Triad Hunter, LLC v. Eagle Natrium, LLC
| Decision Date | 11 March 2019 |
| Docket Number | No. 18 MO 0012,18 MO 0012 |
| Citation | 2019 Ohio 940,132 N.E.3d 1272 |
| Parties | TRIAD HUNTER, LLC, Plaintiff-Appellant, v. EAGLE NATRIUM, LLC et al., Defendants-Appellees. |
| Court | Ohio Court of Appeals |
Atty. Robert M. Stonestreet, Atty. Matthew S. Casto Atty. Timothy M. Miller, Babst, Calland, Clements & Zomnir, P.C., BB & T Square, 300 Summers Street, Suite 1000, Charleston West Virginia 25301, for Plaintiff-Appellant.
Atty. Melanie Morgan Norris, Steptoe & Johnson, PLLC, 1233 Main Street, Suite 3000, Wheeling, West Virginia 26003 and Atty Russell J. Ober, Jr, Atty. Antoinette C. Oliver, Meyer, Unkovic & Scott, LLP, 535 Smithfield Street, Suite 1300, Pittsburgh, Pennsylvania 15222-2315 for Defendants-Appellees.
BEFORE: Carol Ann Robb, Gene Donofrio, Cheryl L. Waite, Judges.
OPINION AND JUDGMENT ENTRY
{¶1} Plaintiff-Appellant Triad Hunter, LLC appeals the judgment of the Monroe County Common Pleas Court granting the motion to dismiss filed by Defendant-Appellee Eagle Natrium, LLC et al. Appellant contends the court erred in dismissing the complaint based on a lack of personal jurisdiction, urging the court misapplied the purposeful availment prong of the constitutional test for ascertaining whether there is personal jurisdiction in Ohio. We agree and find the trial court had personal jurisdiction. Appellant next contests the trial court's alternative ruling that the action should be dismissed under the doctrine of forum non conveniens. We find this decision unreasonable under the totality of the circumstances. In accordance, the trial court's decision is reversed, and the case is remanded.
{¶2} On April 16, 2018, Triad Hunter filed a complaint in Monroe County, Ohio against Eagle Natrium, Axiall Corporation, and Westlake Chemical Corporation asserting causes of action for: negligence in solution mining; trespass by causing fluids and high pressure to enter Triad Hunter's property which impaired Triad Hunter's minerals and damaged the subsurface; conversion of Triad Hunter's minerals such as salt; nuisance which interferes with Triad Hunter's use of its property; violation of a statute which prohibits solution mining in Ohio without a permit; and injunctive relief.
{¶3} Triad Hunter is a Delaware company engaged in the exploration for and production of oil and gas with an office in Marietta, Ohio. In 2014, Triad Hunter purchased or leased all of the mineral rights on certain property along the Ohio River in Monroe County. Triad Hunter states it drilled three wells on its upper well pad in 2014, with future plans to engage in hydraulic fracturing at the Utica Shale layer (11,000 feet). Upon reentry into the wells in 2017, damage was discovered to the well bore casing at the Salina formation (5,900-6,800 feet). (Later testing in 2018 showed additional subsidence and brine fluid containing water from the Ohio River.)
{¶4} As a result, these wells were idled and a new well was drilled at a different location on the well pad. While drilling with air, Triad Hunter unexpectedly encountered salt water, hydrogen sulfide (a toxic gas), and abnormal pressure at the Salina formation where it seemed caverns had formed therein, all allegedly a result of the solution mining activities of the Natrium facility on the other side of the river. As a result of these conditions, Triad Hunter had to use a costlier drilling and casing method to complete the well, but risks to the well remain.
{¶5} Eagle Natrium (a Delaware limited liability company with a principal place of business in Texas) operates a chlor-alkali chemical manufacturing plant along the Ohio River in Natrium, West Virginia (Marshall County). Most of the plant's assets and liabilities were owned by Axiall (a Delaware corporation, with a principal place of business in Texas, registered to do business in Ohio, and said to conduct business operations in Ohio). Axiall was merged into Westlake Chemical Corporation, a Delaware corporation with a principal place of business in Texas with business conducted in Ohio through a wholly-owned subsidiary (which subsidiary is registered to do business in Ohio). It was said employees of Axiall and Westlake operate the Natrium facility.
{¶6} The Natrium facility engages in solution mining in the Salina formation to obtain salt to use in its manufacture of chemicals. The Natrium facility has subsurface brine fields where salt and other minerals are dissolved using water obtained in part from the Ohio River and injected into underground mineral formations. The resulting brine solution is pumped to the surface where minerals are extracted from the solution. This can create caverns in the Salina formation and result in subsidence there and in the Marcellus shale formation (which lies above the Salina formation).
