energy attempted to
purchase the Vandivers’ interest in Harrison Brown no. 1 well. [doc. #41, p. 12-13]. Paul Jarratt,
a former employee of Zadeck Energy, testified in a deposition that Zadeck’s attempt to purchase
Vandiver’s interest in the well, which was unprofitable, suggests Zadeck recognized that Vandiver
3

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In 1994, Zadeck assigned his personal rights, title, and working interest in the Mineral
Leases to T.M. Hopkins, Inc. 5 [doc. #34-1, p. 9]. In 2007, Zadeck Energy conveyed its 50%
working interest in the Mineral Leases to Comstock Oil & Gas Louisiana, LLC (“Comstock”). Id.
Zadeck Energy reserved a one-eighth overriding royalty interest 6 and an option to exchange that
overriding royalty interest for a working interest at the payout. 7 [doc. #41-2, p. 47-48, 213].
Zadeck Energy declined that option in 2018, thereby terminating it. Id. at 213. After the 1994
conveyance to T.M. Hopkins and the 2007 conveyance to Comstock, neither Zadeck nor Zadeck
Energy owned a working interest in the Mineral Leases. [doc. #34-1, p. 9].
Defendants claim that Zadeck Energy included Vandiver’s alleged five-percent working
interest in the Mineral Leases in its conveyance to Comstock. [doc. #41, p. 13]. After the
conveyance, Comstock drilled several wells on the land covered by the Mineral Leases and paid
Zadeck Energy and its successor, Zadeck Interests, the revenue attributable to the overriding
royalty interests. [doc. 34-1, p. 10]. Vandiver did not receive any compensation from the
conveyance, nor did he receive any overriding royalty interest payments. Id. This is the source
of the instant dispute. Id.

actually had a five-percent working interest in the Mineral Leases and not in Harrison Brown well
no. 1. Id. Harrison Brown well no. 1 was plugged and abandoned on October 1, 2019. [doc. #341, p. 10].
5

Zadeck, in his personal capacity, retained a “wellbore interest,” which is an interest only in the
well itself and carries no ownership of mineral leases or right to explore for oil and gas.
6

An overriding royalty interest is an interest in the revenue from the sale of well production.
Encana Oil & Gas (USA), Inc. v. Brammer Eng’g, Inc., 51,045, p. 7 (La. App. 2 Cir. 11/16/16);
209 So.3d 995, 1000. An overriding royalty interest holder does not bear any of the costs to drill
or produce the well. Id.
7

The “payout” would occur once Comstock had recovered all costs of acquisition, drilling,
development, and operation of the wells.
4

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In 2009, Vandiver sent an email to his attorney, Marshall Jones, asking him about a
potential claim against Zadeck for his purported five-percent working interest in the Mineral
Leases. [doc. #s 33-1, p. 4, 33-9]. Treme, one of Vandiver’s daughters, testified that Vandiver
told her about this exchange in 2009. [doc. #33-8, pp. 5-7, 9]. However, no action was filed by
Defendants at that time.
Vandiver died in December 2011. [doc. #45-2 ¶ 3].
Instead, eight and one-half years later, on June 4, 2020, Defendants, through counsel, sent
Plaintiffs a letter claiming that, in 1993, Zadeck Energy conveyed a five-percent working interest
in the Mineral Leases to Vandiver. [doc. #33-1, p. 12]. Shortly after, on July 15, 2020, Zadeck
died. Id.
On January 26, 2021, Defendants filed a notice of proof of claim in Zadeck’s succession,
asserting that they are entitled to (1) a portion of the consideration Zadeck received from the 2007
assignments to Comstock; (2) a portion of the overriding royalty payments Zadeck received from
Comstock; and (3) a formal assignment by Zadeck of the Mineral Leases.
On February 5, 2021, Plaintiffs filed suit in this Court, seeking a judgment at Defendants’
cost declaring that Defendants are not entitled to an assignment of any interest in the Mineral
Leases, nor any profits or accounting associated with them. [doc. #8, p. 8].
On July 7, 2021, the parties submitted their Rule 26(f) report and consented to trial by
magistrate judge [doc. #5]. Chief Judge Hicks subsequently referred the case to the undersigned.
[doc. #18].
On July 13, 2021, Defendants filed their answer and a counterclaim seeking a declaratory
judgment (1) that Zadeck Energy conveyed and transferred to Vandiver a five-percent working
5

