Litigation

Energy Companies | Hess | Industrywide Issues | Jefferson County (OH) | Lease & Royalty Payments | Litigation | Ohio | Statewide OH

Hess Loses OH Court Case, May Owe Big Bucks to 300 Landowners
October 2, 2013October 2, 2013

Hess has just lost a court case in Ohio that may end up costing the company dearly. Hess had purchased leases in eastern Ohio from other companies. The original leases date to 2006-2008 and in many cases the landowners were paid as little as $10 per acre for a signing bonus–absolutely peanuts compared to today’s rates for $5K or more per acre. A Jefferson County landowner sued Hess to get out of his lease agreement because the company had not drilled on his property. Hess argued provisions in the lease let them extend the lease by paying a nominal extra fee.

Hess lost, and now will have to pay that landowner (and by extension around 300 other landowners) big re-signing bonuses or risk losing the land…
Read More “Hess Loses OH Court Case, May Owe Big Bucks to 300 Landowners”
Doddridge County | Energy Companies | EQT Corp | Industrywide Issues | Lease & Royalty Payments | Litigation | West Virginia

WV Landowner Tries to Stop Shale Drilling with New Water Wells
September 30, 2013September 30, 2013

Here’s a novel approach by a landowner to try and stop drilling on land already leased. A landowner in Doddridge County, WV didn’t like how he was being treated by driller EQT, so he drilled several water wells close to where EQT planned to drill Marcellus Shale gas wells on his property. In WV, you can’t drill within 250 feet of a water well–so the water wells effectively shut down drilling on his property.

Except… EQT is now suing the landowner for bad faith and intentionally trying to obstruct a signed contract. Based on the facts in the case, we expect EQT will prevail. Drilling the water wells was “cheating” to prevent drilling and ultimately to get out of the lease. Creative, perhaps–but misguided…
Read More “WV Landowner Tries to Stop Shale Drilling with New Water Wells”
Energy Companies | Hydraulic Fracturing | Industrywide Issues | Litigation | Pennsylvania | Regulation | Statewide PA | XTO

Exclusive: MDN Interviews PA DEP Sec. Chris Abruzzo
September 27, 2013September 27, 2013

MDN became aware that newly nominated (and currently Acting) Secretary of the PA Dept. of Environmental Protection, Chris Abruzzo, would be attending Shale Insight 2013. So we requested an interview with the Secretary, and he obliged! To our knowledge, we were the only media interview he granted during a brief walking around the show visit on Wednesday.

MDN editor Jim Willis asked Sec. Abruzzo some tough questions, including his take on the PA Attorney General’s criminal lawsuit against XTO (see PA AG Abuses Her Authority, Files Criminal Charges Against XTO); his biggest challenge since holding the office in April; how he responds to the charge that the DEP is sometimes too cozy with the drilling industry; an update on the DEP’s study of air quality near drilling sites and compressor stations (see DEP Marcellus Air Study in SW PA Extended Extra Half Year); and his response to John Hanger (former Secretary of the DEP) about his remarks that Abruzzo’s appointment was “bizarre and irresponsible”…
Read More “Exclusive: MDN Interviews PA DEP Sec. Chris Abruzzo”
Chesapeake Energy | Energy Companies | Industrywide Issues | Lease & Royalty Payments | Litigation | Pennsylvania | Statewide PA

Lawyers Say Don’t Ignore Chesapeake’s PA Lawsuit Settlement Letter
September 24, 2013September 23, 2013

Chesapeake Energy recently settled a lawsuit with Pennsylvania landowners in which they agree to pay (a pitifully small) $7.5 million to landowners after shorting them on royalty payments (see Chesapeake Settles PA Royalty Lawsuit for Pittance: $7.5M). The National Association of Royalty Owners Pennsylvania chapter is telling landowners to pay “very close attention” to the settlement letter when it comes.

