Overflow Energy LLC v. Roger Mills County Board of County Commissioners

Filing 21

ORDER granting 10 defendant's motion to dismiss and the case is dismissed without prejudice...plaintiff's motion for preliminary injunction is stricken as moot...see order for specifics. Signed by Honorable Joe Heaton on 02/03/2014. (lam)

IN THE UNITED STATES DISTRICT COURT FOR THE
WESTERN DISTRICT OF OKLAHOMA
OVERFLOW ENERGY, L.L.C., a Texas
limited liability company,
Plaintiff,
vs.
THE BOARD OF COUNTY
COMMISSIONERS OF THE COUNTY OF
ROGER MILLS, STATE OF OKLAHOMA,
in its official capacity as a body politic and
corporate,
Defendant.

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NO. CIV-13-1136-HE

ORDER
Plaintiff Overflow Energy, LLC (“Overflow”) filed this action against the Board of
County Commissioners of the County of Roger Mills (“the County”), seeking declaratory and
injunctive relief. The underlying dispute arises out of the County’s denial of Overflow’s
application for a variance from zoning regulations included in the County’s comprehensive
plan. The County has moved to dismiss pursuant to Fed. R. Civ. P. 12(b)(6). Overflow has
responded and has filed a motion for preliminary injunction. The motions are at issue.
Background
According to the complaint, Overflow drills and operates commercial saltwater
disposal facilities used in the oil and gas industry. On February 1, 2012, Overflow entered
into an agreement to create one such facility on a tract of land in Roger Mills County,

Oklahoma, using an existing wellbore.1 Overflow applied for approval from the Oklahoma
Corporation Commission (“OCC”) to operate the facility, which approval was granted on
October 30, 2012. The land was zoned “agricultural” under the comprehensive plan adopted
by the County. Because operating a saltwater disposal facility would fall outside of the
allowable uses of “agricultural” land, see [Doc. #1, pg. 4, para. 13], Overflow filed an
application for variance with the County Board of Adjustment. On September 23, 2013, after
holding a public hearing on the matter, the board denied Overflow’s application. On October
3, 2013, Overflow filed a notice of appeal to the District Court of Roger Mills County. It
then filed this action, pursuant to 42 U.S.C. § 1983, alleging violations of its substantive due
process rights under the Fourteenth Amendment. It also asserts a violation of the parallel
provision of the Constitution of the State of Oklahoma.
Discussion
Overflow argues that its state and federal constitutional rights were violated because
the County exceeded the scope of its statutory authority by enacting and enforcing zoning
regulations. [Doc. #12, pg. 12]. It contends that “[t]he area of oil and gas development is
an area left solely to the exclusive, plenary jurisdiction of the Oklahoma Corporation
Commission.” Id. Overflow indicates it is not contesting the County’s denial of its request
for variance in this suit, but instead is disputing the County’s power to create and enforce

