Fout et al v. EQT Production Company

Filing 158

MEMORANDUM OPINION AND ORDER REGARDING DEFENDANT'S MOTIONS IN LIMINE: It is ORDERED that Defendant's 82 Motion in Limine is GRANTED; 83 Motion in Limine is GRANTED; 84 Motion in Limine is DEFERRED; 85 Motion in Limine is GRANTE D; 86 Motion in Limine is DENIED AS MOOT; 87 Motion in Limine is DEFERRED; 88 Motion in Limine is GRANTED; 89 Motion in Limine is GRANTED; 90 Motion in Limine is DEFERRED; 91 Motion in Limine is GRANTED; 92 Motion in Limine is GRANTED; 93 Motion in Limine is GRANTED; 94 Motion in Limine is GRANTED; and 149 Motion in Limine is GRANTED. Signed by Senior Judge Frederick P. Stamp, Jr on 4/6/18. (cnd)

IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF WEST VIRGINIA
JOHN FOUT, NANCY FOUT,
J&N MANAGEMENT, LLC and
J&N MANAGEMENT ENTERPRISES, LLC,
Plaintiffs,
v.

Civil Action No. 1:15CV68
(STAMP)

EQT PRODUCTION COMPANY,
a Pennsylvania corporation,
Defendant.
MEMORANDUM OPINION AND ORDER
REGARDING DEFENDANT’S MOTIONS IN LIMINE
Pending before this Court are motions in limine filed by the
defendant, EQT Production Company (“EQT”). The trial of this civil
action1 is scheduled to commence on April 10, 2018.

Now before the

Court are EQT’s fourteen pending motions in limine which have been
fully briefed: (1) Motion in Limine to Preclude Argument or
Evidence of Alter Ego Relationship or the Sale Price Received by
EQT Energy, LLC (ECF No. 82); (2) Motion in Limine to Preclude
Argument or Evidence that Other Lessees Do Not Deduct or Allocate
Post-Production Costs (ECF No. 83); (3) Motion in Limine to
Preclude Argument or Evidence that Post-Production Costs Were
Purportedly Never Defined or Invoiced to Plaintiffs, or Authorized
by Plaintiffs (ECF No. 84); (4) Motion in Limine to Preclude
Argument or Evidence that Allocation of Post-Production Costs Is
1

For a more thorough background of this civil action, see ECF
No. 153.

Not Permitted by Other Leases (ECF No. 85); (5) Motion in Limine to
Preclude Argument or Evidence that Allocation of Post-Production
Costs Is Not Permitted by the Lease (ECF No. 86); (6) Motion in
Limine to Preclude Argument or Evidence that Post-Production Costs
Do Not Enhance the Value of the Natural Gas Produced from the Lease
Premises (ECF No. 87); (7) Motion in Limine to Preclude Argument or
Evidence Regarding Claims of Fraud or Misrepresentation (ECF No.
88);

(8)

Motion

in

Limine

to

Preclude

Argument

or

Evidence

Regarding the Henry Hub or Other Index Prices (ECF No. 89); (9)
Motion in Limine to Preclude Argument or Evidence that the Price at
which Gas Sold from the Lease Premises Is Purportedly Less than
Fair Market Value (ECF No. 90); (10) Motion in Limine to Preclude
Argument or Evidence Regarding Natural Gas Liquids (ECF No. 91);
(11) Motion in Limine to Preclude Argument or Evidence that
Royalties

Paid

to

Plaintiffs

by

EQT

Should

Be

Paid

Without

Deduction or Allocation of Any Post-Production Costs (ECF No. 92);
(12) Motion in Limine to Preclude Argument or Evidence to Support
a Claim for Punitive Damages (ECF No. 93); (13) Motion in Limine to
Preclude Argument or Evidence Regarding Rulings Made in McDonald v.
EQT Production Company or The Kay Company, LLC v. EQT Production
Company (ECF No. 94); and (14) Motion in Limine to Preclude
Argument or Evidence Regarding Senate Bill 360 (ECF No. 149).
This Court has reviewed and considered the fully briefed
motions and the memoranda and exhibits submitted by the parties as

2

well as the comments by counsel concerning these motions at the
pretrial conference on April 2, 2018.

