Case 2:12-md-02311-SFC-RSW ECF No. 2114-14, PageID.38407 Filed 02/17/21 Page 1 of 8
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`EXHIBIT 4
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`Case 2:12-md-02311-SFC-RSW ECF No. 2114-14, PageID.38408 Filed 02/17/21 Page 2 of 8
`Hazard Coal Corp. v. Kentucky West Virginia Gas Co., L.L.C., 311 F.3d 733 (2002)
`159 Oil & Gas Rep. 1, Util. L. Rep. P 14,429, 33 Envtl. L. Rep. 20,106...
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`311 F.3d 733
`United States Court of Appeals,
`Sixth Circuit.
`
`HAZARD COAL CORPORATION, Perry
`County Coal Corporation, and Locust
`Grove, Inc., Plaintiffs–Appellants,
`v.
`KENTUCKY WEST VIRGINIA GAS
`COMPANY, L.L.C., Defendant–Appellee.
`
`No. 01–5179.
`|
`Argued: Aug. 8, 2002.
`|
`Decided and Filed: Nov. 13, 2002.
`
`Synopsis
`Owner of mineral rights, its lessee, and coal mining company
`brought action against gas pipeline company, asserting that
`defendant had to pay for the relocation of its pipelines when
`such pipelines needed to be moved in order for plaintiffs to
`mine underlying coal. On parties' cross-motions for summary
`judgment, the United States District Court for the Eastern
`District of Kentucky, Joseph M. Hood, J., granted summary
`judgment to defendant, and plaintiffs appealed. The Court
`of Appeals, Merritt, Circuit Judge, held that: (1) defendant's
`“sister” corporation, not defendant, owned the gas flowing
`through the pipelines, for purposes of the subject deeds and
`leases, and (2) plaintiffs acquiesced in defendant's practice
`of transporting its affiliate's gas through the pipelines, and so
`were estopped from now objecting to that practice or from
`refusing to pay the cost of relocating the pipelines when they
`had done so previously.
`
`Affirmed.
`
`Attorneys and Law Firms
`
`*734 Jay E. Ingle (argued and briefed), JACKSON &
`KELLY, Lexington, Kentucky, for Appellants.
`
`Wayne F. Collier (argued and briefed), Kinkead & Stilz,
`Lexington, Kentucky, for Appellee.
`
`Jeffrey J. Yost (briefed), Jackson & Kelly, Lexington,
`Kentucky, for Appellants.
`
`Shelby C. Kinkead, Jr. (briefed), Kinkead & Stilz, Lexington,
`Kentucky, for Appellee.
`
`Before: MERRITT and DAUGHTREY, Circuit Judges;
`WEBER, District Judge. *
`
`*735 OPINION
`
`MERRITT, Circuit Judge.
`
`In this Kentucky diversity case, the question on appeal is
`whether plaintiffs or defendant must pay for the relocation
`of defendant's existing gas pipelines where plaintiffs wish to
`mine areas underlying these pipelines. Plaintiffs are Hazard
`Coal Corporation, the owner of surface and mineral rights
`on the contested property, its lessee, Perry County Coal
`Corporation, and Locust Grove, Inc., the mining company
`hired by Perry County Coal. Defendant is a gas pipeline
`company, Kentucky West Virginia Gas Company, L.L.C.,
`the holder of pipeline easements across the property in
`question. The district court granted summary judgment
`to Kentucky West, holding that the easements granted to
`Kentucky West are sufficient to give it the right to require
`plaintiffs to pay for relocating the pipelines pursuant to
`Kentucky law. Unlike the district court, we find that the
`easements, by their terms, do not explicitly require plaintiffs
`to pay for the relocation because Kentucky West is using
`the pipelines to transport gas belonging to a sister company,
`Equitable Production Company, a separate corporate entity,
`an arrangement not contemplated by the express terms of the
`easements. However, because the parties have had extensive
`prior dealings over a number of years in which the plaintiffs
`have acquiesced to the use of the pipelines to transmit gas
`owned by a company other than Kentucky West, we find that
`the plaintiffs have waived any claim to invoke the easement
`language alone as a bar to paying for the cost of relocating the
`pipelines. We therefore AFFIRM the decision of the district
`court.
