Litigation

Baker Hughes | Energy Services | Halliburton | Industrywide Issues | Litigation | M&A | Regulation

Obama DOJ Sues to Block Halliburton/Baker Hughes Merger
April 7, 2016April 7, 2016

That didn’t take long. Yesterday MDN told you that sources in the Obama Dept. of Justice (DOJ) were leaking to the press that they would soon file a lawsuit against the Halliburton/Baker Hughes merger, in order to block it (see DOJ “Preparing Lawsuit” Against Halliburton/BH – Deal Looks Dead). They did. Yesterday the DOJ filed to block the merger saying the “merger would eliminate significant head-to-head competition in oilfield services industry.” Halliburton and Baker Hughes were quick to respond saying they will “vigorously contest the U.S. Department of Justice’s (DOJ) effort to block [the] pending merger.” Bring on the lawyers! Halliburton/BH say the DOJ has “reached the wrong conclusion in its assessment of the transaction and that its action is counterproductive, especially in the context of the challenges the U.S. and global energy industry are currently experiencing.” Here’s the dueling press releases issued yesterday…
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Baker Hughes | Energy Services | Halliburton | Industrywide Issues | Litigation | M&A | Regulation

DOJ “Preparing Lawsuit” Against Halliburton/BH – Deal Looks Dead
April 6, 2016April 6, 2016

Yesterday MDN told you that the U.S. Dept. of Justice has sued investment firm ValueAct Capital with an accusation that ValueAct has inappropriately pulled strings with both Halliburton and Baker Hughes in their planned merger (see DOJ Sues ValueAct Capital for Meddling in Halliburton/BH Merger). It seems that’s not the only lawsuit the DOJ is going to lodge. According to the Wall Street Journal and other national media sources, the Obama DOJ has let leak they plan to sue Halliburton/Baker Hughes to stop the merger. It appears as if it’s all but dead. The Europeans are not fans of the plan (see Europe Puts Halliburton/BH Merger Under a Microscope). Brazil is also against the deal (see Is the Halliburton Buyout of Baker Hughes in Trouble?). If the DOJ turns against it–there’s no way the deal will happen, in our humble opinion. Here’s the latest in the shotgun wedding that may turn out to be a couple at the alter with no one willing to marry them…
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Elk County | Energy Companies | Industrywide Issues | Litigation | Pennsylvania | Seneca Resources | Wastewater

Judge Rules Seneca May Challenge Injection Well Ban in Elk County
April 5, 2016April 5, 2016

There is a new development in the case of an illegal ban on injection wells passed by Highland Township in Elk County, PA. In 2013 the radical leftist PA-based group Community Environmental Legal Defense Fund (CELDF) convinced enough ignoramuses in Highland Township to pass a so-called Community Bill of Rights. Seneca Resources, a driller with leases and an active drilling program in Elk, had planned to drill an injection well on their own property to dispose of their own flowback and produced water. The CELDF-inspired ordinance Highland Twp prevented it, and Seneca threatened to sue the town (see Seneca Resources Threatens to Sue PA Town over Injection Well). Seneca made good and filed to sue, but the town and CELDF tried to prevent the lawsuit. Last week U.S. Magistrate Judge Susan Paradise Baxter ruled that Seneca has standing to sue and the lawsuit will now go forward. By the way, in October of 2015, Judge Baxter ruled in an almost identical case in Grant Township (located in nearby Indiana County) that the town’s injection well ban was illegal (see Fed Judge Overturns Grant Twp, PA Ban on Injection Wells). Even the dullards who enacted the ban in Highland should be able to see the writing on the wall. They’re about to lose. Taxpayers in Highland who are footing the bill (since the CELDF doesn’t pay for legal fees and judgments) are the biggest losers. They may want to remember that come election time…
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Baker Hughes | Energy Services | Halliburton | Industrywide Issues | Litigation | M&A

DOJ Sues ValueAct Capital for Meddling in Halliburton/BH Merger
April 5, 2016July 14, 2016