This Court will address

those motions in limine and set forth its findings, as discussed
below.
EQT’s Motions in Limine
1.

Motion in Limine to Preclude Argument or Evidence of Alter Ego

Relationship or the Sale Price Received by EQT Energy, LLC (ECF No.
82) is GRANTED.
EQT anticipates that the plaintiffs may seek to argue that
there is purportedly an alter ego relationship between EQT and
other affiliates and/or that the price upon which the plaintiffs’
royalties are calculated should be based upon the price for natural
gas sales that is received by EQT Energy, LLC, which is not a party
to

this

regarding

case.

EQT

affiliated

argues
and

that

the

plaintiffs’

non-affiliated

sales

are

contentions
irrelevant

because EQT is the only defendant in the case and the only lessee
obligated to pay royalties to the plaintiffs.

Additionally, EQT

argues that, even if the plaintiffs had included a claim of alter
ego relationship or non-affiliate pricing in their complaint, any
such claims were abandoned and waived as of the June 20, 2017
hearing, where discovery was limited to the reasonableness of postproduction costs actually incurred by the lessee.
In response, the plaintiffs argue that the downstream price
paid to EQT Energy, LLC is the basis of all royalties.

3

The

plaintiffs explain as follows: (1) the enhanced downstream price,
and only the enhanced downstream price, must be paid to the
plaintiffs in order for EQT to receive any deductions; (2) adopting
Leggett v. EQT Production Company, 800 S.E.2d 850 (W. Va.), cert.
denied, 138 S. Ct. 472 (2017), requires the enhanced downstream
price to be the basis of royalties; (3) EQT has stated on the
record that it pays the downstream or interstate pipeline rate as
royalty, and the motion in limine would bar the downstream price,
the only legal price, from being considered; and (4) without paying
the downstream price to the plaintiffs, no deductions are possible.
Accordingly, the plaintiffs oppose the motion in limine and move
this Court to base all deductions upon only the enhanced downstream
price that EQT received for the natural gas.
This Court finds that the issue of alter ego was not pled in
the plaintiffs’ complaint and that, even if it was, it was waived
at the June 20, 2017 status conference during which the parties
agreed that the sole remaining issue is the reasonableness of the
post-production
Accordingly,

expenses

EQT’s

Motion

actually
in

incurred

Limine

to

by

Preclude

the

lessee.2

Argument

or

Evidence of Alter Ego Relationship or the Sale Price Received by
EQT Energy, LLC (ECF No. 82) is GRANTED.

2

The parties’ express waiver of all other issues is discussed
in further detail in this Court’s Memorandum Opinion and Order
Denying Plaintiffs’ Motion for Partial Summary Judgment and
Granting in Part and Denying in Part Defendant’s Motion for Summary
Judgment. ECF No. 153 at 9-10.
4

2.

Motion in Limine to Preclude Argument or Evidence that Other

Lessees Do Not Deduct or Allocate Post-Production Costs (ECF No.
83) is GRANTED.
EQT notes that the plaintiffs are parties to oil and gas
leases with entities other than EQT and anticipates that the
plaintiffs will seek to argue that lessees to the other leases do
not

deduct

or

allocate

post-production

royalties to the plaintiffs.

costs

before

paying

EQT argues that evidence regarding

the practices of other lessees not party to this case is not
relevant to the issue to be decided at trial.
In response, the plaintiffs argue that information regarding
other leases is relevant to evaluate post-production costs of EQT
because none of EQT’s deductions have ever been followed in the oil
and gas industry.

The plaintiffs contend that the procedures in

the industry are relevant and material to determine whether EQT’s
deductions meet the reasonable and necessary standards set forth in
Leggett.
“Evidence is relevant if: (a) it has any tendency to make a
fact more or less probable than it would be without the evidence;
and (b) the fact is of consequence in determining the action.”
Fed. R. Evid. 401.