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interest in the Mineral Leases; (2) recognizing that Defendants own a five-percent working interest
in the Mineral Leases; (3) ordering an accounting of the amount Zadeck Energy received from
Comstock for the Mineral Leases; and (4) awarding Defendants damages equal to the amount
Zadeck Energy received from Comstock for the Mineral Leases. [doc. #17, p. 12].
On January 3, 2022, Plaintiffs filed the instant motions for summary judgment on the issue
of prescription and on the Defendants’ conveyance claim. [docs. #33, 34].
On January 12, 2022, Defendants filed an unopposed motion to continue trial, which was
previously scheduled for March 7, 2022. [doc. #39]. On January 14, 2022, the undersigned
granted Defendants’ motion, continuing trial without date until the disposition of the pending
motions for summary judgment. [doc. #40].
On February 4, 2022, Defendants filed their opposition to the instant motions. [doc. #41,
42].
On February 18, 2022, Plaintiffs filed their reply briefs. [docs. #46, 47]. Accordingly, this
matter is ripe.
II.

APPLICABLE LAW

A. Summary Judgment Standard
Summary judgment is appropriate when the evidence before the Court shows “that there is
no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of
law.” FED. R. CIV. P. 56(a). A fact is “material” if proof of its existence or nonexistence would
affect the outcome of the lawsuit under applicable law in the case. Anderson v. Liberty Lobby,
Inc., 477 U.S. 242, 248 (1986). A dispute about a material fact is “genuine” if the evidence is such
that a reasonable fact finder could render a verdict for the nonmoving party. Id.
6

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A party seeking summary judgment always bears the initial responsibility of informing the
district court of the basis of its motion, and identifying those portions of “the pleadings,
depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any,”
which it believes demonstrate the absence of a genuine issue of material fact by pointing out that
the record contains no support for the non-moving party’s claim. Stahl v. Novartis Pharm. Corp.,
283 F.3d 254, 263 (5th Cir. 2002) (quoting FED. R. CIV. P. 56(c)) (internal quotations omitted).
Thereafter, if the non-movant is unable to identify anything in the record to support its claim,
summary judgment is appropriate. Id. “The court need consider only the cited materials, but it
may consider other materials in the record.” FED. R. CIV. P. 56(c)(3). 8
In evaluating a motion for summary judgment, courts “may not make credibility
determinations or weigh the evidence” and “must resolve all ambiguities and draw all permissible
inferences in favor of the non-moving party.” Total E & P USA Inc. v. Kerr-McGee Oil & Gas
Corp., 719 F.3d 424, 434 (5th Cir. 2013) (internal citations omitted). While courts will “resolve
factual controversies in favor of the nonmoving party,” an actual controversy exists only “when
both parties have submitted evidence of contradictory facts.” Little v. Liquid Air Corp., 37 F.3d
1069, 1075 (5th Cir. 1994) (en banc). To rebut a properly supported motion for summary
judgment, the opposing party must show, with “significant probative evidence,” that a genuine
issue of material fact exists. Hamilton v. Segue Software, Inc., 232 F.3d 473, 477 (5th Cir. 2000).
‘“If the evidence is merely colorable, or is not significantly probative,’ summary judgment is

8

However, Rule 56 does not require the Court to “sift through the record in search of evidence to
support a party’s opposition to summary judgment.” Willis v. Cleco Corp., 749 F.3d 314, 317
(5th Cir. 2014) (citation omitted).
7

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appropriate.” Cutting Underwater Tech. USA, Inc. v. Eni U.S. Operating Co., 671 F.3d 512, 517
(5th Cir. 2012) (quoting Anderson, 477 U.S. at 248).
B. Controlling Law
This Court has diversity jurisdiction pursuant to 28 U.S.C. § 1332 and must apply
Louisiana substantive law just as a Louisiana court would. Musser Davis Land Co. v. Union Pac.
Res., 201 F.3d 561, 563 (5th Cir. 2000) (citing Erie R.R. Co. v. Tompkins, 304 U.S. 64, 79-80
(1938)). To determine a question of state law, this Court first looks to the decisions of the
Louisiana Supreme Court. If the State’s highest court has not yet decided the issue, this Court
must determine as best it can, what the Louisiana Supreme Court would decide. Transcon. Gas
Pipe Line Corp. v. Transp. Ins. Co., 953 F.2d 985, 988 (5th Cir. 1992). State appellate courts’
decisions may guide this Court in determining state law. Hulin v. Fibreboard Corp., 178 F.3d
316, 328 (5th Cir. 1999).
III.

