MEMORANDUM OPINION AND ORDER

JAMES O. BROWNING, District Judge.

THIS MATTER comes before the Court on: (i) the Plaintiffs' Motion to Alter or Amend and to Reconsider Memorandum Opinion and Order [Doc. 252], filed September 15, 2016 (Doc. 255)("Motion to Amend"); and (ii) the Plaintiffs' Second Motion for Class Certification, filed September 15, 2016 (Doc. 256)("Second Motion for Class Certification"). The Court held a hearing on January 24, 2017. The primary issues are: (i) whether the Plaintiffs may raise a new class definition not in the Fourth Amended Complaint, filed October 31, 2013 (Doc. 96-1); (ii) if the Court required the Plaintiffs to amend their Complaint before proposing a new class definition, whether rules 15(a) and 16(b)(4) bar such an amendment; (iii) whether the Plaintiffs previously waived their new class definition by proposing and withdrawing an older one; (iv) whether the new proposed class is ascertainable; (v) whether the new proposed class definition creates commonality; and (vi) whether the new proposed class definition will allow common issues to predominate over individual ones. The Court concludes that (i) the Plaintiffs may raise a new class definition not in the operative complaint; (ii) even if the Plaintiffs could not do so, rules 16(b)(4) and 15(a) would not bar the Plaintiffs from amending their complaint; (iii) the Plaintiffs have not previously waived their new class definition; (iv) the proposed class definition is ascertainable; (v) the proposed class definition does not create commonality; and (vi) common issues would not predominate over individual ones. Accordingly, the Court denies the Motion to Amend and the Second Motion for Class Certification.

FACTUAL BACKGROUND

Plaintiffs Steven J. Abraham and H Limited Partnership filed this class action in August 2012 to recover damages for gas royalty underpayments that Defendant WPX Energy Production L.L.C.("WPX Energy") allegedly makes. Motion to Amend at 1. WPX Energy pays the plaintiff royalty owners on a payment method called the keep-whole payment methodology. See Motion to Amend at 1. This payment method "pays royalty on a well's volume of produced MMbtus (British Thermal Units) based on methane volume and omits royalty [payments] on the value of [Natural Gas Liquids]" or NGLs. Motion to Amend at 2. The Plaintiffs' major contention is that this payment method does not pay them royalties on the value of refined NGLs. See Motion to Amend at 1. Previously, the Plaintiffs moved the Court to certify them as a class, which the Court denied. See Abraham v. WPX Production Productions, LLC, 317 F.R.D. 169, 175 (D.N.M. 2016)(Browning, J.)("Abraham"). The Court denied the previous motion for class certification for several reasons. First,

317 F.R.D. at 175. In other words, the Court held that the proposed class was not ascertainable. See 317 F.R.D. at 254.

The Court further concluded that "how the Defendants should have paid the Plaintiffs . . . varies between leases" because of "textual variations among the leases." 317 F.R.D. at 175. The Court ruled that these factors destroyed two key requirements of class certification, commonality and predominance. See Fed. R. Civ. P. 23(a)(2), (b)(3). The Court also held, however, that the Plaintiffs met the other requirements for class certification. See Abraham, 317 F.R.D. at 175. Because the Court ultimately denied the Motion, the Plaintiffs have now filed a Motion to Amend and Second Motion for Class Certification.

PROCEDURAL BACKGROUND

The Court will outline the basic allegations and legal arguments underlying the Plaintiffs' motions. The Court will also describe the Defendants' responses to those arguments. Finally, the Court will summarize the hearing on these motions.

1. The Motion to Amend.

The Plaintiffs contend that the Court should alter or amend its opinion in Abraham based on a new proposed class definition. See Motion to Amend at 5. Specifically, the Plaintiffs have proposed the following new class definition:

Motion to Amend at 5-6. The Plaintiffs make several arguments why this class definition improves upon the original one. First, the Plaintiffs contend that, unlike in the original class definition, "the class members can be identified without regard to where their gas was processed, or whether it was processed on the WFC system." Motion to Amend at 6. The Plaintiffs assert, "[t]he class includes owners who are paid on the keep-whole methodology regardless of the circumstance of the gas processing." Motion to Amend at 6. They assert that "WPX records provide a database which can identify the class members." Motion to Amend at 6.

Next, the Plaintiffs argue that "the amended class definition addresses many of the Court's concerns about commonality," because, "[d]uring the relevant period, WPX has uniformly paid royalty and overriding royalty to the members of the putative class on a keep-whole method for production gathered and processed by WFC. . . ." Motion to Amend at 7. According to the Plaintiffs, this royalty payment system "calculates payment to class members despite variables in gas flow delivery to processing plants and whether in given instances some of the class wells' gas stream may not be processed." Motion to Amend at 7.

Regarding the issue of predominance, the Plaintiffs contend that "[c]ommon issues will predominate where the class is limited to those owners paid on proceeds and market value of gas at the well leases." Motion to Amend at 9. Specifically, they argue that, under the new class definition, "the Court must resolve the premier common issue, whether plaintiffs are entitled to royalty on processed NGLs, as to only two lease forms," "proceeds" leases and "market value of gas at the well" leases. Motion to Amend at 9-10. The Plaintiffs' key contention is that, despite the Court previously categorizing all of the leases at issue into eleven categories (plus another for illegible leases), only two categories of leases exist under the Plaintiffs' new class definition, namely, "proceeds" leases and "market value" leases. Motion to Amend at 20; Abraham, 317 F.R.D. at 274-75. The Plaintiffs concede that the leases previously referenced as those in Categories B and F are excluded from their new class definition. See Motion to Amend at 20-21.1

Finally, the Plaintiffs assert that, given the new class definition, the Court should certify the Plaintiffs' claims for breach of the implied covenant to market. See Motion to Amend at 22. Their contention is that "WPX does not market the NGLs for the benefit of the class under the keep-whole methodology." Motion to Amend at 22. The Plaintiffs argue that this conduct breaches the implied covenant to market "as to all royalty owners who are entitled to processed NGLs under their royalty provisions." Motion to Amend at 22-23. According to the Plaintiffs, the two categories of leases in their proposed class — proceeds and market value leases — "entitle royalty owners to payment on processed NGLs." Motion to Amend at 23. The Plaintiffs conclude that, because those two lease categories are allegedly entitled to payments on NGLs, the implied covenant to market "applies to those two lease types across the board." Motion to Amend at 23.

Separately, the Plaintiffs contend that their claim for breach of the duty of good faith and fair dealing is also certifiable. See Motion to Amend at 26. They argue that, because WPX Energy has denied the class members payment on NGL royalties, WPX Energy has breached the duty of good faith and fair dealing.

In conclusion, the Plaintiffs ask the Court to amend its decision in Abraham to conclude that the Plaintiffs' new class definition satisfies all of the rule 23 class certification requirements, and certify the case as a class action based on claims for breach of contract, breach of the duty of good faith and fair dealing, and breach of the implied covenant to market. See Motion to Amend at 27.

2. The Second Motion for Class Certification.

Much of the Second Motion for Class certification repeats arguments in the Motion to Amend. It states the Plaintiffs' new class definition and again contends that the new definition meets the rule 23(a)(2) commonality requirement. See Second Motion for Class Certification at 2. It notes again that, "[t]he proposed class definition eliminates the processing issue and focuses on those owners who are paid on the keep-whole methodology." Second Motion for Class Certification at 4.

The Second Motion for Class Certification also argues that the new class definition satisfies the rule 23(b)(3) predominance requirement. See Second Motion for Class Certification at 7. Specifically, the Plaintiffs contend that the question — "are the class members entitled to be paid on the value of processed NGLs" — is answerable on a class-wide basis under the new class definition. Second Motion for Class Certification at 7. After resolving that question, the Plaintiffs argue that "[t]he only lease language inquiry required is: do proceeds (net and gross) leases and market value at the well leases entitle the lessors to share in the value of processed NGLs?" Second Motion for Class Certification at 8. The Plaintiffs argue that this question can be answered on a class-wide basis. See Second Motion for Class Certification at 8-9.

The Plaintiffs then reassert their argument that the Court should certify their claims for beach of the implied covenant to market and the duty of good faith and fair dealing. See Second Motion for Class Certification at 10. The Plaintiffs further reassert their argument that the Court should certify their claim for civil conspiracy to breach their royalty agreements. See Second Motion for Class Certification at 11.

Finally, the Plaintiffs conclude by asking the Court to certify the class based on the new class definition, and to certify their claims for breach of contract, breach of the covenant of good faith and fair dealing, breach of the implied covenant to market, and civil conspiracy. See Second Motion for Class Certification at 13. The Plaintiffs also request that the Court appoint the named Plaintiffs, Steve Abraham and H Limited, as class representatives, and appoint the Gallegos Law Firm, P.C. as class counsel. See Second Motion for Class Certification at 13.

3. The Response to the Plaintiffs' Motion to Amend.

The Defendants2 respond to the Motion to Amend. See Defendants' Response in Opposition to Plaintiffs' Motion to Alter or Amend and to Reconsider Memorandum Opinion and Order, filed November 2, 2016 (Doc. 260)("Response to Motion 1"). The Defendants briefly argue that the new class definition "does not constitute a material change in circumstances and thus does not support relief under Rule 23(c)(1)(C)." Response to Motion 1 at 6.

Next, the Defendants assert that, "by pursuing and then abandoning the `keep-whole' aspect of their new [class] definition, Plaintiffs waived it." Response to Motion 1 at 6. The Defendants argue that the Plaintiffs had previously offered a similar class definition, but later "admitted that their proposed amendment was `inappropriate' and voluntarily withdrew it." Response to Motion 1 at 6-7 (quoting Plaintiffs' Position on Defendants' Motion to Determine Class Certification Based on the Class Definition Contained in Plaintiffs' Fourth Amended Complaint, filed September 23, 2015 (Doc. 242). On these facts, the Defendants conclude that the Plaintiffs waived the "keep-whole" aspect of the new class definition. Response to Motion 1 at 6-7.

The Defendants then contend that "custom and usage evidence supports the Court's Commonality and Predominance rulings." Response to Motion 1 at 8. The Defendants note that, in Abraham, "the Court correctly concluded that `the different industry custom and usage evidence needed to identify each proposed class members' royalty interest and determine how they should be paid' is not common, and cuts against predominance." Response to Motion 1 at 9-10 (quoting Abraham, 317 F.R.D. at 273). The Defendants add that, "at a trial on the merits, evidence of trade usages could potentially bind H Ltd, Mr. Abraham, [and others] to the meaning within the oil and gas industry of disputed lease terms. Whether any of them would be bound would be a question of fact as to each of them." Response to Motion 1 at 11. The Defendants make other arguments in support of the Court's previous rulings regarding commonality and predominance. See Response to Motion 1 at 12, 16, 17, 20, 22, 23. Most notably, however, the Defendants assert that, "whether considering `proceeds' or `market value' leases, [nothing] require[s] that royalty be paid on `processed gas.'" Response to Motion 1 at 27. Specifically, the Defendants argue that the Court did not hold in Abraham that "proceeds" leases "require royalty payment on processed gas, and hence, on the value of refined NGLs." Response to Motion 1 at 27 (emphasis in original). The Defendants refer to a footnote in Abraham in which the court gave its "inclinations about what some of the royalty terms mean . . . `Proceeds' . . . forbids paying NGL royalty on a keep-whole basis." Abraham, 317 F.R.D. at 275 n.82. The Defendants note that this statement was merely the Court's "inclination" and not a holding. Response to Motion 1 at 27. "In contrast to its `inclinations,' the Court held . . . that Plaintiffs' breach-of-contract claims "require an individualized inquiry." Response to Motion 1 at 28 (citing Abraham, 317 F.R.D. at 263).

Finally, the Defendants argue that the "Plaintiffs' implied duty to market and implied duty of good faith and fair dealing claims do not satisfy commonality or predominance." Response to Motion 1 at 31. Regarding the implied duty to market, the Defendants note that the Court held that, "`[e]ven if a reasonably prudent operator would not have marketed the products using the keep-whole scheme, the Plaintiffs suffer harm only if the keep-whole scheme deprived them of their royalty interest.'" Response to Motion 1 at 31 (quoting Abraham, 317 F.R.D. at 265). "The duty to market," the Court noted, "`does not define the lessor's royalty interest; the lease's royalty provision does that.'" Response to Motion 1 at 31 (quoting Abraham, 317 F.R.D. at 265). "Thus, determining whether WPX breached the duty to market turns on an individualized inquiry into whether a particular class member's royalty instrument provides for royalty on refined NGLs." Response to Motion 1 at 31. On these facts, the Defendants conclude that "the question whether WPX breached the duty to market is, as the Court held, not a common one." Response to Motion 1 at 32 (citing Abraham, 317 F.R.D. at 265-66).

Finally, the Defendants assert that the Court cannot certify the claim for breach of the duty of good faith and fair dealing. See Response to Motion 1 at 32. The Defendants argue that the Plantiffs "bald[ly] conclude[e] that WPX breached the duty by denying payment on the value of refined NGLs . . . but they do not explain why this claim is a common one." Response to Motion 1 at 32. The Defendants conclude that the Court should deny the Motion. Response to Motion 1 at 33.

4. The Response to the Plaintiffs' Second Motion for Class Certification.

The Defendants respond to the Plaintiffs' Second Motion for Class Certification. See Defendants' Response in Opposition to Plaintiffs' Second Motion for Class Certification, filed November 2, 2016 (Doc. 259)("Response to Motion 2"). They make several procedural arguments. First, the Defendants assert that "the Court must continue to determine class certification based on the Definition contained in the operative complaint." Response to Motion 2 at 3. Specifically, the Defendants contend that the "Plaintiffs are bound by the class definition in the complaint and `absent an amended complaint [the Court] will not consider certification beyond it.'" Response to Motion 2 at 3 (quoting Costelo v. Chertoff, 258 F.R.D. 600, 604-05 & n.6 (C.D. Cal. 2009)(Selna, J.)). The Defendants contend that "courts will not permit plaintiffs to change or expand their class definition through a motion to certify." Response to Motion 2 at 3 (citing Phelps v. Parsons Tech. Support, Inc., 2010 WL 4386918, at *3 (S.D. Ind. 2010)(Magnus-Stinson, J.)). The Defendants conclude that, because the Plaintiffs have not moved to amend their Complaint, the Court should not entertain the Plaintiffs' Motions. See Response to Motion 2 at 3.

Next, The Defendants argue that the Plaintiffs cannot obtain leave to amend their Complaint, because "the deadline to Amend has passed, and Plaintiffs cannot show good cause under Rule 16(b)(4)." Response to Motion 2 at 3. The Defendants argue that a key requirement of the good-cause standard is "diligence" and that the Plaintiffs have not been diligent by tendering "this new [class] definition nearly three years after they first learned of their ascertainability problem and more than two years after the parties completed extensive discovery and a multi-day hearing premised on the [original class] definition." Response to Motion 2 at 7.

Additionally, the Defendants contend that, to amend a complaint, "a party seeking to amend must satisfy Rule 15(a), under which a court may deny an amendment for, among other things, the moving party's undue delay or the non-movant's undue prejudice." Response to Motion 2 at 7 (citing Foman v. Davis, 371 U.S. 178, 182 (1962)(emphasis in original)). The Defendants contend that both undue delay and undue prejudice are grounds for denying a motion to amend a complaint here. See Response to Motion 2 at 7. The Defendants assert that the Plaintiffs "offer no adequate explanation for their delay." Response to Motion 2 at 8. Regarding undue prejudice, they assert that the "Defendants have been litigating class certification under the [original] class definition for over four years" and have relied on that definition, thus prejudicing the Defendants. Response to Motion 2 at 8.