`
`I. Background
`
`The facts in this case are basically undisputed. Hazard
`Coal owns mineral rights on certain lands in Perry County,
`Kentucky. Hazard Coal has leased some of these interests to
`Perry County Coal, which in turn hired Locust Grove to mine
`these properties. Kentucky West is a gas pipeline operating
`company that owns and operates pipelines over Hazard Coal's
`
` © 2021 Thomson Reuters. No claim to original U.S. Government Works.
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`Case 2:12-md-02311-SFC-RSW ECF No. 2114-14, PageID.38409 Filed 02/17/21 Page 3 of 8
`Hazard Coal Corp. v. Kentucky West Virginia Gas Co., L.L.C., 311 F.3d 733 (2002)
`159 Oil & Gas Rep. 1, Util. L. Rep. P 14,429, 33 Envtl. L. Rep. 20,106...
`
`mineral interests, and Kentucky West also provides well
`services to Equitable Production Company, the company that
`owns the gas flowing through Kentucky West's pipelines
`across the property in question. Kentucky West and Equitable
`Production are “sister corporations,” that is, they are both
`subsidiaries of the parent company, Equitable Resources
`Energy Company, making them corporate affiliates. Each
`company is a separate corporate entity under Kentucky law.
`
`Kentucky West's rights to develop oil and gas on the lands
`in question were conveyed via three separate instruments.
`In the first instrument, executed on November 18, 1926,
`Hazard Coal conveyed certain oil and gas interests by deed
`to R.J. Graf and his wife, and their heirs, representatives,
`successors and assigns. 1 *736 The Grafs subsequently
`sold their interest in this property to the predecessor of
`Kentucky West—Kentucky West Virginia Gas Company, Inc.
`—on December 1, 1927. In the second instrument, executed
`on June 6, 1927, William and Anthony Vizard conveyed
`by deed certain oil and gas interests to R.J. Graf, his heirs,
`representatives, successors and assigns. 2 On December 1,
`1927, Graf and his wife also sold these interests to Kentucky
`West's predecessor, Kentucky West Virginia Gas Company.
`*737 In the third instrument, executed on November 1,
`1963, Hazard Coal leased additional gas and oil rights
`on another tract of land to Kentucky West Virginia Gas
`Company, the predecessor to Kentucky West. 3 In all cases,
`Hazard Coal retained the underground and surface coal estates
`in the property and retains those rights today. These are the
`three instruments out of which all of Kentucky West's rights
`arise concerning the pipelines at issue.
`
`These instruments expressly grant to Kentucky West's
`predecessor the right to drill for oil and gas and the right to
`build pipelines to transport the gas produced. In the 1960s,
`Kentucky West's predecessors began developing the property
`at issue. At that time, Hazard Coal was not actively coal
`mining the area. Over time, Kentucky West or its predecessor
`built an interconnected system of wells and pipelines over
`the property. Some of the pipelines gather and collect gas
`to service wells drilled on that property, others transmit gas
`across the property from wells drilled on other property. The
`pipelines at issue here are five transmission lines that do not
`directly connect to any wells on the property and are not used
`to pump gas from other wells owned by Kentucky West.
`
`On January 1, 1986, Kentucky West's predecessor, Kentucky
`West Virginia Gas Company, conveyed the wells and natural
`gas to Equitable Production's predecessor in a corporate
`
`restructuring. Subsequently, Kentucky West Virginia Gas
`Company became Kentucky West Virginia Gas Company,
`L.L.C. No physical changes occurred to the wells or pipelines,
`but the gas that flows through the pipelines at issue that
`was previously owned by Kentucky West is now owned by
`Kentucky West's corporate affiliate, Equitable Production,
`due to the corporate restructuring.
`
`When the pipelines needed to be moved in order for plaintiffs
`to mine underlying coal, Locust Grove requested that
`Kentucky West remove or relocate the pipelines. Kentucky
`West refused to do so unless plaintiffs paid the costs of
`relocation. Plaintiffs initiated this action in a Kentucky state
`court, which was removed to federal court based on diversity
`jurisdiction. Both sides motions for summary judgment. The
`district court granted defendant's motion and this appeal
`followed.
