Boudreaux v. Jefferson Island Storage & Hub, LLC

IN THE UNITED STATES COURT OF APPEALS

FOR THE FIFTH CIRCUIT

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No. 00-31184
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VERNON VANN BOUDREAUX, ET AL,

Plaintiffs-Appellants,

versus

JEFFERSON ISLAND STORAGE & HUB, LLC,

Defendant-Appellee.

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Appeal from the United States District Court for the
Western District of Louisiana
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July 11, 2001

Before GARWOOD, JOLLY, and DeMOSS, Circuit Judges.

E. GRADY JOLLY, Circuit Judge:

Jefferson Island Storage conducted mining operations to

facilitate the storage of natural gas on its property, which

included the disposal of saltwater by-product via injection deep

into the earth. The Boudreaux plaintiffs sued Jefferson Island for

trespass and unjust enrichment, arguing that although Jefferson

Island injected saltwater into the earth through wells on its own

property, the saltwater eventually migrated beneath the plaintiffs’

land. The district court granted summary judgment for Jefferson

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Island on all claims, holding that the Boudreaux plaintiffs’

trespass claim had prescribed and further finding no law or

evidence that would establish a trespass or unjust enrichment in

this case. We AFFIRM.

I

Jefferson Island operates an underground natural gas storage

facility in Southwest Louisiana. Following a public hearing and

comment period, Jefferson Island was granted the requisite permits

by the Louisiana Department of Natural Resources to create two

underground storage caverns by injecting fresh water into a layer

of salt over 5,000 feet beneath the surface, hollowing out several

salt caverns. These operations produced saltwater as a by-product

and, pursuant to all requisite state and federal permits, Jefferson

Island disposed of that saltwater by-product by injecting it into

the underground “saltwater sea” lying over a mile beneath southwest

Louisiana.1

In August 1999, the Boudreaux plaintiffs filed this suit,

alleging that the injected saltwater “migrated and came to rest”

under their property, constituting a trespass. The Boudreaux

plaintiffs first argued that the saltwater had “filled up” empty

storage space beneath their property. They later abandoned this

1
The record reveals that these subsurface saltwater
formations--consisting of high porosity, high permeability sands--
contained no freshwater formations or oil or gas hydrocarbon zones
that could have been damaged or polluted by the saltwater
injections.

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argument and now contend that the migration of the fluid under the

surface of their land constitutes a trespass, which damages them by

precluding their injection of saltwater into the ground without

trespassing on the property of their neighbors.

The district court granted Jefferson Island’s motions for

summary judgment on all issues--trespass, unjust enrichment, and

prescription. The Boudreaux plaintiffs appealed.

III

We first address the trespass claim. We find that the

Boudreaux plaintiffs’ trespass claim has prescribed and, in the

alternative, that claim is without merit under Louisiana law.

A

Claims for trespass damages under Louisiana Civ. Code Art.

2315 are prescribed in one year under Louisiana Civ. Code Art.

3492. Article 3493 states:

When damage is caused to immovable property, the one year
prescription commences to run from the day the owner of
the immovable acquired, or should have acquired,
knowledge of the damage.

In the case of a continuing trespass, the prescription period does

not begin to run until the conduct ceases. South Central Bell

Telephone Co. v. Texaco, Inc., 418 So.2d 531 (La. 1982).

Jefferson Island began injecting saltwater into its wells in

January 1995 and ceased (for purposes of this suit) in April 1996.

It is uncontested that the Boudreaux plaintiffs learned about the

basis of their trespass claim in 1996, when they decided not to

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join a similar lawsuit. The current lawsuit was filed in August

1999. Given this three year period between the acquiring of

knowledge of the claim and the filing of the lawsuit, the claim has

prescribed under Louisiana law.

The Boudreaux plaintiffs argue, however, that the district

court erred in finding that their trespass claim had prescribed

because, according to their conjecture, the saltwater injected by

Jefferson Island likely remained beneath their land long after it

was first injected, thereby stalling the commencement of the

prescription period.

We cannot agree with the plaintiffs that the circumstances of

this case, even as described by them, reasonably create a

continuing tort under Louisiana law. For example, in Crump v.

Sabine River Authority, 737 So.2d 720 (La. 1999), the Louisiana

Supreme Court held that the continued existence of a canal

diverting water from a plaintiff’s property did not constitute

continuing tortious conduct sufficient to overcome the rule of

prescription. The Crump court found that the actual cause of the

injury was the digging of the canal, and the plaintiff’s cause of

action arose from that conduct. Importantly, the court emphasized

that “[a] continuing tort is occasioned by unlawful acts, not the

continuation of the ill effects of an original, wrongful act.” Id.

at 728.

In Louisiana, “[w]hen the damaging conduct continues,

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prescription runs from the date of the last harmful act.” South

Central Bell, 418 So.2d at 532 (emphasis added). Assuming that

injected saltwater may have settled and remained under the

Boudreaux plaintiffs’ property, such a circumstance is simply not

sufficient to constitute a continuing trespass. Therefore, we

cannot say that the district court erred in granting summary

judgment on the trespass claim based on prescription.

B

Alternatively, we hold that these facts do not constitute a

trespass under Louisiana law. In Louisiana, a trespass is “an

unlawful physical invasion” upon the property of another. Gliptis

v. Fifteen Oil Co., 16 So.2d 471 (La. 1943).2 Assuming saltwater

actually migrated beneath the Boudreaux plaintiffs’ property, the

question is whether Jefferson Island’s saltwater injection was

“unlawful” under Louisiana law. Jefferson Island contends that its

actions were in accordance with state and federal law, and

therefore not unlawful.

