Northern Natural Gas Company v. 80 Acres of Land in Thurston County, Nebraska et al

Filing 58

MEMORANDUM AND ORDER - Solomon's motion to dismiss (filing 51 ) is denied. Solomon's motion to strike (filing 55 ) is denied. Northern's motion for summary judgment (filing 52 ) is granted. Upon deposit with the Clerk of the amou nts referenced below, Northern is entitled to a judgment establishing its right of way easement to wit. That the value of the New ROW on Allotment No 742-4 is $734.00 and the value of the New ROW on Allotment 742-2 is $2,984.00, and the sums shall be deposited with the Clerk forthwith. A separate judgment will be entered upon deposit of the above referenced amounts. Ordered by Judge John M. Gerrard. (LKO)

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF NEBRASKA
NORTHERN NATURAL GAS
COMPANY,
8:17-CV-328
Plaintiff,
vs.

MEMORANDUM AND ORDER

80 ACRES OF LAND IN THURSTON
COUNTY, NEBRASKA; et al.,
Defendants.
This dispute involves the renewal of a right-of-way across tribal and
allotted lands located within reservation boundaries of the Omaha Tribe of
Nebraska. The plaintiff, Northern Natural Gas, filed this suit seeking to
condemn individually owned interests in two parcels of allotted land:
Allotment No. 742-2 and Allotment No. 742-4. The defendants in this case each
have an individual interest in Allotment No. 742-2, Allotment No. 742-4, or
both.
One of the individual interest holders, Nolan J. Solomon, has filed a
motion to dismiss (filing 51) Northern's complaint. Northern has also moved
for summary judgment (filing 52). For the reasons that follow, the Court will
grant Northern's motion for summary judgment and deny Solomon's motion to
dismiss.
BACKGROUND
The Court's prior Memorandum and Order (filing 49) set forth the
background of this case in detail. Generally speaking, Northern Natural Gas
owns and operates a pipeline system spanning much of the Midwest. Filing 30

at 2. In 1931, Northern obtained a right-of-way allowing three of its pipelines
to cross the Omaha Tribe's Reservation located in Thurston County, Nebraska.
Filing 30 at 2-3. That right-of-way was renewed in 1992 for a thirty-year term
set to expire on February 7, 2018 ("the original ROW"). Filing 37-2.
In anticipation of the original ROW's expiration, Northern initiated a
renewal process with the Bureau of Indian Affairs ("BIA"). Filing 30 at 3-4.
This process, at least originally, went smoothly: Northern and the Omaha
Tribe entered into an agreement to renew the rights-of-way across tribal trust
lands ("the New ROW"), see filing 37-3 at 1-7, a majority of the individual
interest holders in Allotment No. 742-2 and Allotment No. 742-4 consented to
that grant, see 25 U.S.C. § 324, and the BIA approved the New ROW and
granted Northern the right-of-way, see filing 37-5. But at some point, one of
the individual interest holders in Allotment No. 742-2 and Allotment No. 7424 withdrew his consent. Filing 30 at 3. That meant Northern would need to
acquire its right-of-way across Allotment No. 742-2 and Allotment No. 742-4
by virtue of condemnation rather than agreement. Compare 25 U.S.C. § 324
with 25 U.S.C. § 357.
So, Northern filed the underlying complaint seeking condemnation of the
Allotments. See filing 30 at 1-7. A few weeks after this condemnation action
was initiated, one of the individual interest holders in Allotment No. 742-2 and
Allotment No. 742-4, Nolan J. Solomon, deeded a fractional interest to the
United States in trust for the Omaha Tribe. Filing 37-6; filing 37-7. In a
previous round of briefing, Solomon argued that conveyance prevents Northern
from condemning any interests in Allotment No. 742-2 and Allotment No. 7424. In light of the Tribe's consent to the right-of-way, the Court rejected that
argument and determined that Northern could condemn the remaining nontribal interests in those parcels. See filing 49 at 8-9
2

