The Third Circuit Court of Appeals issued a precedential opinion with important implications for Federal Rule of Civil Procedure 19. Epsilon Energy commenced a federal lawsuit seeking declaratory and injunctive relief against Chesapeake Appalachia, asking the District Court to interpret joint operating agreements that governed gas exploration and development in the Marcellus Region of Pennsylvania.

Because the joint operating agreements implicated the property and economic interests of multiple JOA Parties, including one whose citizenship destroyed diversity, Chesapeake Appalachia argued the absent JOA parties were indispensable and that Epsilon’s action must be dismissed for lack of subject matter jurisdiction.

On August 23, 2023, the Third Circuit vacated and remanded for reconsideration the District Court’s finding that the action could proceed without the absent JOA parties.  The Third Circuit’s opinion carefully traces the development of joinder jurisprudence and the standard that applies to indispensability determinations under Rule 19(b).  Upon remand, Epsilon Energy moved for dismissal of its own action in the District Court.

Chesapeake Appalachia was represented by the Energy Team at Myers, Brier & Kelly, including Dan Brier, Jack Dempsey, Nick Kravitz and Rich Armezzani.  Jack Dempsey presented Chesapeake Appalachia’s oral argument in the Third Circuit.