The Defendants next briefly reassert their waiver argument, before contending that "the proposed new class definition does not constitute a material change in circumstances justifying Plaintiffs' request to alter or amend the class certification ruling." Response to Motion 2 at 9. Specifically, the Defendants contend that Rule 23(c)(1)(C) "is designed so that `a determination once made can be altered or amended before the decision on the merits, if upon fuller development of the facts, the original determination appears unsound.'" Response to Motion 2 at 9 (quoting Fed. R. Civ. P. 23 advisory committee notes to 1966 amendment). According to the Defendants, a new class definition, offered to replace one the court found wanting, does not meet this standard. See Response to Motion 2 at 10.

Next, the Defendants assert that the Plaintiffs' new class definition "does not solve the ascertainability problem." Response to Motion 2 at 11. The Defendants argue that the new class definition is not ascertainable, because

Response to Motion 2 at 12.

Additionally, the Defendants argue that the new class definition "does not supply commonality." Response to Motion 2 at 13. They argue that "the breach of lease claims and the implied duty claims do not present a common question," and that "the civil conspiracy claim is derivative of the breach-of-contract claims, and it therefore does not supply a common issue." Response to Motion 2 at 13, 19.

Further, the Defendants assert that "the proposed new definition does not eliminate the predominance of individual issues over any common ones." Response to Motion 2 at 20. Specifically, they posit that, despite the new class definition, "lease language variations will continue to overwhelm any alleged common issue," and that "industry custom and usage evidence and other parol evidence will require individualized inquiries." Response to Motion 2 at 20-21.

The Defendants additionally argue that "damages evidence remains highly individualized." Response to Motion 2 at 20. Specifically, "because Plaintiffs have not shown they are entitled to extracted NGLs or actual amounts received by WPX under all royalty and overriding royalty instruments at issue, determining liability and damages requires an individualized inquiry that will differ by lease, well, and month." Response to Motion 2 at 22.

Finally, the Defendants assert that "former royalty owners add individualized issues concerning ownership of claims, which further defeats predominance." Response to Motion 2 at 23. The Defendants contend that the new class definition contains former royalty owners, and that "current royalty owners do not necessarily have the right to assert claims and recover damages for royalties that were not paid to their predecessors-in-interest." Response to Motion 2 at 23. "Accordingly, determining whether a right of action was transferred, and thus, who owns a claim for past underpayments — the current or former owner — will entail examinations of the chain of title for each class member, and possibly extrinsic evidence." Response to Motion 2 at 24. The Defendants thus conclude that the Court should deny the Motion. See Response to Motion 2 at 24.

5. The Reply to the First Response.

The Plaintiffs reply to the Defendants' arguments. See Plaintiffs' Reply to Defendants' Response to Plaintiffs' Motion to Alter or Amend and to Reconsider Memorandum Opinion and Order, filed November 28, 2016 (Doc. 263)("Reply 1"). First, the Plaintiffs re-assert that their new class definition meets the commonality and predominance requirements. See Reply 1 at 1. They re-assert that the leases at issue can be divided into two categories of "proceeds" leases and "market value" leases, and that, at the very least, proceeds leases forbid paying NGL royalty on a keep-whole basis. Reply 1 at 2-3 (citing Abraham, 317 F.R.D. at 275 n.82).

Next, the Plaintiffs argue that the class is ascertainable. See Reply 1 at 4. Specifically, "defining the class by those who are paid on the keep-whole method identifies the persons entitled to relief and who are bound by the judgment. It supplies a source of identification . . . based on WPX's records of past and current monthly remittances for royalty and overriding royalty." Reply 1 at 4.

Additionally, the Plaintiffs argue that, although the Court concluded `"the evidence suggests `gas' refers to the gas produced at the wellhead rather than the processed products,'" there is no dispute "that the proceeds and market value leases entitle payment on `gas.'" Reply 1 at 7 (quoting Abraham, 317 F.R.D. at 263). "There are no sales at the wells. The proxy for sales of gas at the well are proceeds achieved by sales of the gas components at the place and in the subdivide forms of the production found at the outlet of processing plants." Reply 1 at 7-8.

The Plaintiffs also argue that "[c]onstruction of leases is to favor lessors," specifically that "between lessor and lessee construction of the lease shall be against the lessee and in favor of the lessor." Reply 1 at 10 (citing Greer v. Salmon, 1971-NMSC-002, 479 P.2d 294). This rule exists, because "the lessors . . . are not familiar with oil-and-gas industry usage and the leases are form contracts not ordinarily the product of meaningful negotiation." Reply 1 at 11.

The Plaintiffs conclude by asking the Court to amend its decision denying class certification. See Reply 1 at 12.

6. The Reply to the Second Response.

The Plaintiffs reply to the Second Response. See Reply in Support of Plaintiffs' Second Motion for Class Certification, filed November 28, 2016 (Doc. 264)("Reply 2"). First, the Plaintiffs argue that their Second Motion is timely. See Reply 2 at 1. They contend that, "[u]ntil the Court filed [Abraham] on August 16, 2016, the Plaintiffs reasonably believed that this case would be certified. There was no reason for Plaintiffs to file additional motions addressed to the certification issue until the Court announced its decision." Reply 2 at 2. The Plaintiffs further argue that "the Court has ample authority to consider the Second Motion." Reply 2 at 3. Specifically, they contend that "Rule 23 does not limit the class definition to a definition set forth in the complaint. To the contrary, Rule 23 puts the responsibility for defining a class on the Court. The class definition is ultimately determined by the Court, not the parties." Reply 2 at 5 (citing Blair v. Transam Trucking, Inc., 2015 WL 5006076, at *3 (D. Kan. 2015)(Melgren, J.)). Further, the Plaintiffs contend that "[t]he Tenth Circuit has never ruled that a district court is limited to the class definition in the complaint." Reply 2 at 5. The Plaintiffs argue: "The most that can be said in support of WPX's position is that district courts are split on the issue." Reply 2 at 6. The Plaintiffs add that, "[e]ven if the Court were inclined to narrowly view its authority to consider a class definition in a motion for class certification different from that in the operative complaint, the remedy should be to allow plaintiffs to amend their complaint." Reply 2 at 7.

Next, the Plaintiffs assert that their new class definition cures the ascertainability problem. See Reply 2 at 7. They reassert that royalty owners paid on the keep-whole methodology are "readily ascertainable based on WPX's own records." Reply 2 at 7. The Plaintiffs further contend that the new class definition establishes commonality and predominance. See Reply 2 at 8. The Plaintiffs reassert their arguments that the new class definition includes only owners paid under proceeds and market value leases, and that these owners are similarly situated "for purposes of the case, subject only to minor variations in the damage formula that would apply to each." Reply 2 at 9.

Finally, the Plaintiffs re-argue that their implied covenant claims are also certifiable. See Reply 2 at 12. Plaintiffs contend that WPX Energy has breached the implied covenant to market and the breach of the duty of good faith and fair dealing, because "WPX does not fully market the production for the class members, so [it] cannot establish that it has marketed to get the best possible price." Reply 2 at 12.

The Plaintiffs conclude by requesting that the Court grant their Second Motion and certify the new class definition. See Reply 2 at 12.

7. The Hearing.

The Court held a motion hearing on January 24, 2017. See Transcript of Motion Proceeding at 1:1 (taken January 24, 2017)(Court)("Tr."). The Plaintiffs began by stating "there is no doubt that the class is financially injured by nonpayment of the royalty and overriding royalty on natural gas liquids produced from the leases to which are burdened by those royalty interests, and that injury can only be remedied by a certified class action." Tr. at 3:18-24 (Gallegos). Regarding the Defendants' procedural challenges, the Plaintiffs argued that "[t]his is not an issue about amending a complaint. We're not changing or amending any causes of action or claims or defense. A motion is the proper means to seek an order of the Court. The motion is the proper way to come forward for class certification." Tr. at 7:3-8 (Gallegos).

Turning to the ascertainability issue, the Plaintiffs argued that the new class is ascertainable, because "[t]hose royalty owners and overriding royalty owners who are paid on a keep-whole basis are parties that can be easily determined from the database of WPX." Tr. at 10:16-18 (Gallegos). The Plaintiffs then pivoted to commonality, arguing that, under the new class definition, "the issue in this case simply becomes, with everybody paid on the same basis, on the keep-whole basis, are the parties injured by that, or are they not injured by that." Tr. at 12:9-13 (Gallegos). The Plaintiffs continued arguing on commonality, asserting that all but a few leases fit into one of two categories — proceeds leases and market value leases. See Tr. at 23:7-12 (Gallegos). The Plaintiffs concluded by saying that

Tr. at 29:3-11 (Gallegos). The Defendants began their argument on the ascertainability issue. See Tr. at 31:6-8 (Sheridan). Specifically, they asserted that in the Plaintiffs' Reply, they "challenged for the first time findings and conclusions that the Court made with respect to the — which gas from which leases was or was not processed. And he does so in a way that is in direct conflict with the record in the case." Tr. at 32:5-10 (Sheridan). "[T]he reason that this becomes significant is that if the gas was not processed, if it was sold without processing, then there would be no proceeds from the sale of refined NGLs, no proceeds derived by either WFC or WPX." Tr. at 32:23-25, 33:1-2 (Sheridan). "So on the ascertainability question, the Court has to ask itself: Have the plaintiffs proven which gas from which wells on which leases was processed or not? Because if it wasn't processed, then there is no royalty obligation under their new definition." Tr. at 36:9-14 (Sheridan). "[T]he Court's findings and conclusions stand for the proposition that a very substantial quantity of the WPX operated conventional production is not processed. And their definition doesn't cure that." Tr. at 39:8-12 (Sheridan).

The Defendants then turned to their procedural arguments. See Tr. at 40:12-13 (Sheridan). They argued that "a new class certification motion can effectively be nothing more than a motion for reconsideration of the denial of the prior class certification motion," meaning that a court should apply the standards applicable to a motion for reconsideration when considering a second motion for class certification. Tr. at 41:19-24. The Defendants argued that the Plaintiffs' Motions "do nothing more than raise issues that have already been raised, and then advance arguments that they could have raised, but tactically and strategically elected not to." Tr. at 41:7-11 (Sheridan).

Tr. at 53:11-17 (Sheridan). Turning to the proceeds issue, the Defendants argued that

Tr. at 55:23-25, 1-5 (Sheridan)(citing Abraham, 317 F.R.D. at 275 n.82). Regarding commonality, the Defendants posited: "I think that, without first considering the circumstances surrounding the execution of those leases, when they were entered into, what was going on in the industry . . . they may not necessarily mean the same thing. That becomes an individualized inquiry." Tr. at 64:4-10 (Sheridan).

Tr. at 66:12-19 (Sheridan). The Defendants concluded by saying: "I think this Court correctly found that the Plaintiffs could not establish the requirements of commonality and predominance. And nothing that they've said in their motion for reconsideration or second motion for class certification changes the Court's findings and conclusions in that respect." Tr. at 70:5-10 (Sheridan).

The Court then asked the Defendants about the new class definition. See Tr. at 71:1-2 (Court). The Defendants asserted that there were several problems with the new class definition, including the inclusion of former owners and overriding royalty owners. See Tr. at 71:5-8 (Sheridan).

The Court then inquired as to the Defendants' procedural arguments, asking how the Defendants would be prejudiced if the court ruled on the new class definition. See Tr. at 74:1-10 (Court). The Defendants responded by saying:

Tr. at 77:13-23 (Sheridan). The Court also asked the Plaintiffs about prejudicing the Defendants by ruling on the new class definition. See Tr. at 89:13-16 (Court). The Plaintiffs responded that "we basically had a mini trial [—] five, six days of evidence . . ., I think every issue was thoroughly tried at that hearing." Tr. 90:20-25 (Gallegos).

LAW REGARDING MOTIONS TO RECONSIDER

Except where the Federal Rules of Civil Procedure specify, motions to reconsider fall into three categories:

Pedroza v. Lomas Auto Mall, Inc., 258 F.R.D. 453, 462 (D.N.M. 2009)(Browning, J.). See Price v. Philpot, 420 F.3d at 1167; Computerized Thermal Imaging, Inc. v. Bloomberg. L.P., 312 F.3d 1292, 1296 (10th Cir. 2002).

1. Motions for Reconsideration Under Rules 59(e) and 60(b).

Courts may treat motions for reconsideration as a rule 59(e) motion when the movant files within twenty-eight days of a court's entry of judgment. See Price v. Philpot, 420 F.3d at 1167 n.9. If the movant files outside that time period, courts should treat the motion as seeking relief from judgment under rule 60(b). See Price v. Philpot, 420 F.3d at 1167 n.9. "[A] motion for reconsideration of the district court's judgment, filed within [rule 59's filing deadline], postpones the notice of appeal's effect until the motion is resolved." Jones v. United States, 355 F. App'x 117, 121 (10th Cir. 2009)(unpublished). The time limit in rule 59(e) is now twenty-eight days from the entry of a judgment. See Fed. R. Civ. P. 59(e).

Whether a motion for reconsideration should be considered a motion under rule 59 or rule 60 is not only a question of timing, but also "depends on the reasons expressed by the movant." Commonwealth Prop. Advocates, LLC v. Mortg. Elec. Registration Sys., Inc., 680 F.3d 1194, 1200 (10th Cir. 2011). Where the motion "involves `reconsideration of matters properly encompassed in a decision on the merits,'" a court considers the motion under rule 59(e). Phelps v. Hamilton, 122 F.3d 1309, 1323-24 (10th Cir. 1997)(quoting Martinez v. Sullivan, 874 F.2d 751, 753 (10th Cir. 1989)). In other words, if the reconsideration motion seeks to alter the district court's substantive ruling, then it should be considered a rule 59 motion and be subject to rule 59's constraints. See Phelps v. Hamilton, 122 F.3d at 1324. In contrast, under rule 60,

Fed. R. Civ. P. 60(b). Neither a rule 59 nor a rule 60 motion for reconsideration

Servants of the Paraclete v. Does, 204 F.3d 1005, 1012 (10th Cir. 2000). "[A] motion for reconsideration is appropriate where the court has misapprehended the facts, a party's position, or the controlling law." Servants of the Paraclete v. Does, 204 F.3d at 1012. A district court has considerable discretion in ruling on a motion to reconsider. See Phelps v. Hamilton, 122 F.3d at 1324.

Rule 60 authorizes a district court to, "[o]n motion and just terms[,] . . . relieve a party or its legal representative from a final judgment, order, or proceeding for the following reasons," including "any other reason that justifies relief." Fed. R. Civ. P. 60(b). A court cannot enlarge the time for filing a rule 59(e) motion. See Brock v. Citizens Bank of Clovis, 841 F.2d 344, 347 (10th Cir. 1988)(holding that district courts lack jurisdiction over untimely rule 59(e) motions); Plant Oil Powered Diesel Fuel Sys., Inc. v. ExxonMobil Corp., No. 11-0103, 2012 WL 869000, at *2 (D.N.M. Mar. 8, 2012)(Browning, J.)("The Court may not extend the time period for timely filing motions under Rule 59(e). . . ."). "A motion under rule 59 that is filed more than 28 days after entry of judgment may be treated as a Rule 60(b) motion for relief from judgment." 12 JAMES WM. MOORE ET AL., MOORE'S FEDERAL PRACTICE § 59.11[4][b], at 59-32 (3d ed. 2012)(citations omitted). Nevertheless, a court will not generally treat an untimely rule 59(e) motion as a rule 60(b) motion when the party is seeking "`reconsideration of matters properly encompassed in a decision on the merits' contemplated by Rule 59(e)." Jennings v. Rivers, 394 F.3d 850, 854 (10th Cir. 2005).