Now Solomon moves to dismiss Northern's complaint on different
grounds: that the Tribe must be joined to the proceeding as a necessary party.
See filing 51 at 1. And Northern, for its part, has moved for summary judgment
alleging that there is no genuine dispute regarding the value of Solomon's
condemnable interest. Filing 53 at 1. For the reasons discussed below, the
Court will deny Solomon's motion to dismiss and grant Northern's motion for
summary judgment.
STANDARD OF REVIEW
12(B)(7)
When deciding a motion to dismiss under Rule 12(b)(7), the Court must
first determine if the party is a "necessary party" under Rule 19(a)(1). Baker
Grp., L.C. v. Burlington N. & Santa Fe Ry. Co., 451 F.3d 484, 490 (8th Cir.
2006). If the party is "necessary," and joinder would not deprive the Court of
subject matter jurisdiction, then the Court must join the party. Fed. R. Civ. P.
19(a). If, however, the necessary party cannot be joined because the joinder
would deprive the Court of subject matter jurisdiction, then the Court must
determine under Rule 19(b), if "in equity and good conscience the action should
proceed among the parties before it, or should be dismissed." Baker Grp., 451
F.3d at 491.
There are four factors to consider when determining if efficiency and
fairness demand the party be joined under Rule 19(b). Those factors, generally,
include (1) the extent a judgment rendered in the person's absence might
prejudice that person or the existing parties, (2) the extent to which any
prejudice could be lessened or avoided by protective provisions in the judgment,
shaping the relief, other measures; (3) whether a judgment rendered in the
person's absence would be adequate; and (4) whether the plaintiff would have
an adequate remedy if the action were dismissed for nonjoinder. Fed. R. Civ. P
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19(b); see Two Shields v. Wilkinson, 790 F.3d 791, 798 (8th Cir. 2015). The Rule
19 inquiry is a pragmatic rule whose application turns on considerations of
efficiency and fairness in the particular case. See Baker Grp., 451 F.3d at 490;
Pujol v. Shearson/American Express, Inc., 877 F.2d 132, 134 (1st Cir. 1989);
see also Ranger Transp., Inc. v. Wal–Mart Stores, 903 F.2d 1185, 1187 (8th Cir.
1990).
RULE 56(A)
Summary judgment is proper if the movant shows that there is no
genuine dispute as to any material fact and that the movant is entitled to
judgment as a matter of law. See Fed. R. Civ. P. 56(a). The movant bears the
initial responsibility of informing the Court of the basis for the motion, and
must identify those portions of the record which the movant believes
demonstrate the absence of a genuine issue of material fact. Torgerson v. City
of Rochester, 643 F.3d 1031, 1042 (8th Cir. 2011) (en banc). If the movant does
so, the nonmovant must respond by submitting evidentiary materials that set
out specific facts showing that there is a genuine issue for trial. Id.
On a motion for summary judgment, facts must be viewed in the light
most favorable to the nonmoving party only if there is a genuine dispute as to
those facts. Id. Credibility determinations, the weighing of the evidence, and
the drawing of legitimate inferences from the evidence are jury functions, not
those of a judge. Id. But the nonmovant must do more than simply show that
there is some metaphysical doubt as to the material facts. Id. In order to show
that disputed facts are material, the party opposing summary judgment must
cite to the relevant substantive law in identifying facts that might affect the
outcome of the suit. Quinn v. St. Louis County, 653 F.3d 745, 751 (8th Cir.
2011). The mere existence of a scintilla of evidence in support of the
nonmovant's position will be insufficient; there must be evidence on which the
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jury could conceivably find for the nonmovant. Barber v. C1 Truck Driver
Training, LLC, 656 F.3d 782, 791-92 (8th Cir. 2011). Where the record taken
as a whole could not lead a rational trier of fact to find for the nonmoving party,
there is no genuine issue for trial. Torgerson, 643 F.3d at 1042.
DISCUSSION
I. SOLOMON'S MOTION TO DISMISS
Very generally, Solomon argues that the Court should dismiss the
underlying condemnation action because Northern has failed to join the
Omaha Tribe––a party that, according to Solomon, is required under Fed. R.
Civ. P. 19(a) and 71.1. Filing 51 at 1. Northern, however, contends that the
Tribe is not a required party and that dismissal of its complaint is improper.
Filing 56 at 2. That is true, Northern suggests, because it is only seeking to
condemn non-tribal interests in Allotments No. 742-2 and No. 742-4 and the
Tribe has already contractually agreed to rights-of-ways across tribal land––
including those crossing Allotments No. 742-2 and No. 742-4. Filing 56 at 2.
There are two rules governing the joinder of a party in a condemnation
proceeding. The first, Rule 19(a), governs when a party must generally be
joined to a lawsuit. In relevant part, Rule 19 requires that a person must be
joined as a party if in that person's absence, "the court cannot accord complete
relief among existing parties[,]" or that person claims an interest relating to
the subject of the action and is so situated that disposing of the action in the
person's absence may "impair or impede the person's ability to protect that
interest." See Fed. R. Civ. P. 19(a)(1). If a person is required under Rule 19(a),
the analysis continues to 19(b)––instructing the Court to determine if "in
equity and good conscience, the action should proceed among the existing
parties or should be dismissed."

