### IN THE UNITED STATES COURT OF APPEALS FOR THE FIFTH CIRCUIT

No. 17

- 10320

HENRY SEELIGSON; JOHN M. SEELIGSON; SUZANNE SEELIGSON NASH; SHERRI PILCHER,

Plaintiffs

- Appellees

v. DEVON ENERGY PRODUCTION COMPANY, L.P.,

Defendant

- Appellant

Appeal from the United States District Court for the Northern District of Texas U SDC No. 3:16

- CV

- 82

Before WIENER, GRAVES, and HO, Circuit Judges

. PER CURIAM: *
P laintiffs

- Appellees in this class action case (“Plaintiffs”) are royalty
owners who allege that Defendant

- Appellant , Devon Energy Production Company, L.P. (“DEPCO”) , breached its royalty obligations by violating the duty to market i mplied in the class members’ mineral leases. According to
P laintiffs, DEPCO breached this duty by selling the raw, unprocessed gas to its corporate affiliate at the wellheads at a price artificially reduced by an

* Pursuant to 5 TH C IR . R. 47.5, the court has de termined that this opinion should not be published and is not precedent except under the limited circumstances set forth in 5 TH C IR . R. 47.5.4. United States Court of Appeals Fifth Circuit 

### FILED October 16, 2018

Lyle W. Cayce Clerk Case: 17-10320 Document: 00514683594 Page: 1 Date Filed: 10/16/2018No. 17

- 10320

2 u nreasonably high processi ng fee. Plaintiffs aver that DEPCO then pass ed this processing fee on to the royalty owners. Plaintiff s sought to certify a class comprising royalty owners who claim
that their royalty payments were reduced by DEPCO’s pricing scheme. The
district court he ld an evidentiary hearing, the n certified the Class as follows: All person or entities who, between January 1, 2008 and February 28, 2014, (i) are or were royalty owners in Texas wells producing natural gas that was processed through the Bridgeport Gas Pro cessing Plant by Devon Gas Services, LP (“DGS”); (ii) received royalties from Devon Production Company, L.P. (“DEPCO”) on such gas; and (iii) had oil and gas leases that were on one of the [specific forms]

. . . (“The Class Lease Forms”)

. 1 DEPCO now appeals the district court’s certification decision. I. F ACTS AND P ROCEEDINGS Plaintiff s are royalty owners of natural gas wells operated by DEPCO in the Barnett Shale gas field . DEPCO is an oil and gas exploration and production company that is the lessee un der numerous natural gas well leases

. Several thousand of the wells that DEPCO operates in the Barnett Shale are serviced by the Bridgeport Rich Gathering System (the “Bridgeport System”), a series of horizontal pipelines that gather natural gas from indiv idual wells and transport it to the Bridgeport Gas Processing Plant (the “Bridgeport Plant”). During the period of class claims, the Bridgeport System and Bridgeport Plant were owned and operated by Devon Gas Services (“DGS”). In turn, DEPCO and DGS are bo th wholly

- owned subsidiaries of Devon Energy Corporation. A. DEPCO sells gas to DGS During all relevant time s , DEPCO sold all the natural gas that it produced from wells in the Bridgeport System to DGS under a 2005 Gas

1 The court also indicated several persons or entities excluded from the Class. Case: 17-10320 Document: 00514683594 Page: 2 Date Filed: 10/16/2018No. 17

- 10320

3 Purchase and Processing Agreement (the “GPPA”). Under the terms of the GPPA, DEPCO sold “ wet ” natural gas from the wells to DGS (1) at the
wellhead s, (2) for a purchase price of “82.5% of the published industry index value of the residue [“dry”] gas and natural gas liquids (“NGLs”).” DGS then transpor t ed th e wet gas from the individual wells , through the Bridgeport System , to the Bridgeport P lant, where the wet gas was processed into (1)
N GLs and (2) dry residue gas. DGS then sold the processed dry residue gas to third parties. The parties characterize this transaction in different ways. DEPCO says that it transferred ownership of the gas to DGS at the moment of sale at the
wellhead. DEPCO claims that, because it no longer own ed the gas when it was transported through the Bridgeport System and processed at the Bridgeport Plant, it did not charge Plaintiffs a “processing fee ” ; neither was it the sell er of
the NGLs or the residue gas. Accord ing to Pl aintiffs , however, these “sales” were sham transactions, as DEPCO and DGS are closely related subsidiaries of the same corporate parent , and DGS never transferred funds to DEPCO in pay ment for the gas. Plaintiffs contend that DEPCO did not actuall y “sell” the gas to DGS at the wellhead, but transported the gas to the Bridgeport Plant, where DGS

