Opinion
Case No. 2:21-cv-1619
02-11-2022
Linda DOLLISON, et al., Plaintiffs, v. ANTERO RESOURCES CORPORATION, et al., Defendants.
David R. Hudson, Toledo, OH, John David Newborg, Pro Hac Vice, Newborg Law Office, Pittsburgh, PA, R. Anthony DeLuca, Pro Hac Vice, DeLuca, Ricciuti & Konieezka, Pittsburgh, PA, for Plaintiff Sheena Partnership, Ltd. Amy M. Smith, Steptoe & Johnson PLLC, Bridgeport, WV, Lyle B. Brown, Steptoe & Johnson PLLC, Columbus, OH, for Defendant Antero Resources Corporation. Paul N. Garinger, David J. Dirisamer, Barnes & Thornburg LLP, Columbus, OH, for Defendant SWN Production (Ohio) LLC.
David R. Hudson, Toledo, OH, John David Newborg, Pro Hac Vice, Newborg Law Office, Pittsburgh, PA, R. Anthony DeLuca, Pro Hac Vice, DeLuca, Ricciuti & Konieezka, Pittsburgh, PA, for Plaintiff Sheena Partnership, Ltd.
Amy M. Smith, Steptoe & Johnson PLLC, Bridgeport, WV, Lyle B. Brown, Steptoe & Johnson PLLC, Columbus, OH, for Defendant Antero Resources Corporation.
Paul N. Garinger, David J. Dirisamer, Barnes & Thornburg LLP, Columbus, OH, for Defendant SWN Production (Ohio) LLC.
OPINION AND ORDER
MICHAEL H. WATSON, JUDGE
The remaining defendant, Antero Resources Corporation ("Defendant"), moves to dismiss the remaining plaintiff's, Sheena Partnership, Ltd. ("Plaintiff"), Amended Complaint. ECF No. 29. For the following reasons, the motion is DENIED .
I. BACKGROUND
A. Factual Background
The factual allegations from the Amended Complaint are taken as true for purposes of Defendant's motion.
Plaintiff owns many acres of land in Noble County, Ohio, and owns the oil, gas, and other resources located beneath the surface of the land. Amend. Compl. ¶¶ 10–11, ECF No. 27. On August 4, 2011, Plaintiff leased the oil, gas, and related hydrocarbons below its land to Mattmark Holding, LLC ("Mattmark"). Id. ¶ 12. In consideration for the lease, Mattmark agreed to pay "16% of the gross proceeds" it receives from the "sale of all oil, gas, and related hydrocarbons produced" from Plaintiff's land to Plaintiff. Id. ¶ 13. Through a series of assignments, Defendant became the owner of a 70% undivided interest in the lease. Id. ¶ 7. In the Amended Complaint, Plaintiff alleged that Eclipse Resourses 1, L.P. ("Eclipse") owned the remaining 30% interest. Id.
Plaintiff alleges that Defendant failed to properly pay the full 16% royalty fee because of the following payment scheme the parties used: Plaintiff would first calculate the amount of royalty compensation based on the assumption that 100% of the gas is sold. Id. ¶ 15. This calculation would result in an overpayment because 100% of the gas is not sold, and a portion is instead converted into natural gas liquids, which is then sold separately. Id. So, Defendant would recoup this overpayment by crediting itself a certain sum from the sale of the natural gas liquids. Id. However, Plaintiff alleges, the credit Defendant takes from the natural-gas-liquids sale is greater than the amount of overpayment to Plaintiff and, therefore, Plaintiff does not receive the full royalty payment. Id.
B. Procedural Background
This case began in state court in March 2021 when Plaintiff and other individuals (the "Individual Plaintiffs") filed their Complaint in the Noble County Court of Common Pleas. Notice of Removal, Ex. 1, ECF No. 1-1. Defendant and Eclipse, who was originally also named as a defendant, removed to this Court shortly thereafter. Notice of Removal, ECF No. 1.
In this Court, Plaintiffs encountered a series of problems. First, they struggled to perfect service on Eclipse. See, e.g. , Report and Recommendation, ECF No. 24. Individual Plaintiffs also faced a motion to dismiss from Defendant in which Defendant argued that the parties were bound by an arbitration agreement. See Mot. ECF No. 23.
