CDS Family Trust, et al. v. Ernest R. Martin, et al.
MEMORANDUM OPINION. Signed by Judge Richard D. Bennett on 5/16/2017. (jnls, Deputy Clerk)
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MARYLAND
CDS FAMILY TRUST, LLC, et al.,
Civil Action No.: RDB-15-2584
ERNEST R. MARTIN, et al.,
This case involves a dispute over property and mineral rights in a parcel of land
located in Garrett County, Maryland. Plaintiffs CDS Family Trust, LLC and The Carl
Delsignore Family Trust (collectively, “plaintiffs” or “CDS”) seek a declaratory judgment
regarding their asserted ownership in the property and also assert several counts in tort
based on defendants’ allegedly unlawful exploitation of the minerals and the land. (ECF No.
19.) Defendants Corsa Coal Corporation NAPP (“Corsa”), Wilson Creek Energy, LLC
(“Wilson Creek”), WPO, Inc. (“WPO”), Ernest R. Martin, Patricia J. Martin, Jeffrey Rose,
and Debbie Rose have filed a series of cross- and counter-claims asserting their own
respective interests in the property and claims based thereon.
Now pending before this Court are two motions: first, the Motion for Summary
Judgment (ECF No. 53) (the “Martin Motion”) filed by Ernest Martin and Patricia Martin;
second, the Motion for Leave to File Second Amended Complaint (ECF No. 62) (the “CDS
Motion”) filed by CDS. The parties’ submissions have been reviewed, and no hearing is
necessary. See Local Rule 105.6 (D. Md. 2016). For the reasons stated below, the Martin
Motion for Summary Judgment (ECF No. 53) is DENIED WITHOUT PREJUDICE, and
the CDS Motion for Leave to File Second Amended Complaint (ECF No. 62) is
In ruling on a Motion for Summary Judgment, this Court considers the facts and
draws all reasonable inferences in the light most favorable to the nonmoving party. Scott v.
Harris, 550 U.S. 372, 378 (2007).
Through a series of land transactions and testamentary devises over the past sixty
years, the CDS plaintiffs and the Martin defendants have come to assert competing
ownership claims over portions of the land and mineral rights in the Kittanning and
Freeport coal seams which exist, in part, in Garrett County, Maryland. (ECF No. 19 at ¶¶
12-15.) In November 2005, the Martins entered into a lease agreement with defendant
WPO, Inc., to allow WPO to extract coal and other minerals from their purported property.
(Id. at ¶ 19.) The Rose defendants are the agents of WPO, and have acted on its behalf
during the relevant period. (Id. at ¶ 6.) In January 2011, PBS Coals, Inc. (“PBSC”) entered
into an agreement with WPO to purchase WPO’s rights as lessee of the purported Martin
property. (Id. at ¶ 23.) From 2011 to 2013, PBSC and WPO extracted substantial amounts
of coal from the disputed property. (Id. at ¶¶ 25-28.) In 2014, defendant Corsa Coal
Corporation purchased PBSC. (Id. at ¶ 29.) PBSC now exists as a wholly-owned subsidiary
of Corsa Coal. (ECF No. 65-1 at ¶¶ 5-6.)1 Through this action, plaintiffs seek a declaratory
judgment that they are the owners of portions of the Kittanning and Freeport coal seams
and coal. (ECF No. 19 at ¶ 32.) Plaintiffs also allege that defendants have wrongfully
extracted and conveyed significant portions of plaintiffs’ purported minerals and seek
damages and an accounting to remedy the financial injuries which defendants have caused.
STANDARD OF REVIEW
Motion for Summary Judgment
Rule 56 of the Federal Rules of Civil Procedure provides that a court “shall grant
summary judgment if the movant 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(c). A
material fact is one that “might affect the outcome of the suit under the governing law.”
Libertarian Party of Va. v. Judd, 718 F.3d 308, 313 (4th Cir. 2013) (quoting Anderson v. Liberty
Lobby, Inc., 477 U.S. 242, 248 (1986)). A genuine issue over a material fact exists “if the
evidence is such that a reasonable jury could return a verdict for the nonmoving party.”
