W. W. McDonald Land Co. et al v. EQT Production Company et al
Filing
256
MEMORANDUM OPINION AND ORDER denying defendants' 156 MOTION to Bifurcate; denying as moot the plaintiffs' 188 MOTION in Limine to Prevent EQT Production from Asserting the Defense of Advice of Counsel; granting the plaintiffs' ; 190 MOTION in Limine to Exclude the Expert Opinions of John Lowe; granting plaintiffs' 249 MOTION in Limine to Exclude Evidence and Argument Regarding defendants' Settlement Efforts and the Kay Class Action; and denying the defendants' 245 MOTION in Limine to Limit Claims for Prejudgment Interest. Signed by Judge Joseph R. Goodwin on 8/14/2014. (cc: attys; any unrepresented parties) (taq)
IN THE UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF WEST VIRGINIA
CHARLESTON DIVISION
W. W. MCDONALD LAND CO., et al.,
Plaintiffs,
v.
CIVIL ACTION NO. 2:11-cv-00418
EQT PRODUCTION COMPANY, et al.,
Defendants.
MEMORANDUM OPINION AND ORDER
Pending before the court is Defendants’ Motion to Bifurcate [Docket 156], the plaintiffs’
Motion in Limine to Prevent EQT Production from Asserting the Defense of Advice of Counsel
[Docket 188], the plaintiffs’ Motion in Limine to Exclude the Expert Opinions of John Lowe
[Docket 190], the plaintiffs’ Motion in Limine to Exclude Evidence and Argument Regarding
Defendants’ Settlement Efforts and the Kay Class Action [Docket 249], and the defendants’
Motion in Limine to Limit Claims for Prejudgment Interest [Docket 245]. For the reasons stated
below, the Defendants’ Motion to Bifurcate [Docket 156] is DENIED, the plaintiffs’ Motion in
Limine to Prevent EQT Production from Asserting the Defense of Advice of Counsel [Docket
188] is DENIED as moot, the plaintiffs’ Motion in Limine to Exclude the Expert Opinions of
John Lowe [Docket 190] is GRANTED, Plaintiffs’ Motion in Limine to Exclude Evidence and
Argument Regarding Defendants’ Settlement Efforts and the Kay Class Action [Docket 249] is
GRANTED, and the defendants’ Motion in Limine to Limit Claims for Prejudgment Interest
[Docket 245] is DENIED.
I. Motion to Bifurcate
The defendants ask that trial for this matter be bifurcated into two phases. First, a liability
phase would determine whether the leases at issue permit the defendants to deduct post-production
costs. Second, a damages phase would determine whether any permissible deductions were
actually incurred and reasonable. See Syl. Pt. 2, Estate of Tawney v. Columbia Natural Res., LLC,
633 S.E.2d 22, 23 (W. Va. 2006); Syl. Pt. 5, Wellman v. Energy Res., Inc., 557 S.E.2d 254, 256 (W.
Va. 2001).
Whether to bifurcate a trial under Federal Rule of Civil Procedure 42(b) is left to the
discretion of the district court. Light v. Allstate Ins. Co., 182 F.R.D. 210, 212-13 (S.D. W.
Va.1998) (Hallanan, J.). The issues in this case have been substantially narrowed since the
defendants filed their motion to bifurcate. See W.W. McDonald Land Co. v. EQT Prod. Co., 983 F.
Supp. 2d 790 (S.D. W. Va. 2013). With the exception of two leases, I have resolved all issues of
contractual liability in this case. Therefore, with the exception of those two leases, all that is left for
trial is the issue of damages. I therefore FIND that bifurcation of this matter is unnecessary and the
defendants’ motion to bifurcate is DENIED.
II. Motions in Limine
Also pending are several motions in limine. The plaintiffs’ Motion in Limine to Prevent
EQT Production from Asserting the Defense of Advice of Counsel is DENIED as moot because
counsel for the defendants conceded at a pretrial hearing that the defendants will not be asserting
this defense. (See Tr. 12/10/2013 [Docket 234], at 12). The defendants are expected to abide by
this concession.