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The second and more specific rule, Rule 71.1(c), governs the joinder of all
interests holders in the property at issue in a condemnation action. That rule
provides that
the plaintiff need join as defendants only those persons who have
or claim an interest in the property and whose names are then
known. But before any hearing on compensation, the plaintiff must
add as defendants all those persons who have or claim an interest
and whose names have become known or can be found by a
reasonably diligent search of the records, considering both the
property's character and value and the interests to be acquired.
Fed. R. Civ. P. 71.1(c).
With those requirements in mind, the basic question before the Court is
this: does the Tribe have an interest in the land Northern seeks to condemn
making it impossible for the Court to accord complete relief among existing
parties? See generally Fed. R. Civ. P. 19(a)(1); Fed. R. Civ. P. 71.1(c). That is,
does the Tribe's fractional interest in Allotments No. 742-2 and 742-4 require
its addition to the lawsuit, as Solomon argues? See filing 51 at 5. Or does the
fact that the Tribe has already consented to the rights-of-way crossing
Allotments No. 742-2 and No. 742-4 mean that the Tribe is not a required
party, as Northern argues? See filing 56 at 2.
To support why, in his view, the Tribe must be joined as a party, Solomon
relies on two Tenth Circuit decisions, (1) Enter. Mgmt. Consultants, Inc. v. U.S.
ex rel. Hodel, 883 F.2d 890, 893 (10th Cir. 1989), and (2) Pub. Serv. Co. of New
Mexico v. Barboan, 857 F.3d 1101, 1104 (10th Cir. 2017), cert. denied, 138 S.
Ct. 1695, 200 L. Ed. 2d 965 (2018). But those cases are easily distinguishable.
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To begin, Enter. Mgmt. Consultants, Inc., involved an attempt by the
plaintiff to declare two contracts valid. 883 F.2d at 893. Those contracts were
between Enter Management and Citizen Band Potawatomi Tribe of Oklahoma.
But the tribe was no longer a party to the suit. Id. And the Court concluded it
was impossible for the tribe to protect its interest in the agreement without
being joined to the action making the tribe a required party under Fed. R. Civ.
P. 19(a). Id. This case, however, involves a property dispute––not a contract
dispute. Filing 1 at 4-6. And more specifically, it involves a dispute over the
value of non-tribal interests in two parcels of land––not tribal interests in a
tribal contract. Filing 1 at 4-6. So, Salmon's reliance on Enter. Mgmt.
Consultants, Inc. is unpersuasive.
And Solomon's reliance on Barboan does not fare any better. In that
decision, the public utility company brought a condemnation action against the
individual interest holders to obtain a right-of-way across two parcels of land
in which the Navajo Nation held a fractional interest. Barboan, 857 F.3d 1101.
There, the lower court concluded, and the Tenth Circuit agreed, that the
Nation was a required party to the condemnation action under Fed. R. Civ. P.
19(a) because the Nation owned a fractional interest in the land to be
condemned, but could not be joined because of sovereign immunity. 857 F.3d
at 1113 n.1. And although those facts appear, at least on the surface, to be
similar to those at issue here, there is one glaring difference: tribal consent.
In particular, the Barboan decision lacked any, much less sufficient,
evidence to suggest that the Nation had consented to the rights-of-way across
the allotments. Id. That meant that the utility company was, in essence,
seeking to condemn tribal interests in tribal land as well as individual
interests. Id. And because tribal interests were implicated by the
condemnation action, the Nation was a required party. Pub. Serv. Co. of New
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Mexico, 167 F. Supp. 3d 1248 at 1263 ("interest in property to be condemned
must be joined as parties."). But here, Northern is only seeking to condemn
non-tribal interests in Allotments No. 742-2 and No. 742-4. And because the
Tribe has consented to the rights-of-ways across tribal land within its
reservation boundaries––including Allotments No. 742-2 and No. 742-4, see
filing 49 at 7-8, the absence of the Tribe from the underlying action does not,
and cannot, "impair or impede" the Tribe's ability to protect its interest in those
Allotments. See Fed. R. Civ. P 19(a).
So, while the Court agrees that there are many instances where a tribe
has an interest––economic, sovereign, or otherwise––in an underlying dispute
requiring its joinder to the litigation, this is not one of them.1 The Tribe is not
a required party under Fed. R. Civ. P 19(a) or 71.1(c), and the Court will deny
Solomon's motion to dismiss.
II. NORTHERN'S MOTION FOR SUMMARY JUDGMENT
Northern has also moved for summary judgment. Generally speaking,
Northern argues that because the value of Solomon's condemnable interest is
not disputed, judgment is appropriate. In support of that contention, Northern
has offered two expert appraisals demonstrating the purported value the
condemnation action. See Filing 54-2 at 97; filing 54-3 at 16.
The first appraisal, authored by certified appraiser David Baker, opined
that the value of the taking was $0.00. Filing 54-2 at 97. The second appraisal,
performed by Pat McGlamery, staff appraiser for the Eastern Oklahoma