“ charged ” DEPCO a 17.5% processing fee

— a percentage far greater than the
market rate for processing

. Plaintiffs further contend that this processing fee

was passed on to the royalty owners by DEPCO ’s artificial lower ing of the purchase price at the wellhead by 17.5% , uniform ly using this methodology for every well within the Bridgeport System. Plaintiffs insist that all royalty

owners t hus received lower payments as a result of DEPCO’s purely internal pricing scheme. Case: 17-10320 Document: 00514683594 Page: 3 Date Filed: 10/16/2018B. Implied D uty to M arket in Class Leases Each Plaintiff’s royalty interest was memorialized on one of nine
standard oil and gas lease forms (the “Class Lease F orms”). Plaintiffs claim
that all Class Lease Forms are “ proceeds ” leases, in which royalty payments are based on the net proceeds , viz., the amount realized by the lessee

— here, DEPCO

— when the gas is sold at the well. 2 According to Plaintiffs, when a
miner al lease does not contain any provision regarding a duty to market, Texas law implie s a duty to market. This duty requires producers like DEPCO to act in good faith to obtain “the best price reasonably attainable.” Plaintiffs argue that DEPCO breached the implied duty to market when it artificially lowered the price of the natural gas that it sold to DGS at the wellhead . Plaintiffs
contend that because (1) all of the Class Lease Form s are deemed to include
such an implied duty to market, and (2) DEPCO used a uniform pricing methodology to artificially lower the wellhead price and the resulting royalty payments , all class members have “i dentical duty

- to

- market claims.” DEPCO maintains, however, that some of the Class Leases are not subject to an implied duty to market. It claim s that the district court d id not examine the Class Leases and only assumed that each o f them was subject to an implied duty to market. According to DEPCO, three of the named Plaintiffs’ nine leases were modified to change the lessee’s marketing duty, s o that the implied duty to market does not apply to each of the named Plaintiff’s leases,
much less to each of the 4,143 Class Leases.

2 As discussed more fully below, Plaintiffs submitted expert testimony from an “industry veteran” who reviewed more than 10,000 DEPCO leases. He identified 4,143 Leases on the nine Class Lease Form s which did not include any modifications or addenda that would modify the duty to market. Based on this evidence, the district court limited the Class Leases to these 4,143 documents. Case: 17-10320 Document: 00514683594 Page: 4 Date Filed: 10/16/2018C. District Court Decision Plaintiffs originally filed this suit in the Eastern District of Texas, alleging that DEPCO improperly calculated and intentionally underpaid royalties to Plaintiffs for gas that was processed through the Bridgeport Plant. 3 That court scheduled a day

- l ong class certification hearing to receive evidence

on the certifica tion issue. Shortly before the date scheduled for that hearing, however, DEPCO filed an emergency motion to stay the proceedings pending resolution of its motion to transfer venue. 4 The hearing was stayed and the

case was eventually transferred to the Nort hern Distri ct of Texas, where Plaintiffs’ motion for class c ertification was eventually denied. 5 Plaintiffs then filed a motion for r econsideration

. Their motion requested an opportunity to present evidence in support of certification, and t he district cou rt held a class certification evidentiary hearing. After reviewing the additional evidence , including “ over one hundred exhibits, sizeable deposition designations, and the testimony of four live witnesses[,]” the district court granted Plaintiffs’ motion

a nd certified the class. DEPCO timely appealed.
II. L AW AND A NALYSIS A. Standard of Review We review a district court’s class certification for abuse of discretion. 6
A buse of discretion occurs only when all reasonable persons would reject the view of the district court. 7 “Implicit in this deferential standard is a recognition of the essentially factual basis of the certification in quiry and of the district

3 The s e claim s include gas that was processed at the Bridgeport Plant from January 1, 2008 until October 24, 2014.

4 The motion to stay was subsequently granted by a panel of this court. See No. 17

- 90002, Henry Seeligson, et al v. Devon Energy Production Co. LP

. 5 See ECF TX ND 3:16

- CV

- 82, 139.
6 Regents of Univ. of Cal. v. Credit Suisse First Bos. (USA), Inc. , 482 F.3d 372, 380 ( 5th Cir. 2007).
7 Union Asset Mgmt. Holding A.G. v. Dell, Inc ., 669 F.3d 632, 638 (5th Cir. 2012). Case: 17-10320 Document: 00514683594 Page: 5 Date Filed: 10/16/2018No. 17

