Michael Biffle v. Sho-Me Power Electric, etc.

852 F.3d 795, 2017 WL 1160950, 2017 U.S. App. LEXIS 5435
CourtCourt of Appeals for the Eighth Circuit
DecidedMarch 29, 2017
Docket15-2964
StatusPublished
Cited by9 cases

This text of 852 F.3d 795 (Michael Biffle v. Sho-Me Power Electric, etc.) is published on Counsel Stack Legal Research, covering Court of Appeals for the Eighth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Michael Biffle v. Sho-Me Power Electric, etc., 852 F.3d 795, 2017 WL 1160950, 2017 U.S. App. LEXIS 5435 (8th Cir. 2017).

Opinion

BENTON, Circuit Judge.

This case is about the scope of easements under Missouri law and the remedies if easement holders exceed their rights. Sho-Me Power Cooperative held easements to construct and operate an electric transmission line over thousands of *798 parcels. In 1997, it decided to install fiber-optic cables alongside its electrical lines. Sho-Me used the cables for internal communications. Sho-Me assigned the cables’ excess, capacity to a separate company, Sho-Me Technologies, LLC (Tech), to operate a public-serving commercial telecommunications business. A putative class of owners of land subject to Sho-Me’s easements sued Sho-Me and Tech for trespass and unjust enrichment. The district court certified a class of landowners, granted the landowners summary judgment on liability, and held a jury trial on damages. The district court instructed the jury to award the landowners “the fair market rental value” of Sho-Me and Tech’s use of the fiber-optic cable on the landowner’s land “for commercial-telecommunications purposes.” The jury awarded the landowners over $79 million.

Sho-Me and Tech appeal the liability determinations, damages instructions, evi-dentiary rulings, and class certification. Having jurisdiction under 28 U.S.C. § 1291, this court affirms the summary judgment on trespass liability and the class certification, reverses the summary judgment on unjust-enrichment liability, vacates the damages award, and remands.

I.

Sho-Me is a rural electric cooperative (REC) governed by Missouri’s Rural Electric Cooperative Law, Chapter 394 RSMo. Before 1992, Sho-Me got easements across thousands of parcels in southern Missouri. These easements’ language varies. They all grant Sho-Me the right to construct and operate an electric transmission line. Some grant the right to construct appurtenances or do things “necessary and useful to the enjoyment of the easement.” The district court broke the easements into several categories, three at issue in this appeal: Category 1A (“Easements for electric transmission line only or for electric transmission line with unspecified appurtenances”), Category IB (“Easements for electric transmission lines and appurtenances which include specific references to communications equipment”), and Category 1C (“Court orders condemning easements limited to electric transmission lines and generic appurtenances or specifying related communications equipment”). Sho-Me and Tech do not dispute the district court’s categorizations.

As part of its electrical transmission operations, Sho-Me communicates with unattended power substations. It used to do this by microwave radio frequencies. But in 1995, the Federal Communications Commission announced that these frequencies would no longer be available for utilities. In response, Sho-Me developed a plan. It installed fiber-optic cables alongside its electrical lines, using the cables for internal communications. It also formed Tech as a subsidiary company. Sho-Me assigned Tech the cables’ excess capacity so Tech could offer commercial telecommunications services to the public. Tech currently provides broadband services to individuals and businesses across southern Missouri.

In 2010 (in state court) and then in 2011 (in federal court), Michael and Gina Biffle, Dwight Robertson, and Chase Barfield— owners of land subject to Sho-Me easements — filed putative class actions against Sho-Me and Tech. They alleged Tech’s use of the fiber-optic cable for public-serving telecommunications purposes was not authorized by the easements, making Sho-Me and Tech liable for trespass and unjust enrichment. The district court certified a Rule 23(b)(3) class of “All persons who own or owned land in Missouri underlying Defendants’ electric-transmission lines that is burdened by an easement with either Defendant or their subsidiaries, which *799 easement does not contain an arbitration clause, and on or in which a Defendant has licensed the fiber optic cable for commercial-telecommunication uses or has used the fiber optic cable for commercial-telecommunication uses.” The district court entered summary judgment against Sho-Me and Tech, holding them liable for trespass and unjust enrichment on the Category 1A-C easements. 1 The landowners proceeded to a jury trial for damages on the unjust-enrichment claim alone. The jury awarded the landowners $79,014,140 for the “fair market rental value” of Sho-Me and Tech’s unauthorized use of the easements.

II.

Sho-Me and Tech contend that the district court erred iii granting summary judgment on liability because it misconstrued Missouri easement law. This court reviews de novo the district court’s summary judgment decision. Walker v. Hartford Life & Accident Ins. Co., 831 F.3d 968, 973 (8th Cir. 2016). It also reviews de novo the district court’s interpretation of Missouri law. Id. When interpreting Missouri law, this court is “bound by the decisions of the Supreme Court of Missouri. If the Supreme Court of Missouri has not addressed an issue, we must predict how the court would rule, and we follow decisions from the intermediate state courts when they are the best evidence of Missouri law.” Washington v. Countrywide Home Loans, Inc., 747 F.3d 955, 957-58 (8th Cir. 2014). Since the parties do not point to any genuine dispute of material fact, the question is whether Sho-Me and Tech’s use of the fiber-optic cable for commercial telecommunications makes it liable under Missouri law for trespass and unjust enrichment.

A.

The landowners argue — and the district court found — that Sho-Me and Tech are liable for trespass under Missouri law for exceeding the scope of Sho-Me’s easements. This argument raises two questions. First, did Sho-Me and Tech’s use exceed the scope of the easements? And second, if their use did exceed the scope of the easements, was it a trespass?

1.

An easement is “a right to use the land for particular purposes.” St. Charles Cty. v. Laclede Gas Co., 356 S.W.3d 137, 139 (Mo. banc 2011); Farmers Drainage Dist. of Ray Cty. v. Sinclair Ref. Co., 255 S.W.2d 745, 748 (Mo. 1953) (“An ‘easement’ is not the complete ownership of land with the right to use it for all lawful purposes perpetually and throughout its entire extent, but it is a right only to one or more particular uses.... ”). Some easements in Categories 1A-C explicitly refer to a purpose with language like “for the purpose of transmitting electric or other power,” “for electrification purposes,” “for electrical power utility and related communication purposes,” “for the purpose of transmitting and supplying electric energy.” Other easements do not explicitly state a “purpose,” but do specifically grant the right to construct an electric transmission line.

The parties agree that the easements give Sho-Me the right to install and use fiber-optic cables for internal communications related to supplying electricity. They disagree whether the easements give Sho- *800

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Cite This Page — Counsel Stack

Bluebook (online)
852 F.3d 795, 2017 WL 1160950, 2017 U.S. App. LEXIS 5435, Counsel Stack Legal Research, https://law.counselstack.com/opinion/michael-biffle-v-sho-me-power-electric-etc-ca8-2017.