1

Solomon's briefing appears to seek reconsideration of the Court's previous determination

that the Tribe consented to the rights-of-ways. Filing 51 at 5; see filing 49 at 8. The Court,
however, declines to reconsider its previous determination. And Solomon has not provided
the Court with any reason why reconsideration is appropriate.

8

Region of the United States Department of Interior's Bureau of Indian Affairs,
concluded the same. Filing 54-3 at 16. In reaching those conclusions, both
appraisals applied the "Before and After" valuation method

(i.e., the

difference, if any, between the market value of the unencumbered and
encumbered parcel). That valuation method was employed because the general
rule for condemnation actions is that "[w]hen land is taken by eminent domain,
and the title acquired is not a fee, but merely an easement, the proper measure
of damages is the difference between the market value of the land free of the
easement and the market value as burdened with the easement." United States
v. 1,129.75 Acres of Land, More or Less, in Cross & Poinsett Ctys., 473 F.2d
996, 998 (8th Cir. 1973); see Transwestern Pipeline Co. v. O'Brien, 418 F.2d 15,
21 (5th Cir. 1969); Calvo v. United States, 303 F.2d 902, 909 (9th Cir. 1962);
Karlson v. United States, 82 F.2d 330, 337 (8th Cir. 1936).
But even so, at some point, Baker submitted an updated appraisal
utilizing the "taking plus damages" valuation method. This alternative
valuation was used because, at times, "the market may not be sensitive enough
to reflect the impact of a subsurface acquisition on the value of an agricultural
property using the traditional Before and After methodology." Filing 54-2 at 5.
And because Allotments No 742-2 and No. 742-4 are agricultural, Baker used
the "takings plus damage" in his updated report. Filing 54-2 at 5. This method
revealed that the value of the New ROW on parcel 742-4 is $734 and the value
of the New ROW on parcel 742-2 is $2,984. See Filing 54-2 at 78, 98.
Northern neither disputes the use of the "takings plus damage method,"
nor that the value for the New ROW on parcel 742-4 is $734 and the value of
the New ROW on parcel 742-2 is $2,984. See filing 53 at 9. And Solomon has
not provided the Court with any evidence refuting that valuation either. Filing