Under some circumstances, parties can rely on rule 60(b)(1) for a mistake by their attorney or when their attorney acted without their authority. See Yapp v. Excel Corp., 186 F.3d 1222, 1231 (10th Cir. 1999)("Rule 60(b)(1) motions premised upon mistake are intended to provide relief to a party . . . when the party has made an excusable litigation mistake or an attorney has acted without authority. . . ."). Mistake in this context entails either acting without the client's consent or making a litigation mistake, such as failing to file or to comply with deadlines. See Yapp v. Excel Corp., 186 F.3d at 1231. If the alleged incident entails a mistake, then it must be excusable, meaning that the party was not at fault. See Pioneer Inv. Servs. v. Brunswick Assocs. LP, 507 U.S. 380, 394 (1993); Cashner v. Freedom Stores, Inc., 98 F.3d 572, 577 (10th Cir. 1996)("If the mistake alleged is a party's litigation mistake, we have declined to grant relief under Rule 60(b)(1) when the mistake was the result of a deliberate and counseled decision by the party."); Pelican Prod. Corp. v. Marino, 893 F.2d 1143, 1146 (10th Cir. 1990)(holding that attorney carelessness is not a basis for relief under rule 60(b)(1)).

Courts will not grant relief when the mistake of which the movant complains is the result of an attorney's deliberate litigation tactics. See Cashner v. Freedom Stores, Inc., 98 F.3d at 577. This rule exists because a party

Pioneer Inv. Servs. v. Brunswick Assocs. LP, 507 U.S. at 397 (quoting Link v. Wabash R.R. Co., 370 U.S. 626, 633-34 (1962))(internal quotation marks omitted). The Tenth Circuit has held that there is nothing "novel" about "the harshness of penalizing [a client] for his attorney's conduct," and has noted that those "who act through agents are customarily bound," even though, when "an attorney is poorly prepared to cross-examine an expert witness, the client suffers the consequences." Gripe v. City of Enid, Okla., 312 F.3d 1184, 1189 (10th Cir. 2002).

Rule 60(b)(6) is a "grand reservoir of equitable power to do justice in a particular case." Van Skiver v. United States, 952 F.2d 1241, 1244 (10th Cir. 1991)(internal quotation marks omitted). "If the reasons offered for relief from judgment could be considered under one of the more specific clauses of Rule 60(b)(1)-(5), those reasons will not justify relief under Rule 60(b)(6)." Moore, supra § 60.48[2], at 60-182. Accord Liljeberg v. Health Servs. Acquisition Corp., 486 U.S. 847, 863 n.11 (1988)("This logic, of course, extends beyond clause (1) and suggests that clause (6) and clauses (1) through (5) are mutually exclusive."). "The Rule does not particularize the factors that justify relief, but we have previously noted that it provides courts with authority `adequate to enable them to vacate judgments whenever such action is appropriate to accomplish justice,' while also cautioning that it should only be applied in `extraordinary circumstances.'" Liljeberg v. Health Servs. Acquisition Corp., 486 U.S. at 863.

Generally, the situation must be one beyond the control of the party requesting relief under rule 60(b)(6) to warrant relief. See Ackermann v. United States, 340 U.S. 193, 202 (1950)("The comparison [of prior precedent] strikingly points up the difference between no choice and choice; imprisonment and freedom of action; no trial and trial; no counsel and counsel; no chance for negligence and inexcusable negligence. Subsection 6 of Rule 60(b) has no application to the situation of petitioner."). Legal error that provides a basis for relief under rule 60(b)(6) must be extraordinary, as the Tenth Circuit discussed in Van Skiver v. United States:

Van Skiver v. United States, 952 F.2d at 1244-45.

2. Motions to Reconsider Interlocutory Orders.

Considerable confusion exists among the bar regarding the proper standard for a district court to apply when ruling on a motion to reconsider one of its prior "interlocutory" or "interim" orders, i.e., an order that a district court issues while the case is ongoing, as distinguished from a final judgment. This confusion originates from the fact that the Federal Rules of Civil Procedure do not mention motions to reconsider, let alone set forth a specific procedure for filing them or a standard for analyzing them. A loose conflation in terminology in Servants of the Paraclete v. Does, which refers to rule 59(e) motions — "motion[s] to alter or amend a judgment" — as "motions to reconsider,"4 compounded that baseline confusion. Fed. R. Civ. P. 59(e) (emphasis added); Servants of the Paraclete v. Does, 204 F.3d at 1005.

Final judgments are different from interlocutory orders. See Fed. R. Civ. P. 54(a) ("`Judgment' as used in these rules includes a decree and any order from which an appeal lies.")(emphasis added). In addition to ripening the case for appeal, see 28 U.S.C. § 1291 ("The courts of appeals . . . shall have jurisdiction of appeals from all final decisions of the district courts. . . ."), the entry of final judgment narrows the district court's formerly plenary jurisdiction over the case in three ways. First, for the first twenty-eight days after the entry of judgment, when the court can entertain motions under rules 50(b), 52(b), 59, and 60, the district court's jurisdiction trumps that of the Court of Appeals. See Fed. R. App. P. 4(a)(4)(B). Even if a party files a notice of appeal, the Court of Appeals will wait until after the district court has ruled on the post-judgment motion to touch the case. See Fed. R. App. P. 4(a)(4)(B). Second, after twenty-eight days, when the court may consider motions under rule 60, if a party has filed a notice of appeal, the Court of Appeals' jurisdiction trumps the district court's, and the district court needs the Court of Appeals' permission even to grant a rule 60 motion. Third, after twenty-eight days, if no party has filed a notice of appeal, district courts may consider motions under rule 60.

Final judgments implicate two important concerns militating against giving district courts free reign to reconsider their judgments. First, when a case is not appealed, there is an interest in finality. The parties and the lawyers expect to go home, quit obsessing about the dispute, and put the case behind them, and the final judgment — especially once the twenty-eight day window of robust district court review and the thirty-day window of appeal have both closed — is the disposition upon which they are entitled to rely. Second, when a case is appealed, there is the need for a clean jurisdictional handoff from the district court to the Court of Appeals. "[A] federal district court and a federal court of appeals should not attempt to assert jurisdiction over a case simultaneously," as doing so produces a "danger [that] a district court and a court of appeals w[ill] be simultaneously analyzing the same judgment." Griggs v. Provident Consumer Discount Co., 459 U.S. 56, 58-59 (1982).

The Court of Appeals needs a fixed record on which to base its decisions — especially given the collaborative nature of appellate decision making — and working with a fixed record requires getting some elbow room from the district court's continued interference with the case. The "touchstone document" for this jurisdictional handoff is the notice of appeal, and not the final judgment, see Griggs v. Provident Consumer Discount Co., 459 U.S. at 58 ("The filing of a notice of appeal is an event of jurisdictional significance — it confers jurisdiction on the court of appeals and divests the district court of its control over those aspects of the case involved in the appeal." (citations omitted)); Garcia v. Burlington N. R.R. Co., 818 F.2d 713, 721 (10th Cir. 1987)("Filing a timely notice of appeal pursuant to Fed. R. App. P. 3 transfers the matter from the district court to the court of appeals. The district court is thus divested of jurisdiction. Any subsequent action by it is null and void." (citations omitted)); Kirtland v. J. Ray McDermott & Co., 568 F.2d 1166, 1170 (5th Cir. 1978)("[I]t is the filing of the appeal, not the entering of a final judgment, that divests the district court of jurisdiction." (citations omitted)), but, because the final judgment starts the parties' thirty-day clock for filing a timely notice of appeal, the Federal Rules and the Tenth Circuit have chosen to curtail the district court's jurisdiction over the case in the roughly month-long period of potentially overlapping trial- and appellate-court jurisdiction that immediately follows the entry of final judgment, see Servants of the Paraclete v. Does, 204 F.3d at 1009 (noting that post-final judgment motions at the district court level are "not intended to be a substitute for direct appeal").

Basically, rather than suddenly divesting the district court of all jurisdiction over the case — potentially resulting in the district court being unable to rectify easily fixable problems with the final judgment before the case goes to the Tenth Circuit, or even requiring appeal of a case that might otherwise not need to be appealed — the Federal Rules set forth a jurisdiction phased de-escalation process, wherein the district court goes from pre-final judgment plenary jurisdiction, to limited review for the first twenty-eight days post-final judgment, and, finally, to solely rule 60 review after twenty-eight days. In defining the "limited review" that rule 59(e) allows a district court to conduct in the 28-day flux period, the Tenth Circuit, in Servants of the Paraclete v. Does, incorporated traditional law-of-the-case grounds — the same grounds that inform whether a court should depart from an appellate court's prior decision in the same case — into rule 59(e). See United States v. Alvarez, 142 F.3d 1243, 1247 (10th Cir. 1998)(departing from the law-of-the-case doctrine in three exceptionally narrow circumstances: "(1) when the evidence in a subsequent trial is substantially different; (2) when controlling authority has subsequently made a contrary decision of the law applicable to such issues; or (3) when the decision was clearly erroneous and would work a manifest injustice")(citation omitted); Servants of the Paraclete v. Does, 204 F.3d at 1012 (incorporating those grounds into rule 59(e)).

Neither of these concerns — finality nor jurisdictional overlap — is implicated when a district court reconsiders one of its own interlocutory orders. The Federal Rules do not specifically mention motions to reconsider interlocutory orders, but rule 54(b) makes the following open-ended proclamation about their mutability:

Fed. R. Civ. P. 54(b) (emphases added). Rule 54(b) thus (i) provides that a district court can freely reconsider its prior rulings; and (ii) puts no limit or governing standard on the district court's ability to do so, other than that it must do so "before the entry of judgment." Fed. R. Civ. P. 54(b).

The Tenth Circuit has not cabined district courts' discretion beyond what rule 54(b) provides: "[D]istrict courts generally remain free to reconsider their earlier interlocutory orders." Been v. O.K. Indus., 495 F.3d at 1225. In the Tenth Circuit, "law of the case doctrine has no bearing on the revisiting of interlocutory orders, even when a case has been reassigned from one judge to another." Rimbert v. Eli Lilly & Co., 647 F.3d 1247, 1252 (10th Cir. 2011)(emphasis added)(citing Been v. O.K. Indus., Inc., 495 F.3d at 1225). In this context, "the doctrine is merely a `presumption, one whose strength varies with the circumstances.'" Been v. O.K. Indus., Inc., 495 F.3d at 1225 (quoting Avitia v. Metro. Club of Chi., Inc., 49 F.3d 1219, 1227 (7th Cir. 1995)). In short, a district court can use whatever standard it wants to review a motion to reconsider an interlocutory order. It can review the earlier ruling de novo and essentially reanalyze the earlier motion from scratch, it can review the ruling de novo but limit its review, it can require parties to establish one of the law-of-the-case grounds, or it can refuse to entertain motions to reconsider altogether.

The best approach, in the Court's eyes, is to analyze motions to reconsider differently depending on three factors. Cf. Been v. O.K. Indus., Inc., 495 F.3d at 1225 ("[T]he doctrine is merely a `presumption, one whose strength varies with the circumstances.'")(citation omitted). First, the Court should restrict its review of a motion to reconsider a prior ruling in proportion to how thoroughly the earlier ruling addressed the specific findings or conclusions that the motion to reconsider challenges. How "thoroughly" a point was addressed depends both on the amount of time and energy the Court spent on it, and on the amount of time and energy the parties spent on it — in briefing and orally arguing the issue, but especially if they developed evidence on the issue. A movant for reconsideration thus faces a steeper uphill challenge when the prior ruling was on a criminal suppression motion, class certification motion, or preliminary injunction,5 than when the prior ruling is, e.g., a short discovery ruling. The Court should also look, not to the prior ruling's overall thoroughness, but to the thoroughness with which the Court addressed the exact point or points that the motion to reconsider challenges. A movant for reconsideration thus faces an easier task when he or she files a targeted, narrow-in-scope motion asking the Court to reconsider a small, discrete portion of its prior ruling than when he or she files a broad motion to reconsider that rehashes the same arguments from the first motion, and essentially asks the Court to grant the movant a mulligan on its earlier failure to present persuasive argument and evidence.

Second, the Court should consider the case's overall progress and posture, the motion for reconsideration's timeliness relative to the ruling it challenges, and any direct evidence the parties may produce, and use those factors to assess the degree of reasonable reliance the opposing party has placed in the Court's prior ruling. See 18B CHARLES ALAN WRIGHT, ARTHUR R. MILLER, EDWARD H. COOPER, VIKRAM DAVID AMAR, RICHARD D. FREER, HELEN HERSHKOFF, JOAN E. STEINMAN & CATHERINE T. STRUVE, FEDERAL PRACTICE & PROCEDURE § 4478.1, at 695-96 (2d ed. 2002)("Stability becomes increasingly important as the proceeding nears final disposition. . . . Reopening should be permitted, however, only on terms that protect against reliance on the earlier ruling."). For example, if a defendant (i) spends tens of thousands of dollars removing legacy computer hardware from long-term storage; then (ii) obtains a protective order in which the Court decides that the defendant need not produce the hardware in discovery; then (iii) returns the hardware to long-term storage, sustaining thousands more in expenses; and (iv) several months pass, then the plaintiffs should face a higher burden in moving the Court to reconsider its prior ruling that they faced in fighting the motion for protective order the first time.

Third, the Court should consider the Servants of the Paraclete v. Does grounds. The Court should be more inclined to grant motions for reconsideration if the movant presents (i) new controlling authority — especially if the new authority overrules prior law or sets forth an entirely new analytical framework; (ii) new evidence — especially if the movant has a good reason why the evidence was not presented the first time around; or (iii) a clear indication — one that manifests itself without the need for in-depth analysis or review of the facts — that the Court erred.

These three factors should influence the degree to which the Court restricts its review of a prior ruling, but they do not necessarily mean that the Court should always apply a deferential standard of review. The Court should pause before applying a standard of review to its own interlocutory orders that is more deferential than the standard that the Court of Appeals will apply to it, unless the Court concludes that the alleged error in the prior ruling was harmless, or the party moving for reconsideration waived their right to appeal the alleged error by not raising the appropriate argument. Even in circumstances where the Court concludes that it is insulated from reversal on appeal, there are principled reasons for applying a de novo standard. After all, if the Court was wrong in its earlier decision, then, generally speaking, it is unjust to maintain that result — although the Court should weigh this injustice against any injustice that would result from upending the parties' reliance on the earlier ruling, which is the balancing test that the three factors above represent.

What the Court means by "restricting its review" is less about applying a deferential standard of review — although that may be appropriate in some circumstances — and more about reducing (i) the depth of the Court's analysis the second time around — thus conserving judicial resources; and (ii) the impositions that relitigation of the prior ruling will impose on the party opposing the motion for reconsideration. The Court should consider the time and expense that the party opposing reconsideration spent in winning the earlier ruling, and should try to prevent that party from having to bear the same impositions again. Basically, even if the Court ultimately analyzes a motion to reconsider under the same standard that it analyzed the motion that produces the earlier ruling, it should analyze the motion in a different way — one focused on reducing the litigation burdens of the party opposing reconsideration. For example, when a party moves the Court for a preliminary injunction, standard practice is that the Court holds an evidentiary hearing as a matter of course, regardless whether it looks as if the party has a good chance of prevailing. If the party loses and the Court denies the injunction, however, and the party moves for reconsideration, the party should not be entitled to the presumption of an evidentiary hearing merely because he or she received that presumption the first time that the Court considered the motion.