The plaintiffs also move to exclude the opinions of John Lowe, an expert witness proffered
by the defendants. Mr. Lowe opines that the instant case is “distinguishable” from the West
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Virginia cases relevant to this litigation, including Tawney, 633 S.E.2d 22, Wellman, 557 S.E.2d
254, and Cotiga Dev. Co. v. United Fuel Gas Co., 128 S.E.2d 626 (W. Va. 1962). (See Lowe
Report [Docket 190-1], at 4-5). He states that “EQT Production’s royalty-payment practice
appears to me to satisfy the royalty requirements of the leases in question.” (Id. at 5). He further
opines that there is no evidence in this case suggesting that the EQT entities in this case operate as
alter egos. (See id. at 6).
None of these opinions are helpful to the jury. See Fed. R. Evid. 702 (requiring that expert
opinions “help the trier of fact to understand the evidence or to determine a fact in issue”). They do
not assist the jury to decide the facts in issue in this case. Further, Mr. Lowe’s opinions are
impermissible legal conclusions. See United States v. McIver, 470 F.3d 550, 562 (4th Cir. 2006)
(“[O]pinion testimony that states a legal standard or draws a legal conclusion by applying law to
the facts is generally inadmissible.”). Accordingly, the plaintiffs’ motion to exclude Mr. Lowe is
GRANTED.
Next, the defendants move in limine to limit the plaintiffs’ claim for prejudgment interest.
The defendants argue that the plaintiffs should not be able to recover prejudgment interest for the
period preceding the settlement of a class action that the plaintiffs opted out of. That class action,
Kay Company v. Equitable Production Co., No. 2:06-cv-612 (S.D. W. Va.), involved the same
claims that are now at issue here. The plaintiffs in this case chose to opt out of the Kay Co.
settlement and pursue their claims separately, resulting in the instant litigation. The defendants
now contend that, “[b]y foregoing the opportunity to resolve their claims pursuant to the Court
ordered class settlement in Kay Co., Plaintiffs have unilaterally prolonged bringing this matter to
an earlier resolution. As such, equity dictates that Plaintiffs should not be permitted to seek
prejudgment interest for damages . . . which predate the [Kay Co.] settlement . . . on April 28, 2010.
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(See Mem. of Law in Supp. of Mot. in Limine to Limit Claims for Prejudgment Interest [Docket
246], at 3-4).
The defendants’ motion lacks merit. Prejudgment interest is a form of compensation. West
Virginia v. United States, 479 U.S. 305, 310 (1987). West Virginia juries may award prejudgment
interest in breach of contract actions where they see fit. See W. Va. Code § 56-6-27; City Nat. Bank
of Charleston v. Wells, 384 S.E.2d 374, 389 (W. Va. 1989). The plaintiffs exercised their legal
right to opt out of the Kay Co. settlement. See In re Serzone Prods. Liab. Litig., 231 F.R.D. 221,
231 (S.D. W. Va. 2005). Therefore, equity does not dictate that the plaintiffs should be precluded
from recovering prejudgment interest. The defendants’ motion on this issue is DENIED.
In relation to this motion, the plaintiffs move in limine to preclude evidence or argument of
settlement discussions and the Kay Co. class action. This motion is GRANTED. Evidence of
settlement discussions or negotiations is irrelevant and inadmissible. See Fed. R. Evid. 408; Fed.
R. Evid. 402.
Finally, the Defendants’ Motion in Limine to Exclude Evidence or Testimony Regarding
Wells and Leases not at Issue in this Litigation is DENIED without prejudice. The motion
essentially asks for an advisory ruling that all irrelevant evidence will be excluded. I cannot rule on
this motion without knowing the particular pieces of evidence at issue and the context in which the
parties seek to admit such evidence. The parties can expect that the Federal Rules of Evidence will
be enforced.
III. Conclusion
For the reasons stated above, Defendants’ Motion to Bifurcate [Docket 156] is DENIED,
the plaintiffs’ Motion in Limine to Prevent EQT Production from Asserting the Defense of Advice
of Counsel [Docket 188] is DENIED as moot, the plaintiffs’ Motion in Limine to Exclude the
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Expert Opinions of John Lowe [Docket 190] is GRANTED, Plaintiffs’ Motion in Limine to
Exclude Evidence and Argument Regarding Defendants’ Settlement Efforts and the Kay Class
Action [Docket 249] is GRANTED, and the defendants’ Motion in Limine to Limit Claims for
Prejudgment Interest [Docket 245] is DENIED.
The court DIRECTS the Clerk to send a copy of this Order to counsel of record and any
unrepresented parties.
ENTER: August 14, 2014
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