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Deyarmett v. Antero Resources Corp.

United States District Court, S.D. Mississippi, Southern Division

May 19, 2017




         BEFORE THE COURT is the [4] Motion to Dismiss filed by Defendant Antero Resources Corporation pursuant to Federal Rule of Civil Procedure 12. Plaintiff Robert Wayne Deyarmett has not responded to the Motion, and the time for doing so has long expired. See, e.g., Oviedo v. Lowe's Home Improvement, Inc., 184 F. App'x 411, 413 (5th Cir. 2006) (while pro se parties “are entitled to some leniency, the right of self-representation does not exempt a party from compliance with relevant rules of procedural and substantive law”) (citation and quotation marks omitted). The Court has reviewed the Motion, the Memorandum in Support, and the relevant law, and is of the opinion that the Motion should be granted for failure to join an indispensable party.

         Plaintiff, a Mississippi citizen currently incarcerated with the Mississippi Department of Corrections (“MDOC”), instituted a state court action against Defendant Antero. Plaintiff claims Antero owes him and/or his family oil and gas royalties and/or other payments pursuant to a March 2006 Oil and Gas Lease (“the Lease”) between Plaintiff and Antero. Antero did not receive notice of the state court action against it until Plaintiff filed an Amended Complaint therein and sent Antero a copy. Thereafter, Antero, a Delaware corporation with its principal place of business in Colorado, timely removed the action to this Court based on diversity jurisdiction. See 28 U.S.C. §§ 1332, 1446.[1] Following removal, Antero filed the pending Motion to Dismiss.

         Antero argues that (1) the Court lacks subject matter jurisdiction; (2) Plaintiff has failed “to join an indispensable party whose joinder is not feasible[;]” (3) Plaintiff has failed “to state a claim against Antero upon which relief can be granted[;]” and (4) the action should otherwise be “dismissed for insufficient process and insufficient service of process . . . .” (Mot. To Dismiss 2, ECF No. 4). While the Court is of the opinion that it has subject matter jurisdiction, the Court will dismiss this action because Plaintiff has failed to join an indispensable party, as discussed below. Accordingly, the Court need not address Antero's other arguments for dismissal.

         I. Subject Matter Jurisdiction

         The Court must address the challenge to its subject matter jurisdiction first. See Ramming v. United States, 281 F.3d 158, 161 (5th Cir. 2001). “On issues involving jurisdiction, the district court may consider evidence outside the pleadings . . . .” In re The Compl. of RLB Contracting, Inc., 773 F.3d 596, 601 (5th Cir. 2014).

         Antero argues that subject matter jurisdiction lies exclusively in the United States Bankruptcy Court for the Southern District of Texas, in which the Chapter 11 bankruptcy of Vanguard Natural Resources, LLC (No. 17-30560) is pending. In support, Antero has submitted a 2012 Purchase and Sale Agreement (“PSA”) between Antero and Vanguard Permian, LLC, a wholly-owned subsidiary of Vanguard Natural Resources, LLC (hereinafter “Vanguard”). Vanguard has identified the PSA - which lists Plaintiff's Lease as an Asset, (see PSA, ECF No. 4-3, at Ex. A p.36 (ECF p.105)) - as an executory contract in its bankruptcy. Antero states that Vanguard “assumed all obligations and liabilities arising from the Assets, including obligations to pay royalties and to perform all obligations previously imposed on Antero pursuant to the Oil and Gas Lease” that is the subject of this action. According to the PSA, Vanguard assumed all such obligations and liabilities, whether incurred before or after the PSA went into effect.

         Thus, Antero contends that monies owed under the Lease, if any, are Vanguard's property subject to the exclusive jurisdiction of the bankruptcy court pursuant to 28 U.S.C. § 1334(e). That section provides in pertinent part that the bankruptcy court[2] “shall have exclusive jurisdiction . . . of all the property, wherever located, of the debtor as of the commencement of [the bankruptcy] and of property of the estate . . . .” Contrary to Antero's argument here, that section

more properly denotes a grant by Congress of in rem jurisdiction over property of the debtor as of the commencement of the case and over property of the estate. Section 1334(e) must be harmonized with the provisions of § 1334(b) granting non-exclusive jurisdiction over matters ‘arising under, ' ‘arising in, ' and ‘related to' bankruptcy and/or bankruptcies. An action, in personam, that seeks to establish personal liability of the debtor on a claim, but which is not specifically targeted to ownership of, or rights in and to, property of the estate does not fall within this subsection. The bankruptcy court, pursuant to § 1334(e), retains jurisdiction over the disposition of any property of the debtor or the estate necessary to satisfy any such claim or judgment. . . . Thus, an in personam suit against a debtor, which has as its ultimate end the satisfaction of a claim from property of the debtor or the estate, may proceed in a forum other than bankruptcy court, assuming that the automatic stay has been modified, [3] without offending the exclusivity provision of § 1334(e) because the ultimate end of the suit, i.e., satisfaction of the judgment from property of the debtor or estate, cannot be had without dispensation from the bankruptcy court which exclusively controls the property of the debtors and its estate.

Landry v. Exxon Pipeline Co., 260 B.R. 769, 781-82 (Bankr. M.D. La. 2001).

         Here, then, even accepting arguendo Antero's argument that the property at issue is property of Vanguard's bankruptcy estate, the state court had initial subject matter jurisdiction over this in personam suit. As a result, this Court can now exercise subject matter jurisdiction over this action based on diversity.

         II. Failure To Join Indispensable Party

         Nevertheless, the Court is persuaded that Vanguard is an indispensable party to this action and that dismissal is appropriate on that ground. “Rule 12(b)(7) allows dismissal for ‘failure to join a party under Rule 19.'” HS Res., Inc. v. Wingate, 327 F.3d 432, 438 (5th Cir. 2003) (citing Fed.R.Civ.P. 12(b)(7)).

         “Rule 19 provides for the joinder of all parties whose presence in a lawsuit is required for the fair and complete resolution of the dispute at issue.” Id.; see also Pulitzer-Polster v. Pulitzer, 784 F.2d 1305, 1308 (5th Cir. 1986) (“The federal rules seek to bring all persons that may have an interest in the subject of an action together in one forum so that the lawsuit can be fairly and completely disposed of.”). “‘In ruling on a dismissal for lack of joinder of an indispensable party, a court may go outside the pleadings and look to extrinsic ...

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