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Baatz v. Columbia Gas Transmission, LLC

United States Court of Appeals, Sixth Circuit

July 10, 2019

Richard Baatz, et al., Plaintiffs-Appellants,
v.
Columbia Gas Transmission, LLC, Defendant-Appellee.

          Argued: November 27, 2018

          Appeal from the United States District Court for the Northern District of Ohio at Cleveland. No. 1:14-cv-00505-Thomas M. Parker, Magistrate Judge.

         ARGUED:

          Rick L. Ferrara, THE LINDNER LAW FIRM, LLP, Cleveland, Ohio, for Appellants.

          Paul K. Stockman, KAZMAREK MOWREY CLOUD LASETER LLP, Pittsburgh, Pennsylvania, for Appellee.

         ON BRIEF:

          Rick L. Ferrara, Daniel F. Lindner, THE LINDNER LAW FIRM, LLP, Cleveland, Ohio, for Appellants.

          Paul K. Stockman, KAZMAREK MOWREY CLOUD LASETER LLP, Pittsburgh, Pennsylvania, Alexander M. Madrid, MCGUIRE WOODS LLP, Pittsburgh, Pennsylvania, Jodie Hermann Lawson, MCGUIRE WOODS LLP, Charlotte, North Carolina, for Appellee.

          Before: THAPAR, BUSH, and NALBANDIAN, Circuit Judges.

          OPINION

          JOHN K. BUSH, Circuit Judge.

         Richard Baatz and fifty other landowners in Medina, Ohio ("Landowners") appeal the district court's grant of summary judgment to Columbia Gas Transmission, LLC ("Columbia Gas") on Landowners' state-law trespass and unjust enrichment claims involving underground storage of natural gas. Among other things, this case concerns an unusual situation in which, as to one of the claims on which appellee Columbia Gas was found liable (unjust enrichment), it is content to pay the damages awarded even though its position is that no liability should have been imposed at all. A question arises, therefore, as to whether Columbia Gas needed to file a cross-appeal in order to defend the damages award based on an argument that it had no liability on the underlying claim. For the reasons explained below, we hold that no such cross-appeal on liability was necessary, and we AFFIRM the judgment of the district court in all respects.

         I.

         This dispute concerns a natural gas storage area known as the Medina Storage Field, located within the Clinton sandstone formation and approximately 3, 000 feet underground in Medina, Ohio.[1] Columbia Gas injects natural gas into the Medina Storage Field (and other storage fields) during the summer months when gas demand is low and withdraws the stored gas during the winter months when demand is high. Landowners own property either directly above or near the boundary of the Medina Storage Field. Although Columbia Gas or its predecessor in interest has been storing gas in the Medina Storage Field since 1959, the earliest that any Landowner purchased any property at issue was September of 1990. Landowners argue that Columbia Gas intentionally invaded the subsurface of their properties to store natural gas without their permission and unjustly enriched itself by using their land without paying fair market rental value for the easement they claim is needed to use the subsurface.

         Columbia Gas is subject to the Natural Gas Act ("NGA") and is regulated by the Federal Energy Regulatory Commission ("FERC"). Under the NGA, FERC may issue certificates of public convenience and necessity to authorize the construction and maintenance of facilities related to the natural gas industry. 15 U.S.C. § 717f(c). The NGA also authorizes the FERC certificate holder (e.g., Columbia Gas) to obtain the necessary property by eminent domain if the certificate holder "cannot acquire by contract, or is unable to agree with the owner of property to the compensation to be paid." Id. § 717f(h). The NGA does not require the certificate holder to acquire the property it uses for its natural gas storage; the statute merely authorizes acquisition. See id.

         Columbia Gas or its predecessor in interest has been a certificate holder of the Medina Storage Field since 1958, but Columbia Gas did not attempt to obtain any easement rights for the Medina Storage Field until September 2013. At that time, Columbia Gas wrote letters to Landowners offering to purchase a subsurface easement under each of their properties. Landowners rejected Columbia Gas's offer and filed suit soon thereafter, asserting claims for (1) Trespass, (2) Unjust Enrichment-Use of Property for Storage, (3) Mandamus-Inverse Condemnation, (4) Declaratory Judgment, and (5) Permanent Injunction. These claims were similar to those in a different class action, Wilson v. Columbia Gas Transmission, LLC, No. 2:12-cv-01203 (S.D. Ohio 2012). Wilson involved Columbia Gas but did not include the Landowners. Soon after Landowners filed suit, Columbia Gas filed an amended counterclaim in Wilson, adding Landowners as defendants in that case. As part of this filing in Wilson, Columbia Gas sought condemnation to establish easements in the subsurface of Landowners' properties. Columbia Gas then moved to dismiss the present case, arguing that Wilson had "first to file" priority. The district court granted the motion, but this court reversed. See Baatz v. Columbia Gas Transmission, LLC, 814 F.3d 785, 787-88 (6th Cir. 2016).

         On remand, Columbia Gas and Landowners jointly requested to sever their claims in Wilson and to transfer that case to the United States District Court for the Northern District of Ohio. This request was granted, and Wilson was transferred and re-captioned as ...


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