`
`II. Analysis
`
`Plaintiffs maintain that Kentucky West has never obtained
`the right to maintain and operate transmission lines across
`the property for the purpose of transporting gas owned by a
`company other than Kentucky *738 West. Plaintiffs main
`argument is that the deeds and lease grant the right to build and
`maintain collection and gathering lines to serve gas owned by
`Kentucky West only, and do not give Kentucky West the right
`to build transmission lines to serve the gas market generally,
`even a company that is a corporate affiliate. In other words,
`plaintiffs argue that the transmission lines across the property
`for the purpose of transporting Equitable Production's gas
`exceed the rights granted in the original conveyances and,
`therefore, plaintiffs should not be responsible for relocation
`of unauthorized pipelines.
`
`Plaintiffs contend that Kentucky West should have obtained
`authorization to transmit gas belonging to other companies
`or, alternatively, that the district court should have undertaken
`to determine if using the transmission lines to transport gas
`that does not belong to Kentucky West is a “reasonable use,”
`as that term is defined under Kentucky law. In either event,
`plaintiffs contend that the because Kentucky West did not
`receive authorization under the original conveyances to build
`the larger transmission lines and because no analysis has been
`undertaken to determine if such lines are a reasonable use
`within the parameters of the original conveyances, Kentucky
`West must bear the cost of relocating the contested pipelines.
`
` © 2021 Thomson Reuters. No claim to original U.S. Government Works.
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`Case 2:12-md-02311-SFC-RSW ECF No. 2114-14, PageID.38410 Filed 02/17/21 Page 4 of 8
`Hazard Coal Corp. v. Kentucky West Virginia Gas Co., L.L.C., 311 F.3d 733 (2002)
`159 Oil & Gas Rep. 1, Util. L. Rep. P 14,429, 33 Envtl. L. Rep. 20,106...
`
`We first look to the express terms of the three instruments
`under which Kentucky West's rights arise. Although plaintiffs
`are correct that transmission lines across the property for the
`purpose of transporting gas not owned by Kentucky West
`is not expressly authorized, neither do we see where it is
`expressly prohibited. As discussed below, plaintiffs may be
`correct when they argue that the ownership of the wells by a
`separate and distinct legal entity may change the relationship
`under the original grants. However, to the extent that the deed
`language and the lease permit Kentucky West to “assign” its
`rights to transport gas across the property to another entity,
`that right of assignment might cover the current situation if
`Kentucky West has or could assign its rights under the deeds
`and lease to Equitable Production. To date, no assignment has
`ever been made as far as we can tell from the record. Because
`the parties have not fully addressed this issue and because,
`as discussed below, we find that equitable principles require
`plaintiffs to pay for the relocation, we do not rest our holding
`on the assignment issue. But we note that the language in the
`deeds and the lease, standing alone, seems to allow Kentucky
`West to assign its rights under the instruments to an assignee.
`
` In addition, as a Kentucky court recently held, public
`policy also supports allowing Kentucky West to assign
`the right to use a leasehold to transport oil and gas from
`other properties for economic reasons. Lucas v. Equitable
`Resources Exploration, No. 98–CI–00014 (Pike Cty. Cir. Ct.
`Aug. 24, 2000). Based on the language in the deeds and lease,
`and Kentucky law, it is likely that an assignment could be
`made and would be upheld by the Kentucky courts in this
`situation.
`
`Because the documents do not answer the question of which
`party should pay for the pipeline relocation, we look to
`Kentucky law. Both parties rely on Elk Horn Coal Corp. v.
`Kentucky–West Virginia Gas Co., 317 S.W.2d 472 (Ky.1957),
`to support their positions. In Elk Horn, the court relied
`on the “correlative rights” doctrine to hold that when both
`the mineral owner and the oil and gas owner have rights
`attendant to their operations on the property, and they are
`using them reasonably, the mineral owner, as the holder of the
`dominant estate, generally must pay for *739 the relocation
`of the gas lines. Plaintiffs rely on Elk Horn by pointing
`out that Kentucky West has exceeded its rights under the
`plain language of the deeds and lease conveying rights to
`gather oil and gas on the property and that Kentucky West
`never obtained an easement or a right-of-way to allow such
`transmission of gas it does not own across the property at
`issue. Kentucky West relies on Elk Horn by claiming that
`
`because the gas transported across the property is owned
`by a “sister” corporation, Equitable Production, it has the
`necessary ownership interest in the gas to satisfy the terms of
`the deeds, lease and the holding in Elk Horn.