Anderson, 477 U.S. at 248. When considering a motion for summary judgment, a judge’s
function is limited to determining whether sufficient evidence exists on a claimed factual
dispute to warrant submission of the matter to a jury for resolution at trial. Id. at 249.
Motions for summary judgment must be supported by admissible evidence of record.
Fed. R. Civ. P. 56(c)(1). The rule itself provides that, “[a] party asserting that a fact cannot
be or is genuinely disputed must support the assertion by:
While the Amended Complaint alleges that Corsa merged PBSC into Wilson Creek Energy, LLC, and, thus,
that Wilson Creek was PBSC’s successor-in-interest, plaintiffs have since learned that PBSC remains a
separate, wholly-owned subsidiary of Corsa. See ECF No. 19 at ¶ 29; ECF No. 65-1 at ¶¶ 5-6.
(A) citing to particular parts of materials in the record, including depositions,
documents, electronically stored information, affidavits or declarations,
stipulations (including those made for purposes of the motion only),
admissions, interrogatory answers, or other materials; or;
(B) showing that the materials cited do not establish the absence or presence
of a genuine dispute, or that an adverse party cannot produce admissible
evidence to support the fact.
Fed. R. Civ. P. 56(c)(1). A motion for summary judgment will be denied if it is not
sufficiently supported by admissible evidence of record. See generally Under A Foot Plant, Co. v.
Exterior Design, Inc., BPG-15-871, 2016 WL 4555021, at *3 (D. Md. Sept. 1, 2016).
In evaluating a Motion for Summary Judgment, this Court must consider the facts
and all reasonable inferences in the light most favorable to the nonmoving party. Libertarian
Party of Va., 718 F.3d at 312; see also Scott v. Harris, 550 U.S. 372, 378 (2007). This Court
“must not weigh evidence or make credibility determinations.” Foster v. University of Md.Eastern Shore, 787 F.3d 243, 248 (4th Cir. 2015) (citing Mercantile Peninsula Bank v. French, 499
F.3d 345, 352 (4th Cir. 2007)); see also Jacobs v. N.C. Administrative Office of the Courts, 780 F.3d
562, 569 (4th Cir. 2015) (explaining that the trial court may not make credibility
determinations at the summary judgment stage).
Motion for Leave to File an Amended Pleading
Rule 15(a) of the Federal Rules of Civil Procedure provides the general rules for
amending pleadings. Specifically, Rule 15(a) requires that, after a responsive pleading is
served, a plaintiff may amend his complaint “by leave of court or by written consent of the
adverse party.” In general, leave to amend a complaint pursuant to Rule 15(a) shall be
“freely” granted “when justice so requires.” Fed. R. Civ. P. 15(a)(2); see Foman v. Davis, 371
U.S. 178, 182 (1962); Lance v. Prince George’s County, Md., 199 F. Supp. 2d 297, 300-01 (D. Md.
2002). The matter, however, is committed to the discretion of the district court, and the
district judge may deny leave to amend “when the amendment would be prejudicial to the
opposing party, the moving party has acted in bad faith, or the amendment would be futile.”
Equal Rights Center v. Niles Bolton Assocs., 602 F.3d 597, 603 (4th Cir. 2010); see also Simmons v.
United Mortg. & Loan Inv., LLC, 634 F.3d 754, 769 (4th Cir. 2011).
The Martin Motion for Summary Judgment
On October 3, 2016, defendants Ernest and Patricia Martin filed the now-pending
Motion for Summary Judgment (ECF No. 53). The Motion was filed approximately six
weeks before the then-applicable discovery deadline and only eight days before a previously
scheduled settlement conference before Magistrate Judge Gesner.2 The Martins filed a
three-page Memorandum in support of the two-page Motion. (ECF No. 54.) The only
exhibits produced in support of the Motion and Memorandum are three property deeds
from the chain of title to portions of the land and mineral rights at issue in this case. (ECF
Nos. 54-1, 54-2, 54-3.) Based on these deeds alone, the Martins assert that they are entitled
to summary judgment, as they contend they are the owners of the land, mineral rights, and
coal in dispute.
Nevertheless, the Martins have failed to meet their burden of proving that there exist
no genuine issues of material fact and that they are entitled to judgment as a matter of law.
