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McGehee v. Forest Oil Corp.

United States Court of Appeals, Tenth Circuit

November 6, 2018

JACOB McGEHEE; STEVEN RAY HEATH, Plaintiffs-Appellants,
v.
FOREST OIL CORPORATION; LANTERN DRILLING COMPANY, Defendants-Appellees, and SOUTHWEST ELECTRONIC ENERGY CORPORATION, Defendant Third-Party Plaintiff,
v.
ENGINEERED POWER LP; TELEDRIFT, INC., Third-Party Defendants.

          Appeal from the United States District Court for the Western District of Oklahoma (D.C. No. 5:15-CV-00145-C)

          Reggie N. Whitten (Michael Burrage and J. Revell Parrish with him on the briefs), of Whitten Burrage, Oklahoma City, Oklahoma, for Plaintiffs-Appellants.

          Clark W. Crapster of Steidley & Neal, P.L.L.C, Tulsa, Oklahoma, for Defendants-Appellees.

          Before BRISCOE, LUCERO, and MATHESON, Circuit Judges.

          MATHESON, Circuit Judge.

         Plaintiffs Jacob McGehee and Steven Ray Heath appeal the district court's grant of summary judgment to defendants Forest Oil Corp. and Lantern Drilling Co.[1] Forest and Lantern leased a drilling device from Teledrift, the plaintiffs' employer, and returned the device after using it in drilling operations. Plaintiffs then proceeded to clean and disassemble it. Mr. McGehee discovered that, in addition to mud and other debris, several small bolts had fallen into the device. While he attempted to remove these materials, the lithium battery inside the device exploded, injuring himself and Mr. Heath. They sued Forest and Lantern for negligently causing the explosion by allowing bolts to fall into the device. Following discovery, Forest and Lantern moved for summary judgment, which the district court granted, holding they did not owe the plaintiffs a duty of care under Oklahoma tort law. Exercising jurisdiction under 28 U.S.C. § 1291, we affirm.

         I. BACKGROUND

         A. Factual Background

         Forest and Lantern leased a drilling device from Teledrift. The plaintiffs' expert, Joseph D. Jolson, submitted a report that described the device as follows:

From about 2004 - 2008, Teledrift and an acquired company's engineers designed the Proshot; a measurement while drilling (MWD) tool that uses wireless positive mud pulsing technology to provide inclination and azimuth measurements to workers at the well surface during vertical downhole drilling. Teledrift and the acquired company's design team knew Excell and [Southwest Electronic Energy Corporation ("SWE")] as designers and manufacturers of the lithium-thionyl chloride cell containing battery packs used to power MWD tools. Both companies were asked to design battery packs for the Proshot MWD tool. Excell was chosen as the initial manufacture[r].
The Proshot MWD tool's cylindrical battery pack contains six spirally-wound, high-rate, high-capacity DD, lithium-thionyl chloride cells arranged in series. To make a Proshot MWD tool battery assembly, the battery pack is slipped inside a copper-beryllium tube with a wall thickness of almost 0.2 inches. Bulkheads at each end of the copper-beryllium tube keep the battery pack in place and allow electrical connection to the instrument package. The Proshot's battery assembly is approximately 4½ feet long.
The Proshot MWD tool instrument package is approximately 3-feet long. It has a valve body with a diameter of about 4½ inches which becomes one end of the fully assembled Proshot MWD tool. Near the valve body is the locking collar. When the Proshot instrument package is connected to the battery assembly, the Proshot MWD tool is 89.85 inches long. The centralizer has a diameter of about 3½ inches and is the part of the battery assembly furthest from the valve body. Between the valve body and the centralizer, the diameter of the Proshot MWD tool is mostly much smaller than 3½ inches with the locking collar having the largest diameter.
Before shipment to a drill site, Teledrift connects the Proshot's instrument package to a battery assembly. The Proshot MWD tool's valve body is inserted into the box end of the cylindrical drill collar which has an opening of about 4¾ inches. It is pushed further in until it comes to rest on a shoulder at the pin end of the drill collar which has an opening of about 2½ inches.
The length of the resulting drill collar assembly can range from 10 to 16 feet. For most of the Proshot MWD tool's length, there is a gap between its outside diameter and the inside diameter of the drill collar. When the drill collar assembly is downhole, the Proshot MWD tool is vertical and the battery assembly is above the instrument package. During drilling, lubricating mud or lubricating mud mixed with loss circulation material (LCM) is forced into the opening at the box end of the drill collar. The mud or mud/LCM mixture travels down the gap between the battery assembly and drill collar, reaches the instrument package, passes the narrowing gap at the locking collar, slips through holes in the Proshot's valve body and exits at the pin end of the drill collar assembly.