So what’s happening with Halliburton’s $34.6 billion buyout of Baker Hughes? At last check the deal was at best a 50/50 proposition as to whether or not it would happen. Europe currently has the deal under a microscope (see Europe Puts Halliburton/BH Merger Under a Microscope). The European Commission launched a “second phase” of their investigation into the deal, which is problematic for Halliburton. The European Commission says they see “serious potential competition concerns” with the deal. Not good. But that was in January. Since then we’d not heard anything about the deal’s progress–until now. Yesterday the U.S. Dept. of Justice sued ValueAct Capital, accusing the company of purchasing $2.6 billion worth of stock in Halliburton and BH with “the intent to influence the companies’ business decisions as the merger unfolded.” The company has been charged with violating the reporting and waiting period requirements of the Hart-Scott-Rodino Antitrust Improvements Act…
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Anti-Drilling/Fossil Fuel | Crime | Energy Services | Huntingdon County (PA) | Industrywide Issues | Litigation | Pennsylvania | Pipelines | Sunoco Logistics

PA Anti Literally Goes Up a Tree to Stop Mariner East 2 Pipeline
March 31, 2016March 31, 2016

Another environmentalist has tipped over the edge. The daughter of a landowner in Huntingdon County, PA scampered up a tree and planted herself there to prevent that tree and others near it from being cut down by crews clearing a path for the Mariner East 2 pipeline. Just two days ago we told you that Huntingdon County Common Pleas Judge George Zanic previously issued an order to Ellen Gerhart to allow tree clearing on three acres of her property (see Court Grants Mariner East 2 Right to Clear Trees in Huntingdon, PA). Gerhart’s daughter Elise literally “went up a tree” yesterday to a platform pre-built there, between two trees, and says she’ll stay there until the end of the week when tree-clearing season is over. You can’t clear trees after March 31st for fear of killing a threatened bat species. No word on when/if authorities will climb the tree and forcibly remove her. Thing is, she’s not alone. Radical environmentalists are behind Gerhart’s stunt. Two well-known anti-drilling radicals were arrested for blocking work at the site–and bail was set at $100,000 each. Yes, it’s time to get serious with these repeat lawbreakers. It’s also time to go up the tree and extricate Ms. Gerhart and put her in jail with them…
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Anti-Drilling/Fossil Fuel | Industrywide Issues | Litigation | New York | Regulation | Statewide NY

Climate Change Hucksters, Incl. NY AG & Al Gore, Threaten O&G
March 30, 2016March 31, 2016

A small group of rabidly partisan Democrats who have drunk deeply from global warming Kool Aid–including New York’s corrupt Attorney General Eric Schniederman and global warming huckster Al Gore–gathered yesterday in New York to declare they are ready to litigate from sunup to sundown to ensure Dictator in Chief Obama’s Clean Power Plan (currently being challenged in court) is implemented–both now and by the next El Presidente. It is, of course, a sham. They don’t really believe in global warming–most of them anyway. They’re not that stupid (although Al Gore may be). They want total control over the source of energy you use–because it personally empowers them (in the case of New York Attorney General Schneiderman) and enriches them (in the case of Al Gore who buys and sells energy credits). It’s corruption at the highest levels…
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Energy Services | Huntingdon County (PA) | Industrywide Issues | Litigation | Pennsylvania | Pipelines | Sunoco Logistics

Court Grants Mariner East 2 Right to Clear Trees in Huntingdon, PA
March 29, 2016March 29, 2016

It’s always sad when a pipeline company has to resort to eminent domain in order to install a pipeline through/under a property. Once the pipeline is there, you don’t even know it. Our observation is that pipeline companies bend over backwards to avoid sensitive areas and to reroute away from properties that don’t want it. Sometimes that’s not possible. It seems to us like reasonable people should be able to come to terms when it’s not possible to avoid having a pipeline installed. However, some people are not reasonable (able to be reasoned with)–that’s life. And that’s why eminent domain exists. A sad necessity. Such is the case with the Mariner East 2 pipeline being built by Sunoco Logistics Partners. Many landowners have signed agreements with Sunoco LP for Mariner East 2–but some have not. Those not granting permission have been sued using eminent domain, to allow Sunoco to clear trees and begin building. In almost every case Sunoco has won the eminent domain argument in court. The latest instance of victory for Sunoco comes in Huntingdon County, PA. Start the chainsaws! Today more trees are coming down in Huntingdon to make way for Mariner East 2…
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Industrywide Issues | Litigation | Pennsylvania | Regulation | Statewide PA