`
` To the extent Kentucky West argues that it “owns” the
`gas flowing through the pipelines due its relationship as a
`“sister” or affiliate company to Equitable Production, that
`argument must fail. Equitable Production and Kentucky West
`are two entirely separate corporate entities. Under Kentucky
`law, separate corporate interests, including subsidiaries and
`affiliates such as Kentucky West and Equitable Production,
`are separate legal entities and must be recognized and treated
`as such unless there is some reason to pierce the corporate
`veil, which is not the case here. Boggs v. Blue Diamond
`Coal Co., 590 F.2d 655 (6th Cir.1979); Square D. Co. v.
`Kentucky Bd. of Tax Appeals, 415 S.W.2d 594, 601 (1967). As
`noted by plaintiffs, if a business wishes to reap the benefits
`of establishing separate corporations, it must also accept the
`burdens. The companies cannot be separate for some purposes
`and lumped together for others at their whim or convenience.
`Accordingly, Kentucky West cannot rely on the fact that the
`gas flowing through the pipelines belongs to an affiliated
`company to rely on Elk Horn.
`
` Because neither the conveyance instruments nor the case law
`answer the question of who is responsible for relocation in
`this case, we look for further evidence from the record of the
`parties' intentions and subsequent course of dealings. While
`plaintiffs contend that it was never the parties' intention to
`allow transmission lines across the property to transport gas
`not owned by Kentucky West, all or some of the plaintiffs
`have known about the existence of these pipelines for many
`years and, in fact, plaintiffs Perry County Coal and Locust
`Grove have paid to relocate portions of some of the lines in
`question on previous occasions within the last ten years, well
`after the time when Equitable Production started transmitting
`gas through Kentucky West pipelines. The plaintiffs have
`known that Kentucky West and Equitable Production are
`two separate corporate entities, and yet at least two of the
`plaintiffs, Perry County Coal and Locust Grove, have entered
`into many previous agreements to pay Kentucky West to
`relocate its pipelines even when they knew that the gas being
`transported in the pipelines by Kentucky West was owned
`by Equitable Production. The plaintiffs cannot be heard to
`complain at this late date that Kentucky West is in violation
`of the contracts. See, e.g., letter agreements and pipeline
`relocation agreements between Kentucky West and Whitaker
`Coal 4 or Locust Grove, Kentucky West's Memorandum in
`
` © 2021 Thomson Reuters. No claim to original U.S. Government Works.
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`Case 2:12-md-02311-SFC-RSW ECF No. 2114-14, PageID.38411 Filed 02/17/21 Page 5 of 8
`Hazard Coal Corp. v. Kentucky West Virginia Gas Co., L.L.C., 311 F.3d 733 (2002)
`159 Oil & Gas Rep. 1, Util. L. Rep. P 14,429, 33 Envtl. L. Rep. 20,106...
`
`Support of Its Motion for Summary Judgment, No. 99–87
`(E.D.Ky. Dec. 22, 2000).
`
`Furthermore, in addition to the pipeline relocations referenced
`above, plaintiffs dealt with Equitable Production Company,
`*740 or its predecessor Equitable Resources Energy
`Company, not with Kentucky West, to raise or shut-in certain
`wellheads in connection with pipeline relocations. Again, a
`lengthy list of agreements dated between 1997 and 2000
`exist between Locust Grove or Whitaker Coal and Equitable
`Production Company concerning these wells. See, e.g., letter
`agreements between Equitable production Company and
`either Whitaker Coal or Locust Grove, Kentucky West's
`Response to Hazard Coal's Motion for Summary Judgment,
`No. 99–87 (E.D.Ky. Dec. 22, 2000). Plaintiff Hazard Coal
`admits that it was informed by letter when all the contested
`pipelines were built, during the 1960s and 1970s, but claims
`that it did not know that due to a corporate restructuring in
`1986 that the gas being transported in these pipelines was
`owned by Kentucky West's “sister” corporation, Equitable
`Production. What Hazard Coal does not address is the fact
`that its lessee, plaintiff Perry County Coal, and the company
`Perry County Coal hired to mine the property, plaintiff Locust
`Grove, had full knowledge that the gas being transported
`was owned by Equitable Production and not by Kentucky
`West for at least ten years before this action was filed. We
`impute this knowledge to Hazard Coal and find that it had
`at least constructive knowledge of the owner of the gas
`flowing through the contested lines since at least the early
`1990s. For any of the plaintiffs, including Hazard Coal, to
`deny that they had notice of the fact that at least some of
`the gas being transported through the pipelines across the
`property in question was owned by Equitable Production and
`not Kentucky West is either disingenuous or negligent. We
`find no record that any of the plaintiffs objected to Kentucky
`West's use of its pipelines to pump Equitable Production's gas.