In light of these statements, it is perhaps better to characterize the increased burden that a movant for reconsideration faces as one of production and not of persuasion. The Court analyzes motions to reconsider by picking up where it left off in the prior ruling — not by starting anew. Parties opposing reconsideration can do the same, and they may stand on whatever evidence and argument they used to win the earlier ruling. Movants for reconsideration, on the other hand, carry the full burden of production: they must persuade the Court, using only the evidence and argument they put before it, that it should change its prior ruling; they must do all of the legwork, and not rely on the Court to do any supplemental fact-finding or legal research; and they must convincingly refute both the counterarguments and evidence that the opposing party used to win the prior ruling and any new arguments and evidence that the opposing party produces while opposing the motion to reconsider. Unlike the motion that produced the prior ruling, a motion to reconsider is not — and is not supposed to be — a fair fight procedurally. The deck is stacked against a movant for reconsideration, and if such a movant hopes to prevail, he or she must have not only a winning legal position, but the work ethic and tenacity to single-handedly lead the Court to his or her way of thinking.

LAW REGARDING A CLASS DEFINITION NOT IN THE OPERATIVE COMPLAINT

As an initial matter,

Grodzitsky v. Am. Honda Motor Co. Inc., No. 2:12-CV-01142-SVW, 2014 WL 718431, at *4 (C.D. Cal. Feb. 19, 2014)(Wilson, J.). The Tenth Circuit does not have a controlling opinion on this point, although Tenth Circuit language exists that might suggest that a court need not hold a plaintiff to the class definition in the operative complaint. See Carpenter v. Boeing Co., 456 F.3d 1183, 1187 (10th Cir. 2006)("The district court can modify or amend its class-certification determination at any time before final judgment in response to changing circumstances in the case.")(citing Fed. R. Civ. P. 23(c)(1)(C)); In re Integra Realty Res., Inc., 354 F.3d 1246, 1261 (10th Cir. 2004)("Moreover, a trial court overseeing a class action retains the ability to monitor the appropriateness of class certification throughout the proceedings and to modify or decertify a class at any time before final judgment.")(citing Fed. R. Civ. P. 23(c)(1)).

In litigation related to this case, this Court has noted:

Anderson Living Tr. v. WPX Energy Prod., LLC, No. CIV 12-0040, 2016 WL 5376325, at *9 (D.N.M. Aug. 27, 2016)(Browning, J.)("Anderson"). In summary, the Tenth Circuit has not explicitly ruled on this issue, but other Courts of Appeals have at least implied that a court need not hold a plaintiff to the class definition in the operative complaint. For these reasons, the Court concludes that a plaintiff is not bound to the class definition in the operative complaint for purposes of a second motion to certify a class. Class actions are hard work for the Court and the parties; the Court and the parties need to conform the pleadings to the reality of discovery, a lengthy class certification hearing, and the judicial resources expended in analyzing all of the extensive evidence on record. Some flexibility — not more formality — is needed in crafting a class action where one is warranted.

LAW REGARDING WAIVER OF CLAIMS

The Tenth Circuit has noted, in the context of waiver on appeal, that, "if the theory was intentionally relinquished or abandoned in the district court, we usually deem it waived and refuse to consider it." Richision v. Ernest Group, Inc., 634 F.3d 1123, 1127 (10th Cir. 2011)(Gorsuch, J.). "Waiver occurs when a party deliberately considers an issue and makes an intentional decision to forgo it." United States v. Cruz-Rodriguez, 570 F.3d 1179, 1183 (10th Cir. 2009). "We typically find waiver in cases where a party has invited the error that it now seeks to challenge, or where a party attempts to reassert an argument that it previously raised and abandoned below." United States v. Zubia-Torres, 550 F.3d 1202, 1205 (10th Cir. 2008).

In United States v. Zubia-Torres, 550 F.3d at 1207, the Tenth Circuit illustrated the waiver doctrine:

United States v. Zubia-Torres, 550 F.3d at 1207 (internal citation omitted).

LAW REGARDING MODIFICATION OF SCHEDULING ORDERS

"The District Court has wide discretion in its regulation of pretrial matters." Si-Flo, Inc. v. SFHC, Inc., 917 F.2d 1507, 1514 (10th Cir. 1990). Scheduling orders, however, "may be modified only for good cause and with the judge's consent." Fed. R. Civ. P. 16(b)(4). Accord Street v. Curry Bd. of Cty. Comm'rs, No. CIV 06-0776 JB/KBM, 2008 WL 2397671, at *6 (D.N.M. Jan. 30, 2008)(Browning, J.). The advisory committee notes to rule 16 observe:

Fed. R. Civ. P. 16(b)(4) advisory committee's note to 1983 amendment.

The Tenth Circuit has held that the concepts of good cause, excusable neglect, and diligence are related. "The Tenth Circuit . . . has recognized the interrelation between `excusable neglect' and `good cause.'" Pulsecard, Inc. v. Discover Card Servs. Inc., 168 F.R.D. 295, 301 (D. Kan. 1996)(Rushfelt, J.)(citing In re Kirkland, 86 F.3d 172, 175 (10th Cir. 1996)). "Properly construed, `good cause' means that scheduling deadlines cannot be met despite a party's diligent efforts." Street v. Curry Bd. of Cty. Comm'rs, 2008 WL 2397671, at *6. See Advanced Optics Electronics, Inc. v. Robins, 769 F.Supp.2d 1285, 1313 (D.N.M. 2010)(Browning, J.)(noting that the "rule 16(b) good-cause inquiry focuses on the diligence of the party seeking [to] amend the scheduling order."). In In re Kirkland, the Tenth Circuit dealt with the definition of "good cause" in the context of a predecessor to modern rule 4(m) of the Federal Rules of Civil Procedure,6 and noted:

86 F.3d at 175 (emphasis in original)(quoting Putnam v. Morris, 833 F.2d 903, 905 (10th Cir. 1987))(internal quotation marks omitted). The Tenth Circuit explained that Putnam v. Morris "thus recognized that the two standards, although interrelated, are not identical and that `good cause' requires a greater showing than `excusable neglect.'" In re Kirkland, 86 F.3d at 175.

Where a party is diligent in its discovery efforts and nevertheless cannot comply with the scheduling order, the Court has found good cause to modify the scheduling order if the requesting party timely brings forward its request. In Advanced Optics Electronics, Inc. v. Robins, the Court found that, where the defendant did not conduct discovery or make any good-faith discovery requests, and where the defendant did not make efforts "diligent or otherwise" to conduct discovery, the defendant did not, therefore, show good cause to modify the scheduling order. 769 F.Supp.2d at 1313 n.8. In Street v. Curry Bd. Of Cty. Comm'rs, however, the Court found that the plaintiff had "shown good cause for a delay in seeking leave to amend," because she "was diligent in pursuing discovery . . . [and] brought to the Court's attention her identification of an additional claim in a timely manner," where she discovered the claim through "documents provided in discovery." 2008 WL 2397671, at *11. In Montoya v. Sheldon, No. CIV 10-0360 JB/WDS, 2012 WL 5353493 (D.N.M. Oct. 7, 2012)(Browning, J.), the Court did not find good cause to modify the scheduling order and reopen discovery, and refused to grant the plaintiffs' request do so, where the plaintiffs' excuse for not disclosing their expert before the close of discovery was that they thought that the case would settle and they would thus not require expert testimony. See 2012 WL 5353493, at *14. The Court noted:

2012 WL 5353493, at *14.

In Scull v. Management & Training Corp., 2012 WL 1596962 (D.N.M. May 2, 2012)(Browning, J.), the Court denied a plaintiff's request for an extension of time to name an expert witness against a defendant. The plaintiff asserted that he had waited to name an expert witness until a second defendant joined the case, but a scheduling order was in effect before the second defendant entered the case. The Court concluded that the plaintiff should have known that he would need to name an expert witness against the defendant already in the case. See 2012 WL 1596962, at *8. The Court determined that the plaintiff was seeking "relief from his own disregard" for the deadline. 2012 WL 1596962, at *8. "Despite his knowledge that [defendant] PNA had yet to enter the case, [plaintiff] Scull chose to allow the deadline to pass without naming expert witnesses against [defendant] MTC." 2012 WL 1596962, at *8. Regarding the defendant who entered the case at a later date, however, the Court allowed the plaintiff an extension of time to name an expert witness, because it "was not unreasonable for Scull to expect a new deadline to name expert witnesses upon PNA's entrance into the case because he had not yet had the opportunity to engage in discovery against PNA as he had against MTC." 2012 WL 1596962, at *9. The Court also noted that not naming an expert witness "is a high price to pay for missing a deadline that was arguably unrealistic when it was set," as Scull could not have determined the need for an expert witness until after PNA entered the case. 2012 WL 1596962, at *9.

In Stark-Romero v. National Railroad Passenger Co (AMTRAK), 275 F.R.D. 544 (D.N.M. 2011)(Browning, J.), the Court concluded that a lawyer had shown excusable neglect when he missed a scheduling deadline because, soon after his son's wedding, his father-in-law developed a tumor in his chest, and the lawyer arranged his father-in-law's medical care, and only after the lawyer returned to his work did he realize that a deadline passed. See 275 F.R.D. 549-550. The Court noted that the lawyer could have avoided missing the deadline had he not left his work until the last minute, just before his son's wedding, but concluded that the lawyer had demonstrated good faith and missed the deadline because of "life crises," and not because of his inadvertence. 275 F.R.D. 549-550. In West v. New Mexico Taxation and Revenue Department, No. CIV 09-0631 JB/CEG, 2010 WL 3834341 (D.N.M. July 29, 2010)(Browning, J.), the Court allowed a plaintiff extended time to file a response to a defendant's motion for summary judgment, in part because of the difficulty that the plaintiff's counsel experienced attempting to obtain depositions with certain defense witnesses, and thus it was not her fault, and in part because cross-motions on summary judgment are particularly helpful for the Court:

2010 WL 3834341, at **4-5. On the other hand, in Liles v. Washington Tru Solutions, LLC, No. CIV 06-854 JB/CEG, 2007 WL 2298440 (D.N.M. June 13, 2007)(Browning, J.), the Court denied a plaintiff's request for additional time to respond to a defendant's motion for summary judgment, when the only rationale that the plaintiff provided was that its counsel's "family and medical emergencies" precluded the plaintiff from timely responding. 2007 WL 2298440, at *2.

LAW REGARDING AMENDING THE PLEADINGS BEFORE TRIAL

Rule 15(a) provides that a party may amend his or her pleading as a matter of right within twenty-one days of serving it and within twenty-one days of the service of a response pleading. See Fed. R. Civ. P. 15(a). Otherwise, the party must obtain the opposing parties' consent or the court's leave — which should be "freely give[n] . . . when justice so requires" — to amend his or her pleading. Rule 15(a) provides:

Fed. R. Civ. P. 15(a). Under rule 15(a), the court should freely grant leave to amend a pleading where justice so requires. See In re Thornburg Mortg., Inc. Sec. Litig., 265 F.R.D. 571, 579-80 (D.N.M. 2010)(Browning, J.); Youell v. Russell, No. 04-1396, 2007 WL 709041, at *1-2 (D.N.M. Feb. 14, 2007)(Browning, J.); Burleson v. ENMR-Plateau Tele. Co-op., No. 05-0073, 2005 WL 3664299, at *1-2 (D.N.M. Sept. 23, 2005)(Browning, J.). The Supreme Court of the United States has stated that, in the absence of an apparent reason such as "undue delay, bad faith or dilatory motive . . . repeated failure to cure deficiencies by amendments previously allowed, undue prejudice to the opposing party by virtue of allowance of the amendment, futility of amendment, etc.," leave to amend should be freely given. Foman v. Davis, 371 U.S. 178, 182 (1962). Furthermore, the Tenth Circuit has held that district courts should grant a plaintiff leave to amend when doing so would yield a meritorious claim. See Curley v. Perry, 246 F.3d 1278, 1284 (10th Cir. 2001). See also In re Thornburg Mortg., Inc. Sec. Litig., 265 F.R.D. at 579-80.

A court should deny leave to amend under rule 15(a), however, where the proposed "amendment would be futile." Jefferson Cty. Sch. Dist. v. Moody's Investor's Serv., 175 F.3d 848, 859 (10th Cir. 1999). See In re Thornburg Mortg., Inc. Sec. Litig., 265 F.R.D. at 579-80. An amendment is "futile" if the pleading, "as amended, would be subject to dismissal." In re Thornburg Mortg., Inc. Sec. Litig., 265 F.R.D. at 579-80 (citing TV Commc'ns Network, Inc. v. Turner Network Television, Inc., 964 F.2d 1022, 1028 (10th Cir. 1992)). A court may also deny leave to amend "upon a showing of undue delay, undue prejudice to the opposing party, bad faith or dilatory motive, [or] failure to cure deficiencies by amendments previously allowed." In re Thornburg Mortg., Inc. Sec. Litig., 265 F.R.D. at 579 (quoting Frank v. U.S. W., Inc., 3 F.3d 1357, 1365-66 (10th Cir. 1993)).

"The . . . Tenth Circuit has emphasized that `[t]he purpose of [rule 15(a)] is to provide litigants the maximum opportunity for each claim to be decided on its merits rather than on procedural niceties.'" B.T. ex rel. G.T. v. Santa Fe Pub. Sch., No. 05-1165, 2007 WL 1306814, at *2 (D.N.M. March 12, 2007)(Browning, J.)(quoting Minter v. Prime Equip. Co., 451 F.3d 1196, 1204 (10th Cir. 2006)).

If a party seeks to amend his or her pleading after the time for seeking leave for pleading amendments has passed under a scheduling order, then, in addition to meeting rule 15(a)(2)'s requirements, he or she must satisfy rule 16(b)(4)'s good-cause requirement. See Gorsuch, Ltd., B.C. v. Wells Fargo Nat'l Bank Ass'n, 771 F.3d 1230, 1240 (10th Cir. 2014)(Matheson, J.) ("After a scheduling order deadline, a party seeking leave to amend must demonstrate (1) good cause for seeking modification under Fed. R. Civ. P. 16(b)(4) and (2) satisfaction of the Rule 15(a) standard."). Rule 16(b)(4) states: "A schedule may be modified only for good cause and with the judge's consent." Fed. R. Civ. P. 16(b)(4). "In practice, this standard requires the movant to show the `scheduling deadlines cannot be met despite [the movant's] diligent efforts.'" Gorsuch, Ltd., B.C. v. Wells Fargo Nat'l Bank Ass'n, 771 F.3d at 1240. The rule "focuses on the diligence of the party seeking leave to modify the scheduling order to permit the proposed amendment." Advanced Optics Elecs., Inc. v. Robins, 769 F.Supp.2d 1285, 1313 (D.N.M. 2010)(Browning, J.)("Properly construed, `good cause' means that scheduling deadlines cannot be met despite a party's diligent efforts."). See Gerald v. Locksley, 849 F.Supp.2d 1190, 1209-11 (D.N.M. 2011)(Browning, J.)(same).

