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Nature of Suit Code: 380
Nature of Suit: Other Personal Property Damage
Cause of Action: 

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FILED 

UNITED STATES COURT OF APPEALS 

FOR THE TENTH CIRCUIT 

United States Court of Appeals 

T<.'nth ~h-~nit 

CEC 1 2 1990 

ROBERT L. HOECKER 

DOUGLAS E. BURNS, ) Clerk 

) 

Plaintiff-Appellant, ) 

) 

v. ) 

) 

WESTERN GEOPHYSICAL COMPANY OF AMERICA; ) 

CROWN CENTRAL PETROLEUM CORPORATION, ) 

) 

Defendants-Appellees. ) 

ORDER AND JUDGMENT* 

No. 89-6259 

(D.C. No. 87-2319-W) 

( W. D. Okla . ) 

Before MOORE, TACHA, and BRORBY, Circuit Judges. 

This appeal requires us to consider the damages to be awarded 

against defendants-appellees Western Geophysical Company of 

America and Crown Central Petroleum Corporation (collectively 

Western) as a result of their unauthorized exploration of and 

trespass on minerals owned by plaintiff-appellant 

Douglas E. Burns. After the jury awarded Burns more than $890,000 

in actual damages, the district court refused to submit the issue 

of punitive damages to the jury and then granted Western's motion 

* This order and judgment has no precedential value and shall 

not be cited, or used by any court ,ithin the Tenth Circuit, 

except for purposes of establishing the c1:,ctrines of the law of 

the case, res judicata, or collateral estoppal. 10th Cir. R. 

36.3. 

Appellate Case: 89-6259 Document: 010110097323 Date Filed: 12/12/1990 Page: 1 
for remittitur or a new trial on the issue of actual damages. 

Burns refused the court's remittitur and was awarded approximately 

$280,000 by a jury in a second trial. Burns timely appeals the 

district court's grant of remittitur in the first trial, its 

decision regarding punitive damages and several of its evidentiary 

rulings in the second trial. We reverse the district court on the 

issues raised in the first trial and thus need not reach Burns' 

arguments concerning the second trial. 

Background 

Appellant Burns owns severed mineral rights to approximately 

3500 acres in western Oklahoma. Appellee Western. conducted 

geophysical exploration of Burn's property without his consent but 

with the consent of the surface owner, and then allegedly 

communicated the results of the exploration to third parties. 

Burns responded by filing this action against Western for mineral 

trespass and for actual and punitive damages. 

At the close of evidence, the district court granted a 

directed verdict against Western on the issue of whether Oklahoma 

law requires mineral owner permission to conduct geophysical 

exploration of severed minerals. The court then submitted the 

question of Burns' actual damages to the jury, but reserved 

judgment on whether to allow the jury also to consider awarding 

punitive damages against Western. In its instructions, the court 

directed the jury to award Burns (1) "the reasonable cost to 

purchase the right to conduct geophysical exploration on [Burns'] 

property at the time the geophysical exploration occurred" and 

(2) "the difference between the fair market value of his property 

2 

Appellate Case: 89-6259 Document: 010110097323 Date Filed: 12/12/1990 Page: 2 
before the geophysical exploration, and the fair market value of 

his property after the geophysical findings were communicated to 

third parties" if, in fact, the jury found that Western had 

communicated the results of its exploration to third parties and 

that this communication "tended to demonstrate that the property 

is less valuable for oil and gas exploration purposes." Doc. 52, 

Instruction 20. 

Burns' theory on the first element of damages was that the 

value of the right to explore a mineral property is represented by 

the amount paid to obtain an oil and gas lease on the property. 

Burns presented evidence in support of this general theory, see 

Tr. I at 55-57, 67-68, 262, 280, 503, 519-21, 1 and evidence that 

the per acre lease payment or "lease bonus" for property similar 

to his in the relevant time period was between $35 and $300/acre, 

yielding an average weighted bonus of between $183.08/acre 

($638,123.51) and $206.89/acre ($721,113.02) for Burns' property. 2 

Tr. I at 505-16; Plaintiff's Ex. 137; see Tr. I at 177-79. On the 

second damage element, Burns presented evidence, based on standard 

appraisal methods for nonproducing minerals, that Western's 

unauthorized exploration and communications reduced the value of 

his minerals by 25% or $73.12/acre ($254,859.03). Tr. I at 516-

1 "Tr. I" refers to the transcript of the first trial in this 

matter, which is designated in the record on appeal as Volumes VIVIII. 

2 The lease bonus figures used in calculating these averages 

were weighted to give greater emphasis to lease bonuses paid in 

1985, the year in which Western explored Burns' property, and to 

lease bonus figures derived from proceedings before the Oklahoma 

Corporation Commission. See Tr. I at 506-16; Plaintiff's Ex. 137. 