Subsequently, Individual Plaintiffs filed a notice of dismissal in which they dismissed their claims and agreed to proceed with arbitration. See ECF No. 25. Plaintiff filed an Amended Complaint against Defendant only and included no claims against Eclipse. Amend. Compl., ECF No. 27.
Now, Defendant moves to dismiss Plaintiff's claim for three alternative reasons: (1) to dismiss for failure to state a claim under Federal Rule of Civil Procedure 12(b)(6) ; (2) to dismiss for failure to join an indispensable party under Federal Rule of Civil Procedure 12(b)(7) ; or (3) to dismiss or stay pending arbitration.
II. MOTION TO DISMISS FOR FAILURE TO STATE A CLAIM
A. Standard of Review
A claim survives a motion to dismiss under Rule 12(b)(6) if it "contain[s] sufficient factual matter, accepted as true, to state a claim to relief that is plausible on its face." Ashcroft v. Iqbal , 556 U.S. 662, 678, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009) (citation omitted). "The plausibility standard is not akin to a ‘probability requirement,’ but it asks for more than a sheer possibility that a defendant has acted unlawfully." Id. (citation omitted). This standard "calls for enough fact to raise a reasonable expectation that discovery will reveal evidence of [unlawful conduct]." Bell Atl. Corp. v. Twombly , 550 U.S. 544, 556, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007). A pleading's "[f]actual allegations must be enough to raise a right to relief above the speculative level, on the assumption that all the allegations in the [pleading] are true (even if doubtful in fact)." Id. at 555, 127 S.Ct. 1955 (internal citations omitted). While the court must "construe the [pleading] in the light most favorable to the [non-moving party]," Inge v. Rock Fin. Corp. , 281 F.3d 613, 619 (6th Cir. 2002), the non-moving party must provide "more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do." Twombly , 550 U.S. at 555, 127 S.Ct. 1955.
B. Analysis
Defendant argues that the Amended Complaint fails to state a claim for breach of contract; specifically, that the Amended Complaint should be dismissed because: (1) Plaintiff has failed to plausibly allege that Plaintiff performed its obligations under the contract; and (2) Plaintiff's theory of how Defendant breached the contract is contrary to Sixth Circuit precedent and, therefore, fails to state a claim on which relief may be granted.
Under Ohio law, which the parties agree applies in this case, the essential elements of breach of contract are: (1) the existence of a contract; (2) performance by the plaintiff; (3) the defendant's breach; and (4) damages or loss to the plaintiff. Kline v. Mortg. Elec. Registration Sys., Inc. , 704 F. App'x 451, 463 (6th Cir. 2017) (citing Siemaszko v. FirstEnergy Nuclear Operating Co. , 187 Ohio App. 3d 437, 444, 932 N.E.2d 414 (2010) ).
1. Plaintiff has plausibly alleged a claim for breach of contract.
Plaintiff has plausibly alleged all the elements of a breach of contract claim. It has alleged that the parties had a contract: the lease agreement. Amend. Compl. ¶¶ 12–14, ECF No. 27. It has alleged that it performed (by leasing its mineral rights to Defendant), and that Defendant breached (by not paying Plaintiff the full royalty payment). Id. ¶¶ 12, 15, 22. Finally, it has alleged damage from the breach in the form of insufficient royalty payments. Id. ¶ 15. Because Plaintiff has plausibly alleged all the elements of a breach of contract claim, Defendant's motion is without merit.
To the extent that Defendant argues that Plaintiff failed to plausibly allege that it generally complied with its obligations under the contract, that argument is unavailing. From a review of the parties’ lease agreement, as attached to the Amended Complaint, it is apparent that Plaintiff's primary obligation under the contract was to lease its interest in the gas, oil, and other hydrocarbons underneath its land to Defendant, to give Defendant the rights to produce gas and oil from the same, and, by extension, to give Defendant access to the minerals beneath the land. See Amend. Compl., Ex. A, ECF No. 27-1. True, the Amended Complaint does not include a specific allegation to the effect of "Plaintiff permits Defendant to access the leased gas and oil below its land." However, the only fair reading of the Amended Complaint is that from the date of the lease agreement to the present, Plaintiff allowed Mattmark, and later Defendant, to have access to the leased minerals. See, e.g. , Amend. Compl. ¶¶ 12, 15, ECF No. 27. Accordingly, Defendant's argument is unavailing.
