United States District Court, N.D. West Virginia
JANET C. PACKARD, ET AL., Plaintiffs,
ANTERO RESOURCES CORPORATION, a Delaware corporation, Defendant.
MEMORANDUM OPINION AND ORDER GRANTING DEFENDANT'S
MOTION TO DISMISS THE AMENDED COMPLAINT [DKT. NO. 21] AND
DISMISSING THE AMENDED COMPLAINT WITH PREJUDICE [DKT. NO.
M. KEELEY UNITED STATES DISTRICT JUDGE.
consolidated breach of contract case, the plaintiffs, Janet
C. Packard, Leroy Packard, Garnet C. Cottrill, and Marlyn C.
Sigmon (“the Plaintiffs”), allege in their
Amended Complaint that the defendant, Antero Resources
Corporation (“Antero”), has breached certain
lease agreements and violated its duty to act in good faith
by pooling the Plaintiffs' mineral interests through the
use of a horizontal well (Dkt. No. 20). Antero has moved to
dismiss the Amended Complaint contending, among other things,
that the Plaintiffs' reformed deeds are subject to the
pooling modifications that were executed in 2012 (Dkt. Nos.
21, 22). Alternatively, it submits that the reformed deeds do
not apply retroactively against it because, under West
Virginia law, it is a third party whose rights will be
affected (Dkt. No. 22). Because Antero's first argument
disposes of the matter in its entirety, the Court
GRANTS Antero's motion (Dkt. No. 21) and
DISMISSES the Amended Complaint WITH
The Amended Complaint
their Amended Complaint, the Plaintiffs allege that they own
mineral interests in real property subject to three oil and
gas leases. These include one tract containing 50.82 acres in
Union District, Harrison County, West Virginia, two tracts
containing 6.5 and 104.75 acres in Union District, Harrison
County, West Virginia, and one tract containing 54.18 acres
in Union District, Harrison County, West Virginia (“the
Subject Property”) (Dkt. No. 20 at 1-13). When the
Plaintiffs inherited their interests in these tracts in 1987,
those interests were subject to three oil and gas leases
(“the Subject Leases”). Id. at 2, 5, 10.
Allegedly, the Subject Leases “did not provide
authority for pooling or unitization.” Id. at
in 1989, the Plaintiffs conveyed their interests in the
50.82-acre tract, the 6.5- and 104.75-acre tracts, and the
54.18-acre tract to Gerald W. Corder, Roger M. Corder, and
Randall N. Corder (“the Corders”), respectively
(“the 1989 Deeds”). Id. at 2, 5-6,
10-11. The Plaintiffs concede that all three conveyances
“failed to reserve an undivided interest in the oil and
gas to the grantors, ” which they describe as a
“scrivenor's error.” Id. at 2, 6,
11. Although the 1989 Deeds failed to reserve their mineral
interests, the Plaintiffs allege that the property tax on
their mineral interests has been assessed and paid since at
least 2004, making them “of record.” Id.
at 4, 8-9, 12-13. These tax tickets are attached to the
Amended Complaint as Exhibit 2 (Dkt. No. 20-2).
the property taxes were being assessed and paid, Antero
acquired the Subject Leases in 2010 and 2012 (Dkt. No. 20 at
3, 6, 11). After acquiring these leases, Antero had
the Corders execute three oil and gas lease modifications
that purportedly gave Antero the express right to
“pool” the underlying mineral interests
(“the Pooling Modifications”) (Dkt. No. 20-1).
two years later, in 2014, the Plaintiffs and others filed
suit in the Circuit Court of Harrison County, West Virginia,
to reform the 1989 Deeds to include their previously omitted
reservation of mineral interests (Dkt. No. 20 at 2-3, 6, 11,
13-14). Soon after filing suit, the Plaintiffs and others
filed a “Notice of Lis Pendens” in the Office of
the Clerk of Harrison County, West Virginia, to put others on
notice that litigation was pending and that they claimed
mineral interests under the 1989 Deeds (Dkt. No. 20-5). After
their state court action succeeded (Dkt. No. 20-7), the
parties executed reformed deeds, which were recorded in 2016
(“the Reformed Deeds”) (Dkt. Nos. 20 at 3-4, 6-8,
11-12; 22-3). The Reformed Deeds establish that the
Plaintiffs and others retained their respective mineral
interests in the 1989 Deeds. Id.
though the Subject Leases do not expressly grant the right to
pool or unitize, the Plaintiffs allege that Antero has
drilled horizontal wells through each of the tracts at issue,
produced minerals from the oil and gas estate, and pooled
their gas with the gas of others (Dkt. No. 20 at 15-17).
Accordingly, the Amended Complaint asserts a claim for breach
of contract. Id. at 16-17.
plaintiffs filed these actions in December 2017 in the
Circuit Court of Harrison County, West Virginia (Dkt. No.
1-1). Antero timely removed them to this Court based on
diversity jurisdiction (Dkt. No. 1). After Antero moved to
dismiss each of the complaints (Dkt. No. 6), the Court held a
scheduling conference during which it consolidated the cases
and granted in part and denied in part Antero's motions
(Dkt. Nos. 18, 19). Later, the Court issued a Memorandum
Opinion explaining its decision, and expressly declining to
address Antero's argument that it had the right to pool
under the Pooling Modifications because the parties had not
addressed what effect, if any, the Reformed Deeds had on
these modifications (Dkt. No. 23 at 15). The Plaintiffs
responded by filing an Amended Complaint alleging the instant
breach of contract claim (Dkt. No. 20). Now pending is
Antero's motion to dismiss the Amended Complaint, which
is fully briefed and ripe for review (Dkt. No. 21).
STANDARD OF REVIEW
Rule of Civil Procedure 12(b)(6) allows a defendant to move
for dismissal on the grounds that a complaint does not
“state a claim upon which relief can be granted.”
When reviewing the sufficiency of a complaint, a district
court “must accept as true all of the factual
allegations contained in the complaint.” Anderson
v. Sara Lee Corp., 508 F.3d 181, 188 (4th Cir. 2007)
(quoting Erickson v. Pardus, 551 U.S. 89, 94
(2007)). “While a complaint . . . does not need
detailed factual allegations, a plaintiff's obligation to
provide the ‘grounds' of his ‘entitle[ment]
to relief' requires more than labels and conclusions, and
a formulaic recitation of the elements of a cause of action
will not do.” Bell Atl. Corp. v. Twombly, 550
U.S. 544, 555 (2007) (internal citation omitted). A court is
“not bound to accept as true a legal conclusion couched
as a factual allegation.” Papasan v. Allain,
478 U.S. 265, 286 (1986).
order to be sufficient, “a complaint must contain
‘enough facts to state a claim to relief that is
plausible on its face.'” Anderson, 508
F.3d at 188 n.7 (quoting Twombly, 550 U.S. at 547).
“A claim has facial plausibility when the plaintiff
pleads factual content that allows the court to draw the
reasonable inference that the defendant is liable for the
misconduct alleged.” Ashcroft v. Iqbal, 556
U.S. 662, 678 (2009). A motion to dismiss “does not
resolve contests surrounding the ...