3 

Appellate Case: 89-6259 Document: 010110097323 Date Filed: 12/12/1990 Page: 3 
18.; Plaintiff's Ex. 138. Combining this damage figure with the 

more conservative $183.08/acre average lease bonus figure 

described above, Burns argued that his minimum actual damages as a 

result of Western's mineral trespass were $256.20/acre for a total 

of $892,982.54. 

The jury returned a verdict awarding Burns actual damages in 

the amount of $892,982.54, the exact amount that Burns had argued 

as his minimum damages. The district court found the verdict to 

be excessive, however, and granted Western's motion for remittitur 

or new trial on the grounds that (1) the jury had improperly 

equated the value of the right to conduct geophysical exploration 

with the value of an oil and gas lease and (2) the portion of the 

award apparently attributable to Western's third-party 

communications was simply "excessive." Burns v. Western 

Geophysical Co., No. CIV-87-2319-W, slip op. at 7-9 (Jan. 27, 

1989)(Order). The district court determined that the "amount that 

the jury should have allowed" for the two damage elements was 

$212,719.45, $61.03/acre or one-third of the $183.08/acre minimum 

average value for leasing Burns' mineral property. Id. at 7. The 

district court also denied Burns' timely request to submit the 

issue of punitive damages to the jury. 

Burns refused the remittitur and a second trial was held 

solely on the actual damage issue. This time the jury returned a 

verdict awarding Burns $277,960.00, representing approximately 

$80/acre in damages. Burns contends on appeal that this award was 

4 

Appellate Case: 89-6259 Document: 010110097323 Date Filed: 12/12/1990 Page: 4 
tQe result of numerous prejudicial comments and evidentiary 

rulings made by the district court during the trial. 

Discussion 

The first issue on appeal is whether the district court 

abused its discretion in the first trial by ordering remittitur or 

a new trial. It is well established in this circuit that "absent 

an award so excessive as to shock the judicial conscience and to 

raise an irresistible inference that passion, prejudice, 

corruption or other improper cause invaded the trial, the jury's 

determination of the damages is considered inviolate." O'Gilvie 

v. Int'l Playtex, Inc., 821 F.2d 1438, 1449 (10th Cir. 

1987)(quoting Malandris v. Merrill Lynch, Pierce, Fenner & Smith, 

Inc., 703 F.2d 1152, 1168 (10th Cir. 1981) (en bane) (plurality 

opinion)), cert. denied, 486 U.S. 1032 (1988); Garrick v. City & 

County of Denver, 652 F.2d 969, 971-72 (10th Cir. 1981). This 

rule and the strict scrutiny it entails for a grant of remittitur 

or new trial is intended to protect the litigants' constitutional 

right to a jury trial: 

[Where] the trial judge ... grants a new trial on the 

ground that the verdict was against the weight of the 

evidence, the trial judge in negating the jury's .verdict 

has, to some extent at least, substituted his judgment 

of the facts and the credibility of the witnesses for 

that of the jury. Such an action effects a denigration 

of the jury system and to the extent that new trials are 

granted the judge takes over, if he does not usurp, the 

prime function of the jury as the trier of the facts. 

It then becomes the duty of the appellate tribunal to 

exercise a closer degree of scrutiny and supervision 

than is the case where a new trial is granted because of 

some undesirable or pernicious influence obtruding into 

the trial. Such a close scrutiny is required in order 

to protect the litigants' right to jury trial. 

5 

Appellate Case: 89-6259 Document: 010110097323 Date Filed: 12/12/1990 Page: 5 
Lind v. Schenley Indus., Inc., 278 F.2d 79, 90 (3d Cir.), cert. 

denied, 364 U.S. 835 (1960). Thus, "to assure that the judge does 

not simply substitute his judgement for that of the jury, ... 

new trials should not be granted on evidentiary grounds unless, at 

minimum, the verdict is against the great--not merely the 

greater--weight of the evidence." Hewitt v. B.F. Goodrich Co., 

732 F.2d 1554, 1556 (11th Cir. 1984)(en banc)(quoting Conway v. 

Chemical Leaman Tank Lines, Inc., 610 F.2d 360, 363 (5th Cir. 

1980)). 

Under these standards, this court must find that the jury's 

verdict was against the great weight of the evidence on both 

elements of Burns' alleged damages, that relating to the 

unauthorized mineral exploration and that relating to the 

detrimental communication of the exploration results, in order to 

affirm the district court's order for remittitur or new trial. 