The Court has previously stated that its rule 16(b) good-cause inquiry focuses on the diligence of the party seeking to amend the scheduling order. See Walker v. THI of N.M. at Hobbs Ctr., 262 F.R.D. 599, 602-03 (D.N.M. 2009)(Browning, J.); Guidance Endodontics, LLC v. Dentsply Int'l, Inc., No. 08-1101, 2009 WL 3672505, at *2-3 (D.N.M. Sept. 29, 2009) (Browning, J.); Trujillo v. Bd. of Educ. of the Albuquerque Pub. Sch., Nos. 02-1146 and 03-1185, 2007 WL 2296955, at *3 (D.N.M. June 5, 2007)(Browning, J.). The United States District Court for the District of South Carolina has stated:

Dilmar Oil Co., Inc. v. Federated Mut. Ins. Co., 986 F.Supp. 959, 980 (D.S.C. 1997)(Currie, J.) (citations omitted), aff'd, 129 F.3d 116 (4th Cir. 1997). See Denmon v. Runyon, 151 F.R.D. 404, 407 (D. Kan. 1993)(O'Connor, J.)(affirming an order denying the plaintiff's motion to amend after the deadline which the scheduling order established had passed and stating that, "[t]o establish `good cause,' the party seeking to extend the deadline must establish that the scheduling order's deadline could not have been met with diligence"). Cf. SIL-FLO, Inc. v. SFHC, Inc., 917 F.2d 1507, 1518-19 (10th Cir. 1990)(affirming, under rule 16(b), denial of a motion to amend an answer to include a compulsory counterclaim filed three months after the scheduling order deadline).

In In re Kirkland, 86 F.3d 172 (10th Cir. 1996), the Tenth Circuit dealt with the definition of "good cause" in the context of rule 4(j).7 The Tenth Circuit noted:

86 F.3d at 175 (emphasis omitted)(internal quotation marks omitted)(quoting Putnam v. Morris, 833 F.2d 903, 905 (10th Cir. 1987)). The Tenth Circuit explained that Putnam v. Morris "thus recognized that the two standards, although interrelated, are not identical and that `good cause' requires a greater showing than `excusable neglect.'" In re Kirkland, 86 F.3d at 175.

Other courts within the Tenth Circuit have held that "the `good cause' standard primarily considers the diligence of the party . . . seeking an extension[, who] must show that despite due diligence it could not have reasonably met the scheduled deadlines. Carelessness is not compatible with a finding of diligence and offers no reason for a grant of relief." Pulsecard, Inc. v. Discover Card Servs. Inc., 168 F.R.D. 295, 301 (D. Kan.1996)(Rushfelt, M.J.)(alterations in original)(internal quotation marks omitted). The Honorable Dale A. Kimball, United States District Judge for the District of Utah, concluded that "good cause" existed to amend his scheduling order when he decided to permit the plaintiff's counsel to withdraw as counsel. Kee v. Fifth Third Bank, No. CIV 06-0602 DAK/PMW, 2008 WL 183384, at *1 (D. Utah Jan. 17, 2008). Judge Kimball reasoned: "[I]n light of the court's decision to permit [counsel] to withdraw . . . the court has determined that good cause exists for amending the existing scheduling order." Kee v. Fifth Third Bank, 2008 WL 183384, at *1.

RELEVANT LAW REGARDING CLASS CERTIFICATION UNDER RULE 23(b)(3).

Rule 23 sets forth the requirements for certifying a class action under the federal rules. See Fed. R. Civ. P. 23. All classes must satisfy: (i) all the requirements of rule 23(a); and (ii) one of the three sets of requirements under rule 23(b), where the three sets of requirements correspond to the three categories of classes that a court may certify. See Fed. R. Civ. P. 23(a)-(b). The plaintiff8 bears the burden of showing that the requirements are met, see Rex v. Owens ex rel. Okla., 585 F.2d 432, 435 (10th Cir. 1978); Pueblo of Zuni v. United States, 243 F.R.D. 436, 444 (D.N.M. 2007)(Johnson, J.), but, in doubtful cases, class certification is favored, see Esplin v. Hirschi, 402 F.2d 94, 101 (10th Cir. 1968)("[T]he interests of justice require that in a doubtful case, . . . any error, if there is to be one, should be committed in favor of allowing the class action."); Eisen v. Carlisle & Jacquelin, 391 F.2d 555, 563 (2d Cir. 1968)("[W]e hold that. . . rule [23] should be given a liberal rather than a restrictive interpretation, and that [denying certification] is justified only by a clear showing to that effect. . . ."). In ruling on a class certification motion, the Court need not accept either party's representations, but must independently find the relevant facts by a preponderance of the evidence.9 See Rutstein v. Avis Rent-A-Car Sys., Inc., 211 F.3d 1228, 1234 (11th Cir. 2000)("Going beyond the pleadings is necessary, as a court must understand the claims, defenses, relevant facts, and applicable substantive law in order to make a meaningful determination of the certification issues."). "In determining the propriety of a class action, the question is not whether the plaintiff or plaintiffs have stated a cause of action or will prevail on the merits, but rather whether the requirements of Rule 23 are met." Anderson v. City of Albuquerque, 690 F.2d 796, 799 (10th Cir. 1982). See Vallario v. Vandehey, 554 F.3d 1259, 1267 (10th Cir. 2009)("We, of course, adhere to the principle that class certification does not depend on the merits of a suit."). Still, the Court must conduct a rigorous analysis of the rule 23 requirements, even if the facts that the Court finds in its analysis bear on the merits of the suit:

Wal-Mart Stores, Inc. v. Dukes, 131 S.Ct. 2541, 2551-52 (2011)(Scalia, J.)("Wal-Mart.") In a subsequent, seemingly contradictory admonition, however, the Supreme Court cautioned district courts not to decide the case's merits at the class certification stage:

Amgen Inc. v. Conn. Ret. Plans & Trust Funds, 133 S.Ct. 1184, 1194-95 (2013)(Ginsburg, J.). To reconcile these two directives, the Court will find facts for the purposes of class certification by the preponderance of the evidence, but will allow the parties to challenge these findings during the subsequent merits stage of this case. This approach is analogous to preliminary injunction practice, and many circuits have endorsed it. See Abbott v. Lockheed Martin Corp., 725 F.3d 803, 810 (7th Cir. 2013); In re Hydrogen Peroxide Antitrust Litig., 552 F.3d 305, 313 (3d Cir. 2008); Gariety v. Grant Thornton, LLP, 368 F.3d 356, 366 (4th Cir. 2004). Because of the res judicata effect a class judgment has on absent parties, a court may not simply accept the named parties' stipulation that class certification is appropriate, but must conduct its own independent rule 23 analysis. See Amchem Prods., Inc. v. Windsor, 521 U.S. at 620-22. In taking evidence on the question of class certification, the Federal Rules of Evidence apply, albeit in a relaxed fashion. See Anderson, 306 F.R.D. at 378 n.39.

1. Rule 23(a).

All classes must satisfy the prerequisites of rule 23(a):

Fed. R. Civ. P. 23(a). "A party seeking to certify a class is required to show . . . that all the requirements of [rule 23(a)] are clearly met." Reed v. Bowen, 849 F.2d 1307, 1309 (10th Cir. 1988). "Although the party seeking to certify a class bears the burden of proving that all the requirements of Rule 23 are met, the district court must engage in its own `rigorous analysis' of whether `the prerequisites of Rule 23(a) have been satisfied.'" Shook v. El Paso Cty., 386 F.3d 963, 968 (10th Cir. 2004)(quoting Gen. Tel. Co. of the S.W. v. Falcon, 457 U.S. 147, 161 (1982))(citing Reed v. Bowen, 849 F.2d at 1309). These four requirements are often referenced as numerosity, commonality, typicality, and adequacy, respectively. The commonality requirement is particularly relevant to this case.

Rule 23(a)(2) requires that "there are questions of law or fact common to the class." Fed. R. Civ. P. 23(a)(2) (emphasis added). Even "factual differences in the claims of the individual putative class members should not result in a denial of class certification where common questions of law exist." In re Intelcom Group Sec. Litig., 169 F.R.D. 142, 148 (D. Colo. 1996). See Adamson v. Bowen, 855 F.2d 668, 676 (10th Cir. 1988)("That the claims of individual putative class members may differ factually should not preclude certification under Rule 23(b)(2) of a claim seeking the application of a common policy."); Lopez v. City of Santa Fe, 206 F.R.D. 285, 289 (D.N.M. 2002)(Vázquez, J.)("Commonality requires only a single issue common to the class, and the fact that `the claims of individual putative class members may differ factually should not preclude certification under Rule 23(b)(2) of a claim seeking the application of a common policy." (citations omitted)). A single common question will suffice to satisfy rule 23(a)(2), but the question must be one "that is central to the validity of each one of the claims." Wal-Mart, 131 S. Ct. at 2551.

"The commonality requirement has been applied permissively in securities fraud litigation." In re Initial Pub. Offering Sec. Litig., 227 F.R.D. 65, 87 (S.D.N.Y. 2004). "Securities cases often involve allegations of common courses of fraudulent conduct, which can be sufficient to satisfy the commonality requirement." 5 Jerold S. Solovy, Ronald L. Marmer, Timothy J. Chorvat & David M. Feinberg, Moore's Federal Practice § 23.23[4][b], at 23-77 (3d ed. 2004). "Where the facts as alleged show that Defendants' course of conduct concealed material information from an entire putative class, the commonality requirement is met." In re Oxford Health Plans, Inc. Sec. Litig., 191 F.R.D. 369, 374 (S.D.N.Y. 2000). Accord Initial Pub. Offering, 227 F.R.D. at 87 ("In general, where putative class members have been injured by similar material misrepresentations and omissions, the commonality requirement is satisfied.").

The commonality requirement was widely perceived to lack teeth before the Supreme Court's decision in Wal-Mart, which grafted the following requirements onto rule 23(a)(2): (i) that the common question is central to the validity of each claim that the proposed class brings; and (ii) that the common question is capable of a common answer. See Wal-Mart, 131 S. Ct. at 2550-52. In that case, a proposed class of about 1.5 million current and former Wal-Mart employees sought damages under Title VII for Wal-Mart's alleged gender-based discrimination. See 131 S. Ct. at 2547. Wal-Mart, however, had no centralized company-wide hiring or promotion policy, instead opting to leave personnel matters to the individual store managers' discretion. See 131 S. Ct. at 2547-48. The plaintiffs argued that, although no discriminatory formal policy applied to all proposed class members, "a strong and uniform `corporate culture' permits bias against women to infect, perhaps subconsciously, the discretionary decisionmaking of each one of Wal-Mart's thousands of managers — thereby making every [proposed class member] the victim of one common discriminatory practice." 131 S. Ct. at 2548. The Supreme Court disagreed that such a theory constitutes a common question under rule 23(a)(2).

Wal-Mart, 131 S. Ct. at 2550-51 (emphasis in original)(quoting Nagareda, supra, at 132). In EQT Production Co. v. Adair, 764 F.3d 347 (4th Cir. 2011), the United States Court of Appeals for the Fourth Circuit stated:

764 F.3d at 366 (citations omitted).

In Wal-Mart, Justice Scalia stated: "Wal-Mart is entitled to individualized determinations of each employee's eligibility for backpay." 131 S. Ct. at 2546. From this observation, he then concluded:

Wal-Mart, 131 S. Ct. at 2561. Thus, the common question or questions cannot be "incidental," nor can the plaintiff submit a long list of "incidental" questions or issues, and say that they predominate over the real issues to be used.

2. Rule 23(b).

Once the court concludes that the threshold requirements have been met, "it must then examine whether the class falls within at least one of three categories of suits set forth in Rule 23(b)." Adamson v. Bowen, 855 F.2d at 675. See DG ex rel. Stricken v. Devaughn, 594 F.3d 1188, 1199 (10th Cir. 2010)("In addition to satisfying Rule 23(a)'s requirements, the class must also meet the requirements of one of the types of classes described in subsection (b) of Rule 23."). Rule 23(b) provides that a class action is appropriate if the threshold requirements are satisfied, and the case falls into one or more of three categories:

Fed. R. Civ. P. 23(b). "Only one of rule 23(b)'s subdivisions must be satisfied to meet the class-action requirements." Gonzales v. City of Albuquerque, No. CIV 09-0520 JB/RLP, 2010 WL 4053947, at *11 (D.N.M. Aug. 21, 2010)(Browning, J.)(citing Carpenter v. Boeing, Co., 456 F.3d 1183, 1187 (10th Cir. 2006)(stating that the district court must determine whether a suit "falls within one of the categories of actions maintainable as class actions")).

The three categories of class actions — really four, as rule 23(b)(1) contains two subcategories, known as (b)(1)(A) and (b)(1)(B) class actions — are not of equal utility. Class actions under (b)(1) can be certified only in very particular circumstances. Class actions under (b)(2) are broadly available, but are only capable of seeking injunctive or declaratory relief, and not damages. Far and away the most controversial class action category, (b)(3), can be brought for class-wide damages, injunctive relief, declaratory relief, or any combination thereof. Class actions under (b)(3) always require notice to all proposed class members of certification of the class, and those individuals must be given the opportunity to opt out if they so desire. See Fed. R. Civ. P. 23(c)(2)(B); Phillips Petrol. Co. v. Shutts, 472 U.S. at 812 ("[W]e hold that due process requires at a minimum that an absent plaintiff be provided with an opportunity to remove himself from the class by executing and returning an `opt out' or `request for exclusion' form to the court."). The other class action categories, however, are ordinarily mandatory, and neither notice nor opportunity to opt out needs to be given. See Fed. R. Civ. P. 23(c)(2)(B); Phillips Petrol. Co. v. Shutts, 472 U.S. at 811 n.3 (limiting the constitutional requirement of an opt-out notice "to those class actions which seek to bind known plaintiffs concerning claims wholly or predominately for money judgments"). The Court will focus on the most important form of class action, the (b)(3) damages class action.10

To satisfy rule 23(b)(3), the court must find "that the questions of law or fact common to the members of the class predominate over any 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." Fed. R. Civ. P. 23(b)(3) (emphases added). Rule 23(b)(3) provides that "[t]he matters pertinent to these findings include": (i) the class members' interest in individually controlling the prosecution or defense of separate actions; (ii) the extent and nature of any litigation concerning the controversy already commenced by or against members of the class; (iii) the desirability or undesirability of concentrating the litigation of the claims in the particular forum; and (iv) the difficulties likely to be encountered in the management of a class action. Fed. R. Civ. P. 23(b)(3)(A)-(D).

Rule 23(b)(3)'s first requirement is that questions common to the class predominate over those that are individualized. See Fed. R. Civ. P. 23(b)(3). A question is common when "the same evidence will suffice for each member to make a prima facie showing," Blades v. Monsanto Co., 400 F.3d 562, 566 (8th Cir. 2005)(citing In re Visa Check/MasterMoney Antitrust Litig., 208 F.3d 124, 136-40 (2d Cir. 2001)), or when the issue is "susceptible to generalized, class-wide proof," In re Nassau Cty. Strip Search Cases, 461 F.3d 219, 227 (2d Cir. 2006). A question is individual when "the members of a proposed class will need to present evidence that varies from member to member," Blades v. Monsanto Co., 400 F.3d at 566. Although a case need not present only common questions to merit certification, and the presence of some individual questions does not destroy predominance, the rule 23(b)(3) predominance requirement is much stricter than the rule 23(a)(1) commonality requirement: the latter requires only that a common question or questions exist; the former requires that the common question or questions predominate over the individual ones. See Amchem Prods., Inc. v. Windsor, 521 U.S. 591, 623-24; In re Thornburg Mortg., Inc. Sec. Litig., 912 F. Supp. 2d at 1225 ("The predominance criterion of rule 23(b)(3) is `far more demanding' than rule 23(a)(2)'s commonality requirement."). As the Tenth Circuit, addressing a Title VII claim, put it:

Monreal v. Potter, 367 F.3d 1224, 1237 (10th Cir. 2004)(Ebel, J.)(footnote omitted).