ANALYSIS

A. Plaintiffs’ Motion for Summary Judgment on Prescription
In the instant motion, Plaintiffs argue that any claim Defendants may have had to the
Mineral Leases or profits from the conveyance of the Mineral Leases has prescribed. Plaintiffs
argue that the claims Defendants assert in their counterclaim are personal actions subject to a tenyear prescriptive period. Because Vandiver and Treme knew about all potential claims in 2009,
Plaintiffs argue that those claims are now time-barred.
In their opposition, Defendants contend that their claims are real actions and, as such, are
imprescribable. Defendants argue that they brought the instant action to determine the parties’
rights to the Mineral Leases, and actions to determine a party’s ownership rights are real actions
8

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under Louisiana law. Defendants also argue that, although Plaintiffs transferred their rights in the
Mineral Leases to a third party, the transfer was merely a sublease and “[i]f Comstock determined
that it no longer wished to drill on the Harrison Brown Leases, it could release [them] and the
working interest rights would revert back to [Plaintiffs].” [doc. #41, p. 15]. Finally, Defendants
insist that Plaintiffs’ prescription argument fails because Defendants’ counterclaim seeks the exact
same thing as Plaintiffs’ declaratory judgment—that is, a determination of the parties’ rights to the
Mineral Leases.
In reply, Plaintiffs argue that, although an action to determine a party’s ownership is
typically a real action, such a real action abates when the property is no longer in the defendant’s
possession. [doc. #46, p. 2]. In this scenario, Plaintiffs argue that the only remaining action is a
potential personal action for unjust enrichment or damages against the former possessor. Id.
Plaintiffs also argue that the action has in fact abated because the conveyance to Comstock was
not a sublease, nor do Plaintiffs have any right or option to regain ownership of the Mineral Leases.
Id. at 4. Finally, Defendants clarify that they do not seek a judgment of the parties’ rights; rather,
they seek only a determination that Defendants are not entitled to the Mineral Leases or any profits
associated with them because Defendants’ potential claims have since prescribed. [doc. #46, p.
2].
The determinative question before the Court is whether Defendants’ claims constitute a
personal or real action. “The [Louisiana] Supreme Court has declared that ‘the term real right
under the civil law is synonymous with propriety interest, both of which refer to a species of
ownership. Ownership defines the relation of man to things and may, therefore, be declared against
the world.’” CLK Co., v. LLC v. CXY Energy, Inc., 98-0802, p. 1104 (La. App. 4 Cir. 9/16/98);
719 So.2d 1098, 1104 (quoting A.N. Yiannopoulos, Louisiana Civil Law Treatise-Property § 201,
9

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367 (1991)). On the other hand, “[a] personal right may be defined as the legal power that a person
(obligee) has to demand from another person (obligor) a performance consisting of giving, doing,
or not doing a thing. The Louisiana Supreme Court has declared that ‘a personal right . . . defines
man’s relationship to man and refers to an obligation one owes to another which may be declared
only against the obligor.” Id. (emphasis omitted). Importantly, a real right is imprescribable while
a personal right is subject to a ten-year prescriptive period. Boone v. Conoco Phillips Co., 20131196, p. 21 (La. App. 3 Cir. 5/7/14); 139 So.3d 1047, 1060-61; Songbyrd, Inc. v. Bearsville Recs.,
Inc., 104 F.3d 773, 779 (5th Cir. 1997); LA. CIV. CODE art. 3499 (“a personal action is subject to
a liberative prescription of ten years.”).
“Actions seeking recognition of ownership or enforcement of the rights thereof, whether
in movable or immovable property, are not personal actions; they are ‘real actions.’” Songbyrd,
104 F.3d at 777 (quoting A.N. Yiannopoulos, 2 Louisiana Civil Law Treatise § 241, 476 (1991)).
These actions, referred to as “revendicatory actions,” allow “[t]he owner of a thing . . . to recover
it from anyone who possesses or detains it without right and to obtain judgment recognizing his
ownership and ordering delivery of the thing to him.” LA. CIV. CODE art. 526. However, because
this right is predicated on the defendant maintaining possession of the property, a “revendicatory
action abates when the [property] is no longer in the defendant’s possession.” Boykins v. Boykins,
2007-0542, p. 5 (La. App. 4 Cir. 4/30/08); 984 So.2d 181, 185. When a revendicatory action
abates, “a plaintiff may have a personal action for damages or unjust enrichment against the former
possessor . . . .” Id. (emphasis added); see also Dual Drilling Co. v. Mills Equip. Invs., Inc., 980343, p. 4 (La. 12/1/98); 721 So.2d 853, 856. Thus, the nature of a cause of action may change
from a real action to a personal action, depending on the relationship of the parties to the property.
Aertker v. Placid Holding Co., No. 07-473, 2012 WL 4472002 (M.D. La. Sept. 12, 2012) (holding
10