- 10320

6 court’ s inher ent power to manage and control pending litigation.” 8 W e review de novo, however, w hether the district court app lied the correct lega l
standard

. 9
B. Federal Rule of Civil Procedure 23 Requirements “[T] o maintain a class action, the class sought to be represented must be adequately defin ed and clearly ascertainable.” 10 This requirement is an implied prerequisite of Rule 23. 11 “However, the court need not know the identity of each class member before certification; ascertainability requires

on ly that the court be able to identify class members at some stage of the proceeding.” 12 If the proposed class is ascertainable, the party seeking certification must also comply with Federal Rule of Civil Procedure 23. 13 That party must first satisfy Rule 23(a)’s requirements of numerosity, commonality, typicality, and adequacy of representation. 14 If successful, that party must
then satisfy the provisions of one of Rule 23(b)’s three subsections. 15 In this

case , Plaintiffs rely on Rule 23(b) (3), “which requi res that questions of law or fact common to the class predominate over questions affecting only individual members, and that a class action is superior to other available methods for the fair and efficient adjudication of the controversy.” 16 “The Rule 23(b) (3) predominance inquiry tests whether proposed classes are sufficiently cohesive

8 In re Monumental Life Ins. Co. , 365 F.3d 408, 414 (5th Cir. 2004) (quoting Allison v. Citgo Petroleum Corp ., 151 F.3d 402, 408 (5th Cir. 1998)).
9 Maldonad o v. Ochsner Clinic Found ., 493 F.3d 521, 523 (5th Cir. 2007).
10 Union Asset Mgmt. Holding , 669 F.3d at 639 (quoting DeBremaecker v. Short , 433 F.2d 733, 734 (5th Cir. 1970) (per curiam)).
11 John v. Nat’l Sec. Fire & Cas. Co ., 501 F.3d 443, 445 (5th Cir. 2007).
12 Frey v. First Nat. Bank Sw. , 602 F. App’ x 164, 168 (5th Cir. 2015) (unpublished) (quoting William B. Rubenstein, N EWBERG ON C LASS A CTIONS § 3:3 (5th ed. 2011)).
13 F ED

. R. C IV

. P. 23.
14 F ED

. R. C IV

. P. 23(a).
15 F ED

. R. C IV

. P. 23(b).
16 Ahmad v. Old Republic Nat’l Title Ins. , 690 F.3d 698, 702 (5th Cir. 2012) (citing F ED

. R. C IV

. P. 23(b)). Case: 17-10320 Document: 00514683594 Page: 6 Date Filed: 10/16/2018No. 17

- 10320

7 to warrant adjudication by representation.” 17 Plaintiffs have the burden of showing that Rule 23’s requirements are met. 18
i. Ascertainability
The district court did not abuse its discretion in determining that the class of royalty owners was ascerta inable. DEPCO relied on precedent from the Third Circuit to claim that the Plaintiffs had to demonstrate “ by a preponderance of t he evidence, that the class is ‘ currently and readily
ascertainab le based on objective criteria.’” 19 But, t his court has not adopted
that heightened standard. Instead , a party need only demonstrate

— “at some stage of the proceeding” 20

— t hat t he class is “ adequately defin ed and clearly ascertainable.” 21 Here, both DEPCO and the public records provide sufficient objective criteria from which to identify class members. 22 We conclude that the district court did not abuse its discretion in finding that the class is
ascertainable.
ii. Commonality The parties do n ot dispute the district court’s ruling s regarding numerosity, typicality , or adequacy of representation; however, DEPCO does

17 Amchem Prods., Inc. v. Windsor , 521 U.S. 591, 623 (1997).
18 Wal

- Mart Stores, Inc. v. Dukes , 564 U.S. 338, 350

– 51 (2011)