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54-4 at 12. Instead, Solomon's arguments are twofold: (1) the BIA did not
approve the $3,718.00 appraisal, and (2) that appraisal is not correct.
Solomon's former contention is easily disposed of. Specifically, Solomon
takes issue with the fact that the BIA failed to "determine the valuation" of the
rights-of-ways. Filing 55 at 1; 25 C.F.R. § 169.114. That is, Solomon claims the
BIA must perform or approve the appraisal being used. But Solomon has not
provided the Court with any authority suggesting that the BIA is required to
approve the valuation of a condemnation action involving non-tribal interests.
And even assuming such a requirement exists, Solomon's argument still fails.
Indeed, in August 2015, the BIA did undertake a valuation analysis for the
rights-of-way. Filing 54-3 at 18; see also filing 54-4 at 14. See filing 54-3 at 60.
Specifically, BIA staff appraiser Pat McGlamery inspected the property and
opined that "there is no loss of Market Value that can be attributed to this
pipeline Right of Way". Filing 54-3 at 18; see also filing 54-4 at 14; filing 54-3
at 56. That conclusion was further reviewed and certified by Eric Paul Griffin,
Review Appraiser Quality Assurance for the U.S. Department of Interior.
Filing 54-3 at 56, 62.
So, contrary to Solomon's contention, the BIA did appraise and review
the value of the rights-of-way across Allotments No. 742-2 and No. 742-425.
See filing 54-3 at 62; filing 54-3 at 112. And the Court is not persuaded by
Solomon's contention that the interest holders are somehow disadvantaged by
the fact that Baker's appraisal, which resulted in a higher valuation than the
appraisal performed and certified by the BIA, was not conducted by the BIA
itself. See filing 55 at 1.
That leaves Solomon's latter contention, that Northern's valuation
evidence is not supported by the facts in this case. See filing 55 at 1. But
Solomon has provided the Court with no argument, much less evidence, to
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suggest that Northern's methodology is unreliable. In fact, when asked if he
had any reasons to disagree with the ultimate valuation, Solomon admitted he
did not. See generally Filing 14 at 256; filing 54-4 at 15. Instead, Solomon's
issue with the ultimate valuation appears to rest solely on the fact that the
appraisal is different than the original offer on the table––$300.00 per rod in
exchange for consent to the rights-of-ways.2 See filing 54-4 at 11.
Solomon uses that initial offer to support his contention that the proper
valuation of the right-of-way is $900.00 per rod. He apparently reaches that
conclusion by taking Northern's initial offer (i.e., $300.00 per rod) and
multiplying it by "the volume going through the lines." Filing 54-4 at 12.
Solomon claims he decided on this approach (i.e., the volume in the line
approach) by performing "research online" concerning oil and gas appraisals.
Filing 54-4 at 12-13.
But Solomon's purported methodology is not sufficient to oppose
Northern's motion for summary judgment. Indeed, appropriate evidence "must
be made on personal knowledge" on matters the declarant is "competent to
testify on." Fed. R. Civ. P. 56(c)(1)(4). And Solomon does not have any personal
knowledge to support his valuation. See filing 54-4 at 12-13. More
fundamentally though, Solomon—who admits he has no training regarding
how to value interests in land, has never received any certifications involving
land valuation, and is not a certified appraiser—is not competent to testify on
the valuation of a pipeline easement. See filing 54-4 at 7, 12.3

2

A rod is a unit of land measurement equal to 16.5 feet. Black's Law Dictionary (10th ed.