`
`The evidence here, in the form of the letters and agreements
`between plaintiffs and defendant (or
`their respective
`predecessors) over a number of years, shows a sufficient
`degree of repetition or continuity of practice to warrant the
`conclusion that a custom or course of dealing exists with
`the consent and approval of plaintiffs. Despite plaintiffs'
`arguments, the record demonstrates that the parties' intentions
`were to allow Equitable Production's gas to flow through the
`contested pipelines and to pay for the relocation of those
`pipelines.
`
`In addition to the parties' intentions as demonstrated by their
`actions, Kentucky West raises many equitable doctrines as
`defenses to plaintiffs' claims. To the extent that the original
`terms and understanding of the parties to the deeds and lease
`restricted the size and use of the pipelines across the property,
`any right to enforce those restrictions, or to claim that they
`are not responsible for the cost of relocating the pipelines, has
`been lost through a variety of equitable principles, including
`waiver, acquiescence, laches and estoppel.
`
`Although all of the equitable defenses raised by Kentucky
`West may have some merit, this situation presents a classic
`case of waiver by acquiescence. Acquiescence consists of
`assent by words or conduct on which the other party relies.
`Acquiescence may serve as a basis for asserting the defense
`of estoppel
`
`[w]hen a party with full knowledge,
`or at least with sufficient notice or
`means of knowledge, of his rights,
`and of all the material facts, freely
`does what amounts to a recognition
`of the transaction as existing, or
`acts in a manner inconsistent with
`its repudiation, or lies by for a
`considerable
`time and knowingly
`permits
`the other party
`to deal
`with the subject matter under the
`belief that the transaction has been
`recognized or freely abstains for
` *741
`a considerable length of
`time from impeaching it, so that
`the other party is thereby reasonably
`induced
`to
`suppose
`that
`it
`is
`recognized, there is acquiescence and
`the transaction, although originally
`impeachable, becomes unimpeachable
`in equity....
`
`J. Pomeroy, 2 Equity Jurisprudence § 965, at p.2094 (5th
`ed.1941); see also J. Pomeroy, 3 Equity Jurisprudence §§
`816–818 (5th ed.1941) (equity will debar a party from
`recovery when he stands by and knowingly permits another
`to deal with his property as though it were rightfully his or he
`was rightfully dealing with it and makes no objection).
`
` © 2021 Thomson Reuters. No claim to original U.S. Government Works.
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`Case 2:12-md-02311-SFC-RSW ECF No. 2114-14, PageID.38412 Filed 02/17/21 Page 6 of 8
`Hazard Coal Corp. v. Kentucky West Virginia Gas Co., L.L.C., 311 F.3d 733 (2002)
`159 Oil & Gas Rep. 1, Util. L. Rep. P 14,429, 33 Envtl. L. Rep. 20,106...
`
`In response to this equitable defense, plaintiffs, specifically
`Hazard Coal, claim that they were not aware of, and therefore
`could not have objected to, the transport of Equitable
`Production's gas through the pipelines. Plaintiffs rightly claim
`that “mere silence,” standing alone, cannot constitute waiver
`by acquiescence. However, what we have here is not mere
`silence. As described above, the letters and agreements
`between the parties show Hazard Coal or its representatives
`actively engaged in negotiation with defendant or Equitable
`Production. Hazard Coal cannot deny that it knew or should
`have known about these many agreements. These agreements
`served as ratification of, or at least acquiescence in, Kentucky
`West's practice of transporting Equitable Production's gas
`through the pipelines. The plaintiffs cannot be heard to
`complain now. The failure to raise any objections up to
`now about the transport of Equitable Production gas through
`Kentucky West pipelines was reasonably taken by Kentucky
`West as acquiescence in the practice and Kentucky West
`relied on that acquiescence.