In its reply, Defendant also argues that Plaintiff failed to plausibly allege that it performed under the contract because the Amended Complaint failed to address anything relating to the contractual provision about ad valorem taxes. The ad valorum tax clause provides as follows:
Lessee and Lessor agree to pay their proportionate share of any increase in ad valorem taxes attributable to, or resulting from, the assessment of oil and gas due to production from the Leased Premises.
Amend. Compl., Ex. A 13, ECF No. 27-1.
According to Defendant, because Plaintiff failed to allege that it paid its proportionate share of an increase in ad valorem taxes, it has not plausibly alleged that it performed under the contract and, therefore, Plaintiff has failed to state a claim for breach of contract. However, Plaintiff would only be responsible for its share of an increase in ad valorem taxes if there was, in fact, an increase in ad valorem taxes. At this time, there is no evidence or allegation before the Court that there was such an increase. Accordingly, Defendant's argument is without merit.
2. Plaintiff's theory of how Defendant breached the contract is not necessarily contrary to Sixth Circuit precedent.
Defendant next argues that Plaintiff fails to state a claim for breach of contract because Plaintiff's theory of how Defendant breached the contract is contrary to Sixth Circuit precedent. Defendant cites at length to various cases explaining how, or rather when , royalty calculations in gas and oil leases should be calculated (i.e., at pre-production versus at post-production). Reply 2–5, ECF No. 31. Defendant asserts that the parties’ lease agreement is substantially similar to those in the cases it cites and that Defendant calculates the royalty payments at the time prescribed by those cases. Id. Thus, Defendant argues, Plaintiff's argument that Defendant should calculate the royalty payment at a different time is contrary to Sixth Circuit precedent and, consequently, the Court should dismiss the claim. Id.
Whether or not this argument is persuasive, it misses a fundamental point: Plaintiff's theory of how Defendant breached the contract has nothing to do with when Defendant calculated the royalty payment. Amend. Compl. ¶ 15, ECF No. 27. Instead, Plaintiff alleges that Defendant breached the contract by miscalculating the amount of overpayment to Plaintiff in the parties’ somewhat convoluted overpayment-and-crediting scheme. Id. At this juncture, neither party has briefed whether this theory is in accordance with, or contrary to, Sixth Circuit precedent. Accordingly, the Court will not delve into the topic sua sponte and will, instead, allow Plaintiff to pursue its theory for the time being.
For these reasons, Defendant's Rule 12(b)(6) motion is DENIED .
III. FEDERAL RULE OF CIVIL PROCEDURE 12(b)(7)
When Defendant filed its motion, it argued that Plaintiff had failed to join Eclipse, the owner of the remaining 30% interest in the lease. Mot., ECF No. 29. In response, Plaintiff argued that Eclipse no longer exists. Resp., ECF No. 30. To clarify, the Court directed the parties to file a joint notice explaining the ownership of this 30% interest. Order, ECF No. 32. The parties did so, explaining that SWN Production (Ohio), LLC ("SWN") is the current owner of the 30% interest. Joint Notice, ECF No. 33. It appears that the arguments related to Defendant's Rule 12(b)(7) motion would be substantially the same for both Eclipse and SWN, so the Court address the parties’ originally briefed arguments as applied to SWN.
A. Standard of Review
Rule 12(b)(7) provides for dismissal for failure to join a necessary party under Rule 19. See Fed. R. Civ. P. 12(b)(7). Whether joinder is proper under Rule 19 is a three-step process:
First, the court must determine whether the person or entity is a necessary party under Rule 19(a).
Second, if the person or entity is a necessary party, the court must then decide if joinder of that person or entity will deprive the court of subject matter jurisdiction.
Third, if joinder is not feasible because it will eliminate the court's ability to hear a case, the court must analyze the Rule 19(b) factors to determine whether the court should "in equity and good conscience" dismiss the case because the absentee is indispensable.