The predominance question applies to both macro damages — the total class damages — and to the micro damages — the individual damages. In Comcast Corp. v. Behrend, 133 S.Ct. 1426 (2013), the Supreme Court held that it could not accept the regression model which the plaintiffs' expert had developed as evidence that damages were susceptible of measurement across an entire class — as rule 23(b)(3) requires. The plaintiffs argued four theories of antitrust violations; one theory was that Comcast Corp.'s activities had an antitrust impact, because Comcast Corp.'s activities reduced the level of competition from "overbuilders," companies that build competing cable networks in areas where an incumbent cable company already operates. The district court found, among other things, that the damages resulting from overbuilder-deterrence impact could be calculated on a classwide basis. To establish such damages, the plaintiffs relied solely on the testimony of Dr. James McClave. Dr. McClave designed a regression model which compared actual cable prices in the Philadelphia "Designated Market Area" with hypothetical prices that would have prevailed but for Comcast Corp.'s allegedly anticompetitive activities. The model calculated damages of $875,576,662.00 for the entire class. As Dr. McClave acknowledged, however, the model did not isolate damages resulting from any one theory of antitrust impact. The district court nonetheless certified the class.

The Court of Appeals for the Third Circuit affirmed the district court decision. The Third Circuit concluded that the plaintiffs "provided a method to measure and quantify damages on a classwide basis," finding it unnecessary to decide "whether the methodology was a just and reasonable inference or speculation." 133 S. Ct. at 1433 (quoting 655 F.3d 182, 206 (3d Cir. 2011)). The Supreme Court granted certiorari on the question "[w]hether a district court may certify a class action without resolving whether the plaintiff class had introduced admissible evidence, including expert testimony, to show that the case is susceptible to awarding damages on a class-wide basis." 133 S. Ct. at 24. Justice Scalia criticized the Third Circuit's reluctance to entertain arguments against the plaintiffs' damages model "simply because those arguments would also be pertinent to the merits determination. . . ." 133 S. Ct. at 1433. Justice Scalia said that

133 S. Ct. at 1433. Justice Scalia stated that, under the Third Circuit's logic, "at the class-certification stage, any method of measurement is acceptable so long as it can be applied classwide, no matter how arbitrary the measurements may be. Such a proposition would reduce rule 23(b)(3)'s predominance requirement to a nullity." 133 S. Ct. at 1433 (emphasis in original).

It is clear that Comcast Corp. v. Behrend applies to classwide damages. It is less clear that Comcast Corp. v. Behrend's language applies to the determination of individual damages. There are three ways that the Court could deal with Comcast Corp. v. Behrend and the determination of individual damage awards. First, the Court could decide that Comcast Corp. v. Behrend applies only to classwide damages and is not controlling at all in the determination of individual damages. Second, the Court could decide that everything that Justice Scalia said about classwide damages also applies to the determination of individual damages. Third, the Court could decide that Justice Scalia said some things relating to the determination of individual damages, but not the same things that apply to classwide damages. As to the first option, while much could be said of limiting Justice Scalia's opinion to classwide damages — even from the language of the opinion and from the wording of the question presented — the Court is reluctant to say that it has nothing to say that might be relevant to the determination of individual damages awards. Some of Justice Scalia's concerns about admissible evidence to determine damages — whether classwide or individual damage awards — still seems relevant to whether damages are classwide or individual. While Justice Scalia was not addressing the determination of individual damage awards, some of what he said — and how he said it — causes the Court to be cautious in determining a methodology for calculating individual damage awards. On the other hand, the Court is not convinced that it should or even can apply Comcast Corp. v. Behrend's language to the individual determination of damages as it does to classwide damages. The dissent stated that "[r]ecognition that individual damages calculations do not preclude class certification under Rule 23(b)(3) is well nigh universal." 133 S. Ct. at 1437 (Ginsburg, J., dissenting). Justice Scalia did not refute this proposition, and the Court has no reason to think the dissent's statement — which is accurate — does not remain good law. Accordingly, just because each plaintiff and class member may get a different amount and there has to be a separate calculation of each plaintiff's damages does not defeat class certification.

What the Court thinks that Comcast Corp. v. Behrend says that is relevant to the individual determination of damages is threefold. First, at the class certification stage, the Court cannot ignore how individual damages, if any are appropriate, are to be decided. In other words, the Court cannot ignore the possible complexities of the individual damages determinations in making the predominance calculation. A class can have individual damage calculations, but the Court has to look at the issues of individual damages calculations at the class certification stage. Second, the methodology for all class members needs to be common or, if there are different methodologies for some plaintiffs and class members, the Court must take these differences into account at the class certification stage in the predominance analysis. In other words, if the Court is going to use different methodologies for different class members, it must decide: (i) whether these differences create questions affecting only individual members; and (ii) whether these individual questions predominate over the questions of law or fact common to the class. Third, even if the methodology is common to the class, the Court must decide whether it will operate in a consistent way for each individual class member. The law and methodology may be the same, but when applied to the class, they may create issues for one class member or group of class members that they do not create for other class members or groups. The predominance analysis must identify precisely the common issues and uncommon issues that application of the class methodology or methodologies raise, and then determine whether, in the total issue mix, the common issues predominate over the individual ones.

A defendant's desire to assert individual counterclaims11 does not typically defeat predominance. See Phillips Petrol. Co. v. Shutts, 472 U.S. 797, 810 (1985); Allapattah Servs, Inc. v. Exxon Corp., 333 F.3d 1248, 1260 (11th Cir. 2003). A defendant's desire to assert individual affirmative defenses also often does not defeat predominance, see Smilow v. Sw. Bell Mobile Sys., Inc., 323 F.3d 32, 39 (1st Cir. 2003)("Courts traditionally have been reluctant to deny class action status under Rule 23(b)(3) simply because affirmative defenses may be available against individual members."), but this statement is less true after Wal-Mart.12 Other recurring individual issues present more serious challenges to predominance, such as: (i) the prima facie element of reliance or due diligence in common-law fraud and other cases;13 (ii) differences in the applicable law in a multi-state, state law-based class actions,14 see Castano v. Am. Tobacco Co., 84 F.3d 734, 741 (5th Cir. 1996); and (iii) the need to determine individual personal injury damages, which presents such a challenge to predominance that class certification of mass tort claims is now exceedingly rare, see Amchem Prods., Inc. v. Windsor, 521 U.S. at 625. There is little uniform guidance on how to assess when common issues predominate over individual ones, and the Court's statements to this point have, obviously, done more to disavow various tempting but fallacious rules than they have to set forth a usable standard.

There is currently a split of authority between the United States Court of Appeals over the proper way to analyze predominance — with the United States Courts of Appeals for the Seventh and Sixth Circuits on one side and the United States Courts of Appeals for the Third, Tenth, and Eleventh Circuits on the other. The Honorable Richard A. Posner,15 United States Circuit Judge for the Seventh Circuit, concludes that the predominance inquiry boils down to "a question of efficiency." Butler v. Sears, Roebuck & Co., 702 F.3d at 362. Judge Posner poses the predominance question as: "Is it more efficient, in terms both of economy of judicial resources and of the expense of litigation to the parties, to decide some issues on a class basis or all issues in separate trials?" Butler v. Sears, Roebuck & Co., 702 F.3d at 362. In Butler v. Sears, Roebuck & Co., the Seventh Circuit reversed a district court's denial of certification of a class of washing-machine owners who alleged that Sears' washing machines were prone to cultivate mold and affirmed the district court's certification of the same class to pursue a claim that the machines' control units were defective. See 702 F.3d at 360-61. The Seventh Circuit certified the class — which spanned six states — to pursue its mold claim under state breach-of-warranty law:

Butler v. Sears, Roebuck & Co., 702 F.3d at 362. Along with numerous other class actions pending appeal before the Supreme Court, the Supreme Court vacated Butler v. Sears, Roebuck & Co., and remanded it to the Seventh Circuit "for reconsideration in light of Comcast Corp. v. Behrend." Butler v. Sears, Roebuck & Co., 727 F.3d at 797 (7th Cir. 2013). On reconsideration, the Seventh Circuit reaffirmed its prior decision, again in an opinion written by Judge Posner:

In re Whirlpool Corp. Front-Loading Washing Products Liability Litigation, 678 F.3d at 421 (citation omitted). That case was also vacated after Comcast Corp. v. Behrend, and, like the Seventh Circuit, the Sixth Circuit reaffirmed its prior decision, fleshing out the predominance inquiry in more detail than it had done in its prior opinion:

In re Whirlpool Corp. Front-Loading Washing Products Liability Litigation, 722 F.3d 838, (7th Cir. 2013)(citations omitted). The Seventh Circuit and Sixth Circuit, thus, define predominance in much the same way: if the district court can design a mechanism for trying the case that is fair to the defendants and more efficient than individual litigation of the same dispute, then predominance is satisfied. See Butler v. Sears, Roebuck & Co., 727 F.3d at 802. This styling of the predominance inquiry is in keeping with that given, many years earlier, by a leading class-action treatise:

McLaughlin on Class Actions § 5:23 (11th ed. 2016)(emphases added)(omission in original) (footnotes omitted).

Although the Seventh Circuit and the Sixth Circuit may agree about the definition of predominance, the Third, Tenth, and Eleventh Circuits stake out a different test.

Sacred Heart Health Sys., Inc. v. Humana Military Healthcare Serv., Inc., 601 F.3d 1159, 1170 (11th Cir. 2010)(emphasis in original)(citations omitted).18 The Eleventh Circuit, however, imposes a different, more rigorous, second step: the district court's trial plan must spend more time adjudicating the common questions than it does adjudicating the individual questions. The Eleventh Circuit's test may not be the greatest — the Court sees little reason why negative-value cases that can be fairly and efficiently adjudicated via class action should not be certified19 — but it is commendable in that it is a test that district courts can use, rather than yet another meaningless recitation, see CGC Holding Co. LLC v. Broad & Cassel, 773 F.3d 1076 (10th Cir. 2014)("[T]he predominance prong `asks whether the common, aggregation-enabling, issues in the case are more prevalent or important than the non-common, aggregation defeating, individual issues." (quoting Newberg § 4:49)), circular axiom, see, e.g., Amchem Prods., Inc. v. Windsor, 521 U.S. at 623 ("The Rule 23(b)(3) predominance inquiry tests whether proposed classes are sufficiently cohesive to warrant adjudication by representation."), obvious guidepost, see Reed v. Bowen, 849 F.2d at 1309 ("Each case must be decided on its own facts, on the basis of `practicalities and prudential considerations.'"), self-evident comparison, see Monreal v. Potter, 367 F.3d at 1237 ("[T]he predominance criterion of Rule 23(b)(3) [i]s `far more demanding' tha[n] the Rule 23(a) commonality requirement[.]" (quoting Amchem Prods., Inc. v. Windsor, 521 U.S. at 623-24)), or worthless slogan, see Marcus v. BMW of N. Am., LLC, 687 F.3d at 600 (exhorting district courts to examine claims "`through the prism' of Rule 23(b)(3)").

The Tenth Circuit followed the Eleventh Circuit's approach in CGC Holding Co., LLC v. Broad and Cassel.

3. Oil-and-Gas Class Actions.

Oil-and-gas wells are often drilled on land owned by entities or individuals other than the oil company that performs the drilling. The landowners execute mineral leases or deeds with the oil companies, dividing the estate up into a royalty interest, which the landowner-lessor owns, and a working interest, which the oil company-lessee owns. The lessee builds wells on the leased land and connects them to a gathering system — a system of small pipelines that collect oil and gas from a large number of wells in a region — which then carries it to a plant for treatment or processing. When the lessee sells the oil or gas, it then pays the lessors a fraction of the proceeds, known as a royalty, which effectively serves as "rent" for the use of the leased land. Royalty owners sometimes contend that their lessees are underpaying their royalty, either by deducting impermissible costs from the proceeds — a lessee can typically deduct post-production costs, but not production costs, from the sale proceeds before dividing off royalties — or by paying on an amount that does not reflect the true sale proceeds. The relationship between lessors and lessee is fundamentally a contractual one, but there is also positive law — case law and statutes — supplying default terms and contractual gap-fillers. Each lessor's monthly royalty is typically small and, thus, lessors have little practical recourse for royalty underpayment in individual litigation. They will, instead, band together with other landowner-lessors with whom a given oil company-lessor contracts — often other lessors on a single gathering system or within a region — and sue the oil company via class action. These class actions have a prodigious history in the state courts, where they were traditionally brought — because oil-and-gas royalty law is principally state law — before CAFA's passage. See, e.g., Phillips Petrol. Co. v. Shutts, 472 U.S. at 799. These actions present recurring issues, and, as certification reversals are both more common20 and more instructive than affirmances, the Court will focus on cases where appellate courts concluded that a proposed class failed to satisfy rule 23's requirements. But see Karen E. Kahle & Denielle M. Stritch, Grouping the Marcellus Payout: Use of Class Actions in Royalty Litigation Concerning Post-Production Cost Deductions, 88 N.D. L. Rev. 699 (2012).

The Tenth Circuit's only cases on rule 23(a) and (b)(3)'s application to oil-and-gas royalty cases21 came in two companion cases issued on July 9, 2013, Roderick and Chieftain Royalty Co. v. XTO Energy, Inc., 528 F. App'x 938 (10th Cir. 2013)(unpublished),22 which were both written by the Honorable Paul J. Kelly, Jr.,23 United States Circuit Judge for the Tenth Circuit, and joined by the Honorable Scott M. Matheson, Jr.,24 United States Circuit Judge for the Tenth Circuit, and the Honorable Monroe G. McKay, Senior United States Circuit Judge for the Tenth Circuit. In Roderick, a class of individuals owning interests in a total of roughly 650 leases and over 300 wells across ten well fields in Kansas brought a class action against XTO Energy for breach of contract, unjust enrichment, and an accounting. See 725 F.3d at 1215. The district court certified the class on the basis of a single common issue, "whether XTO's uniform payment methodology breached the implied duty of marketability under Kansas law," which the district court deemed to predominate over individual issues. 725 F.3d at 1217. On appeal, the Tenth Circuit decertified the class on two grounds.

First, the Tenth Circuit stated that the district court had failed to consider variations in lease language at all, relying instead on the implied duty of marketability. See 725 F.3d at 1216. This failure constituted an abuse of discretion, because the duty of marketability obtains only "[a]bsent a contract providing to the contrary," and, thus, can be negated by express lease language. 725 F.3d at 1216 (alteration in original)(quoting Sternberger v. Marathon Oil Co., 894 P.2d 788, 800 (Kan. 1995)). The plaintiffs had not reviewed any of the class leases, and XTO Energy reviewed only one-fifth of them, categorizing them by royalty type, "several of which negate[d] the IDM [implied duty of marketability] completely or in part (i.e., by providing for certain express deductions)." 725 F.3d at 1216. Second, the Tenth Circuit held that applying Kansas' implied duty to market requires determining the point at which gas from each well becomes marketable, declaring that "[o]nce gas is in marketable condition, the IDM is satisfied — regardless of whether a market exists at that location . . . [and] gas may be marketable at the well." 725 F.3d at 1219 (emphasis in original). Importantly, the Tenth Circuit did not hold that the class could not be certified, and, to the extent that the Court reads such things into judicial opinions, it implied the opposite. Rather, it held that the district court's inquiry — and the form in which it certified the class — was inadequate, and gave the district court multiple leads for conducting a new rule 23 analysis on remand. See 725 F.3d at 1219 ("On remand, the [plaintiffs] could, for example, create a chart classifying lease types, and although we express no opinion as to the merits, the district court could decide that no lease type negates the IDM." (citing Foster v. Merit Energy Co., 282 F.R.D. 541, 551 n.12 (W.D. Okla. 2012))); id. at 1219 ("On remand, the district court should consider whether and to what extent marketability affects commonality." (footnote omitted)).