ROA, Vol. I at 137. In their opposition to summary judgment, the plaintiffs submitted the following diagram and photograph of the ProShot MWD. ROA, Vol. II at 190-91.

         (Image omitted)

         As described by Dr. Jolson and as depicted above, the ProShot Measurement While Drilling ("ProShot MWD" or "ProShot") tool, when fully assembled, includes a valve body, a paddle, a locking collar, a lithium battery, a piston, a centralizer, and a debris catcher. This assembly fits into a cylindrical drill collar, also called a drill pipe or "sub." ROA, Vol. I at 145-46.

         In addition to the foregoing names of the ProShot MWD collar assembly parts, this opinion uses terms related to the drilling operator's use of the tool. The "drill hole" is the hole in the ground where the drill pipe containing the ProShot assembly is inserted. "Downhole" refers to the shaft of the "drill hole." Thus, mud or rocks falling "downhole" necessarily drop into the "drill hole," and may also fall into the "drill pipe" containing the ProShot assembly, including the lithium battery.

         The terms "debris catcher" and "drill screen" (or "debris screen") appear in the record without much explanation or discussion. We understand "debris catcher" to be a part of the ProShot MWD assembly that sits on top of the ProShot tool and is placed along with the tool inside the drill pipe (or collar). We understand "drill screen" to be an item that is used to prevent debris from falling into the drill hole.

         Oil and drilling companies use the ProShot MWD to guide the drilling process by sending information to the controllers at the surface level. Mud and rocks frequently enter the drill collar assembly during the tool's use. After the device is returned, Teledrift cleans and disassembles it by pulling the ProShot MWD tool from the drill collar. Mud and rocks lodged inside the collar frequently can impede removal of the ProShot. Teledrift employees use various methods to extract the ProShot.

         Mr. McGehee and Mr. Heath worked for Teledrift. Their jobs included disassembling the ProShot devices when they were returned after use. In this case, having received the drilling device from Forest and Lantern, the Teledrift crew consisting of Mr. McGehee, who was the foreman, and Mr. Heath and Charles Wheeler, commenced the process to remove the ProShot MWD tool from the drill collar (or drill pipe). Mr. McGehee sprayed water into the collar to loosen mud. Then he used a pulling tool to remove the ProShot, but it was stuck. He continued to spray water into the collar and observed three or four bolts come out. He then tapped the valve body inside the collar with a 125-pound metal rod to dislodge the ProShot, a method he had used before.

         Mr. McGehee struck the valve body in this manner approximately 120 times after spraying water to loosen dried mud. After about 30 minutes of work to remove the ProShot from the collar, the ProShot's lithium battery pack exploded, injuring Mr. McGehee and Mr. Heath, who was standing nearby. Mr. Wheeler was not injured. No evidence was adduced that Forest or Lantern knew that bolts had dropped into the drilling device. See Oral Arg. at 3:36-4:02.

         B. Procedural Background

         Mr. McGehee and Mr. Heath filed an action in the Oklahoma State District Court of Cleveland County. They alleged that at least one of the bolts inside the drilling device compromised the lithium battery pack and caused the explosion. They further alleged that Forest and Lantern negligently allowed the bolts to fall downhole, resulting in the explosion and their injuries. The case was removed to the Western District of Oklahoma under 28 U.S.C. §§ 1332, 1441, and 1446.

         After the parties completed discovery, Forest and Lantern moved for summary judgment, which the district court granted, holding that Forest and Lantern did not owe a duty of care to the plaintiffs. It relied on Beugler v. Burlington Northern & Santa Fe Railway Co., 490 F.3d 1224 (10th Cir. 2007). In Beugler, Burlington Northern & Santa Fe ("BNSF") had lowered a crossing gate to repair a broken rail. Id. at 1229. When the plaintiff, a Union Pacific Railroad employee, lifted the gate for traffic to pass by, he turned toward a honking truck and injured his neck. Id. at 1226-27. He sued BNSF for negligence. We affirmed summary judgment for BNSF, holding that BNSF did not owe a duty to the plaintiff under Oklahoma law. Because the plaintiff had been trained to lift crossing gates and had ...


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