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that a revendicatory action related to immovable property abated because defendants no longer
owned an interest in the property, leaving plaintiff with a personal action for damages).
In this case, Defendants seek a judgment determining that Defendants are entitled to a fivepercent working interest in the Mineral Leases and awarding Defendants such an interest, as well
as damages. [doc. #9 ¶ 18]. At first glance, Defendants’ claim appears to be a real action because
they are seeking recognition of their ownership in the Mineral Leases. Certainly, such actions are
categorized as real actions under Louisiana law. See Songbyrd, 104 F.3d at 777. Yet, Defendants’
action is complicated by the fact that Plaintiffs no longer own the property of which Defendants
seek a judgment of ownership. It is undisputed that, even if Defendants had owned five-percent
of the Mineral Leases at some point, this interest was conveyed to, and recorded by, Comstock in
2007. [doc. #33-5]. Due to the conveyance and recordation, Defendants cannot seek a property
interest in the Mineral Leases that are now owned by Comstock. Thus, Defendants do not have a
real action because they can no longer claim a right against the world. 9 Boykins, 984 So.2d at 185.
What Defendants have is a personal action against Plaintiffs for any conduct that may have
deprived them of the property to which they were purportedly entitled before the conveyance to
Comstock. See id.; Aertker, 2012 WL 4472002 at *5. However, because Defendants knew of this
potential action in 2009 (at the latest), any personal action Defendants may have once had has been

9

Although Plaintiffs maintained a one-eighth overriding royalty interest in the Mineral Leases, an
overriding royalty interest is distinct from a working interest. “An overriding royalty is an interest
severed out of the working interest or lessee’s share of the oil, free of the expenses of development,
operation, and production.” Encana, 209 So.3d at 1000. Importantly, an overriding royalty
interest is a nonpossessory interest. Standard Oil Co. v. Marshall, 265 F.2d 46, 57 (5th Cir. 1959).
On the other hand, a working interest provides the right to enter the land to explore, drill, and
produce and sell oil and gas. It is also burdened with the cost of development and operation of the
well. Gloria’s Ranch, LLC v. Tauren Expl., Inc., 252 So.3d 431, 440-41 (La. 2018).
11

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extinguished by the ten-year prescriptive period to which personal actions are subject. [doc. #s
33-8, pp. 35-36, 113-121, 33-9].
Although Defendants concede that the Mineral Leases were conveyed to Comstock, they
contend that Plaintiffs retain a working interest in the Mineral Leases, and, thus, that the real action
did not abate. Defendants argue that “[i]f Comstock determined that it no longer wished to drill
on the [Mineral Leases], it could release [them] and the working interest rights would revert back
to [Defendants],” reserving Plaintiffs’ ownership rights. [doc. #41, p. 15]. In support for their
assertion, Defendants cite to Smith v. Sun Oil Co., 116 So. 379 (La. 1928), a Louisiana Supreme
Court case in which “a conveyance of a mineral lease subject to a reserved overriding royalty and
a right of reversion . . . was held to be a sublease.” However, Defendants do not cite to any
language in the agreement with Comstock that might suggest a right of reversion, nor has the Court
found any such language. 10 Thus, the Court finds that Sun Oil – the only support Defendants offer
for the proposition that Plaintiffs maintain a present or future working interest in the Mineral
Leases – is inapplicable.
Finally, the undersigned is unpersuaded by Defendants’ argument that, if the Court finds
that Defendants’ claims have prescribed, it must also find that Plaintiffs’ claims are barred by
prescription. Defendants seek a judgment recognizing their rights to the Mineral Leases and
compensation for those rights. Plaintiffs merely seek a judgment finding that Defendants are not
entitled to those rights because they no longer exist. While Defendants’ position would require