While the evidence marshalled by the Martins tends to show that they “owned a percentage
That Settlement Conference was cancelled by Letter Order dated October 5, 2016. (ECF No. 56.) Judge
Gesner later scheduled a Settlement Conference for May 22, 2017. (ECF No. 73.)
of the Kittanning Seam,” it does not prove that there exist no genuine issues of material fact
regarding their ownership in that land or in the Freeport Seam; nor do the deeds prove that
the Martins are not liable for alleged injuries arising out of their relationship with WPO, Inc.
See ECF No. 58 at 3-4. Accordingly, viewing all evidence in the light most favorable to the
non-moving party, the Martins have not established their entitlement to summary judgment
as a matter of law. The Martin Motion for Summary Judgment (ECF No. 53) will be
DENIED WITHOUT PREJUDICE and this case will proceed with discovery.
The CDS Motion for Leave to File Second Amended Complaint
Plaintiffs’ Motion for Leave to File Second Amended Complaint seeks to name as an
additional defendant PBS Coals, Inc. (“PBSC”). (ECF No. 62.) While plaintiffs had initially
believed that PBSC was subsumed into other corporate defendants as a result of mergers
and other corporate transactions, they later learned that PBS still exists as a wholly-owned
subsidiary of defendant Corsa. (Id. at ¶ 4.) As plaintiffs believe that PBSC may be liable for
some or all of the acts alleged in the Amended Complaint, they wish to correct their
pleadings to include this party.
Defendants Corsa and Wilson Creek—the ultimate parents of PBSC—oppose the
Motion on two bases. First, defendants assert that plaintiffs have not shown good cause for
the amendment under Rule 16(b)(4). (ECF No. 65 at 3.) Specifically, defendants argue that
plaintiffs knew that their allegations regarding PBSC’s no longer existing were incorrect for
nine to twelve months before plaintiffs finally moved to add PBSC as a defendant. (Id. at 36.) Second, defendants argue that amendment would be futile under Rule 15(a)(2) because
the statute of limitations on plaintiffs’ claims against PBSC began running on March 26,
2013 and expired on March 26, 2016. (Id. at 6-7.)
In their Reply memorandum, plaintiffs argue that Corsa and Wilson Creek cannot
show any prejudice based on plaintiffs’ failure to name PBSC earlier, and suggest that
defendants should have disclosed more readily the corporate relationships among and
common legal representation of Corsa, Wilson Creek, and PBSC. (ECF No. 71 at 2.)
Plaintiffs further argue that they were hardly careless in naming parties, had good reason to
believe that the parent/affiliate corporations took over PBSC, and argue that there would be
no prejudice to Corsa and Wilson Creek by adding Corsa’s subsidiary while discovery is still
ongoing. (Id. at 3-6.) With respect to defendants’ statute of limitations argument, plaintiffs
argue that the purported termination of the mining agreement among PBSC and other
defendants does not necessarily preclude all causes of action against PBSC. In particular,
plaintiffs argue that defendants, despite purportedly ending their relationship in 2013,
“continue to engage in a working relationship to mine and sell coal to [PBSC] by way of
trespass and conversion.” (Id. at 7.) Thus, CDS asserts, amendment would not be futile.
Allowing plaintiffs to file a Second Amended Complaint which introduces no new
causes of action or theories of recovery, but which seeks only to name as an additional
defendant a corporate subsidiary/affiliate of two defendants which have actively litigated this
matter, will not unfairly prejudice those defendants. Nor, in light of the extensive corporate
entanglements among these defendants, can it be said that plaintiffs acted in bad faith in
delaying to name PBSC as a defendant. See ECF No. 71 at 4. While it remains to be seen
whether certain claims against PBSC may be barred by the relevant statute of limitations, this
Court cannot at this point conclude that all of plaintiffs’ claims against PBSC are time-barred
so as to render amendment futile. Accordingly, the CDS Motion for Leave to File Second
Amended Complaint (ECF No. 62) will be GRANTED.
For the reasons stated above, the Martin Motion for Summary Judgment (ECF No.
53) is DENIED WITHOUT PREJUDICE, and the CDS Motion for Leave to File Second
Amended Complaint (ECF No. 62) is GRANTED.
A separate Order follows.
Dated: May 16, 2017
Richard D. Bennett
United States District Judge
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