MEMORANDUM OPINION AND ORDER DENYING DEFENDANTS’ MOTION TO DISMISS THE COMPLAINT AND GRANTING PLAINTIFF’S MOTION TO DISMISS THE COUNTERCLAIMS
This is а condemnation case arising from a prior civil action between defendants, Jeffery and Sandra"Moore (“the Moores”), and the plaintiff, Equitrans L.P. (“Equi-trans”). In that underlying civil action, Equitrans held a right-of-way over the Moores’ property to construct and maintain a natural gas pipeline. The Moores sued Equitrans, claiming that it built and maintained portions of the pipeline outside of the right-of-way, thereby breaching the right-of-way agreement and trespassing on the Moores’ property. After a trial, a jury found that two portions of the pipeline violated the right-of-way agreement or were trespassing. This Court stаyed a determination on whether to enter an ejectment order.
I.Background
In 1960, Equitrans entered into a right-of-way agreement with the Moores to build a pipeline under a portion of their property (“the 1960 right-of-way”). In 2012, the Moores sued Equitrans claiming that approximately 700 feet of the pipeline was built outside of the 1960 right-of-way (hereinafter referred to as “the underlying civil action”). Equitrans maintained that it constructed all portions of the pipeline within the 1960 right-of-way. Following a trial, a jury found that Equitrans’ placement of two portions of the pipeline either violated the 1960 right-of-way agreement or trespassed on the Moores’ property. The Moores did not claim monetary damages and sought only ejectment. This Court stayed execution of the judgment so that Equitrans could seek condemnation of a right-of-way through the property upon which it was found to be trespassing (“the Property”). The Property consists of two portions of the Moores’ property through which the pipeline runs, totaling approximately 0.56 acres.
Equitrans attempted to settle the underlying civil action before and after trial, but the Moores refused and countered with other demands. Equitrans then filed this condemnation action under 15 U.S.C. § 717f(h) to obtain a right-of-way through the Property (“the condemnation right-of-way”). The Moores filed a motion to dismiss the complaint for failure to state a claim, and an answer with counterclaims alleging vexatiоus litigation and trespass by Equitrans. Equitrans then filed a motion to dismiss the counterclaims.
II.Applicable Law
To survive a motion to dismiss under Rule 12(b)(6), “a complaint must contain sufficient factual matter, accepted as true, to ‘state a claim to relief that is plausible on its face.’ ” Ashcroft v. Iqbal,
III.Discussion
A. Motion to Dismiss the Complaint
To state a claim for condemnation under § 717f(h), the plaintiff must plead that: (1) it is a “holder of a certificate of рublic convenience and necessity”; (2) the right-of-way will be used for the construction, operation, or maintenance of a pipeline; and (3) it was unable to “acquire [the right-of-way] by contract, or [was] unable to agree with the owner of [the] property [as] to ... compensation.” 15 U.S.C. § 717f(h).
Equitrans’ complaint facially states a claim for condemnation under § 717f(h). It alleges that Equitrans holds a certificate of public convenience and necessity, issued by the Federal Energy Regulatory Commission, for the creation of the pipeline running through the Moores’ property. Equi-trans states that the Propеrty will be used to maintain and operate the pipeline, which is necessary for its transmission of natural gas in interstate commerce. Finally, Equi-trans plead that it “has attempted, but
Equitrans’ complaint clearly pleads all that is necessary for its condemnation claim to survive a motiоn to dismiss. However, the Moores argue that Equitrans’ claim fails for several other reasons: (1) Equitrans failed to comply with the Natural Gas Act; (2) condemnation was a compulsory counterclaim in the underlying civil action; (3) Equitrans should be judicially estopped from claiming that it did not comply with the 1960 right-of-way agreement; and (4) condemnation here would violate the Fifth Amendment’s Takings Clause.
1. Compliance With the Natural Gas Act
The Moores argue that Equitrans’ condemnation claim must be dismissed because it failed to comply with the Natural Gas Act in building the pipeline and in seeking condemnation. Specifically, the Moores argue that the 1960 right-of-way agreеment precludes condemnation of the Property under § 717f(h), and that Equi-trans unlawfully entered the Property before seeking a right-of-way or condemnation.
a. Existence of a Contract
The Moores argue that Equitrans obtained the necessary right-of-way from their predecessors in title in 1960, and thus Equitrans was able to “acquire by contract” the necessary right-of-way. However, the Property is not part of the 1960 right-of-way. See l:12-cv-123, ECF 102 at 4. The jury specifically found that, regarding the Property, the pipeline is not within the 1960 right-of-way or is trespassing. Moreover, the Moores seek to eject Equi-trans from the Property, which would essentially force it to dig up the existing pipeline and move it to a location within the 1960 right-of-way. While Equitrans does have the 1960 right-of-way, it also has the right to choose the route of the pipeline. See Williams v. Transcontinental Gas Pipe Line Corp.,
b. Pre-Condemnation Occupation ‘ of Property
The Moores argue that Equitrans failed to comply with § 717f(h) because it entered and used the Property without first seeking a right-of-way agreement or condemnation. Thus, the Moores argue that Equitrans acted in bad faith and did not attempt to obtain the right-of-way before entering the Property.