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The complaint indicates the tract of land is approximately 3.2 acres in size, located in
the center of the SW/4 of Section 23, Township 14 North, Range 23 West, Roger Mills County
(“the land”).
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zoning rules at all. It asks the court to issue a temporary and permanent injunction enjoining
the County from enforcing its zoning regulations, and other related declaratory relief.
The County asserts three arguments in support of its motion to dismiss. First, it says
that Overflow’s § 1983 action is not ripe. Second, it argues that the Anti-Injunction Act, 28
U.S.C. § 2283, bars the court from granting Overflow’s requested remedies. Finally, the
County asserts that the court should abstain from exercising jurisdiction in this case. The
court concludes that it need not address defendant’s first two arguments, as abstention is
appropriate in the circumstances existing here.
As a general rule, federal courts are “obliged to decide cases within the scope of
federal jurisdiction.” Sprint Commc’ns, Inc. v. Jacobs, ___U.S.___, 134 S.Ct. 584, 588
(2013). However, there are a number of narrow circumstances in which abstention from
exercising that jurisdiction is proper. The Supreme Court recognized one such basis for
abstention in Burford v. Sun Oil Co., 319 U.S. 315 (1943). There, the Court explained that
abstention is proper where the “exercise of federal review of the question in a case and in
similar cases would be disruptive of state efforts to establish a coherent policy with respect
to a matter or substantial public concern.” Colo. River Water Conservation Dist. v. United
States, 424 U.S. 800, 814 (1976) (discussing the implications of Burford).
The Tenth Circuit addressed the scope of Burford in Grimes v. Crown Life Ins. Co.,
857 F.2d 699 (10th Cir. 1988), applying Burford in a declaratory judgment suit brought by
the Oklahoma Insurance Commissioner as liquidator of an insurance company. The court
listed four factors that should be considered when determining whether abstention is
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appropriate:
(1) whether the suit is based on an exclusively federal cause of action; (2)
whether the suit requires the court to decide issues directly relevant to the
liquidation proceeding or state policy in the regulation of the insurance
industry; (3) whether state procedures reflect a desire to create special state
forums to regulate and adjudicate these issues; and, (4) whether difficult or
unusual state laws are at issue.
Grimes, 857 F.2d at 704-05. Although, as noted below, there is some basis for concluding
Grimes may have viewed Burford abstention too broadly, it continues to provide useful
guidance as to factors to be weighed.
Applying the relevant Grimes factors to this case, the court concludes they clearly
weigh in favor of abstention. Plaintiff alleges violations of both its federal and state
substantive due process rights. Although it has a federal cause of action, the underlying issue
as to it involves questions of state statutory interpretation. If the court were to adjudicate the
matter, it would require interpretation of Oklahoma statutes as to the relative powers of the
OCC and county zoning boards and to decide issues relevant to Oklahoma’s regulation of the
oil and gas industry. Such questions are “entangled in a skein of state-law that must be
untangled before the federal case [could] proceed . . . .” See New Orleans Pub. Serv., Inc. v.
Council of City of New Orleans (“NOPSI”), 491 U.S. 350, 361 (1989). These factors weigh
in favor of abstention.
Moreover, the issues raised by this case appear to involve unsettled questions of
Oklahoma law. The various state statutes involved do not suggest a clear or unequivocal
answer, one way or the other, to the questions posed by this case. Compare 17 Okla. Stat.

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§52, and 52 Okla. Stat. §§ 87.1, 139(A) (powers of the OCC), with 19 Okla. Stat. §§ 865.51865.69 (county planning and zoning). Plaintiff has cited a 1986 opinion of the Oklahoma
Attorney General that appears to support its position. See 18 Okla. Op. Att’y Gen. 66, 1986
WL 235094. However, an Attorney General’s opinion is not binding on either this court or
a state court. See State ex rel. York v. Turpen, 681 P.2d 763, 767 (Okla. 1984). Further,
defendant has identified various legislative enactments since the date of the Attorney
General’s opinion which may undercut its rationale and result.
Finally, Oklahoma law provides a forum for the determination of issues related to
county zoning board decisions—as the pending state case illustrates. See 19 Okla. Stat. §
865.64.2

“If adequate state court review of an administrative order based upon

predominantly local factors is available, intervention of a federal court is not necessary for
the protection of federal rights.” Robert-Gay Energy Enters., Inc. v. State Corp. Comm'n of
Kan., 753 F.2d 857, 860 (10th Cir. 1985) (citing Ala. Pub. Serv. Comm'n v. S. Ry. Co., 341
U.S. 341, 349 (1951)). In Robert-Gay, the Tenth Circuit analyzed a Kansas statute similar