This Court finds that the practices of other

lessees not party to this case is not relevant to the sole
remaining issue in this matter, which is the reasonableness of the
post-production

expenses

actually

5

incurred

by

the

lessee.

Specifically, the practices of other lessees is not of consequence
to the fact-finder in determining the sole remaining issue in this
case.

Accordingly, EQT’s Motion in Limine to Preclude Argument or

Evidence that Other Lessees Do Not Deduct or Allocate PostProduction Costs (ECF No. 83) is GRANTED.
3.

Motion in Limine to Preclude Argument or Evidence that Post-

Production Costs Were Purportedly Never Defined or Invoiced to
Plaintiffs, or Authorized by Plaintiffs (ECF No. 84) is DEFERRED.
EQT anticipates that the plaintiffs may seek to argue that the
post-production costs allocated to the plaintiffs were purportedly
never defined or invoiced to the plaintiffs, or authorized by them.
EQT argues that any such reference or evidence has no tendency to
prove or disprove the sole issue to be decided in this case (i.e.,
whether the post-production costs incurred and allocated to the
plaintiffs

are

reasonable).

EQT

contends

that

there

is

no

requirement that EQT define or invoice post-production costs to the
plaintiffs, much less that these costs be authorized by them.
The plaintiffs respond that the motion in limine should be
denied because EQT should be forced to define “costs” and “invoice
costs” before they are paid.

The plaintiffs reason that a written

policy is reasonable and necessary.
This Court finds it appropriate to further consider at trial
how the plaintiffs intend to use evidence that the post-production
costs were never defined or invoiced to them.

6

Accordingly, EQT’s

Motion in Limine to Preclude Argument or Evidence that PostProduction Costs Were Purportedly Never Defined or Invoiced to
Plaintiffs, or Authorized by Plaintiffs (ECF No. 84) is DEFERRED.
4.

Motion

in

Limine

to

Preclude

Argument

or

Evidence

that

Allocation of Post-Production Costs Is Not Permitted by Other
Leases (ECF No. 85) is GRANTED.
EQT anticipates that the plaintiffs may seek to argue that the
deduction or allocation of post-production costs is not permitted
by other oil and gas leases to which the plaintiffs are parties.
EQT argues that evidence regarding other leases is not relevant to
this issue to be decided at trial.

EQT further argues that such

evidence would wrongly suggest to the jury that the lease at issue
must allow the pro rata deduction or allocation of post-production
costs, which is contrary to Leggett.
In response, the plaintiffs argue that the motion in limine
should be denied because of the difficulty of defining postproduction costs.

The plaintiffs contend that costs must be

properly allocated, and that EQT cannot apportion its costs on the
plaintiffs’ well.
This Court finds that evidence of other leases is not relevant
to

this

civil

action

because

it

is

of

no

“consequence

in

determining” the sole remaining issue of the reasonableness of the
post-production expenses actually incurred by the lessee.
Evid. 401.

Fed. R.

Additionally, this Court finds that, even if evidence

7

of other leases were relevant, its probative value would be
substantially outweighed by the risk of unfair prejudice and, thus,
would be excluded pursuant to Federal Rule of Evidence 403.
Accordingly,

EQT’s

Motion

in

Limine

to

Preclude

Argument

or

Evidence that Allocation of Post-Production Costs Is Not Permitted
by Other Leases (ECF No. 85) is GRANTED.
5.

Motion

in

Limine

to

Preclude

Argument

or

Evidence

that

Allocation of Post-Production Costs Is Not Permitted by the Lease
(ECF No. 86) is DENIED AS MOOT.
EQT anticipates that the plaintiffs may seek to argue that the
deduction or allocation of post-production costs is not permitted
by the lease.

EQT notes the Leggett holding that “[r]oyalty

payments pursuant to an oil or gas lease governed by West Virginia
Code § 22-6-8(e) (1994) may be subject to pro rata deduction or
allocation of all reasonable post-production expenses actually
incurred by the lessee.”