With respect to the first of these elements, the value of the 

right to conduct geophysical exploration of a mineral property, 

the district court found that the right to conduct geophysical 

exploration was just one of at least four rights obtained through 

the purchase of an oil and gas lease3 and thus rejected the jury's 

acceptance of Burns' evidence that the fair market value of the 

right to explore was the full amount of the lease purchase price. 

Order at 5-6, 8. Western presented no evidence, however, that the 

3 The four rights identified by the district court were the 

right to conduct all forms of exploration, the right to drill a 

well, the right to produce oil and gas from that well and the 

right of ownership of this production. Order at 8. 

6 

Appellate Case: 89-6259 Document: 010110097323 Date Filed: 12/12/1990 Page: 6 
value· of the right to explore an oil and gas property was, as the 

district court suggested, a percentage rather than the whole of 

the lease purchase price. In fact, the record shows that the vast 

majority of the evidence presented in the first trial either 

supported or was consistent with Burns' contention and the jury's 

apparent finding that the full lease bonus represented the "price 

of admission" to an oil and gas property and that no reasonable 

mineral owner would permit even geophysical exploration of his or 

her property without payment of this entire amount. See. e.g., 

Tr. I at 55-57, 67-68, 262, 286, 503, 519-21, 534, 538. The only 

evidence in the record supporting the district court's remittitur 

is the acknowledgment by Burns' expert witness, in response to the 

district court's questioning, that the lease bonus purchased 

rights in addition to the right to explore. 4 See Tr. I at 461-65. 

This evidence against the jury's determination of the value of the 

right to conduct geophysical exploration does not represent the 

"great weight of the evidence" on this issue and thus cannot 

justify the district court's substitution of its judgment for that 

of the jury on this element of Burns' damages. 

732 F.2d at 1556. 

See Hewitt, 

The district court also found that the jury erred in 

apparently accepting Burns' calculation of the damages he suffered 

4 The only other evidence in the record that suggests that 

something other than a full lease bonus is the actual value of the 

right to explore was the testimony of a Western executive that an 

oil and gas company may have paid as much as $2000 per mile to 

obtain a mineral owner's permission to conduct seismic exploration 

of a severed mineral estate in Louisiana. See Tr. I at 670. 

7 

Appellate Case: 89-6259 Document: 010110097323 Date Filed: 12/12/1990 Page: 7 
as a result of Western's third-party communications of the 

exploration results. The court gave no reason for this 

conclusion, however, and Western submitted no evidence directly 

challenging Burns' calculation of this damage element. 5 Thus, it 

cannot be said that the jury's decision on this element of damages 

was against the great weight of the evidence, and the district 

court again abused its discretion in granting remittitur or new 

trial on the basis of this alleged jury error.

6 

The final issue we need address on appeal is whether the 

district court erred in the first trial in refusing to submit the 

question of punitive damages to the jury. Oklahoma law permits 

punitive damages to be awarded "[i]n any action for the breach of 

an obligation not arising from contract, where the defendant has 

been guilty of conduct evincing a wanton or reckless disregard for 

5 Instead of contesting Burns' evidence on 

directly, Western apparently argued only that Burns 

prove that he had incurred any damages as a result 

alleged communications with third parties. 

this element 

had failed to 

of Western's 

6 Western also defends the district court's grant of remittitur 

on the ground that the jury's award for damages relating to 

Western's communication of its exploration results duplicated 

damages included in the first element because purchase of the 

right to explore, particularly through the purchase of an oil and 

gas lease, includes the right to communicate the results of 

exploration activity. See Answer Brief at 10. Western not only 

did not make this argument to the jury, however, it also failed to 

object to the court's jury instruction requiring separate 

determination of damages resulting from the right to explore 

Burns' minerals and any decrease in the value of Burns' minerals 

as a result of Western's communication of exploration results. 

Accordingly, Western may not now complain that the jury's verdict 

must be remitted as a result of allegedly duplicative damage 

instructions and awards. See Fed. R. Civ. P. 51 (party may not 

challenge jury instruction on appeal if it did not object to the 

instruction at trial). 

8 

Appellate Case: 89-6259 Document: 010110097323 Date Filed: 12/12/1990 Page: 8 
the rights of another, oppression, fraud or m~lice, actual or 

presumed." Okla. Stat. Ann. tit. 23, § 9 (West 1987). "Whether 

punitive damages should be awarded (under Oklahoma law] is a 

question for the jury. 'Only where there is no evidence 

whatsoever that would give rise to an inference of actual malice 

or conduct deemed equivaient to actual malice may a trial court 

refuse to submit an exemplary damage instruction to the jury.'" 

Averitt v. Southland Motor Inn, 720 F.2d 1178, 1182 (10th Cir. 