2014).
3

The Court recognizes that in some instances, the owner of land may be competent to testify

to its market value for these purposes. See United States v. 3,698.63 Acres of Land, More or

11

So, in the absence of appropriate evidence contradicting the methodology
or ultimate conclusion of the appraisal evidence submitted by Northern, no
genuine issues of material fact remain for trial. The only evidence before the
Court is that the value of the interests Northern seeks to condemn is, at the
very most, $3,718.00. Accordingly, the Court will grant Northern's motion for
summary judgment in its entirety.
III. MOTION TO STRIKE
As a final matter, the Court will deny Solomon's motion to strike (filing
55) Northern's motion for summary judgment. Although it is not entirely clear
to the Court, Solomon actually seems to be seeking to strike Solomon's
appraisal reports. See filing 55 at 1. In support of that motion, Solomon argues
that the appraisals are from "NGG contractors" rather than BIA appraisals.
See filing 55 at 1. But as discussed above, that argument is without merit, and
Solomon's motion will be denied.
IT IS ORDERED:
1. Solomon's motion to dismiss (filing 51) is denied.
2. Solomon's motion to strike (filing 55) is denied.
3. Northern's motion for summary judgment (filing 52) is granted.

Less, in Burleigh, Emmons & Morton Ctys., State of N. D., 416 F.2d 65, 68 (8th Cir. 1969).
But Solomon's opinion is not based on his familiarity with the land, or even market value—
it was based on Northern's settlement offer and the capacity of the pipeline, not any
knowledge he had as a landowner. Compare id. at 65-69, with, e.g., filing 54-4 at 11-13.

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4. Upon deposit with the Clerk of the amounts referenced below,
Northern is entitled to a judgment establishing its right of way
easement to wit:
Three right-of-way easements across each of Parcel
One and Parcel Two (as shown on the plats of the
proposed

easements

attached

to

the

Amended

Complaint as Exhibit "B" and as legally described on
Exhibit "C" thereto), for a period commencing
February 8, 2016 and expiring February 9, 2046. The
easements are for purposes of allowing Plaintiff to
construct, maintain, operate, inspect, repair, replace,
protect, alter, and remove pipelines and below ground
appurtenances,

including

cathodic

protection

apparatus, on, over, under, across, and through a strip
of land one hundred feet (100') in width, together with
the right of ingress to and egress from said right-ofway across the adjacent property of the Interest
Holder for the purpose of surveying and clearing the
right-of-way of brush, trees, and obstructions, and for
constructing,

maintaining,

operating,

inspecting,

repairing, replacing, protecting, altering, or removing
the pipelines and appurtenances of Plaintiff located
thereon, in whole or in part, at the will of the Plaintiff.
The easements are to be subject to the right of the
Interest Holders to use the property for all purposes
which will not interfere with the use of the right-ofway for Plaintiff’s purposes; provided, however, that
13

no building, structure, improvement, landscaping or
obstruction,

other

than

ordinary

and

usual

agricultural fences, shall be placed within or upon the
easement by Interest Holders and no alteration of the
ground surface or grade of the right-of-way shall be
made by the Interest Holders without the Plaintiff's
express written consent and the Plaintiff shall not be
liable for damages caused on the right-of-way by
keeping the right-of-way clear of such trees, brush,
undergrowth,
improvements,

landscaping,
residential

buildings,
fences

structure,
and

other

obstructions in the exercise of its rights.
5. That the value of the New ROW on Allotment No 742-4 is
$734.00 and the value of the New ROW on Allotment 742-2 is
$2,984.00, and the sums shall be deposited with the Clerk
forthwith.
6. A separate judgment will be entered upon deposit of the above
referenced amounts.
Dated this 23rd day of October, 2018.
BY THE COURT:

John M. Gerrard
United States District Judge
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