In the unpublished companion case, Chieftain Royalty v. XTO Energy, Inc., the Tenth Circuit applied Roderick's holding to a much larger class action composed of lessors for 14,300 leases and 2,300 wells in Oklahoma. See 528 F. App'x at 940. Again, Judge Kelly noted that "approximately 13,568 leases have yet to be examined by XTO Energy — let alone by Chieftain or the district court," and that this omission was "particularly significant because unlike the plaintiff in Roderick, Chieftain admits that some leases expressly abrogate — and one even negates — the IDM." 528 F. App'x at 942-43. Judge Kelly added one interesting elaboration on the Roderick holding:

528 F. App'x at 942 (alteration in original)(emphasis in original)(citations omitted).

Other Circuits have also analyzed oil-and-gas royalty class actions, although, the Tenth Circuit did not cite any of them in the companion cases discussed above. The Court suspects that the Tenth Circuit did not want to rely too heavily on cases issued before Wal-Mart. One influential case that discusses rule 23's application to oil-and-gas royalty cases in the post-Wal-Mart era is EQT Production Co. v. Adair. The Honorable Albert Diaz, United States Circuit Judge for the Fourth Circuit, joined by the Honorable J. Harvie Wilkinson III and Barbara M. Keenan, United States Circuit Judges for the Fourth Circuit, vacated a district court's certification of five closely related oil-and-gas royalty class actions and remanded them for further analysis. See 764 F.3d at 352. That case was primarily about mineral-rights ownership — namely, whether certain coal-rights owners also held title to the coalbed methane under the leased premises — but it also addressed royalty underpayments. See 764 F.3d at 347-365 (addressing the coalbed methane ownership issue). Judge Diaz pointed out three individual issues that the district court failed to consider and that weighed against predominance. First, the case addresses the issue of intra-class variations in lease language; the Fourth Circuit's rationale parallels the Tenth Circuit's, going into more detail in some areas:

764 F.3d at 366-67 (citations omitted). These statements support the Court's conclusion that the predominance inquiry is neither a quantitative inquiry comparing the number of common questions to the number of individual questions, nor a cursory inquiry asking whether the defendants generally subjected the class members to the same factual treatment by the defendants or whether their claims are subject to the same legal standard. Rather, it is a manageability inquiry that requires the Court to determine whether common legal issues, susceptible to common evidence, exist in the right places to try the case in a way that is fair to all parties. Second, the Fourth Circuit pointed out that the district court would "likely need to consider" course-of-performance evidence. 764 F.3d at 370-71. Third, it stated that "the district court should reevaluate the implications of the defendants' statute of limitations defense for Rule 23's predominance requirement." 764 F.3d at 371. The plaintiffs' claims were facially time-barred, but they pled fraudulent concealment to toll the statute, and the Fourth Circuit held that, "[a]lthough a defendant's conduct is not irrelevant, attention must also be paid to the plaintiff's knowledge and actions," and, "[i]n this context, a plaintiff's knowledge typically requires individual evidence." 764 F.3d at 370.

After determining that the facts that oil-and-gas companies engaged in numerous common practices may be sufficient for commonality purposes, the Fourth Circuit in EQT Production Co. v. Adair made it clear that such common practices are not enough to satisfy the predominance requirement:

764 F.3d at 366-68, 70 (footnote omitted)(citation omitted).

The Fourth Circuit, like the Tenth Circuit, never held that the five putative classes were intractably or irredeemably uncertifiable — just that the district court did not ask all the necessary questions.25

EQT Prod. Co. v. Adair, 764 F.3d at 367. The case is littered with instructions to the district court for improving its rule 23 analysis on remand. See, e.g., EQT Prod. Co. v. Adair, 764 F.3d at 367 ("We also remand for the district court to . . . consider how variations in the defendants' royalty obligations to the class members implicate the commonality and predominance inquiries in [certain of the five classes]."); 764 F.3d at 371 ("Where the proper balance lies in the superiority analysis we leave to the district court on remand as part of its broader consideration of the other Rule 23(b)(3) factors."). In its conclusion, the Fourth Circuit summed up its holding:

764 F.3d at 371.

ANALYSIS

The Court concludes that: (i) the Plaintiffs may raise a new class definition not in the operative Complaint, because the Tenth Circuit has no controlling opinion, other Courts of Appeals have indicated that such a practice is allowed, and such a practice is sound; (ii) even if the Court bound the Plaintiffs to the class definition in the operative Complaint, rules 16(b)(4) and 15(a) would not bar the Plaintiffs from amending their Complaint; (iii) the Plaintiffs have not previously waived their new class definition even though they previously submitted and withdrew a different class definition; (iv) the proposed class definition is ascertainable, because the Plaintiffs have eliminated the gas processing problem; (v) the proposed class definition does not create commonality because of differences in lease language; and (vi) those same differences in lease language indicate that common issues would not predominate over individual issues. Accordingly, the Court denies the Motion to Amend and the Second Motion for Class Certification.

I. THE PLAINTIFFS MAY RAISE A NEW CLASS DEFINITION NOT IN THE OPERATIVE COMPLAINT.

The Court concludes that the Plaintiffs need not rely on the class definition in their operative Complaint. District Courts are split on this topic. Some courts have found that "[t]he Court is bound to class definitions provided in the complaint and, absent an amended complaint, will not consider certification beyond." Costelo v. Chertoff, 258 F.R.D. at 604. Others have allowed amendment during class certification proceedings and noted "[t]hat this approach is also consistent with Rule 23, which contemplated the amendment of a class certification order prior to judgment." Savanna Group, Inc. v. Trynex, Inc., 2013 WL 66181, at *2-3.

The Tenth Circuit does not have a controlling opinion on this point, although Tenth Circuit language exists that might suggest that a court need not hold a plaintiff to the class definition in the operative complaint. See Carpenter v. Boeing Co., 456 F.3d at 1187 ("The district court can modify or amend its class-certification determination at any time before final judgment in response to changing circumstances in the case.")(citing Fed. R. Civ. P. 23(c)(1)(C)); In re Integra Realty Res., Inc., 354 F.3d at 1261 ("Moreover, a trial court overseeing a class action retains the ability to monitor the appropriateness of class certification throughout the proceedings and to modify or decertify a class at any time before final judgment.")(citing Fed. R. Civ. P. 23(c)(1)).

Other Courts of Appeals have implied that the operative complaint does not bind the plaintiff during class certification. The United States Court of Appeals for the Fifth Circuit has "specifically invited" a district court to reconsider a denial of class certification. Calderon v. Presidio Valley Farmers Ass'n, 863 F.2d at 389. The Second Circuit has similarly noted that a plaintiff could seek to certify a narrower class after the United States Court of Appeals for the Second Circuit upheld the district court's denial of class certification. See In re Initial Public Offering Sec. Litig., 483 F.3d at 73. The Second Circuit stated that the district court "can be expected to give such a request full and fair consideration." 483 F.3d at 73.

In short, the Tenth Circuit has no controlling opinion on this issue, but other Courts of Appeals have implied that a court need not bind the plaintiff to the class definition in the operative complaint. The Court consequently concludes that the Plaintiffs may submit a new class definition without amending their complaint. This rule is consistent with rule 23(c)(1)(C) which explains that "an order that grants or denies class certification may be altered or amended before final judgment." Fed. R. Civ. P. 23(c)(1)(C).

II. THE PLAINTIFFS COULD AMEND THEIR COMPLAINT NOTWITHSTANDING RULES 16(B)(4) AND 15(A).

Even if the operative Complaint bound the Plaintiffs to their original class definition, the Court would grant leave to amend their complaint. If a party seeks to amend his or her pleading after the time for seeking leave for pleading amendments has passed under a scheduling order, then he or she must meet rule 15(a)(2)'s requirements and satisfy rule 16(b)(4)'s good-cause requirement. See Gorsuch, Ltd., B.C. v. Wells Fargo Nat'l Bank Ass'n, 771 F.3d at 1240 ("After a scheduling order deadline, a party seeking leave to amend must demonstrate (1) good cause for seeking modification under Fed. R. Civ. P. 16(b)(4) and (2) satisfaction of the Rule 15(a) standard."). Rule 16(b)(4) states: "A schedule may be modified only for good cause and with the judge's consent." Fed. R. Civ. P. 16(b)(4). "In practice, this standard requires the movant to show the `scheduling deadlines cannot be met despite [the movant's] diligent efforts.'" Gorsuch, Ltd., B.C. v. Wells Fargo Nat'l Bank Ass'n, 771 F.3d at 1240.

Here, the Plaintiffs have been "diligent." The Defendants argue that the "Plaintiffs tender this new [class] definition nearly three years after they first learned of their ascertainability problem and more than two years after the parties completed extensive discovery and a multi-day hearing premised on the [original class] definition." Response to Motion 2 at 7. This statement, however, leaves out the key fact that the Plaintiffs did not propose a new class definition until after the Court announced Abraham. "Until the Court filed [Abraham] on August 16, 2016, plaintiffs reasonably believed that this case would be certified. There was no reason for plaintiffs to file additional motions addressed to the certification issues until the Court announced its decision." Reply 2 at 2. In other words, rule 16(b)(4)'s "diligence" requirement does not mean that plaintiffs must be clairvoyant and preemptively file a new class certification motion. That the Plaintiffs did not propose a new class definition until after the Court rejected the original one does not demonstrate lack of diligence.

Similarly, rule 15(a) would not prevent the Plaintiffs from hypothetically re-filing an amended complaint. Rule 15(a) provides that a party may amend his or her pleading as a matter of right within twenty-one days of serving it and within twenty-one days of the service of a response pleading. See Fed. R. Civ. P. 15(a). Otherwise, the party must obtain the opposing parties' consent or the court's leave — which should be "freely give[n] . . . when justice so requires" — to amend his or her pleading. The Supreme Court has stated that, in the absence of an apparent reason such as "undue delay, bad faith or dilatory motive . . . repeated failure to cure deficiencies by amendments previously allowed, undue prejudice to the opposing party by virtue of allowance of the amendment, futility of amendment, etc.," leave to amend should be freely given. Foman v. Davis, 371 U.S. at 182.

Here, the Defendants object that the Plaintiffs have unduly delayed amending their class definition, and that an amended class definition would unduly prejudice the defendants. See Response to Motion 2 at 7. Neither of these allegations are correct. First, the same reasoning described above regarding the rule 16(b)(4)'s "diligence" requirement applies to the Defendants' undue delay allegation. The Defendants protest that the Plaintiffs waited to submit a new class definition until after the parties retained experts, briefed the original class definition, completed discovery, and had a hearing. See Response to Motion 2 at 8. The Plaintiffs waited, however, because the Court had yet to issue an opinion rejecting their original class definition before submitting a new one. Like the rule 16(b)(4) diligence requirement, the rule 15(a) undue delay defense does not require the Plaintiffs to predict how a court will rule on a pending motion.

Similarly, the Defendants would not suffer undue prejudice if the Court hypothetically allowed an amended complaint. The Defendants argue that they "have been litigating this class certification under the operative class definition for over four years . . . Defendants tailored their arguments and evidence to that definition." Response to Motion 2 at 8. "Now, after four years of vigorous and expensive litigation culminating in the denial of their motion, Plaintiffs come forward with a new class definition." Response to Motion 2 at 8. The Defendants contend that "[c]ompelling Defendants to re-litigate certification under this new definition would be manifestly unfair." Response to Motion 2 at 8-9. In other words, the Defendants are proposing a rule saying that a plaintiff attempting to certify a class only gets one opportunity to do so if the litigation is sufficiently long and expensive. No such rule exists or should exist. The Court should try to get its decision right, and if the Court is convinced — notwithstanding its earlier determinations — that a class action is the appropriate vehicle to litigate a set of claims, then the Court should certify the class notwithstanding its earlier determinations. "Courts typically find prejudice only when the amendment unfairly affects the defendants in terms of preparing their defense to the amendment. Most often, this occurs when the amended claims arise out of a subject matter different from what was set forth in the complaint and raise significant new factual issues." Minter v. Prime Equipment Co., 451 F.3d 1196, 1208 (10th Cir. 2006). Here, however, the Plaintiffs propose a new class definition based on the same "subject matter" and on the same facts as in Abraham.

Further, the Fifth Circuit has "specifically invited" a district court to reconsider a denial of class certification. Calderon v. Presidio Valley Farmers Ass'n, 863 F.2d at 389. The Second Circuit has similarly noted that a plaintiff could seek to certify a narrower class after the Second Circuit upheld the district court's denial of class certification. See In re Initial Public Offering Sec. Litig., 483 F.3d at 73. The Second Circuit stated that the district court "can be expected to give such a request full and fair consideration." 483 F.3d at 73. The suggestion that the Plaintiffs should only get one opportunity to submit a class definition is therefore incorrect. Accordingly, even if the Court required the Plaintiffs to amend their complaint, there would be no undue delay, and the Defendants would not suffer undue prejudice.

III. THE PLAINTIFFS DID NOT WAIVE THEIR NEW CLASS DEFINITION.

The Court concludes that the Plaintiffs did not waive their new class definition. The Tenth Circuit has noted, in the context of waiver on appeal, that "if the theory was intentionally relinquished or abandoned in the district court, we usually deem it waived and refuse to consider it." Richision v. Ernest Group, Inc., 634 F.3d 1123, 1127 (10th Cir. 2011)(Gorsuch, J.). "Waiver occurs when a party deliberately considers an issue and makes an intentional decision to forgo it." United States v. Cruz-Rodriguez, 570 F.3d 1179, 1183 (10th Cir. 2009).

The Defendants reference a proposal to change the class definition that the Plaintiffs made during oral argument related to Abraham. See Response to Motion 1 at 6. Specifically, the Plaintiffs stated at oral argument: "[W]e also propose that the class definition speak to the gas and liquids processed at the various plants, or if not processed, the gas is or has been allocated natural gas liquids. . . ." Response to Motion 1 at 6 (citing Abraham, 317 F.R.D. at 216)(emphasis in original)). The Defendants allege that "the sole reason counsel offered [for this class definition] mimics the current one," in other words, mimics the current reason that the Plaintiffs have offered their new class definition. Response to Motion 1 at 6. That reason, according to the Defendants, is so that the class definition would "encompass all royalty and overriding royalty owners injured by the defendants' `keep-whole' royalty payment methodology." Response to Motion 1 at 6. The Defendants conclude that, because the Plaintiffs, at oral argument, proposed a class definition for the same reason that they propose the new class definition at issue in this motion, and subsequently withdrew the former one, the Plaintiffs have waived their new class definition. See Response to Motion 1 at 7.