Thus, EQT argues that evidence that the

lease does not expressly permit the deduction or allocation of
post-production costs has no tendency to prove or disprove whether
these costs may be allocated or deducted here, much less prove or
disprove the sole issue to be decided in this case.
The plaintiffs do not oppose this motion in limine.

The

plaintiffs agree that the lease does not permit post-production
costs that enhance the value of the product, but that the law does.
Accordingly,

EQT’s

Motion

in

Limine

8

to

Preclude

Argument

or

Evidence that Allocation of Post-Production Costs Is Not Permitted
by the Lease (ECF No. 86) is DENIED AS MOOT.
6.

Motion in Limine to Preclude Argument or Evidence that Post-

Production Costs Do Not Enhance the Value of the Natural Gas
Produced from the Lease Premises (ECF No. 87) is DEFERRED.
EQT anticipates that the plaintiffs may seek to argue that the
post-production costs at issue in this case should not be permitted
because they purportedly do not “enhance” the value or quality of
the natural gas produced from the lease premises.

EQT notes that

the gathering and compression services provided and at issue in
this case are exactly the types of post-production services that
Leggett already recognized as enhancing the value of the gas.
Accordingly, EQT argues that there is no issue of fact to be
decided by the jury on the issue of whether these services enhance
the value of the gas, and, thus, any such argument is irrelevant
and inadmissable.
In response, the plaintiffs argue that the motion in limine
should be denied the enhanced downstream price must be paid to all
lessors,

but,

in

this

case,

the

plaintiffs

received

an

impermissible upstream index price with deductions.
This Court finds it appropriate to further consider at trial
how the plaintiffs intend to use evidence that the post-production
costs do not enhance the value of the natural gas.

Accordingly,

EQT’s Motion in Limine to Preclude Argument or Evidence that Post-

9

Production Costs Do Not Enhance the Value of the Natural Gas
Produced from the Lease Premises (ECF No. 87) is DEFERRED.
7.

Motion in Limine to Preclude Argument or Evidence Regarding

Claims of Fraud or Misrepresentation (ECF No. 88) is GRANTED.
EQT anticipates that the plaintiffs may seek to offer evidence
regarding claims of fraud or misrepresentation.

EQT argues that

any claims that the plaintiffs may have had with respect to alleged
fraud or misrepresentation were abandoned and waived as of the June
20, 2017 hearing.

EQT further notes that discovery in this case

has been limited to the issue of the reasonableness of postproduction costs based upon the parties’ agreement and this Court’s
order pursuant to the June 20, 2017 hearing.
In response, the plaintiffs argue that they alleged counts of
fraud and negligent misrepresentation in their complaint, and that
the claims must be presented to the jury for evaluation.
This Court finds that the plaintiffs waived their claims for
fraud and misrepresentation at the June 20, 2017 status conference,
at which the parties agreed that the sole remaining issue is the
reasonableness of the post-production expenses actually incurred by
the lessee.

Accordingly, EQT’s Motion in Limine to Preclude

Argument or Evidence Regarding Claims of Fraud or Misrepresentation
(ECF No. 88) is GRANTED.

10

8.

Motion in Limine to Preclude Argument or Evidence Regarding

the Henry Hub or Other Index Prices (ECF No. 89) is GRANTED.
EQT anticipates that the plaintiffs may offer evidence of the
“Henry Hub index” and its pricing or other pipeline distribution
pricing, particularly that the “Henry Hub index” price should be
used to determine the wellhead price upon which the plaintiffs’
royalties should be calculated. EQT argues that the “Henry Hub” is
a distribution hub located on the natural gas pipeline system in
Louisiana, which is a distant market far from the wells located on
the lease premises in this case and the pipeline systems into which
the gas is sold. Thus, EQT argues that evidence concerning pricing
at the “Henry Hub” has no tendency to prove or disprove the price
upon which the plaintiffs’ royalties should be paid, much less
provide evidence of the sole issue to be decided in this case.