10

The undersigned notes that the conveyances did include an option for Zadeck Energy to
exchange its overriding royalty interest for a working interest at the payout (i.e., once Comstock
had recovered all costs of acquisition, drilling, development, and operation of the wells). [doc.
#41-2, p. 47]. However, even if the Court were to find that the option operated as a right of
reversion in this case, Zadeck Energy declined the option in 2018, thereby terminating it. Id. at
213.
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the Court to rule on the merits of the case (now barred by prescription), Plaintiffs’ position does
not. In finding that Plaintiffs are entitled to summary judgment, the Court is merely finding that
Plaintiffs do not owe Defendants anything because Defendants’ potential rights have prescribed.
B. Plaintiffs’ Motion for Summary Judgment on Conveyance
In their motion for summary judgment on conveyance, Plaintiffs argue that Zadeck did not
convey, either orally or in writing, or deliver to Vandiver, any interest in the Mineral Leases.
Plaintiffs contend that neither they nor Defendants have any evidence that there was ever a writing
conveying an interest in the Mineral Leases to Vandiver or Defendants. And, even if there was an
oral conveyance, Plaintiffs argue that Vandiver never received delivery of any alleged conveyance
and never recognized an alleged transfer under oath.
In their opposition, Defendants contend that there was a valid oral transfer of the Mineral
Rights by Zadeck to Vandiver. Vandiver, Defendants argue, received physical possession of a
five-percent working interest in the Mineral Leases and Julie Zadeck, on behalf of her father’s
estate, testified under oath that there was an agreement with Vandiver related to the subject
property. Finally, Defendants argue that by bringing this petitory action, Plaintiffs admit that
Defendants are in possession of a five-percent working interest.
In reply, Plaintiffs argue that Defendants have not met their burden by presenting evidence
of a written conveyance of the Mineral Leases, testimony that such a document existed, testimony
by the alleged transferor under oath recognizing transfer of the leases, or evidence that the Mineral
Leases were delivered to Defendants. Plaintiffs also argue that parole evidence is inadmissible to
prove a conveyance. Finally, Plaintiffs contend that because this is not a petitory action, they have
not admitted delivery of the Mineral Lease.
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This Court need not reach the issue of whether there was a conveyance of the Mineral
Leases. Because the Court finds that Defendants have a personal action against Plaintiffs, and not
a real action, and that the personal action has prescribed, the issue of whether there was a valid
conveyance is moot. If there was no conveyance, then the Plaintiffs do not owe the Defendants
any revenue, assignment of interest, or accounting related to the Mineral Leases or conveyances.
And, even if there was a conveyance, any action that Defendants have related to the conveyance
is a personal action that has prescribed under the ten-year prescriptive period. Accordingly, the
Court is barred from considering the substantive merits of the personal action.
C. Plaintiffs’ Costs
In their amended complaint, Plaintiffs request that judgment be rendered in favor of
Plaintiffs against Defendants at their cost. [doc. #6, p. 8].
Federal Rule of Civil Procedure 54(d) provides that “[u]nless a federal statute, these rules,
or a court order provides otherwise, costs . . . should be allowed to the prevailing party.” FED. R.
CIV. P. 54(d). While the rule grants the court discretion to deny costs to a prevailing party, “the
general discretion conferred by Rule 54(d)(1) has been circumscribed by the judicially-created
condition that a court ‘may neither deny nor reduce a prevailing party's request for cost without
first articulating some good reason for doing so.’” Pacheco v. Mineta, 448 F.3d 783, 794 (5th Cir.
2006) (quoting Schwarz v. Folloder, 767 F.2d 125, 131 (5th Cir. 1985)).
In Pacheco, the court articulated several factors to justify withholding costs from a
prevailing party, including the losing party’s good faith in bringing the action, close and difficult
legal issues presented, the losing party’s limited financial resources, misconduct by the prevailing
party, and substantial benefit conferred on the public. Id. at 794-95. While the losing party’s good
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faith in bringing the action is not enough by itself to justify denying costs to the prevailing party,
it can, in conjunction with consideration of the other factors, weigh in favor of denying costs. Id.
at 793-95.
Applying the Pacheco factors, the Court finds that costs should not be awarded to
Plaintiffs. This case presented close and difficult legal issues. Further, the Court believes that
Defendants’ claims were brought in good faith.
IV.

CONCLUSION

For the foregoing reasons, Plaintiffs’ motion for summary judgment on prescription is
GRANTED in PART and DENIED in PART. To the extent that Plaintiffs seek a declaratory
judgment that Plaintiffs do not owe Defendants (1) an assignment of any interest in the Mineral
Leases; (2) any revenue received by Plaintiffs attributable to the Mineral Leases; or (3) an
accounting of any revenue received from the conveyances, Plaintiffs’ motion is GRANTED as
Defendants’ claims are prescribed. To the extent that Plaintiffs seek a judgment requiring
Defendants to pay Plaintiffs’ costs associated with this suit, Plaintiffs’ motion is DENIED.
Plaintiffs’ motion for summary judgment on conveyance is DENIED as MOOT. As the
Court did not reach the substantive merits of the motion for summary judgment on conveyance,
Defendants’ motion to strike is also DENIED as MOOT.
Defendants’ counterclaim is DISMISSED WITH PREJUDICE.
THUS DONE in Chambers on this 15th day of September, 2022.

KAYLA DYE MCCLUSKY
UNITED STATES MAGISTRATE JUDGE

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Case 5:21-cv-00323-KDM Document 57 Filed 09/15/22 Page 16 of 16 PageID #: 3165

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