. 19 Carrera v. Bayer Corp ., 727 F.3d 300, 306 (3d Cir. 2013) (quoting Marcus v. BMW of N. Am., LLC , 687 F.3d 583, 593 (3d Cir. 2012)).
20 Frey , 602 F. App’x at 168 (quoting William B. Rubenstein, N EWBERG ON C LASS A CTIONS § 3:3 (5th ed. 2011)).
21 Union Asset Mgm t. Holding , 669 F.3d at 639 (quoting DeBremaecker , 433 F.2d at 734 ).
22 DEPCO claims that it does not record ownership by lease and does not have complete records on past ownership. It contends that Plaintiffs’ proposed alternative

— reviewing property and title records

— is not administratively feasible and therefore fails to satisfy Rule 23’s ascertainability requirements. We are not convinced . Before any individual class member can recover, he must demonstrate that he was entitled to receive royalty payments. “However, . . . ‘the possibility that some [claimants] may fail to prevail on their individual claims will not defeat class membership’ on the basis of the ascertainability requirement.” In re Deepwater Horizon , 739 F.3d 790, 821 (5th Cir. 2014). Case: 17-10320 Document: 00514683594 Page: 7 Date Filed: 10/16/2018No. 17

- 10320

8 challenge th at court’s rul ing on commonality. To satisfy Rule 23’s commonality requirement, Plaintiffs had to demonstrate th at th er e are qu estions of law or fact common to the class. 23 A common question “ must be of such a nature that it is capable of classwide resolution

— which means that determination of its truth or falsity will resolve an issue that is central to the validity of each one of the claims in one stroke .” 24 This requirement “can be satisfied by an instance of the defendant’ s injurious conduct, even when the resulting i njurious effects

— the damages

— are diverse .” 25 The district court determined that the answers to two common qu estions would determine whether DEPCO violated the implied duty to market: (1) “Did the 82.5% value sale of residue gas and NGLs violate DEPCO’s duty to market owed to royalty owners?” and (2) “Did DEPCO violate its duty to market owed to royalty owners by failing to recover profits from DGS for gas sales DGS made to third parties?” DEPCO contends that these questions are based on incorrect application of Texas law and erroneous factual findings , leading the district court to abuse
its discretion in conclud ing that the proposed class satisfies Rule 23(a)’s commonality requirement

. If these questions are not common to the class, or if they are based on incorrect legal conclusions or factual findings , class certification was an abuse of discretion. 26

a. Duty to Market
DEPCO insist s that the district court abused its discretion when it
determin ed that each of the Class Leases imposed the same marketing duty

23 F ED

. R. C IV

. P. 23(a).
24 Wal

- Mart Stores, Inc. , 564 U .S. at 350

. 25 Deepwater Horizon , 739 F.3d at 810

– 11.
26 Regents of Univ. of Cal

. , 482 F.3d at 380 (“Where a district court premises its legal analysis on an erroneous understanding of governing law, it has abused its discretion.”). Case: 17-10320 Document: 00514683594 Page: 8 Date Filed: 10/16/2018No. 17

- 10320

9 without reviewing every individual lease and any “ancillary documents” that might have modified DEPCO’s duty to market the gas. Relying on Dvorin v. Chesapeake Exploration , DEPCO contends that , under Texas law, the district court was required to review every Class Lease , as well as any ancillary
documents , before determining that all the Class Leases imposed the same duty to market.
T he district court in Dvorin determined that the leases of the proposed class members were insufficient to demonstrate that the claims could be resolved with a “common answer.” 27 The court explained that , even though the “specific portions of the royalty provisions . . . are substantially the same, the court is required to review the contracts as a whole.” 28 Once the court reviewed the entire document, it was clear that the contracts varied regarding “the point

o f sale,” and “ cost at the well. ” 29 Some even contained clauses that limited royalty payments based on the price Chesapeake paid for its share of production. 30 The Dvorin court held that , b ecause other terms of the contract modified the royalty clauses, the c lass members’ claims could not be resolved
with a common answer. There is no evidence that such differences exist here. Dvorin did not hold
that a court must locate every potential ancillary document before determining that a group of l eases imposed the same duty. There, the plain language of the

contracts varied so much that it was not possible to reach a “common answer”

to the p laintiffs’ claims. Here, in comparison, the court determined that “none of the nine lease forms contain langu age that modifies the implied covenant to

27 Dvorin v. Chesapeake Expl., LLC , No. 3:12

- CV

- 3728

- G, 2013 WL 6003433, at *6 (N.D. Tex. Nov. 13, 2013)

. 28 Id

. 29 Id

. 30 Id

. Case: 17-10320 Document: 00514683594 Page: 9 Date Filed: 10/16/2018No. 17

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10 market.” 31 Defendants have not provided any ancillary documents that modify the duty to market in the Class Leases