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The statute reads, “An appeal to the district court from any decision, ruling, judgment,
or order of said county board of adjustment may be taken by any person or persons, firm or
corporation, jointly or severally, aggrieved thereby, or any department, board or official of
government by filing with the clerk of said board within ten (10) days a notice of such appeal.
No bond shall be required for such appeal, but costs may be required in the district court as in
other cases. Upon filing of such notice, the clerk of said board shall forthwith transmit to the
clerk of the district court the originals or certified copies of all papers constituting the record in
such case, together with the order, judgment or decisions of said board. Said cause shall be tried
de novo in the district court and said court shall have the same power and authority as the
county board of adjustment, together with all other powers of the district court in law or in
equity. An appeal to the Supreme Court from the decision of the district court shall be allowed as
in other cases.” 19 Okla. Stat. § 865.64 (emphasis added).
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to 19 Okla. Stat. § 865.64 and determined that Kansas had “established its own elaborate
review system for dealing with the [] complexities of oil and gas fields.”3 Id. Here, the
referenced Oklahoma statute provides a vehicle not only for review of individual zoning
board decisions, but also for challenges to the County’s authority to enact the regulations at
all. This factor weighs in favor of abstention.
Although the Tenth Circuit has continued to apply the Grimes factors when
determining whether Burford abstention is proper, it acknowledged that the Supreme Court
has since formulated “more narrow tests [in] Quackenbush and NOPSI . . . .” See Okla. ex
rel. Doak v. Acrisure Bus. Outsourcing Servs., LLC, 529 F. App'x 886, 897 (10th Cir. 2013)
(“Burford abstention is proper only ‘when there are difficult questions of state law bearing
on policy problems of substantial public import whose importance transcends the result in
the case . . . or [ ] where the exercise of federal review of the question in a case and in similar
cases would be disruptive of state efforts to establish a coherent policy with respect to a
matter of substantial public concern.’” Id. (quoting NOPSI, 491 U.S. at 361)). However,
even under the more narrow formulation of Quackenbush and NOPSI, the result is the same.
The issues requiring resolution in this case involve unsettled issues of state law and have
substantial implications for a major state industry and for local citizens impacted by it. A
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The judicial review powers granted by 19 Okla. Stat. § 865.64 are arguably broader
than those examined in Robert-Gay. In Robert-Gay, state court review was limited to the
analyzing “the lawfulness or reasonableness of the original order” and the reviewing court had
only the power to “vacate or set aside” the original order. Id. (discussing Kansas law). The
Oklahoma statute authorizes a de novo trial of the issues before the board of adjustment plus the
exercise of all powers ordinarily inhering in the state district court. See emphasis in fn. 2.
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decision would potentially impact not only the parties in this case, but also the powers and
authority of all county zoning boards in the state organized under the same statutory scheme,
as well as that of the OCC. Furthermore, land use and zoning cases are often viewed as
“classic examples” of important issues of local concern in which a federal court should be
reluctant to interfere.4 Even applying the “more narrow tests,” the court concludes that
abstention is proper.5
Accordingly, defendant’s motion to dismiss [Doc. #10] is GRANTED and the case
is dismissed without prejudice. Plaintiff’s motion for preliminary injunction [Doc. #11] is
STRICKEN AS MOOT.
IT IS SO ORDERED.
Dated this 3rd day of February, 2014.

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“[C]ases involving questions of state and local land use and zoning law are a classic
example of situations in which the exercise of federal review of the question in a case and in
similar cases would be disruptive of state efforts to establish a coherent policy with respect to a
matter of substantial public concern.” Pomponio v. Fauquier Cnty. Bd. of Sup'rs, 21 F.3d 1319,
1327 (4th Cir. 1994) (quoting NOPSI, 491 U.S. at 361) (internal quotation marks omitted) cert.
denied 115 S. Ct. 192 (1994), overruled on other grounds by Quackenbush,517 U.S. 706.
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Plaintiff’s only argument against the application of Burford abstention is essentially its
conclusory statement that “this case does not involve a difficult question of state law and does
not involve a question of important state policies or administrative concerns.” [Doc. #12, pg.
28]. For the reasons stated, the court concludes otherwise.
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