Glancy v. Taubman Ctrs. Inc. , 373 F.3d 656, 666 (6th Cir. 2004) (internal quotation marks and citations omitted) (emphasis in original).
B. Analysis
1. SWN is a necessary party.
As for the first step, Rule 19(a)(1) instructs that a required party is one where:
(A) in that person's absence, the court cannot accord complete relief among existing parties; or
(B) that person claims an interest relating to the subject matter of the action
and is so situated that disposing of the action in the person's absence may:
(i) as a practical matter impair or impede the person's ability to protect the interest; or
(ii) leave an existing party subject to a substantial risk of incurring double, multiple, or otherwise inconsistent obligations because of the interest.
Fed. R. Civ. P. 19(a)(1). "Under Rule 19(a)(1)(B), a party can be deemed ‘necessary’ to litigation if it is a party to an agreement in dispute." Spielman v. IMG Coll., LLC , No. 2:17-CV-612, 2019 WL 13044154, at * 3 (S.D. Ohio Nov. 27, 2019) (internal citation omitted).
SWN is a necessary party. The lease agreement was originally between Plaintiff and Mattmark. Amend. Compl. ¶¶ 10–11, ECF No. 27. Through a few assignments and conversion, the lease transferred to its current ownership: Defendant owns a 70% interest and SWN owns a 30% interest. Id. ¶ 7; Joint Notice ¶ 5, ECF No. 33. That same lease, the agreement that governs it, and the method of interpreting its royalty payment scheme are in dispute in this action. Thus, SWN is a party to the agreement in dispute in this case. As such, it is a necessary party.
2. SWN can be properly joined.
Because SWN is a necessary party, the Court must next consider whether it can be joined. In that consideration, the Court must evaluate both whether joinder of SWN would destroy the Court's subject-matter jurisdiction and whether the Court has personal jurisdiction over SWN.
a. Joinder would not destroy subject-matter jurisdiction.
First, joining SWN would not destroy subject-matter jurisdiction. This case is before the Court on diversity jurisdiction. Federal Courts may have diversity-of-citizenship jurisdiction in cases where no plaintiff and no defendant are citizens of the same state and the amount in controversy is $75,000 or greater. 28 U.S.C. § 1332.
Joining SWN would not destroy diversity jurisdiction. Plaintiff is a citizen of either Ohio and/or Virginia; Defendant is a citizen of Delaware and Colorado. Notice of Removal ¶¶ 11-12, ECF No. 1. SWN's only member is a Delaware corporation with its principal place of business in Texas. Joint Notice ¶ 5, ECF No. 35. So, Plaintiff is a citizen of Virginia and/or Ohio, while Defendant and SWN are citizens of states other than Ohio and Virginia. Thus, if SWN were joined, it would not destroy diversity or, by extension, subject-matter jurisdiction.
b. The Court has personal jurisdiction over SWN.
The Court next considers whether it has personal jurisdiction over SWN. After a 2020 revision, Ohio's long-arm statute became co-extensive to the limits of the federal Due Process Clause. Ohio Rev. Code § 2307.382(C) ("In addition to a court's exercise of personal jurisdiction under division (A) of this section, a court may exercise personal jurisdiction over a person on any basis consistent with the Ohio Constitution and the United States Constitution."); 2020 Ohio Laws File 44 (Am. H.B. 272) (amending Ohio's long-arm statute to make it co-extensive with the federal Due Process Clause); see also C.T. v. Red Roof Inns , Inc., No. 2:19-CV-5384, 2021 WL 2942483, at *10 (S.D. Ohio July 1, 2021), appeal dismissed , No. 21-3635, 2021 WL 4739619 (6th Cir. Aug. 4, 2021) (citing to Ohio Rev. Code § 2307.382(C) and observing that Ohio's long-arm statute and the U.S. Constitution "are now coextensive"). So, if the Court finds that it has personal jurisdiction over SWN under the federal Due Process Clause, it will also have personal jurisdiction over SWN under Ohio's long-arm statute.