PA Conventional Drillers File Lawsuit to Stop New DEP Regulations
March 28, 2016March 28, 2016

Pennsylvania’s small, conventional oil and gas drillers have had enough of Gov. Tom Wolf and his Secretary of the Dept. of Environmental Protection, John Quigley. Last week a trade association representing many of PA’s small, independent oil and gas drillers–the Pennsylvania Independent Petroleum Producers Association (PIPP)–filed a lawsuit against implementation of new rules and changes to existing rules known as Chapters 78 & 78a (see PA DEP Issues “Final” New Drilling Regulations; Industry Pushback and PA DEP On Course to Jam New Regulations Down Drillers’ Throats). PIPP objects to conventional drillers being subjected to many of the same rules as unconventional (shale) drillers. PIPP says the two types of drilling are apples and oranges and to make small drillers jump through the same hoops as big shale drillers will literally eliminate small drillers from the Keystone State–making it unprofitable to continue drilling. So PIPP, on behalf of those drillers, sued to stop the new regulations…
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Energy Companies | EQT Corp | Greene County (PA) | Industrywide Issues | Litigation | Pennsylvania | Statewide PA

PA Court Says Leaseholder Can Sublease Production Rights
March 28, 2016March 28, 2016

We’re not sure how many landowners this may potentially affect, but we found a recent court decision by Pennsylvania Superior Court to be interesting. Landowners who had inherited property (and a lease) in Greene County, PA asked the court to “sever” the lease into two parts. The lease is with EQT and its affiliates and is 50 years old–long before Marcellus drilling. The landowner makes the case that because EQT had assigned the production rights to a third party and had never themselves drilled, the lease is terminated. There are two parts to the lease: one which said EQT had up to 10 years to extract oil and gas, the other that EQT can store natgas underground. The landowners were looking to end that portion of the lease that allows drilling because EQT never drilled on or under the property–and by assigning those rights to someone else, they have abrogated their rights under the lease. The court disagreed and said you can’t “sever” production rights from storage rights. If one OR the other happened, under the original lease, that is enough to make all parts of the lease ongoing and enforceable. Our description is likely not very good. Here’s what the legal beagles at Vorys say about the case, along with a copy of the decision…
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Blue Ridge Mtn Res/Magnum Hunter | Energy Companies | Industrywide Issues | Litigation | Pipelines | Triad Hunter

MHR Wiggles Out of One Midstream Contract, Sues to End Another
March 23, 2016March 23, 2016

Two weeks ago Magnum Hunter Resources (MHR), a driller focused almost exclusively on the Marcellus/Utica and going through bankruptcy protection proceedings, struck a deal with pipeline company Texas Gas Transmission Inc. to terminate four existing contracts with company to use its pipelines. MHR was pressuring Texas Gas to cancel the contracts it has with MHR subsidiary Triad Hunter, but Texas Gas was resisting. In the end Texas Gas agreed to cancel the contracts provided they get a $15 million “unsecured claim” which grants Texas Gas the right to be near the front of the line to get paid $15M when MHR is either sold or emerges from bankruptcy proceedings. MHR isn’t, however, having as much success with canceling signed contracts for another of its subsidiaries in the Bakken Shale region. Bakken Hunter has an existing, signed contract with Oklahoma midstream company Oneok. Citing the recent Sabine Oil & Gas ruling in which that company was allowed to cancel midstream contracts during bankruptcy (see Midstream Nightmare Comes True: Judge Lets Driller Cancel Contracts), MHR is asking a Delaware bankruptcy court to allow them to wiggle out of the Oneok deal. In addition to updates on these two situations, we also have news that the Securities and Exchange Commission is at least partially blaming two former Magnum Hunter employees–a chief financial officer and chief account officer–for the company’s financial predicament…
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Anti-Drilling/Fossil Fuel | Industrywide Issues | Litigation | Medina County | Ohio | Portage County | Regulation | Statewide OH

