Hey Andy,
When a copy and paste takes place some amount of formatting will be carried over, and Method will try to translate that into HTML.
The best practice is to click on on the button to do a Plain Text paste. Alternatively, on a Mac you can paste and match formatting by using the keyboard shortcut command+option+shift+V.
I tested both of these methods and they produced html with a <p> and <br /> tags. Hope that helps.
Sam