It is somewhat unclear whether this amendment applies retroactively. Compare Ripepi v. USA Taekwondo, Inc. , No. 5:20-CV-01896, 2021 WL 4459465, at * 8 (N.D. Ohio Sept. 29, 2021) (acknowledging the issue of whether the amendment applies retroactively but declining to decide it because such a decision was "better suited for a later time") with Smith v. Swaffer , No. 1:20-CV-1848, 2021 WL 4596922, at * 10 (N.D. Ohio Oct. 7 , 2021) (deciding without discussion that the amendment does not apply retroactively). In any event, the amendment became effective in December 2020, and the original complaint in this action was filed in March 2021. See 2020 Ohio Laws File 44 (Am. H.B. 272); Notice of Removal, ECF No. 1. Thus, whether or not the amendment is retroactive generally, it applies here.
Further, even if Defendant were to argue that the amendment should not apply because at least some of the events underlying this cause of action took place prior to December 2020, and even if the Court were to agree with such an argument, that would have no impact on the ultimate outcome. One of the enumerated bases for personal jurisdiction in Ohio Revised Code § 2307.382(A) is when a cause of action arises from the potential defendant's "transacting any business in this state." Ohio. Rev. Code. § 2307.382(A)(1). "[T]he Ohio ‘transacting business’ standard is coextensive with the purposeful availment prong of the constitutional analysis." DCM Grp., Inc. v. Ebix, Inc. , No. 2:17-CV-740, 2018 WL 7290826, at * 6 (S.D. Ohio Dec. 13, 2018) (internal quotation marks and citations omitted). Because the Court has found that SWN purposefully availed itself of Ohio, see infra , it would likewise find that SWN's Ohio activities satisfied the "transacting business" standard for § 2307.382(A). Thus, even if the Court were to use the older version of the statute, it would conclude that it had personal jurisdiction over SWN under the long-arm statute.
Under the federal Due Process Clause, the Court may exercise personal jurisdiction over a non-resident defendant based on either specific or general jurisdiction. See Goodyear Dunlop Tires Operations, S.A. v. Brown , 564 U.S. 915, 919, 131 S.Ct. 2846, 180 L.Ed.2d 796 (2011). "General jurisdiction is proper only where a defendant's contacts with the forum state are of such a continuous and systematic nature that the state may exercise personal jurisdiction over the defendant even if the action is unrelated to the defendant's contacts with the state." Bird v. Parsons , 289 F.3d 865, 873 (6th Cir. 2002) (internal quotation marks and citations omitted). In contrast, specific jurisdiction "is confined to adjudication of issues deriving from, or connected with, the very controversy that establishes jurisdiction." Goodyear , 564 U.S. at 919, 131 S.Ct. 2846 (internal quotation marks and citations omitted). Only specific jurisdiction is at issue here.
The Sixth Circuit has established a three-part test to determine whether specific personal jurisdiction exists over a non-resident defendant:
First, the defendant must purposefully avail himself of the privilege of acting in the forum state or causing a consequence in the forum state.
Second, the cause of action must arise from the defendant's activities there. Finally, the acts of the defendant or consequences caused by the defendant must have a substantial enough connection with the forum state to make the exercise of jurisdiction over the defendant reasonable.
Air Prods. & Controls, Inc. v. Safetech Intern., Inc. , 503 F.3d 544, 550 (6th Cir. 2007) (quoting S. Mach. Co. v. Mohasco Indus., Inc. , 401 F.2d 374, 381 (6th Cir. 1968) ). As the Sixth Circuit has explained, this test is "based on existing Supreme Court jurisprudence on personal jurisdiction, primarily International Shoe [Co. v. State of Wash., Off. of Unemployment Comp. & Placement , 326 U.S. 310, 66 S.Ct. 154, 90 L.Ed. 95, (1945)]." Air Prod. & Controls, Inc. , 503 F.3d at 550. Further, "the approach simply applies in a specific fashion the broad rule requiring substantial minimum contacts as a basis for jurisdiction." Id. (internal quotation marks and citations omitted).
i. SWN has purposefully availed itself of the privilege of acting in Ohio.