. 32 In fact, even six months after the district court certified a class based on 4,143 individual leas es, DEPCO’s expert challenged only five of them

. DEPCO also claims that three of the Class Lease Forms contain express marketing clauses and therefore cannot include the implied duty to market.
Tho se clause s state that DEPCO must “use reasonable diligence to produce, utilize, or market the minerals.” DEPCO is correct that this language precludes the implied duty to market; however, it does not necessarily impose

a different marketing duty on DEPCO. Neither DEPCO nor Plaintiffs cite any

case that stands for the proposition that an express duty to market requires
either the same or a different marketing duty than the implied duty to market.
In Bowden v. Phillips Petroleum Co ., the Texas Supreme Court evaluated a similar situation, yet declined to state a cate gorical rule on this issue. 33 There, the p laintiffs claim ed that a group of proceeds leases , some with both express marketing clauses an d , others with the implied duty to market , imposed the same duty. The court explained that it could be possible that exp ress and implied duties to market may not “in practice require different conduct.” 34 Here, the express marketing clause in three of the Class Leases Forms imposes a duty to use “reasonable diligence,” which is virtually identical to the implied duty to act as a “reasonably prudent operator.” 35 Given this close

31 See Seeligson v. Devon Energy Prod. Co., L.P. , No. 3:16

- CV

- 00082

- K, 2017 WL 68013, at *17 (N.D. Tex. Jan. 6, 2017)

. 32 During the certification hearing, Plaintiffs presented testimony from an industry expert who led a team in reviewing more than 10,000 leases received from DEPCO. T he

e xpert testified that any leases which had exhibits or addenda that modified the duty to marke t were excluded from the class.
33 247 S.W.3d 690, 701 (Tex. 2008).
34 Id.
35 See Amoco Prod. Co. v. Alexander , 622 S.W.2d 563, 567

– 68 (Tex. 1981)

. Case: 17-10320 Document: 00514683594 Page: 10 Date Filed: 10/16/2018No. 17

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11 similarity and the fact that Texas law acknowledges that express marketing
clauses m ight impose the same duty as the implied duty to market, the district
court did not abuse its discretion in ho ld ing that DEPCO owed all class
members the sam e duty , under either the express marketing clause or the implied duty to market

. 36 Owing a uniform duty, however, is not necessarily sufficient to establish commonality. The duty DEPCO owed to the royalty owne rs was “an obligation to obtain the best current price reasonably available.” 37 In Bowden v. Phillips
Petroleum , the Supreme Court of Texas explained that even if a gas producer owed “an identical duty to market” to a group of royalty owners, the jury would
still need to determine “the price a reasonably prudent operator would have received at the wellhead.” 38 The Bowden court explained that “variations in well locations, quality of production, and field regulations, among other factors, will require the jury to conduct a well

- by

- well analysis

. . . unless the class offers particular evidence that the gas price at the wells can be evaluated classwide .” 39 Plaintiffs argue that such a well

- by

- well analysis is not necessary here because DEPCO used a uniform pricing structure for every well in the Bridgeport System. Plaintiffs contend that they do not need to adduce evidence of a higher available price at each wellhead, but only evidence that DEPCO could have processed the gas at a fee lower than the 17.5% it paid DGS. After reviewing the parties ’ motions and evidence, and hearing extensive testimony regarding the Class Leases, t he district court determined that DEPCO use d a classwide pricing structure determined by the uniform pro cessing fee, so that

36 T his determination falls squarely within the “ district court’s inherent power to manage and control pending litigation .” See Monumental Life Ins. Co. , 365 F.3d at 414 (quoting Allison , 151 F.3d at 408 ).
37 Union Pac. Res. Grp., Inc. v. Hankins , 111 S.W.3d 69, 72 (Tex. 2003)

. 38 Bowden , 247 S.W.3d at 701.
39 Id

. at 701

– 02 (emphasis added). Case: 17-10320 Document: 00514683594 Page: 11 Date Filed: 10/16/2018No. 17

