## Facts

- Valley View Angus Ranch, Inc. owned a 450-acre ranch in Oklahoma; Duke Energy Field Services, Inc. operated a gas pipeline across the ranch under an easement.
- In October 2003, Valley View’s president reported an alleged pipeline leak and claimed resulting soil and groundwater pollution.
- In January 2004, Duke sought entry to install monitoring wells after obtaining permits; Valley View denied access.
- Duke filed an Oklahoma state-court action seeking to prevent interference with its easement and obtained a temporary restraining order; the order was later vacated and injunctive relief was denied.
- Before answering in state court, Valley View filed a federal action seeking damages for trespass, nuisance, and unjust enrichment based on the alleged leak and contamination.
- Valley View later answered in state court without asserting counterclaims; Duke amended to seek damages for interference with its easement.
- The state court entered partial summary judgment that Duke held an easement interest, and a jury found for Duke on its interference claim; Valley View did not appeal.
- In federal court, Duke obtained summary judgment on the ground that Valley View’s federal claims were barred by claim and issue preclusion as omitted compulsory counterclaims.

## Issues

1. Whether Valley View’s federal claims for trespass, nuisance, and unjust enrichment were compulsory counterclaims in the prior state easement-interference action, such that claim preclusion barred the federal suit.
2. Whether the state judgment on Duke’s easement and interference claim collaterally estopped Valley View from litigating pipeline-leak contamination and related damages in federal court.

## Decision

- The Tenth Circuit reversed the federal district court’s summary judgment and remanded.
- Valley View’s contamination-based claims were not compulsory counterclaims because they did not arise from the same transaction or occurrence as Duke’s easement-interference claim.
- Claim preclusion did not apply because the two actions involved different operative facts, evidence, and legal issues.
- Issue preclusion applied only to matters actually decided in state court (including Duke’s easement interest), not to whether a leak occurred, caused contamination, or supported tort and restitutionary remedies.

## Legal Principles

- A claim is a compulsory counterclaim only if it arises out of the same transaction or occurrence as the opposing party’s claim, assessed by the relationship of operative facts, evidence, and issues rather than the shared property or parties.
- Claim preclusion bars later litigation only when the later claim is sufficiently tied to the prior action that it should have been litigated there under the governing state preclusion rules.
- Issue preclusion applies only to issues actually litigated and necessarily determined in the prior action; determinations about easement rights do not, by themselves, decide independent questions of environmental harm, causation, or damages.
- A prior judgment establishing an easement may bind the parties on that point in later litigation, while leaving separate tort claims based on alleged misconduct and resulting damages open for adjudication.

## Conclusion

The Tenth Circuit held that a landowner’s damages claims for alleged pipeline leakage and contamination were not barred by a prior state action focused on easement access and interference, because the suits involved different transactions and issues; only the state court’s easement determination carried preclusive effect.


Valley View Angus Ranch, Inc. v. Duke Energy Field Servs., Inc., 497 F.3d 1096 (10th Cir. 2007)