"Purposeful availment" is the "constitutional touchstone" of personal jurisdiction and is present where the defendant's conduct and connection with the forum are such that he "should reasonably anticipate being haled into court there." Burger King Corp. v. Rudzewicz , 471 U.S. 462, 474, 105 S.Ct. 2174, 85 L.Ed.2d 528, (1985) (quoting World-Wide Volkswagen Corp. v. Woodson , 444 U.S. 286, 297, 100 S.Ct. 559, 62 L.Ed.2d 490 (1980) ). "This ‘purposeful availment’ requirement ensures that a defendant will not be haled into a jurisdiction solely as a result of ‘random,’ ‘fortuitous,’ or ‘attenuated’ contacts, or of the ‘unilateral activity of another party or a third person.’ " Id. at 475, 105 S.Ct. 2174 (internal citations omitted).
Here, there is minimal information about how SWN began its business dealings in Ohio—whether it initiated the relationship or where the negotiating took place. However, SWN did not merely direct communications or sales at Plaintiff. Instead, it actively carries on business on Plaintiff's land in Ohio, maintaining a 30% interest in the lease of minerals underneath Plaintiff's property. Presumably it has, or will, continue to extract gas and other minerals from the lease, as its predecessor (Eclipse) did for many years. Even if SWN has a passive role in the oil and gas operation, it still maintains a 30% interest in the at-issue oil and gas. Considering all these facts, the Court concludes that SWN has "purposefully availed" itself so that the Court has personal jurisdiction over it under Ohio's long-arm statute.
ii. This action arises from SWN's contacts with Ohio.
Under the second part of the test, the cause of action must "arise from" the defendant's activities in the forum state. See Air Prods. Controls Inc. , 503 F.3d at 553. A cause of action "arises from" a defendant's activities in the state when the defendant's contacts with the forum state are related to the operative facts of the plaintiff's cause of action. CompuServe, Inc. v. Patterson , 89 F.3d 1257, 1267 (6th Cir. 1996). Said another way, "[i]n order for a court to exercise specific jurisdiction over a claim, there must be an ‘affiliation between the forum and the underlying controversy, principally, [an] activity or an occurrence that takes place in the forum State.’ " Bristol-Myers Squibb Co. v. Superior Ct. of California, San Francisco Cty. , ––– U.S. ––––, 137 S. Ct. 1773, 1781, 198 L.Ed.2d 395 (2017) (quoting Goodyear , 564 U.S. at 919, 131 S.Ct. 2846 ).
This case arises directly from SWN's contacts with Ohio. As discussed above, SWN's contacts with Ohio are its involvement with the lease of the minerals beneath Plaintiff's land in Noble County, Ohio. It is this lease agreement that has given rise to this action. That is, the cause of action centers around whether the leaseholders (Defendant and SWN) properly paid Plaintiff for the lease of Plaintiff's minerals. This creates a sufficient nexus between Plaintiff's activities in Ohio and this case. So, the second prong of the test is satisfied. iii. Personal jurisdiction over SWN is reasonable.
Finally, where the first two prongs of the test are met, an inference arises that jurisdiction is reasonable. See Intera Corp. v. Henderson , 428 F.3d 605, 618 (6th Cir. 2005). Still, in considering whether the exercise of jurisdiction is reasonable, courts look to: (1) the burden on the defendant; (2) the interest of the forum state; (3) the plaintiff's interest in obtaining relief; and (4) other states’ interest in securing the most efficient resolution of the policy. Id.
Because the Court found the first two prongs satisfied, there is an inference that personal jurisdiction over SWN is reasonable here. In addition, the four factors support a finding of reasonableness. Admittedly, litigating this matter in another state would likely have minimal impact on Plaintiff's rights, aside from inconvenience. However, all other factors weigh in Plaintiff's favor. Litigating this matter in Ohio would not impose a significant burden on SWN, which conducts business on Plaintiff's land in Ohio and, presumably most, if not all, the evidence in this case is in Ohio. In addition, Ohio has an interest in this controversy as the lease agreement is governed by Ohio law, and the minerals and property underlying the action are located in Ohio. Finally, no other state has a substantial interest in the litigation as no other state's laws or land would be affected by it. Thus, as three of the four factors weigh in favor of finding that personal jurisdiction over SWN is reasonable, the third prong of the test is met.