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12 the gas price at the wells could be evaluated classwide. 40 In light of the “essentially factual basis of the certification inquiry and of the district court’s inherent power to manage and control pending litigation,” 41 we are convinced

t hat the district court did not abuse its discretion in rul ing that Plaintiffs could
demonstrate that DEPCO breached its implied duty to market by basing its price on a higher processing fee than the fee that a “reasonably prudent operator would have receiv ed at the wellhead.” 42 This issue is precisely the type of common question “ that determination of its truth or falsity will resolve an issue that is central to the validity of each one of the claims in one stroke. ” 43 b. Duty to recover downstream profits
The se cond question the district court found common to all class
members was , “Did DEPCO violate its duty to market owed to royalty owners by failing to recover profits from DGS for gas sales DGS made to third parties?”
Later in the order, the district court framed this issue as whether DEPCO breached its duty “by not following its own policy to recoup the profits DGS made on subsequent gas sales.” At no point, however, did the district court

40 See Bowden , 247 S.W.3d at 701

. 41 Monumental Life Ins. Co. , 365 F.3d at 414 (quoting Allison , 151 F.3d at 408 ).
42 See Bowden , 247 S.W.3d at 701

. As discussed more fully below, the district court made the factual determination that the price was determined based on the processing fee DGS charged DEPCO. This factual finding is reviewed for clear error. See Energy Mgmt. Corp. v. City of Shreveport , 46 7 F.3d 471, 479 (5th Cir. 2006). Furthermore, given the limit on conducting “merits inquiries” at this stage in the litigation, and the deference granted to the district court’s factual findings, that court did not abuse its discretion in determining that whether DEPCO breached its duty to Plaintiffs was a common question capable of classwide resolution

. See Deepwater Horizon , 739 F.3d at 810 (quoting Wal

- Mart Stores, Inc ., 564 U.S. at 350) ( citations omitted) (holding that an issue is capable of classwide resolution when the “determination of its truth or falsity will resolve an issue that is central to the validity of each one of the claims in one stroke.”).
43 Wal

- Mart Stores, Inc. , 564 U.S. at 350. Case: 17-10320 Document: 00514683594 Page: 12 Date Filed: 10/16/2018No. 17

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13 explain why the implied duty to market includes a duty to recoup pro fits made on downstream gas sales. 44 DEPCO insist s that neither the Class Leases nor the implied duty to market imposed a duty to recoup downstream profits ; and Plaintiffs do not
address th is alleged duty in their brief. At best, Plaintiffs aver that DEPCO policies instructed that “DGS may not make profit at the expense of [DEPCO by] ... sell[ing] gas to third parties at higher prices than the transfer price under the GPPA.” 45 The district court did not provide any legal basis for imposing a duty to recover do wnstream profits on DEPCO, so it abused its
discretion when it determin ed that this was a common question which could support class certification. Fifth Circuit law , however, recognizes that even one common question may be sufficient to support commonality. 46 Here, the district court determined that the driving question behind th is class litigation would be whether DEPCO artificially lowered the wellhead price , in violation of the implied duty to
market. Texas law is clear that , to determine whether DEPCO has breached the implied duty to market, the court must “focus[] on the behavior of the lessee rather than on evidence of other sales .” 47 Because DEPCO’s behavior presents “at l east one contention that is central to the validity of each class member ’ s

44 The court did not expressly find that DEPCO’s sales to DGS were a sham, but , based on the way it phr ased the second common question , it certainly seems to imply that the sale was a sham. The validity of this possible conclusion, howe ver, is not currently before this panel.
45 Plaintiffs do not assert that they have standing to enforce these internal guidelines, but contend that standing is a merits question which should not be resolved at this stage of th e litigation.
46 See Deepwater Horizon , 739 F.3d at 810.
47 Hankins , 111 S .W.3d at 71. Case: 17-10320 Document: 00514683594 Page: 13 Date Filed: 10/16/2018No. 17

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14 claims[,]” the district court did not abuse its discretion in rul ing that commonality was satisfied. 48
iii. Predominance Federal Rule of Civil Procedure 23(b)(3) requires the court to determine
whether “the questions of law or fact common to class members predominate over any questions affecting only individual members.” 49 This “entails identifying the substantive issues that will control the outcome, assessing which issues will predomi nate, and then determining whether the issues are common to the class, a process that ultimately prevents the class from degenerating into a series of individual trials.” 50 Absent this analysis, “it [is] impossible for the court to know whether the common i ssues would be a