First, this Court cannot conclude that Equitrans seeks condemnation in bad faith.
Second, § 717f(h) does not require the condemnor to seek condemnation before entering the property. The prior unauthorized occupation' of property to be condemned does not preclude condemnation. See Searl v. Sch. Dist. No. 2, of Lake Cnty.,
The Moores argue that this case is analogous to Humphries v. Williams Natural Gas Co.,
2. Compulsory Counterclaim
The Moores argue that Equitrans waived its condemnation claim because it constituted a compulsory counterclaim in the underlying civil action that Equitrans failed to file.
Federal Rule of Civil Procedure 13(a) requires a party to file as a counterclaim any claim that “arises out of the
Here, Equitians’ condemnation claim became mature after it served its answer in the underlying civil action. Equi-trans maintained throughout the underlying. civil action that its pipeline was within the I960 right-of-way. The core factual and legal issue in that case was whether Equi-trans had a contractual right to a right-of-way over the Property. Section 717f(h)’s requirement that Equitrans be unable to contract for the condemnation right-of-way was logically dependent upon the resolution of the underlying civil action. If Equi-trans was within the 1960 right-of-way, it would have had a contract for the necessary right-of-way and condemnation would not be available. Therefore, Equitrans’ condemnation claim could not have matured until after the pipeline was found to be outside the 1960 right-of-way.
Even so, Equitrans’ condemnation claim was not a compulsory counterclaim in the underlying civil action. To determine whether a counterclaim is compulsory, this Court must consider: (1) whether “the issues of fact and law” raised by the claim and the counterclaim are “largely the same”; (2) whether res judicata would bar ' a subsequent suit on the ... counterclaim”; (3) whether “substantially the same evidence” supports or refutes both the claim and the counterclaim; and (4) whether'any “logical relationship” exists between the claim and the counterclaim. Painter v. Harvey,
The facts and law applicable to this condemnation claim, as well as the evidence required to support it, are very different from those required in the Moores’ trespass and breach of contract claims in the underlying civil action. Res judicata would not bar this condemnation action because the underlying civil аction did not resolve any factual issues pertinent to this case other than a determination that .the relevant portions of the pipeline are outside the 1960 right-of-way or are trespassing.
Although the jury found in the underlying civil action that Equitrаns did not comply with the 1960 right-of-way or was trespassing on the Property, the Moores argue that judicial estoppel-should apply to hold Equitrans to its losing position: that Equi-trans complied with the 1960 right-of-way.
Judicial estoppel applies only if: (1) “the party sought to be estopped ... [is] seeking to adopt a position that is inconsistent with a stance taken in prior litigation”; (2) “the prior inconsistent position ... [was] accepted by the court”; and (3) “the party against whom judicial estop-pel is to be applied ... intentionally misled the court to gain unfair advantage.” Zinkand v. Brown,
The Moores argue that in the underlying civil action, Equitrans took the position that it complied with the 1960 right-of-way, but now says that it did not comply with the 1960 right-of-way in regard to the property. However, the jury verdict in the underlying civil action provides that Equitrans in fact did not comply with the 1960 right-of-way regarding the property. The Moores are essentially asking this court to hold Equitrans to its losing position in the underlying civil action, which is factually inconsistent with the verdict. But judicial estoppel applies only where the party to be estopped took a prior position that was “accepted by the court,” Zinkand,
4.Unconstitutional Taking
The Moores argue that condemnation here would violate the Fifth Amendment’s Takings Clause. Specifically, they argue that Equitrans lacks a public purpose in condemning the property and that the taking would be excessive.
The Fifth Amendment to the United States Constitution permits the tаking of private property only “for public use” and with “just compensation.” U.S. Const, amend. V. To satisfy the public use requirement, a taking need only be “rationally related to a conceivable public purpose.” Hawaii Housing Auth. v. Midkiff,
First, Equitrans has a public purpose in condemning the property under the Natural Gas Act. In passing the Natural Gas Act, Congress concluded that “the business of transporting and selling natural gas for ultimate distribution to the public is affected with a public interest, and that federal regulation in matters relating to the transportation [and sale] of natural gas ... is necessary in the public interest.” 15 U.S.C. § 717(a). The Natural Gas Act is a valid exercise of Congress’ power to regulate iriterstate commerce, Fed. Power Comm’n v. Natural Gas Pipeline Co. of Am.,
It therefore follows that Equitrans’ condemnation claim does not violate the’ Fifth Amendment if its pleadings are sufficient to state a condemnation claim under § 717f(h). Equitrans sufficiently plead its condemnation claim and, therefore, has a public purpose in condemning the property under § 717f(h).