`
`In sum, Hazard Coal or its representative received notice of
`the construction, including size, of every contested pipeline.
`Hazard Coal or its representatives knew of the corporate
`restructuring of Equitable and Kentucky West if not in
`
`1986 when it occurred, at least by the early 1990s. Perry
`County Coal and Locust Grove dealt directly with Equitable.
`The plaintiffs, including Hazard Coal, are sophisticated
`companies, and knew or should have known the location,
`size, and ownership status of both the contested pipelines and
`the gas flowing through them long ago. There is nothing in
`the record to indicate that this fact was hidden from them. If
`they did not believe from the beginning that the conveyance
`instruments allowed Equitable Production gas to flow through
`Kentucky West pipelines under the terms of the original
`conveyances, they should not have paid for relocation of
`any pipelines previously and they should have relayed their
`concerns about the practice to Kentucky West or Equitable.
`Under the law they have waived the right to now complain
`about the practice they have allowed for some time. 5
`
`For the foregoing reasons, the judgment of the district court
`is affirmed.
`
`All Citations
`
`311 F.3d 733, 159 Oil & Gas Rep. 1, Util. L. Rep. P 14,429,
`33 Envtl. L. Rep. 20,106, 2002 Fed.App. 0393P
`
`Footnotes
`
`*
`
`1
`
`The Honorable Herman Weber, United States District Judge for the Southern District of Ohio, sitting by
`designation.
`The language of the Graf deed is as follows:
`[T]he Hazard Coal Corporation, does hereby grant, give alien and convey unto said R.J. Graf, party of
`the second part, his heirs, representatives, successors and assigns, all the oils and gases, and all rights
`thereto, insofar as said party of the first part may now own the same, in, upon or under, or hereafter
`found, in, upon, or under the hereinafter described tracts and boundaries of land, together with the
`exclusive right to enter upon said land and drill thereupon for oil and gas and pump for and store the
`same upon said land, and remove, pipe and transport the same therefrom, with all rights of way deemed
`necessary or convenient, and to use and operate the said land and surface thereof, and any and all
`parts thereof, including the right to use, divert, dam, and pollute water courses thereon in every and any
`manner that may, by party of the second part, his successors, representatives or assigns, be deemed
`necessary or convenient for the full and free exercise and enjoyment of any and all of the property rights
`and privileges hereby bargained, sold, granted or conveyed, including but not limiting to that of drilling,
`pumping and therefrom removing or otherwise utilizing the said pipe lines for the transportation therefrom
`of said articles; and also the right to build, erect, alter, repair, maintain and operate on said land and,
`at his option, to build thereon and remove therefrom any and all houses, tanks, derricks, pipe lines,
`machinery and any and all equipment that may be part of the second part, his successors or assigns,
`be deemed necessary ro [sic] convenient for the full and free exercise and enjoyment of any and all
`the property rights and privileges herein bargained, granted, sold or conveyed, and the right thereupon
`
` © 2021 Thomson Reuters. No claim to original U.S. Government Works.
`
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`Case 2:12-md-02311-SFC-RSW ECF No. 2114-14, PageID.38413 Filed 02/17/21 Page 7 of 8
`Hazard Coal Corp. v. Kentucky West Virginia Gas Co., L.L.C., 311 F.3d 733 (2002)
`159 Oil & Gas Rep. 1, Util. L. Rep. P 14,429, 33 Envtl. L. Rep. 20,106...
`
`2
`
`3
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`convert, reduce, refine, store, pump and manufacture the said, or any and all of said property or the
`products in, upon or under said lands, or other land owned or hereafter acquired by said party of the
`second part, his successors or assigns, by purchase, lease or otherwise, and the right to pump, store
`and leave upon said land any and all muck, bone, shale, water or refuse from said wells or houses, and
`any and all matter or products that may be excavated or produced by the exercise and enjoyment of
`any and all of the property rights or privileges hereby bargained, sold, granted or conveyed, subject,
`however, to the provisions hereinafter stated.
`Def. Brief at 6–7.