OH Antis Circulate Petitions for Bans Already Tossed by Courts
March 22, 2016March 22, 2016

The Pennsylvania-based Community Environmental Legal Defense Fund (CELDF) is a radical environmental group backed with Big Green money that exists to fleece local towns into adopting bans on fracking and pipelines. Last year we carried an expose of the group (see PA’s CELDF Unmasked as Troublemakers in Ohio Utica Shale). Much of their community agitating work is done in Ohio. Time after time their so-called “community bill of rights” initiatives are shot down by Ohio courts. The latest instance (and there have been many) was earlier this month when the U.S. 8th District Court of Appeals overturned the CELDF-created bill of rights law passed in the Cleveland suburb of Broadview Heights (see Mad Moms Hopping Mad Over Court Decision re Broadview Heights, OH). You would think towns would learn that a) these initiatives invariably are challenged and thrown out by the courts, and b) if the initiatives interfere with a local business that sues the town, the CELDF is nowhere to be found (see Anti Group CELDF Won’t Help Grant Twp Pay $1M Judgement). But there’s plenty of insane people–like those circulating petitions in Medina and Portage counties to get a CELDF-backed bill of rights initiative on the local ballot. The very same initiative already shot down by Ohio courts in other locations…
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Anti-Drilling/Fossil Fuel | Fayette County | Industrywide Issues | Litigation | Regulation | Wastewater | West Virginia

Fayette WV Commissioners Change Ban to Focus on Injection Wells
March 21, 2016March 21, 2016

The Democrat commissioners of Fayette County, WV are scrambling to try and keep their jobs after enacting what is turning out to be a disastrous ordinance to ban all fracking, injection wells, drilling, etc. In January, three liberal Democrat county commissioners from Fayette County, WV, with the backing and help of the radical WV Mountain Party, voted to ban injection wells in the county (see WV County Officially Bans Injection Wells; Children Brainwashed). In fact, the ban is intentionally written so broadly it will also ban the operation of more than 500 vertical oil and gas wells in the county. The next day EQT sued to overturn the ban (see EQT Sues WV County that Banned Injection Wells, Seeks Injunction). Not long after, a U.S. District Court judge slapped an injunction on the county preventing them from enforcing the ban at least until a hearing scheduled for later this month (see Judge Stops WV County from Enforcing Injection Well Ban, For Now). One of the chief architects of the ban, from the Mountain Party, admits the ban is intended to stop all oil and gas activity in the county (see Anti Admits Fayette County, WV Ban Aims to Shut Down All O&G Wells). Facing a lawsuit they will lose, the commissioners have backed away from the position of banning everything to do with drilling in the county. They’ve revised the proposed ban regulation as a tactic to avoid losing their court case–but everyone sees through this latest pathetic attempt. Sensing they won’t win their court case to ban drilling as well as injection wells, they’ve opted to toss the drilling part and go for just banning injection wells. We hope the voters and taxpayers in Fayette County vote the three commissioners out at the next election for their anti-drilling malfeasance…
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Anti-Drilling/Fossil Fuel | Industrywide Issues | Litigation

Canadian Company Fights Back Against Green Bully Greenpeace
March 21, 2016March 21, 2016

