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Ely v. Cabot Oil & Gas Corp.

Citations: 38 F. Supp. 3d 518; 2014 U.S. Dist. LEXIS 115390; 2014 WL 4071640Docket: No. 3:09-cv-2284

Court: District Court, M.D. Pennsylvania; April 23, 2014; Federal District Court

Narrative Opinion Summary

The case involves a group of plaintiffs, initially totaling 44, who filed a lawsuit against Cabot Oil & Gas Corporation and GasSearch Drilling Services Corporation, alleging that hydraulic fracturing activities led to property damage and personal injuries. Over time, settlements reduced the plaintiffs to 12, with key individuals including the Elys and the Huberts. The plaintiffs argued for strict liability, claiming hydraulic fracturing is an ultrahazardous activity under Pennsylvania law. However, the court, adopting the recommendation of a magistrate judge, granted summary judgment in favor of the defendants. The ruling was based on the conclusion that hydraulic fracturing does not qualify as an ultrahazardous activity, thus not subjecting it to strict liability. The court emphasized traditional negligence standards should apply instead. The court's decision considered the economic benefits of natural gas drilling in Pennsylvania, highlighting substantial job creation and economic contributions. The ruling aligns with Pennsylvania's legal framework, which historically does not classify oil and gas drilling as inherently dangerous. Consequently, the plaintiffs' claims will be evaluated under negligence rather than strict liability principles, and the defendants' motion for summary judgment was granted.

Legal Issues Addressed

Economic Impact Consideration in Determining Abnormally Dangerous Activities

Application: The court considered the substantial economic benefits of natural gas drilling in its determination that such activities are not abnormally dangerous.

Reasoning: Evidence presented favors the Defendants, showcasing substantial economic benefits to Dimock Township and Susquehanna County from natural gas drilling, including a significant number of Marcellus Shale wells, substantial royalty payments to local entities.

Evaluation of Abnormally Dangerous Activities

Application: The court applied the Restatement (Second) of Torts Sections 519 and 520 to evaluate whether hydraulic fracturing qualifies as abnormally dangerous, concluding it does not meet the criteria.

Reasoning: Section 520 outlines factors to consider in determining if an activity is abnormally dangerous, including the degree of risk, potential severity of harm, inability to mitigate risk through care, commonality of the activity, appropriateness to the location, and the balance of its societal benefit against its dangers.

Negligence Standards for Natural Gas Drilling

Application: Claims of property damage and personal injuries related to natural gas drilling are to be evaluated under negligence standards, not strict liability.

Reasoning: Plaintiffs’ claims of property damage and personal injuries should be evaluated according to negligence standards under Pennsylvania law, which traditionally does not apply strict liability to these activities.

Strict Liability for Ultrahazardous Activities under Pennsylvania Law

Application: The court determined that hydraulic fracturing is not classified as an ultrahazardous activity under Pennsylvania law, thus not subject to strict liability.

Reasoning: The Magistrate Judge found the Plaintiffs' claims unsubstantiated and noted that courts have historically rejected the classification of oil and gas drilling as inherently dangerous, instead applying traditional negligence standards to such cases.

Summary Judgment Standard under Federal Rule of Civil Procedure 56(a)

Application: The court granted summary judgment to the defendants as the plaintiffs failed to provide sufficient evidence to establish a genuine issue for trial on their strict liability claims.

Reasoning: If the movant shows a lack of evidence supporting the nonmoving party's claims, the latter must provide substantial evidence to establish a genuine issue for trial.