EQT

further contends that the plaintiffs waived any claim they may have
had regarding the market value of natural gas sold from the lease
premises as of the June 20, 2017 hearing.
In response, the plaintiffs argue that the “Henry Hub index”
is relevant to show that the enhanced downstream price is not paid
to the plaintiffs.
This Court finds that the “Henry Hub” in Louisiana is located
in too distant of a market from the wells at issue in this case to
be relevant.

Additionally, the “Henry Hub” index is not relevant

because EQT did not use the “Henry Hub” index in calculating the
11

plaintiffs’ royalty payments.

In sum, this Court finds that

evidence regarding the “Henry Hub” index has no tendency to make
any fact of consequence to the sole remaining issue in this civil
action

“more

evidence.”

or

less

probable

Fed. R. Evid. 401.

than

it

would

be

without

the

Further, even if relevant, such

evidence would not be admissible under Federal Rule of Evidence
403.

Accordingly, EQT’s Motion in Limine to Preclude Argument or

Evidence Regarding the Henry Hub or Other Index Prices (ECF No. 89)
is GRANTED.
9.

Motion in Limine to Preclude Argument or Evidence that the

Price at which Gas Sold from the Lease Premises Is Purportedly Less
than Fair Market Value (ECF No. 90) is DEFERRED.
EQT anticipates that the plaintiffs may seek to argue that the
price at which gas sold from the lease premises is purportedly less
than market value.

EQT argues that any claim the plaintiffs may

have had that the sales price for natural gas sold from the lease
premises was less than market value was abandoned and waived as of
the June 20, 2017 hearing, where discovery was limited to the sole
issue of the reasonableness of post-production costs actually
incurred by the lessee.
In response, the plaintiffs argue that the motion in limine
should be denied because the plaintiffs are entitled to gas at the
enhanced downstream price received by EQT Midstream.

12

This Court finds it appropriate to further consider at trial
how the plaintiffs intend to use evidence that the price at which
the gas is sold is less than fair market value. Accordingly, EQT’s
Motion in Limine to Preclude Argument or Evidence that the Price at
which Gas Sold from the Lease Premises Is Purportedly Less than
Fair Market Value (ECF No. 90) is DEFERRED.
10.

Motion in Limine to Preclude Argument or Evidence Regarding

Natural Gas Liquids (ECF No. 91) is GRANTED.
EQT anticipates that the plaintiffs may seek to offer evidence
regarding natural gas liquids or seek to obtain royalties for the
alleged sale of natural gas liquids.

EQT argues that, at the June

20, 2017 hearing, the plaintiffs abandoned and waived any claim
they may have had with respect to natural gas liquids.

Thus, EQT

represents that, since June 20, 2017, it has conducted no discovery
to explore the basis for claims that the plaintiffs may have had
regarding natural gas liquids.

EQT further argues that the

undisputed evidence in this case establishes that EQT sells gas at
or near the wellhead before processing or separation of any natural
gas liquids and does not separately sell any natural gas liquids
from natural gas produced from wells located on the Lease premises.
Thus, EQT contends that there is no valid basis upon which to
impose any obligation on EQT to pay royalties for something that it
does not sell.

13

In response, the plaintiffs argue that EQT wishes to overlook
natural gas liquids even though they received compensation for
them, which further damages the plaintiffs and enriches EQT.

The

plaintiffs contend that the motion in limine should be denied
because, by wrongfully deducting monetary costs and taxes and not
compensating the plaintiffs for natural gas liquids, EQT has failed
to properly pay royalties and thereby intentionally and wrongfully
breached the terms of the lease.
This
regarding

Court

finds

natural

gas

that

the

liquids

plaintiffs
at

the

waived

June

20,

any

claims

2017

status

conference, at which the parties agreed that the sole remaining
issue

is

the

reasonableness

of

actually incurred by the lessee.

the

post-production

expenses

Accordingly, EQT’s Motion in

Limine to Preclude Argument or Evidence Regarding Natural Gas
Liquids (ECF No. 91) is GRANTED.
11.

