44 F.4th 680
7th Cir.2022Background
- Finite Resources is majority owner of the abandoned Orient #1 coal mine in Franklin County, Illinois; DTE (later Keyrock) leased part of the mine and drilled two wells to extract coal‑mine methane.
- DTE obtained an Illinois Department of Natural Resources (IDNR) vacuum permit in 2007 to use a vacuum pump to extract methane; defendants operated under that permit for over a decade.
- Finite discovered extensive depletion of methane in 2018, petitioned IDNR for compulsory unitization (denied), and sued defendants for conversion, trespass, accounting, common‑law unitization, and injunctive relief to stop vacuum pumping.
- Defendants removed the case to federal court; the district court granted summary judgment for defendants, holding the rule of capture applies and Finite did not own unproduced gas.
- Finite appealed, arguing correlative rights prohibit vacuum pumping and that the Seventh Circuit should certify the question to the Illinois Supreme Court; the appellate court declined certification and affirmed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether correlative rights bar use of a vacuum pump to extract coal‑mine methane | Vacuum pumping intentionally wastes/depletes the common source and violates Finite’s correlative rights, so defendants may be liable | Rule of capture permits capturing migrating gas; use of pumps does not negate capture rule; IDNR permit implies regulatory approval | Correlative rights do not prevent vacuum pumping here; rule of capture controls; summary judgment for defendants |
| Whether Finite owned the unextracted methane to support conversion/trespass/accounting claims | Correlative rights entitle Finite to protection of a fair share and remedies for wrongful depletion | Under the rule of capture, gas is not owned until captured; no absolute ownership of in situ gas | Gas not owned until captured; claims that depend on ownership fail |
| Whether the Seventh Circuit should certify the vacuum‑pump/correlative‑rights question to the Illinois Supreme Court | Illinois law on vacuum pumps and correlative rights is unsettled; certification appropriate | IDNR regulation and existing authority make the answer sufficiently clear; issue unlikely to recur | Certification denied; court not genuinely uncertain about state law |
Key Cases Cited
- Brown v. Spilman, 155 U.S. 665 (1895) (articulates the rule of capture principle)
- Cont’l Res. of Illinois, Inc. v. Illinois Methane, LLC, 364 Ill. App. 3d 691 (2006) (applies rule of capture to migrating gas)
- Briggs v. Southwestern Energy Production Co., 224 A.3d 334 (Pa. 2020) (rule of capture applies even when production is assisted by pumps)
- Coastal Oil & Gas Corp. v. Garza Energy Trust, 268 S.W.3d 1 (Tex. 2008) (owners may use stimulation techniques that drain neighboring reservoirs)
- Flexible Steel Lacing Co. v. Conveyor Accessories, Inc., 955 F.3d 632 (7th Cir. 2020) (standard of review for summary judgment)