EEE Minerals, LLC v. North Dakota

318 F.R.D. 118, 2016 U.S. Dist. LEXIS 184582, 2016 WL 7209805
CourtDistrict Court, D. North Dakota
DecidedOctober 3, 2016
DocketCase No. 1:16-cv-115
StatusPublished
Cited by1 cases

This text of 318 F.R.D. 118 (EEE Minerals, LLC v. North Dakota) is published on Counsel Stack Legal Research, covering District Court, D. North Dakota primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
EEE Minerals, LLC v. North Dakota, 318 F.R.D. 118, 2016 U.S. Dist. LEXIS 184582, 2016 WL 7209805 (D.N.D. 2016).

Opinion

ORDER GRANTING THE DEFENDANTS’ MOTIONS TO DISMISS

Daniel L. Hovland, District Judge

I. BACKGROUND

This action was originally filed in 2014, in the state District Court of McKenzie County, North Dakota. The lawsuit was commenced in an effort to determine who owns title to oil and gas interests under and adjacent to the Missouri River in four townships in western North Dakota. The original action included two named Plaintiffs, and named as Defendants the State of North Dakota, the Board of University and School Lands of the State of North Dakota, and Continental Resources, Inc. Continental Resources moved to dismiss the complaint for failure to join necessary and indispensable parties. The state court allowed limited discovery and provided the Plaintiffs an opportunity to move to amend their complaint. The current amended complaint was filed in state court on or about April 15, 2016. It expanded the lands defined as “Class Property” to essentially include the whole of the Missouri River from the Montana-North Dakota border to the Fort Bert-hold Indian Reservation near New Town, North Dakota.

The case was removed to federal court on May 13, 2016. See Docket No. 1. There have been a multitude of motions to dismiss filed by more than 100 Defendants beginning in June of 2016. See Docket Nos. 72, 94-96,107, 122,127,130,132-185,188,191,199, 202, 222, 233, 239, 278, and 280. The primary basis for the motions to dismiss is the failure to join the United States as a necessary party.

A. THE LANDS AND PARTIES

The lands included in this lawsuit are tracts immediately adjacent to the Missouri River as well as many tracts of land miles from the water. The Plaintiffs define the [121]*121“Class Property” as all or parts of 27 different townships through which the Missouri River runs. A “township” consists of a six-mile by six-mile area subdivided into 36 “sections” of one square mile (640 acres) each. See N. Oil and Gas, Inc. v. Moen, 808 F.3d 373, 375 (8th Cir. 2015). A township includes 36 square miles of land, or 23,040 acres. The Plaintiffs’ definition of “Class Property” is not limited to lands immediately adjacent to the water, and generally includes entire townships.

The amended complaint reveals the Plaintiffs claim an interest in only a small subset of the lands they define as the “Class Property.” The Plaintiffs claim to own an interest in all or parts of just five sections of land within the area defined as the “Class Property.” The State of North Dakota claims an interest in the riverbed of the Missouri River across the “Class Property.” Concerning the river, the State’s ownership of the riverbed is defined by the river’s “ordinary high water mark.” The Plaintiffs dispute the location of the ordinary high water mark as delineated by the Board of University School Lands of the State of North Dakota (“Land Board”). See Docket No. 5-24, ¶ 51-70. The Plaintiffs also take issue with the State’s claim that the ordinary high water mark extends to the current shores of the Lake Sakakawea reservoir, as opposed to the historic riverbed before inundation due to the Garrison Dam.

The Plaintiffs are claiming they have been deprived of their oil and gas interests by virtue of the State of North Dakota claiming ownership to all of the oil and gas under Lake Sakakawea as sovereign land under the Equal Footing Doctrine. The State contends it owns all of the oil and gas under Lake Sakakawea because North Dakota’s title to the beds of navigable waters extends up to the ordinary high water mark. In other words, State title follows the waterline.

With respect to the non-state Defendants, they are alleged to be “the holders of oil and gas leases from the State” within the “Class Property” area. See Docket No. 5-24, ¶¶ 16-45. The amended complaint attempts to identify all parties with working interests in leases with the State in each of the respective townships included in the “Class Property.” The amended complaint also lists each of the State of North Dakota oil and gas leases claimed to be adverse to the named Plaintiffs’ interests. See Docket No. 5-24, ¶¶ 59-60. The Plaintiffs claim the Defendants owning State leases adverse to their individual interests are: Continental Resources, Inc.; Statoil Oil & Gas LP; and Hess Bakken Investments II, LLC.

E. THE AMENDED COMPLAINT

The amended complaint asserts eight individual counts. See Docket No. 5-24. Count I sets forth quiet title claims upon which the Plaintiffs’ remaining claims depend. It is styled a “Request for Declaratory Relief’ against all Defendants. This is a request for the Court to delineate and quiet title in relation to the ordinary high water mark of the Missouri River within the area defined as the “Class Property.” Count I requests “a declaration by the Court that the State of North Dakota does not own title to the mineral interests owned by the Plaintiffs and the Class, such property located above the [ordinary high water mark] as the [ordinary high water mark] existed for the historical Missouri River at that point in time before the construction of Garrison Dam and subsequent filling of the Lake Sakakawea Reservoir.” See Docket No. 5-24, ¶ 85. The prayer for relief requests that “title to the mineral interests in the McKenzie County, Mountrail County, and Williams County property identified herein be forever quieted in Plaintiffs and the Class, and that Defendants be forever barred and enjoined from further asserting claims against this property.” See Docket No. 5-24, ¶ 125.

Counts II through VI set forth various theories for monetary relief based on the theory that the State of North Dakota has improperly leased and collected royalties on minerals that will be quieted in the Plaintiffs and the proposed class under Count I. Counts II and III assert takings claims against the State of North Dakota under the state and federal constitutions. Count IV asserts conversion claims against all Defendants. Count V asserts constructive trust and unjust enrichment claims against all Defendants. Count VI alleges conspiracy claims [122]*122against all Defendants, alleging the Defendants conspired to effect wrongful takings or deprivations of the Plaintiffs’ and class members’ minerals. A second “Count VI” asserts a claim against the State of North Dakota under 42 U.S.C. § 1983, premised on a wrongful taking under the Fifth Amendment of the United States Constitution.

Finally, Count VII requests injunctive relief during the pendency of the case. Pending a ruling on the proper delineation of the ordinary high water mark within the boundaries of the Garrison Dam Project, the Plaintiffs seek a court-ordered deposit of “all proceeds related to any and all oil and gas produced from the property, including but not limited to bonus payments, royalty payments, delinquency penalties, and other fees and costs associated with the mineral interests” described in the amended complaint. See Docket No. 5-24, ¶ 119.

The Plaintiffs seek both declaratory relief and damages for themselves and a putative class. The “Class” is defined as:

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Bluebook (online)
318 F.R.D. 118, 2016 U.S. Dist. LEXIS 184582, 2016 WL 7209805, Counsel Stack Legal Research, https://law.counselstack.com/opinion/eee-minerals-llc-v-north-dakota-ndd-2016.