Motion

Royalties

in

Paid

Limine
to

to

Preclude

Plaintiffs

by

Argument

EQT

Should

or
Be

Evidence
Paid

that

Without

Deduction or Allocation of Any Post-Production Costs (ECF No. 92)
is GRANTED.
EQT anticipates that the plaintiffs may argue that EQT should
pay them royalties without deduction or allocation of any postproduction costs.

EQT contends that any such argument is contrary

to Leggett. EQT argues that there is no dispute that West Virginia
Code § 22-6-8 governs the royalties to be paid to the plaintiffs

14

for natural gas and/or oil produced from wells drilled or reworked
on the property covered by the lease after the enactment of the
Flat-Rate Statute.
In response, the plaintiffs argue that EQT has furnished to
them statements as to their deductions totaling $250,155.34, which
would total approximately $1,000,000.00 for all lessors if the
plaintiffs received approximately one-fourth of the royalty of the
wells.

The plaintiffs contend that, as the owner of seven-eights

of the well, EQT would be responsible for eight times the royalty,
or total deductions of $800,000.00.

Thus, the plaintiffs argue

that the motion in limine be denied unless EQT can establish
$800,000.00 in deductions from the well that have enhanced the
product, are properly allocated, actually incurred, and reasonable.
This Court agrees with EQT’s contention that any argument that
EQT should pay the plaintiffs royalties without deduction or
allocation of any post-production costs is contrary to Leggett.
Under Leggett, EQT is permitted to deduct post-production expenses
from the plaintiffs’ royalty payments that are reasonable and
actually incurred by the lessee.

Accordingly, EQT’s Motion in

Limine to Preclude Argument or Evidence that Royalties Paid to
Plaintiffs by EQT Should Be Paid Without Deduction or Allocation of
Any Post-Production Costs (ECF No. 92) is GRANTED.

15

12.

Motion in Limine to Preclude Argument or Evidence to Support

a Claim for Punitive Damages (ECF No. 93) is GRANTED.
EQT anticipates that the plaintiffs may seek to offer evidence
to support a claim for punitive damages against EQT.

EQT contends

that any claim the plaintiffs may have had for punitive damages was
abandoned and waived as of the June 20, 2017 hearing.
In response, the plaintiffs argues that the motion in limine
should be denied because Count VI of the complaint properly alleges
punitive damages and because whether EQT has acted in a willful,
wanton, reckless, or fraudulent manner is a question of fact for
the jury.
This

Court

finds

that

the

plaintiffs

waived

any

claims

regarding punitive damages at the June 20, 2017 status conference,
at which the parties agreed that the sole remaining issue is the
reasonableness of the post-production expenses actually incurred by
the lessee.
their

Additionally, even if the plaintiffs had not waived

punitive

damages

claim

at

the

June

20,

2017

status

conference, punitive damages are not an available remedy in a
contract action, which this essentially is.

See Warden v. Bank of

Mingo, 341 S.E.2d 679, 684 (W. Va. 1985) (“[P]unitive damages are
generally unavailable in pure contract actions.”).

Accordingly,

EQT’s Motion in Limine to Preclude Argument or Evidence to Support
a Claim for Punitive Damages (ECF No. 93) is GRANTED.

16

13.

Motion in Limine to Preclude Argument or Evidence Regarding

Rulings Made in McDonald v. EQT Production Company or The Kay
Company, LLC v. EQT Production Company (ECF No. 94) is GRANTED.
EQT anticipates that the plaintiffs may seek to reference
rulings made in a case previously pending in the United States
District Court for the Southern District of West Virginia, McDonald
v. EQT Production Company, Civil Action No. 2:11CV418, and a case
currently pending before Judge John Preston Bailey in the United
States District Court for the Northern District of West Virginia,
The Kay Company, LLC v. EQT Production Company, Civil Action No.
1:13CV151.

EQT states that the court in McDonald did not consider

any EQT evidence regarding the reasonableness of post-production
costs allocated in that case pursuant to the terms of the parties’
leases.
Additionally, EQT indicates that, unlike here, none of the
leases at issue in that case included a flat well royalty provision
and no royalties at issue were paid pursuant to West Virginia Code
§ 22-6-8.