Second, the Moores argue that condemnation of the property would constitute an excessive taking because it is not strictly necessary for Equitrans to maintain the pipeline and provide gas to its customers. The Moores rely on City of Cincinnati v. Vester,
B. Equitrans’ Motion to Dismiss the Moores’ Counterclaims
Equitrans argues that this Court should dismiss the Moores’ counterclaim because it’ is barred under Federal Rule of Civil Procedure 71.1(e)(3). Equitrans argues that the only responsive pleading allowed under Rule '71.1(e)(3) is an answer and not á counterclaim. The Moores argue that a counterclaim is not a pleading and'therefore is not barred under that Rule.
Rule 71.1(e)(3) provides that
Á defendant waives all objections and defenses not stated in its answer. No other pleading or motion asserting an additional objеction or defense is allowed. But at the trial on compensation, a defendant — whether or not it has previously appeared ' or answered — may present evidence on the, amount of compensation to be paid and may share in the award.
Fed R. Civ. P. 71.1(e)(3). After extensive research into this matter, this Court concludes that a counterclaim is not .a pleading, but is nevertheless barred under Rule 71.1(e) because it is not an objection or defense to the condemnation claim.
First, a counterclaim is not a pleading, but is a claim for relief that may be stated in a pleading. Federal Rule оf Civil Procedure 7(a) provides an exhaustive definition of “pleading” as used in the - Rules. Rule 7(a) states that “[o]nly these
Second, as a “claim for relief’ that may be stated in a pleading, a countеrclaim is barred by Rule 71.1(e) because it is not an objection or defense to the condemnation claim. Rule 71.1(e) expressly “prescribes what matters the answer should set forth.” Fed. R. Civ. P. 71.1 advisory committee’s notes to 1951 Addition, Note to Subdivision (e). Rule 71.1(e) provides that if a defendant “has' an objection or defense to the taking,” he may serve an answer, and “the answer must: (A) identify the property in which the defendant claims an interest; (B) state the nature and extent of the interest; and (C) state all the defendant’s objections and defenses to the taking.” Fed. R. Civ. P. 71.1(e)(2). Nowhere does the rule state that the defendant may plead any claims for relief. Moreover, Rule 71.1(a) expressly states that the other Federal Rules of Civil Procedure do not apply to condemnation proceedings unless Rule 71.1 provides otherwise, and Rule 71.1 does not invoke-the application of other rules regarding what may be plead in an' answer. This makes sense because Rule 71.1 provides for the narrow adjudication' of only the condemnation claim by requiring “[o]ne pleading to raise all objections and defenses to the taking and=one hearing to dispose of them ..., not successive pleadings and successive hearings spanning a muсh longer period of time.” Atl. Seaboard Corp. v. Van Sterkenburg,
Equitrans - cites various authоrities for the proposition that Rule 71.1(e)(3) categorically bars counterclaims as unauthorized pleadings. But,.after thoroughly reviewing these authorities and the body, of case law on this matter, this Court finds no credible authority to support Equitrans’ position. -Rather, the district courts that have concluded that Rule 71.1(e)(3) cate
Equitrans cites a foоtnote in Washington Metropolitan Area Transit Authority v. Precision Small Engines,
Equitrans also relies on Columbia Gas Transmission, LLC v. 14.96 Acres, No. 2:14-cv-27773,
The Columbia Gas court also relied on various district court decisions, which all seem to this Court to misinterpret the above discussed authority and conclude that counterclaims are categorically barred under Rule 71.1(e). The court cited Kansas Pipeline Co. v. 200 Foot by 250 Foot Piece of Land,
IV. Conclusion
The plaintiffs complaint sufficiently pleads its condemnation claim, and the defendants’ counterclaims are barred under Rule 71.1(e). Accordingly, the defendants’ motion to dismiss the complaint (ECF No. 6) is DENIED, and the plaintiffs motion to dismiss the counterclaims (ECF No. 10) is GRANTED.
IT IS SO ORDERED.
The Clerk is DIRECTED to transmit a copy of this memorandum opinion and order to counsel of record herein.
Notes
. Courts are split on whether § 717f(h) requires good faith negotiations. The Ninth Circuit requires proof that the plaintiff engaged in good faith negotiations, Transwestern Pipeline Co. v. 17.19 Acres,
. "For the doctrine of res judicata to be applicable, there must be: (1) a final judgment on the merits in a prior suit; (2) an identity of the cause of action in both the earlier and the later suit; and (3) an identity of parties or their privies in the two suits.” Pueschel v. United States,
. Although the Crawford court correctly concluded that counterclaims are not pleadings, this Court believes that the Crawford court incorrectly concluded that Rule 71.1(e) therefore did not bar counterclaims.