We first note that this issue has been directly addressed in

the context of virtually identical facts by a federal district

court in Louisiana. In Raymond v. Union Texas Petroleum Corp., 697

F.Supp. 270 (E.D. La. 1988), the plaintiffs claimed that the

defendants had injected saltwater into a disposal well, and that

2
Ownership of a tract of land in Louisiana includes ownership
of all that lies above and below the surface of the land. See La.
Civ. Code Art. 490.

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the saltwater had migrated into the subsurface of the plaintiffs’

property. Judge Mentz determined that the plaintiffs’ trespass

claim was not actionable, relying on the Louisiana Supreme Court’s

decision in Nunez v. Wainoco Oil & Gas Co., 488 So.2d 955 (La.

1986).

In Nunez, the defendant drilled a well on property adjacent to

Nunez’s property, and the well extended under the plaintiff’s

property two miles beneath the surface. Both parcels of land were

included within a “drilling unit” created by the Louisiana

Conservation Commission. The Nunez court held that the plaintiff’s

trespass claim was not actionable because the process of

unitization superseded individual property rights to establish a

common interest in the hydrocarbon deposit. Id. at 964.

Judge Mentz applied Nunez’s rationale to hold that migrated

saltwater, disposed of pursuant to the authority of the State of

Louisiana, cannot constitute a legally actionable trespass.

Raymond, 697 F.Supp. at 274.3 Although Nunez’s specific holding

was that no legally actionable trespass occurs “when a unit has

been created by order of the [State],” the court did repeatedly

defer to the “important state interest in developing its resources

3
The Boudreaux plaintiffs argue that Raymond is
distinguishable from this case in that the saltwater injected by
Jefferson Island was not a by-product of “oil or gas exploration
activities,” whereas the saltwater in Raymond was created as a
result of actual drilling activities. We cannot agree with so fine
a distinction, as Jefferson Island is an intrastate gas pipeline
company and was conducting drilling operations for the storage of
natural gas.

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fully and efficiently” under La. R.S. § 30:1 et. al., Louisiana’s

natural resources conservation law, which gives the Commissioner of

Conservation the “authority over all persons and property necessary

to enforce effectively the provisions of this Chapter and all other

laws relating to the conservation of oil and gas.” La. R.S. §

30:4A. Here, Jefferson Island was granted authorization by the

Department of Conservation to drill its saltwater disposal wells

pursuant to Title 30. Under these circumstances, the district

court properly followed Raymond in finding no trespass claim under

the facts of this case.

As a final point, we should observe that, despite the

Louisiana Supreme Court’s rejection of the particular trespass

claims in Nunez, a plaintiff can still recover if he can show that

his property was actually damaged. See Nunez, 488 So.2d at 964,

n.29 (“However, we acknowledge that should a unit operation create

for one landowner within the unit a particular expense, as a result

of damage to his premises, or measurable inconvenience, that

landowner may be entitled to recover compensation . . .”); Raymond,

697 F.Supp at 274 (“It should be noted that the court in Nunez does

not preclude a landowner from recovering compensation for damages

to his property or measurable inconvenience.”). However, no

evidence of any measurable damages or inconvenience exists in this

case. If saltwater injected by Jefferson Island did migrate

beneath the Boudreaux plaintiffs’ property a mile underground, that

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fluid did nothing more than displace existing saltwater and in no

way affected the use or enjoyment of the land.4

IV

The Boudreaux plaintiffs alternatively assert a claim of

unjust enrichment against Jefferson Island. The nature of this

case makes clear that the plaintiffs have no claim for unjust

enrichment under Louisiana law. Louisiana Civ. Code Art. 2298, the

unjust enrichment statute, states that “the remedy declared here is

subsidiary and shall not be available if the law provides another

remedy for the impoverishment or declares a contrary rule.” Under

this provision, when a remedy at law is available to redress an

injury or the law precludes recovery, Louisiana plaintiffs may not

pursue an action for unjust enrichment to defeat the purpose of the

rule of law applicable to the dispute. See Edmonton v. A-Second

Mortgage Co., 289 So.2d 116, 122 (La. 1974).

The Boudreaux plaintiffs simply cannot assert a claim for

unjust enrichment in the face of a claimed trespass, even if

recovery for trespass is precluded under Nunez. See Mongrue v.

Monsanto Co., 1999 WL 970354 at *5 (E.D. La. 1999) (“[P]laintiffs

seek, and the law provides, a plausible trespass remedy. Unjust

4
In an attempt to articulate damages, the plaintiffs assert
that they were damaged because they cannot now inject saltwater
under their property without trespassing on their neighbor’s
property. We reject this argument; the legality of any potential
saltwater injection by the Boudreaux plaintiffs beneath their
property was not affected by Jefferson Island’s injection of
saltwater.

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enrichment is not an appropriate cause of action because no gap in

the law exists that prevents plaintiffs from pursuing a remedy at

law for their alleged injury.”), aff’d by Mongrue v. Monsanto Co.,

249 F.3d 422 (5th Cir. 2001). Therefore, the district court

properly dismissed the Boudreaux plaintiffs’ unjust enrichment

claim.5

V

The Boudreaux plaintiffs’ trespass claim has prescribed under

La. Civ. Code. Art. 3493 and, in the alternative, no unlawful

trespass occurred and no damages were suffered. Furthermore, their

unjust enrichment claim is prohibited by La. Civ. Code Art. 2298.

For the foregoing reasons, the judgment of the district court is

A F F I R M E D

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Even if the Boudreaux plaintiffs could assert a claim for
unjust enrichment, that claim would fail. Article 2298 requires
that the unjustly enriched party must be enriched “at the expense
of another person.” As detailed in this opinion, to the extent
Jefferson Island was enriched, no losses were incurred by any other
persons.

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