EQT also contends that, while The Kay Company involves

some claims concerning royalty payments made pursuant to West
Virginia Code § 22-6-8, the period for discovery is still open in
that case, and neither the court nor the factfinder has considered
much of the evidence presented here regarding the reasonableness of
the post-production costs.

Thus, EQT argues that the courts’

rulings in McDonald and The Kay Company regarding the costs that

17

may have been permissibly deducted from lessors’ royalties are not
relevant here.
In response, the plaintiffs argue that, while McDonald and The
Kay Company, are not controlling, they are helpful in understanding
the nature of post-production costs and should be considered.

The

plaintiffs contends that the rulings in those cases should be
consistent with Leggett, and, thus, the motion in limine should be
denied.
This Court finds that evidence regarding rulings made in
McDonald and The Kay Company must be excluded because they have no
“tendency to make a fact more or less probable than it would be
without the evidence.”

Fed. R. Evid. 401.

Furthermore, even if

evidence of those rulings were relevant, this Court finds that
their probative value would be substantially outweighed by the risk
of confusing the issues or misleading the jury and, thus, would be
excluded pursuant to Federal Rule of Evidence 403.

Accordingly,

EQT’s Motion in Limine to Preclude Argument or Evidence Regarding
Rulings Made in McDonald v. EQT Production Company or The Kay
Company, LLC v. EQT Production Company (ECF No. 94) is GRANTED.
14.

Motion in Limine to Preclude Argument or Evidence Regarding

Senate Bill 360 (ECF No. 149) is GRANTED.
In its final motion in limine, EQT addresses Senate Bill 360,
which the West Virginia Legislature passed on March 2, 2018, in
response to the Leggett decision.

18

EQT notes that Senate Bill 360

dramatically changes the law with respect to the payment of
royalties pursuant to West Virginia Code § 22-6-8. EQT anticipates
that the plaintiffs may seek to argue or provide evidence of the
recent

amendments

to

the

royalty

payment

provisions

of

West

Virginia Code § 22-6-8, which were enacted pursuant to Senate Bill
360.

EQT

argues

that

those

recent

amendments

may

not

be

retroactively applied to the plaintiffs’ claims regarding the
payment of royalties.

Thus, EQT contends that Senate Bill 360 is

not relevant in this case.
The plaintiffs address Senate Bill 360 in their Supplemental
Brief and Response to Defendant’s Motion in Limine Regarding Issues
for Litigation Set Forth in Paragraph VIII of the Joint Pretrial
Order.

ECF No. 151.

In the response, the plaintiffs discuss

Leggett and Senate Bill 360, and move this Court to clarify which
will be followed by this Court at trial.
At trial, this Court will follow the law as it is set forth in
Leggett v. EQT Production Company, 800 S.E.2d 850 (W. Va.), cert.
denied, 138 S. Ct. 472 (2017).

This Court finds that EQT is

correct that Senate Bill 360 cannot apply retroactively to the
See Pub. Citizen, Inc. v. First

plaintiffs’ claims in this case.

Nat’l Bank in Fairmont, 480 S.E.2d 538, 543-44 (W. Va. 1996)
(“[U]nless expressly stated otherwise by the statute, [amendments
to a statute] will not apply to pending cases or cases filed
subsequently

based

upon

facts

completed

19

before

the

statute’s

effective date.”). Thus, pursuant to Federal Rule of Evidence 401,
Senate Bill 360 is not relevant in this case because it is of no
consequence in determining the action.

Accordingly, EQT’s Motion

in Limine to Preclude Argument or Evidence Regarding Senate Bill
360 (ECF No. 149) is GRANTED.
IT IS SO ORDERED.
The Clerk is DIRECTED to transmit a copy of this memorandum
opinion and order to counsel of record herein.
DATED:

April 6, 2018

/s/ Frederick P. Stamp, Jr.
FREDERICK P. STAMP, JR.
UNITED STATES DISTRICT JUDGE

20