{¶7} The complaint filed by Triad Hunter alleged the salt caverns from the Natrium facility extend under the Ohio River and into Triad Hunter's property in Ohio as the defendants have solution-mined salt and other minerals from property they do not own in the Salina formation. The complaint alleged various caverns were known to have been created years earlier as the Natrium facility complained about "communication" in 2013 between Marcellus shale wells on the lower well pad of Triad Hunter's property and the defendants' southern solution mining wells. It was noted the stimulation of a Marcellus shale well is only expected to result in pressure and fluid traveling less than 500 feet (rather than a half mile away to the southern fields of the Natrium facility).
{¶8} In response to the complaint, the defendants filed a motion to dismiss on May 17, 2018. The defendants attached affidavits to the dismissal motion. The affidavit of the site manager of the Natrium facility stated the facility cannot store large amounts of brine and cannot operate with a lengthy interruption in the brine supply. It was noted that Triad Hunter's wells at issue in the current suit are almost two miles from the Natrium facility (without discussing the distance from the brine fields). An affidavit confirmed the 2013 pressure experienced in the brine wells when Triad Hunter stimulated wells in the Marcellus shale formation. It also disclosed that Eagle Natrium sued Triad Hunter in West Virginia as a result of the 2013 communication between wells and that suit was settled in 2017.
{¶9} As a result of the more recent communication, Triad Hunter filed a West Virginia action (mostly mirroring the within suit) against the current defendants on November 27, 2017. The defendants attached that complaint to their motion to dismiss and complained of forum shopping. The affidavit of an attorney for Eagle Natrium acknowledged Triad Hunter had a pending motion to voluntarily dismiss the West Virginia action, which Eagle Natrium would oppose during an oral argument scheduled in West Virginia for June 4, 2018.
{¶10} Initially, the motion to dismiss raised a lack of personal jurisdiction under Civ.R. 12(B)(2). The defendants requested an evidentiary hearing where Triad Hunter would have the burden of demonstrating personal jurisdiction by a preponderance of the evidence. The defendants noted Triad Hunter's reliance on the long-arm statute and argued the next step was not satisfied as the exercise of personal jurisdiction would deprive them of their constitutional right to due process. They claimed they did not "purposely avail" themselves of the privilege of acting in or causing a consequence in the forum state and the exercise of personal jurisdiction would not comport with the principles of fair play and substantial justice due to the switching of venues midstream and the West Virginia interests at stake. The motion to dismiss alternatively argued that even if personal jurisdiction was proper, the court should dismiss the case under the doctrine of forum non conveniens. The defendants argued the public and private interests called for the suit to proceed in West Virginia rather than Ohio.1
{¶11} Triad Hunter responded on June 4, 2018, asserting the Natrium facility begins its activities in West Virginia but extends into Ohio where minerals are being stolen while infrastructure and subsurface are being damaged. It was noted the defendants contradict themselves by alleging a lack of personal jurisdiction in Ohio while alleging a lack of "subject matter jurisdiction" in West Virginia; attached was the defendants' answer filed in the 2017 West Virginia action containing a defense that the West Virginia court "lacks subject matter jurisdiction over activity that is alleged to have occurred and caused damage outside the State of West Virginia." As for personal jurisdiction in Ohio, Triad Hunter's response cited four provisions in the long-arm statute, R.C. 2307.382(A)(1),(3),(6), and (8), and argued the constitutional step was satisfied as: the defendants purposefully availed themselves of the privilege of acting or causing a consequence in Ohio; the cause of action arose from the activities in Ohio; and the acts or consequences have a substantial connection with Ohio to make the exercise of jurisdiction reasonable.
{¶12} Regarding forum non conveniens, Triad Hunter's response provided an analysis of the private and public interests to be weighed and concluded the scale tipped in favor of allowing the case to proceed in the forum chosen by the plaintiff. Triad Hunter emphasized its substantial connection to Ohio where it owns realty that was trespassed upon and damaged. It was urged the defendants disingenuously argue against forum shopping where the Ohio suit was filed after the defendants claimed there was no "subject matter jurisdiction" in West Virginia due to the activity at issue occurring in Ohio. Triad Hunter also claimed the defendants failed to agree to submit to jurisdiction in West Virginia in order to allow the Ohio court to dismiss under Civ.R. 3(D).
{¶13} On June 8, 2018, the defendants filed a reply. They disclosed their request...
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