This argument is incorrect. According to the Tenth Circuit, "[w]aiver occurs when a party deliberately considers an issue and makes an intentional decision to forgo it." United States v. Cruz-Rodriguez, 570 F.3d at 1183. Here, the Plaintiffs submitted two different class definitions, the one they orally submitted and withdrew, and the one presently at issue. That the Plaintiffs submitted the former definition for the same reason that they submit the current one does not change the fact that the two class definitions themselves are different. In other words, the plaintiffs did not "deliberately consider[] an issue and make[] an intentional decision to forgo it"; rather, the Plaintiffs submitted two issues, namely, two class definitions, for the Court to consider, albeit for the same underlying reason. United States v. Cruz-Rodriguez, 570 F.3d at 1183. The Plaintiffs did not, therefore, waive their current class definition.

IV. THE PROPOSED NEW CLASS IS ASCERTAINABLE..

The Court concludes that the new class definition solves the ascertainability problem. Rule 23(c) requires the Court to "define the class and the class claims, issues, or defenses." Fed. R. Civ. P. 23(c)(1)(B). Specifically, the Court must include "a readily discernible, clear, and precise statement of the parameters defining the class or classes to be certified." Wachtel v. Guardian Life Ins. Co., 453 F.3d 179, 187 (3d Cir. 2006). Another "essential" prerequisite to a rule 23(b)(3) class action is that the "class must be currently and readily ascertainable based on objective criteria." Marcus v. BMW of N. Am., LLC, 687 F.3d at 592-93. See EQT Prod. Co. v. Adair, 764 F.3d at 358 ("A class cannot be certified unless a court can readily identify the class members in reference to objective criteria.").

A key reason why the original class is not ascertainable is:

Abraham, 317 F.R.D. at 255 (internal citations omitted). The new class definition solves this processing problem. Unlike the old putative class, which the plaintiffs define based on "where the oil or natural gas produced from the leases was delivered to [enumerated processing plants]," the new class definition is based on people "whose royalty and overriding royalty has been calculated on a `keep-whole' method omitting payment on the value of the processed natural gas liquids portion of the production." Abraham, 317 F.R.D. at 184; Motion to Amend at 5. Under the new class definition, "the class members can be identified without regard to where their gas was processed." Motion to Amend at 6. More important, "[t]he class is limited to those owners who are paid on the keep whole methodology. WPX records provide a database which can identify the class members. WPX records show which owners' interests apply to production on the WFC system and are paid on the keep-whole methodology." Motion to Amend at 6. The Defendants do not specifically deny that they have such records. See Response to Motion 2 at 11-12. Instead, the Defendants protest that the new class definition is still "tied to a demand for payment on processed NGLs." Response to Motion 2 at 12. The keep-whole methodology identifies, however, "those class members whose gas is processed." Reply 2 at 7. Because the Defendants appear to have records showing who they pay on the keep-whole methodology, there is "a readily discernible, clear, and precise statement of the parameters defining the class or classes to be certified." Wachtel v. Guardian Life Ins. Co., 453 F.3d at 187. Accordingly, the Court concludes that the new class definition is ascertainable.

V. THE NEW CLASS DEFINITION DOES NOT MEET THE COMMONALITY REQUIREMENT.

Rule 23(a)(2) requires that "there are questions of law or fact common to the class." Fed. R. Civ. P. 23(a)(2) (emphasis added). The commonality requirement was widely perceived to lack teeth before the Supreme Court's decision in Wal-Mart, which grafted the following requirements onto rule 23(a)(2): (i) that the common question is central to the validity of each claim that the proposed class brings; and (ii) that the common question is capable of a common answer. See Wal-Mart, 131 S. Ct. at 2550-52. In Wal-Mart, Justice Scalia stated: "Wal-Mart is entitled to individualized determinations of each employee's eligibility for backpay." 131 S. Ct. at 2546. From this observation, he then concluded:

Wal-Mart, 131 S. Ct. at 2561. Thus, the common question or questions cannot be "incidental" nor can the plaintiff submit a long list of "incidental" questions or issues, and say that they predominate over the real issues to be used.

Here, the Plaintiffs have moved the Court to certify claims for royalty underpayment, breach of contract, breach of the duty of good faith and fair dealing, breach of the implied covenant to market, and civil conspiracy See Motion to Amend at 27; Second Motion for Class Certification at 13. The Court will address each claim in light of the commonality requirement.

1. Both the Royalty-Underpayment Claim and Breach-of-Contract Claim Lack Commonality.

Previously, the Court held that the underpayment and breach-of-contract claims did not meet the commonality requirement. See Abraham, 317 F.R.D. at 260-61. The Court ruled, regarding the keep-whole method, that "this uniform policy, which calculates and pays the class' royalties without regard to variations in lease language, is a common issue." Abraham, 317 F.R.D. at 260. However, "to determine whether royalty agreements require payment on all production in the method that the Plaintiffs seek, the Court must ask the question as to each of the different lease forms. The question, therefore, is not common to all proposed class members." Abraham, 317 F.R.D. at 261. Under the new class definition, the leases still have varying language.

Abraham, 317 F.R.D. at 274-75. The Plaintiffs urge that all of these leases can be primarily grouped into only two categories, namely, "proceeds" leases and "market value" leases. See Motion to Amend at 20. The Court concludes that this is an oversimplification of lease language. First, the Plaintiffs actually propose three categories of leases and not two. The Plaintiffs assert that "[t]he new class definition includes only those owners paid under proceeds (gross and net) leases and market value leases . . . [G]ross proceeds owners are all similarly situated. Net Proceeds owners are all similarly situated. Market value owners are all similarly situated." Reply 2 at 9. In other words, the three categories that the Plaintiffs actually propose are gross proceeds, net proceeds, and market value leases.

The larger problem is, however, at the beginning of the new class definition. The Plaintiffs state that "[t]he class consists of all present and former owners of royalty and overriding royalty from August 2006 to the present. . . ." Motion to Amend at 5 (emphasis added). There is an important distinction between royalty and overriding royalty instruments. As the Court found, unlike many oil and gas leases, "[o]verriding royalty interests generally are not created through the use of form contracts." Abraham, 317 F.R.D. at 196. Instead, "[o]verriding royalty interests often are created in individualized circumstances and business transactions, and the agreements contain unique royalty valuation terms. . . . [T]here is no standardization in the overriding royalty interest terms, because overriding royalty instruments are not generic like leases." 317 F.R.D. at 195. In related litigation, the Court, however, noted that it has "a list of some of the textual provisions found in the class overriding royalties. . . . [T]he list contains far more textual permutations than the eleven that exist for royalty instruments, and that list is illustrative, not exhaustive, of all of the overriding royalty provisions among the class." Anderson Living Trust v. WPX Energy Production, LLC, 306 F.R.D. 312, 343 (D.N.M. 2015)(Browning, J.).

Importantly, the Plaintiffs bear the burden of showing that they meet the class certification requirements. See Rex v. Owens ex rel. Okla., 585 F.2d at 435. Here, the Plaintiffs have not explained why the overriding royalty instruments in the putative class are substantively the same as the leases. Considering that their new class definition specifically includes both royalty and overriding royalty owners, and that variances in lease language was a key reason that the Court denied class certification in Abraham, the Plaintiffs have not met their burden of showing commonality.

Because of the distinction between royalty and overriding royalty instruments, the Court cannot soundly say that the Plaintiffs have shown, by a preponderance of the evidence, that common questions whether WPX Energy is underpaying the Plaintiffs or whether WPX Energy breached the leases are capable of common answers. See Wal-Mart, 131 S. Ct. at 2550-52.

2. The Implied Covenant to Market and Breach of the Duty of Good Faith and Fair Dealing Claims Lack Commonality.

As previously explained, "the duty to market does not define the lessor's royalty interest; the lease's royalty provision does that." Abraham, 317 F.R.D. at 265. "To determine which class members were entitled to be paid on the NGLs, however, the Court must examine each lease." Abraham, 317 F.R.D. at 265. "Accordingly, although the implied duty to market applies in every class lease, to demonstrate that WPX Production violated that duty by failing to pay royalties on NGLs, the Plaintiffs must establish the right to NGL payment under the various lease forms." Abraham, 317 F.R.D. at 265. Because the Court concludes that large variations in the leases and overriding royalty instruments still exist, despite the new class definition, the Court cannot soundly depart from its holding in Abraham that the common question whether WPX Energy breached the implied covenant to market is capable of a common answer. See Wal-Mart, 131 S. Ct. at 2550-52.

For similar reasons, the Court cannot hold that the common question whether WPX Energy breached the duty of good faith and fair dealing is capable of a common answer. See El Paso Natural Gas Co. v. American Petrofina Co. of Texas, 733 S.W.2d 541, 550 (Tex. App.-Houston [1st Dist] 1986)(stating that the duty to market in good faith "is based on the assumption that the operator is marketing something that belongs to the royalty owners").

3. The Civil Conspiracy Claim Lacks Commonality.

Similarly, the Court cannot soundly conclude that the Plaintiffs' civil conspiracy claim is capable of a common answer. The "Plaintiffs allege that WPX and WFC engage in a conspiracy to breach the class royalty and overriding royalty agreements." Second Motion for Class Certification at 11. The Plaintiffs argue that, "based on the fact that royalty owners under proceeds leases and market value leases are entitled to royalty on the value of the NGLs, the Court should reinstate the conspiracy claim." Second Motion for Class Certification at 11-12. This allegation rests, however, on the premise that all of the lease and overriding royalty instruments at issue can be grouped into the simple categories of "proceeds" and "market value" leases. As explained above, the Court holds that the Plaintiffs have not met their burden of demonstrating, by a preponderance of the evidence, that all of the instruments at issue in this case can be grouped into these two categories, especially in the case of the overriding royalty owners. For this reason, the Court cannot soundly conclude that this claim is one capable of a common answer. See Wal-Mart, 131 S. Ct. at 2550-52.

VI. UNDER THE NEW CLASS DEFINITION, COMMON ISSUES WILL NOT PREDOMINATE.

The Court concludes that, based on the new class definition, common issues will not predominate over individual ones. "Predominance regularly presents the greatest obstacle to class certification." CGC Holding Co. v. Broad and Cassel, 773 F.3d at 1087. As the Tenth Circuit has instructed, to determine predominance, the Court must "characterize the issues in the case as common or not, and then weigh which issues predominate." CGC Holding Co., LLC v. Broad & Cassel, 773 F.3d at 1087 (emphasis in original). "The nature of the evidence that will suffice to resolve a question determines whether the question is common or individual." Seabron v. Am. Family Mut. Ins. Co., 2013 WL 3713652, at *7 (citing In re Visa Check/Master Money Antitrust Litig., 280 F.3d at 136-40). "If, to make a prima facie showing on a given question, the members of the proposed class will need to present evidence that varies from member to member, then it is an individual question." Blades v. Monsanto Co., 400 F.3d at 566. See Messner v. Northshore Univ. Healthsystem, 669 F.3d at 815.

In Abraham, the Court applied the 10th Circuit test and made the following determinations:

Abraham, 317 F.R.D. at 270-271. Under the new class definition, individual issues (iv), (v), and (vi) are eliminated. See Motion to Amend at 10. All of these issues involved how the Plaintiffs' gas was processed. The key to the new class definition, however, is royalty owners "whose royalty and overriding royalty has been calculated on a `keep-whole' method omitting payment on the value of the processed natural gas liquids portion of the production." Motion to Amend at 5. Unlike the old class definition, which would have required the Court to spend significant time "determining which wells' gas is or has been delivered to processing plants for extraction and marketing of natural gas liquids from the gas at [various processing plants]," the new definition is no longer tied to any specific processing plants. Abraham, 317 F.R.D. at 272. The old definition specifically involved natural gas that "was delivered to the Ignacio Processing Plant. . . the Kutz Plant . . . or the Lybrook Plant." Abraham, 317 F.R.D. at 184. A key problem with this definition was that:

Abraham, 317 F.R.D. at 255 (internal citations omitted). The new class definition, however, does not rely upon how or where gas is processed. Instead, the key to the class is WPX Energy's keep-whole payment method. The Court, therefore, concludes that the new class definition eliminates individual issues (iv), (v), and (vi).

Individual issue (iii) is "parol evidence concerning negotiations and oral agreements contemporaneous to the execution of certain class leases." Abraham, 317 F.R.D. at 270-271. The Court noted, however, that it "doubts that much of this evidence exists . . . and assigns a low weight to it in the predominance calculus." Abraham, 317 F.R.D. at 271 n.77. The Defendants have not given the Court any reason to depart from assigning parol evidence "low weight." In fact, the Defendants point out that the "Plaintiffs introduced no evidence of the circumstances surrounding the execution of any lease, and they cite none in their motion." Response to Motion 1 at 18. Because the Court has not seen any parol evidence concerning the leases' execution, it continues to assign individual issue (ii) low weight.

That leaves individual issues (i) and (ii). Individual issue (ii), "the various leases' differing language," is the most important. Abraham, 317 F.R.D. at 270-271. In Abraham, the Court held that, under the original class definition, "given the lease language obligations and the variations in state law, this class action could involve up to thirteen different legal standards for the jury to apply, which would be manageable if the Court did not have to confront the considerable number of other individualized issues already discussed." Abraham, 317 F.R.D. at 275 (emphasis added). In other words, the Court was concerned that common issues would not predominate. Under the new class definition, however, the Plaintiffs have conceded that what the Court termed Category B and Category F leases would no longer be part of the class. Motion to Amend at 20-21. Previously, the Court found, in the chart below, that up to 13 legal standards may exist among the several categories of leases due to variations in Colorado and New Mexico oil and gas law. See Abraham, 317 F.R.D. at 275.

Based on the Plaintiffs' concessions regarding their new class definition, the Court modifies the chart as follows:

Because the Court held in Abraham that 13 legal standards would be manageable if it were not for other individualized issues, and because the Court is satisfied that individual issues (iv), (v), and (vi) are eliminated and individual (iii) is assigned "low weight," the Court now holds that up to 10 legal standards would be manageable. See Abraham, 317 F.R.D. at 275.

Finally, regarding individual issue (i), "industry-custom-and-usage evidence regarding the meaning of specific royalty provisions," the Court previously held that:

Abraham, 317 F.R.D. at 271. The Court notes that, by the Plaintiffs' own admission, the new class definition removes Category F leases in both New Mexico and Colorado, as well as Category B leases, all of which are in Colorado. See Motion to Amend at 20-21. Because the new class definition contains fewer categories, the issue of the lease language will be less individualized.

Having characterized the issues, the Court must now weigh them to determine which issues will predominate. See CGC Holding Co., LLC v. Broad & Cassel, 773 F.3d at 1087. First:

Abraham, 317 F.R.D. at 270-271. Now, the individual evidence in this case includes, (i) less industry and custom usage evidence regarding the meaning of specific royalty provisions than under the old class definition, (ii) up to 10, as opposed to up to 13, possible legal standards regarding variance in lease language, and (iii) low weight given to parol evidence regarding lease negotiation and execution. The evidence regarding lease language variation would likely consume the most time at a trial.

Just as the variations in lease language prevent the Court from soundly concluding that the new class definition satisfies the commonality requirement, those variations prevent the Court from soundly concluding that common issues predominate over individual issues. The Court will, consequently, deny class certification.

IT IS ORDERED that (i) the Plaintiffs' Motion to Alter or Amend and to Reconsider Memorandum Opinion and Order [Doc. 252], filed September 15, 2016 (Doc. 255), is denied; and (ii) Plaintiffs' Second Motion for Class Certification, filed September 15, 2016 (Doc. 256), is denied.