48 Id

. While it is uncommon to find commonality based on a single issue, we are mindful that commonality and predominance should be evaluated by “weighing, not counting, issues.” See In re Oil Spill by Oil Rig Deepwater Horizon in Gulf of Mexic o, on Apr. 20, 2010 , 910 F. Supp. 2d 891, 912 (E.D. La. 2012), aff’ d sub nom. In re Deepwater Horizon , 739 F.3d 790 (5th Cir. 2014). Given that whether DEPCO breached its duty to market will constitute a substantial portion of the litigation, this single i ssue is sufficient to support the distr ict court’s commonality finding

. DEPCO argues that the district court abused its discretion because it based the purported common question in this case on erroneous factual findings regarding the type of leases involved in this case . The parties agree that DEPCO sold natural, unprocessed gas to DGS at the wellhead pursuant to a proceeds lease . In characterizing the transaction as a sale of “residue gas and natural gas liquids,” the district court incorrectly describe d a market value lease , rather than a proceeds lease. See Seeligson , 2017 WL 68013, at *2. In its analysis, however, the court described the sale of natural gas at the wellhead and treated the leases as proceeds leases , t riggering the implied duty to market. See Seeligson , 2017 WL 68013, at *15

– 16. Because it applied the correct analysis and ultimately described the complicated transaction accurately, the district court’s initial misstatements regarding the type of gas sol d at the wellhead were harmless error. DEPCO also contends that the district court “implied” that affiliate sales should be held to a higher duty to market than non

- affiliate sales. This contention seems to be based solely on the fact that the district cou rt included the word “affiliate” in its description of the issues in this case. Nothing in the district court’s opinion indicates that it sought to hold DEPCO to a higher standard because it sold the gas to its corporate affiliate. DEPCO’s contention on t his issue is without merit.
49 F ED

. R. C IV

. P . 23(b)(3).
50 Gene And Gene LLC v. BioPay LLC , 541 F.3d 318, 326 (5th Cir. 2008) (quoting Bell Atl. Corp. v. AT&T Corp ., 339 F.3d 294, 302 (5th Cir. 2003)). Case: 17-10320 Document: 00514683594 Page: 14 Date Filed: 10/16/2018No. 17

- 10320

15 ‘significant’ portion of the individual trials

. . . much less whether the common issues predominate.” 51 DEPCO insist s that each lease raises individual issues regarding tolling and the applicable statute of limitations , precluding predomin ance. DEPCO explains that the class certification order includes two categories of claims that are time barred: (1) claims that DEPCO breached the implied duty to market when it entered the GPPA in 2005; and (2) claims that DEPCO breached this duty beginni ng on January 1, 2008, when it failed to recoup profits on DGS’s downstream sales. Plaintiffs count er that the limitations periods were tolled by the discovery rule and fraudulent concealment. DEPCO responds to this by stating that the determin ation whethe r the limitation periods were tolled will require “thousands” of mini

- trials. DEPCO raised these potential individu al issues in the district court, but in its certification order, the court did not
discuss how limitation s and tolling questions might affect predominance. Despite the potential for individual questions based on DEPCO’s statute of limitations defense, the district court did not mention the role , if any, the tolling or limitations issues would play in this class action litigation

. To establish predominance, the district court must identify “the substantive
issues that wi ll control the outcome, assess[ ] which issues will predominate, and then determin[e] whether the issues are common to the class.” 52 Absent this analysis, “it [is] impossible for t he court to know whether the common issues would be a ‘significant’ portion of the individual trials

. . . much less
whether the common issues predominate.” 53 The district court did not consider the statute of limitations and tolling questions in its predominance analysis,

51 Madison v. Chalmette Ref., L.L.C ., 637 F.3d 551, 557 (5th Cir. 2011).
52 Bell Atl. , 339 F.3d at 301.
53 Madison , 637 F.3d at 557

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16 so it abused its discretion when it determined that common questions would predominate over individual issues and certif ied the class. 54
III. CONCLUSI ON
The district court did not abuse its discretion in concluding that Plaintiffs satisfied Federal Rule of Civil Procedu re 23’s commonality requirement. Because the court failed to address whether the applicable statute of limitations and pote ntial tolling questions would raise individual
issues , it abused its discretion in certifying the class as written. We therefore REVERSE and REMAND for further proceedings consistent with this opinion.

54 See id

. (“By failing to adequately analyze and balance the common issues against the individualized issues, the district court abused its discretion in determining that common issues predominated and in certifying the class.”)

. Case: 17-10320 Document: 00514683594 Page: 16 Date Filed: 10/16/2018