One of the favorite ways Big Green groups bully companies and municipalities is by using lawsuits against them. We see it all the time in the oil and gas industry. Example: THE Delaware Riverkeeper and Clean Air Council–both based in the Philadelphia area–filed a lawsuit against the Town of Middlesex in Butler County, PA (see ACLU Bullies Threaten Butler County Landowners over Martian Lawsuit). Butler County is on the opposite side of the state from where Riverkeeper and the Clean Air Council are supposed to be operating. Such is how they work. Another favorite tactic is to launch smear campaigns against the industry. One of the most radical Big Green groups is Greenpeace. They’re famous for smear campaigns–full of lies. They tried to run such a campaign against a Canadian forestry company–and the company fought back, in court. And now the court will make Greenpeace open up their records for close scrutiny. Cockroaches like Greenpeace can’t stand the light of day shining into their activities. They’re worried. And that got us to thinking. Why northeast drillers and midstream companies use the example of this forestry company as their model to fire back at THE Delaware Riverkeeper, Catskill Mountainkeeper, Food & Water Watch, and a plethora of other odious groups? Let’s force them to open up their books and expose them for the colluding frauds they are…
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Anti-Drilling/Fossil Fuel | Athens County | Hydraulic Fracturing | Industrywide Issues | Litigation | Ohio | Regulation | Statewide OH

Mad Moms Hopping Mad Over Court Decision re Broadview Heights, OH
March 15, 2016March 15, 2016

In 2012 Broadview Heights, OH, a Cleveland suburb, passed an illegal “Community Bill of Rights” law that bans oil and gas drilling in their township. Ohio law specifically and plainly states that only the state–not local municipalities–have the sole right to regulate the oil and gas industry. The law was promptly thrown out by a lower court, which resulted in anti-drilling groups including the Ohio Community Rights Network (OHCRN) and Mothers Against Drilling in Our Neighborhoods (MADION), with Big Green money backing from the odious PA-based Community Environmental Legal Defense Fund (CELDF), appealing the decision. It eventually made its way up the chain to the 8th District Court of Appeals. The nutters were so ecstatic when the 8th District agreed to hear the case, they celebrated with “street dramatizations” (see Antis Celebrate OH Appeals Court Hearing with Street Dramatization). They’re not celebrating anymore. The 8th District has ruled against the Broadview Heights law. Not only that, the 8th District is the first court to directly address the so-called “bill of rights” argument. In a crushing blow to the nutters, the 8th District Court said, in essence, “No. Towns don’t have inalienable rights to create laws that supersede the state’s laws.” However, nutters never go away–they blat and bleat and carry on, as they are doing now with this decision. At least we have some resolution in Ohio. This decision is a resounding refutation of the CELDF and their predatory behavior of pressuring towns into passing “bill of rights” laws that ban drilling and fracking…
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Coterra Energy (Cabot O&G) | Energy Companies | Industrywide Issues | Litigation | Pennsylvania | Statewide PA

Reaction to Dimock Court Decision Continues
March 15, 2016March 15, 2016

Last week a brain dead, OJ-style jury awarded two families $4.25 million (one of the families already being millionaires) in the six year-old case claiming Cabot Oil & Gas contaminated water wells in Dimock, PA with their drilling activities (see Dimock Jury Levies $4.25M Judgement Against Cabot in Dimock Case). The jury rewarded the plantiffs for being unreasonable and refusing to allow their water to be fixed–because methane in water CAN be fixed. The plantiffs held out, hoping to shake down Cabot, and they got an obtuse jury to agree with them. The case is still generating shock waves with both supporters of shale energy, and irrational detractors of fossil energy. Below is reaction to the decision from the Pennsylvania chapter of the National Association of Royalty Owners (NARO), the litigious radicals at Food & Water Watch, and from Penn State’s Marcellus Center for Outreach and Research…
Read More “Reaction to Dimock Court Decision Continues”
Industrywide Issues | Litigation | Pipelines

DB Brief on Court Decision re Driller Canceling Pipeline Contract
March 15, 2016March 15, 2016

Last week MDN brought you the news that midstreamers’ nightmare had come true–with a decision in a Texas court case that allowed a driller who had declared bankruptcy to cancel previously signed contracts for a pipeline gathering system (see Midstream Nightmare Comes True: Judge Lets Driller Cancel Contracts). The fear is that more drillers will use this new tactic of declaring bankruptcy in order to shed previously signed deals with pipeline companies. Is that fear legitimate? After all, this was a single case for a single driller/pipeline company. Will it be used as a precedent in other cases? We spotted a policy brief from powerhouse banking company Deutsche Bank, their Equity Research division, addressing the question of just what are the implications coming from the Texas decision…
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