`The Vizard deed provides as follows:
`[T]he said William Vizard, and the said Anthony Vizard, Trustees, do hereby grant, give alien and convey
`unto the said R.J. Graf, party of the second part, his heirs, representatives, successors and assigns,
`all the oils and gases, and all rights thereto, in so far as said party of the first part may now own the
`same, in, upon, or hereafter found, in, upon or under the hereinafter described tracts and boundaries of
`land, together with the exclusive right to enter upon said land and drill thereupon for oil and gas and to
`pump for and store the same upon said land, and remove, pipe and transport the same therefrom, with
`all rights of way deemed necessary or convenient, and to use and operate the said land and surface
`thereof, and any and all parts thereof, including the right to use, divert, dam and pollute water courses
`thereon in every and any manner that may, by party of the second part, his successors, representatives
`or assigns, be deemed necessary or convenient for the full and free exercise and enjoyment of any
`and all of the property rights and privileges hereby bargained, sold, granted or conveyed, including but
`not limiting that to drilling, pumping and therefrom removing or other wise utilizing the said pipe lines
`for the transportation therefrom of said articles; and also the right to build, erect, alter, repair, maintain
`and operate on said land, and, at his option, to build thereon and remove therefrom any houses, tanks,
`derricks, pipe lines, machinery and any and all equipment that may, by party of the second part, his
`successors or assigns, be deemed necessary or convenient for the full and free exercise and enjoyment
`of any and all the property rights and privileges herein bargained, granted, sold or conveyed, and the
`right to thereupon convert, reduce, refine, store, pump and manufacture the said or any and all of said
`property or products in, upon or under said lands, or other land owned or hereafter acquired by said party
`of the second part, his successors or assigns, by purchase, lease or otherwise, and the right to pump,
`store and leave upon the land any and all muck, bone, shale, water or refuse from said wells or houses,
`and any and all matter or products that may be excavated or produced by the exercise and enjoyment
`of any or all of the property rights or privileges hereby bargained, sold, granted or conveyed, subject,
`however, to the provisions hereinafter stated.
`Def. Brief at 8–9.
`The Hazard Coal lease provides in relevant part as follows:
`[T]he Lessor, in consideration of One Dollar ($1.00), in hand paid by the Lessee, receipt of which is
`hereby acknowledged, and of the covenants and agreements hereinafter contained, hereby grants,
`demises, leases and lets unto the Lessee, its successors and assigns, all that certain tract of land
`hereinafter described, for the sole and only purpose, and with the exclusive right, of operating for,
`producing and marketing therefrom, together with the right-of-way and servitudes for pipe lines,
`telephone and telegraph lines, structures, houses, and buildings, and all other rights and privileges
`necessary, or deemed necessary, incident to or convenient for the economic operation of this land, and
`any other lands, the oil and gas rights in which, or the control thereof, Lessee now has or owns, or which
`may be hereafter acquired by Lessee, successors or assigns, by any manner of conveyance or contract,
`for oil or gas, with the right to use, for such purposes, free of charge, oil, gas and water, produced from
`or on the premises, and with the right, but without the obligation, either during or after the term hereof,
`to remove all and any property or improvements which Lessee, successors or assigns, may place or
`erect on the premises....
`Def. Brief at 9–10.
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` © 2021 Thomson Reuters. No claim to original U.S. Government Works.
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`Case 2:12-md-02311-SFC-RSW ECF No. 2114-14, PageID.38414 Filed 02/17/21 Page 8 of 8
`Hazard Coal Corp. v. Kentucky West Virginia Gas Co., L.L.C., 311 F.3d 733 (2002)
`159 Oil & Gas Rep. 1, Util. L. Rep. P 14,429, 33 Envtl. L. Rep. 20,106...
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`Whitaker Coal has “certain interests in the property rights claimed by [plaintiffs].” Because Whitaker was not
`a party, the parties entered into an agreement whereby Whitaker agreed to be bound by the proceedings.
`Def. Br. at 16 n. 2.
`To the extent that what plaintiffs are actually complaining about in this lawsuit is the long-standing practice in
`Kentucky whereby the coal companies can receive consent to mine near gas pipelines only after agreeing to
`pay for their relocation, we will not alter that practice here. That is a matter of public policy best left to state
`law, Kentucky legislators or the interested parties through negotiation.
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`End of Document
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`© 2021 Thomson Reuters. No claim to original U.S. Government Works.
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` © 2021 Thomson Reuters. No claim to original U.S. Government Works.
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