Summary

OPINION OF THE COURT

In this Rule 23(b)(3) class action dispute over royalties due under oil and gas leases, none of the named plaintiffs had arbitration clauses in their leases, but the proposed classes were defined broadly enough to include leaseholders with arbitration clauses in their leases. The defendant moved to compel arbitration against the leaseholders with arbitration clauses in their leases but only after class certification and the expiration of the opt-out period for putative class members. Because that motion was preceded by years of litigation, the District Court concluded that the defendant impliedly waived its right to compel arbitration against the unnamed class members with arbitration clauses in their leases by demonstrating a preference for litigation over arbitration. Through this interlocutory appeal, the defendant challenges that ruling. In reviewing the District Court's legal conclusion of waiver de novo and its attendant factual findings for clear error, see White v. Samsung Elecs. Am., Inc., 61 F.4th 334, 338 (3d Cir. 2023), we will VACATE the order denying the defendant's motion to compel arbitration and REMAND the case for further proceedings consistent with this Opinion.

XTO Energy, Inc., a wholly owned subsidiary of Exxon Mobil Corporation.