1983)(quoting Sopkin v. Premier Pontiac, Inc., 539 P.2d 1393, 1397 

(Okla. Ct. App. 1975); see also Chavez v. Sears, Roebuck & Co., 

525 F.2d 827, 830 (10th Cir. 1975)(trial court errs in failing to 

submit punitive damages instruction to jury if "there is some 

competent evidence of fraud, oppression, gross negligence, or 

malice in the record"). We have also held that a trial court must 

submit the issue of punitive damages to the jury unless "the 

evidence and all the inferences to be drawn therefrom are so 

patent that minds of reasonable men could not differ as to the 

conclusions to be drawn therefrom." Silkwood v. Kerr-McGee Corp., 

769 F.2d 1451, 1455 (10th Cir. 1985)(quoting Taylor v. Nat'l 

Trailer Convoy, Inc., 433 F.2d 569, 571-72 (10th Cir. 1970)), 

cert. denied, 476 U.S. 1104 (1986). 

In this case, Burns alleged that he was entitled to punitive 

damages under the Oklahoma statute because Western knowingly 

disregarded his property rights by exploring his mineral property 

without his permission and because Western fraudulently 

misrepresented to Oklahoma mineral owners that their consent was 

not required in advance of such exploration. See Doc. 9 at 4-5; 

9 

Appellate Case: 89-6259 Document: 010110097323 Date Filed: 12/12/1990 Page: 9 
Appellant's Brief in Chief at 39. In support of this claim, Burns 

submitted evidence that mineral owner consent had been required in 

every one of the many states that have considered the issue, 

Tr. I at 379, 389-91, 397, and that the trade association manual 

adopted by Western as its operating guide stated that such 

permission was required "with reasonable certainty" in all states. 

See Plaintiff's Ex. 136 at 4, 13, 26 n.6. He also presented 

evidence that Western officials were aware of these legal 

requirements and of the importance of the permitting issue in 

general, see id. at 457, 466, 472-73, 673, and had discussed 

whether it was necessary to obtain mineral owner permission for 

exploration in Oklahoma, id. at 490-91, 673, but that they did not 

investigate the issue in any way and continued to explore Burns' 

and other Oklahoma mineral properties without obtaining the 

mineral owners' permission and to advise mineral owners who 

inquired about these activities that their permission was not 

necessary under Oklahoma law. Id. at 290, 303, 322, 331-32, 346, 

466. Although there is counter evidence in the record, the fact 

remains that this chain of evidence is sufficient for a reasonable 

person to conclude that Western had, at minimum, recklessly 

disregarded the property rights of Burns and other mineral owners 

in Oklahoma by exploring their properties without permission. 7 

7 Western acknowledged that Burns had presented evidence 

raising these types of inferences when it argued in its motion for 

new trial or remittitur that a new trial should be granted because 

the court improperly admitted evidence indicating that Western 

"had an unreasonable and highly culpable state of mind" for not 

obtaining mineral owner permission for its geophysical exploration 

activities. See Doc. 55 at 3. 

10 

Appellate Case: 89-6259 Document: 010110097323 Date Filed: 12/12/1990 Page: 10 
T~is is all that is required under Oklahoma and federal law for 

the issue of punitive damages to be submitted to the jury. See 

Silkwood, 769 F.2d at 1455; Averitt, 720 F.2d at 1182. Thus, the 

district court erred in failing to submit this issue to the jury 

for determination. 

Western argues against this result on the ground that the 

lack of any definitive Oklahoma authority requiring companies to 

obtain mineral owner consent before conducting geophysical 

explorations precluded an award of punitive damages as a matter of 

law. We disagree. The essence of Western's argument is that in 

the absence of a specific Oklahoma rule of law requiring mineral 

owner permission, such permission was not required to conduct 

exploration activities in the state and Western was therefore in 

full compliance with state law at all times relevant to this case. 

Even assuming that Western was in technical compliance with 

Oklahoma law, however, this compliance would not bar the award of 

punitive damages under the Oklahoma statute. See Silkwood, 

769 F.2d at 1458. Thus, while the clarity or lack of clarity of 

Oklahoma law on the mineral owner permission issue may be relevant 

to determining whether Western acted "recklessly" or "maliciously" 

as required for an award of punitive damages, see Okla. Stat. Ann. 

tit. 23, § 9, the lack of any definitive Oklahoma authority on the 

issue did not automatically defeat Burns' claim for such damages. 

For this reason and those stated above, the judgment of the 

United States District Court for the Western District of Oklahoma 

11 

Appellate Case: 89-6259 Document: 010110097323 Date Filed: 12/12/1990 Page: 11 
i~. ·REVERSED and REMANDED for additional proceedings consistent 

with this order and judgment. 

ENTERED FOR THE COURT 

PER CURIAM 

12 

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