For these reasons, the Court holds that it has personal jurisdiction over SWN under the federal Due Process Clause and, therefore, also under Ohio's long-arm statute. Because SWN is a necessary party who may be joined, the Court ORDERS that it be joined as a defendant. As SWN is, pursuant to this order, a defendant, Defendant's Rule 12(b)(7) motion is DENIED AS MOOT .
Now that SWN is a defendant, Plaintiff is ORDERED to perfect service of process on SWN in accordance with Federal Rule of Civil Procedure 4.
IV. MOTION TO DISMISS OR STAY PENDING ARBITRATION
Defendant next argues that the Court should dismiss this case because it must first proceed through arbitration. Defendant acknowledges that its lease agreement with Plaintiff did not include an arbitration agreement. However, Defendant argues that because Plaintiff considered itself similar enough to the Individual Plaintiffs to join them in the original Complaint, the Court should apply equitable principles and bind Plaintiff to the arbitration clause signed by Individual Plaintiffs.
The Court finds this argument unpersuasive. A "fundamental goal of contract law is to uphold clearly ascertained and negotiated contract rights." Wallace Hardware Co. v. Abrams , 223 F.3d 382, 400 (6th Cir. 2000) (internal citation and quotation marks omitted). If Defendant did not want a lease agreement without an arbitration agreement, it should not have agreed to the assignment of Plaintiff's lease. The Court will not read into the parties’ contract a provision which does not exist. So, Defendant's motion to dismiss pursuant to a non-existent arbitration agreement is denied.
The primary case on which Defendant relies, Belmont Med. Care, LLC v. Cmty. Ins. Co. , No. 2:18-CV-968, 2019 WL 1676003 (S.D. Ohio Apr. 17, 2019), is easily distinguishable. In that case, the two defendants sought to enforce an arbitration agreement against the plaintiff. Id. at * 1. One of the defendants and the plaintiff had signed the agreement; the other defendant had not. Id. at *4. These few facts demonstrate the most striking difference between Belmont and this case: in Belmont , a non-signatory sought to enforce an arbitration agreement against a signatory. Id. at **4–5. Here, one non-signatory is attempting to enforce a non-existent arbitration agreement against another non-signatory, based simply on the fact that it had arbitration agreements with other parties in other contracts. Further, although "[n]on-signatories may be subject to an arbitration agreement between two contracting parties," Id. at *4, here there is no "arbitration agreement between two contracting parties." Id. Because of the factual dissimilarities, none of Belmont ’s equity-based reasoning applies here.
Finally, Defendant argues in the alternative that the Court should stay this case pending the outcome of the arbitration proceedings between it and Individual Plaintiffs. As quoted by Defendant, the Supreme Court of the United States has explained that the decision to stay "litigation among the non-arbitrating parties pending the outcome of arbitration ... is left to the district court ... as a matter of its discretion to control its docket." Moses H. Cone Mem'l Hosp. v. Mercury Constr. Corp. , 460 U.S. 1, 20 n.23, 103 S.Ct. 927, 74 L.Ed.2d 765 (1983) (internal quotation and citations omitted). "In exercising its discretion, the Court considers whether arbitrable claims predominate or whether the outcome of nonarbitrable claims depend on the arbitrator's decision." RECO Equip., Inc. v. Wilson , No. 2:20-CV-3556, 2021 WL 1721047, at * 6 (S.D. Ohio Apr. 30, 2021).
Upon Individual Plaintiffs’ voluntary dismissal, there are no more arbitrable claims in this case, and the only remaining claims are the non-arbitrable ones. So, the Court concludes, in its discretion, that a stay is inappropriate. Accordingly, Defendant's motion to dismiss or stay pending the outcome of arbitration is DENIED .
V. CONCLUSION
For these reasons, Defendant's motion to dismiss for failure to state a claim and motion to dismiss or stay pending the outcome of arbitration are DENIED . Upon consideration of Defendant's motion to dismiss for failure to join an indispensable party, the Court concludes that SWN is a necessary party but can be joined. Accordingly, the Court ORDERS that SWN be joined as a defendant, and Defendant's Rule 12(b)(7) motion is DENIED AS MOOT .
Plaintiff is ORDERED to perfect service on SWN in accordance with Rule 4.