The settlement letter may have much broader implications than just getting a check for a few bucks from Chesapeake. It may set the rules for how your future royalties will be calculated…
Read More “Lawyers Say Don’t Ignore Chesapeake’s PA Lawsuit Settlement Letter”
Accidents | Energy Companies | Industrywide Issues | Litigation | Lycoming County | Pennsylvania | Wastewater | XTO

XTO Will Pay $20M+ to Settle PA Frack Wastewater Spill Case
September 19, 2013September 19, 2013

XTO Energy (owned by Exxon) continues to fight against an egregious–perhaps illegal–abuse of power by Pennsylvania Attorney General Kathleen Kane, an anti-driller who is attempting to criminalize an accidental spill of frack wastewater hoping to make “an example” of XTO (see PA AG Abuses Her Authority, Files Criminal Charges Against XTO).

Meanwhile, XTO has just settled the civil side of that accident by agreeing to pay more than $20 million–$100,000 in fines and $20 million to implement new procedures and technologies to ensure such a spill does not happen again…
Read More “XTO Will Pay $20M+ to Settle PA Frack Wastewater Spill Case”
Health Impacts | Hydraulic Fracturing | Industrywide Issues | Litigation | New York | Regulation | Statewide NY

NY Eco Group Sues Health Dept/Shah to Release Frack Health Study
September 18, 2013September 18, 2013

MDN has made it plain we believe New York State Dept. of Health Commissioner Nirav Shah, who in February of this year said he was just “weeks away” from releasing the results of his research on the potential public health impacts of proposed new fracking rules from the NY Dept. of Environmental Conservation, is covering for his boss, Gov. Andrew “Ditherer” Cuomo (see Cuomo Underling Shah: “No Timetable” on Fracking Decision). We on the pro-drilling side of the debate are not the only ones unhappy with the Cuomo/Shah marionette show.

This week an anti-drilling group from the Finger Lakes area–the Seneca Lake Pure Waters Association–sued Shah and the Dept. of Health in an attempt to get the research documents finally released. The Association previously filed Freedom of Information Law (FOIL) requests in an effort to obtain the documents but Shah refused. Now the courts may finally force Andrew the Great Ditherer to finally get off his rear-end and make a decision by requiring Shah to release his findings…
Read More “NY Eco Group Sues Health Dept/Shah to Release Frack Health Study”
Coterra Energy (Cabot O&G) | Energy Companies | Industrywide Issues | Litigation | Pennsylvania | Susquehanna County

Dimock Family & Lawyers in Legal Hot Water for Secret Assistance
September 16, 2013September 16, 2013

“Dimock” is the issue that won’t die because the media and anti-drillers won’t let it. The latest installment in this soap opera: Landowners Scott and Monica Ely refused Cabot Oil & Gas’ offer to settle in 2012, although virtually all other landowners who say Cabot contaminated their water wells with methane (natural gas) did settle. The Elys were hoping for a bigger payday, so they kept on–against the advice of their lawyers.

The Elys told the court they couldn’t find legal help so they would represent themselves. Then, against legal and ethical standards, a pair of lawyers (one of them from the firm previously representing the Dimock families) secretly helped them anyway. The Elys and their surreptitious lawyers are now in legal hot water…
Read More “Dimock Family & Lawyers in Legal Hot Water for Secret Assistance”
Crime | Industrywide Issues | Litigation | Mahoning County | Ohio | Wastewater

Harch Environmental Gets $100K Fine for OH Wastewater Dumping
September 12, 2013September 12, 2013

In early June, the Ohio Dept. of Environmental Resources (ODNR) “temporarily” shut down Harch Environment Services after it was caught illegally dumping frack wastewater on the ground (see Another OH Company Shut Down for Illegal Frack Wastewater Dumping). The ODNR investigated and has just assessed a $100,000 fine against Harch. As part of their action, ODNR is requiring Harch to cease wastewater hauling for 30 days–although we were under the impression they had already ceased as of early June. Plus, ODNR says it reserves the right to bring more charges, including criminal charges, against the company in the future.

It does appear, however, that Harch (unlike D&L Energy) will be permitted to resume operations in Ohio once again…
Read More “Harch Environmental Gets $100K Fine for OH Wastewater Dumping”
Broome County | Chesapeake Energy | Energy Companies | Industrywide Issues | Lease & Royalty Payments | Litigation | New York | Tioga County (NY)

Done Deal: Chesapeake Drops Leases on 13K Acres in NY
September 10, 2013September 10, 2013

Last week MDN told you that Chesapeake was set to release 12,000 acres of leases in the Southern Tier of New York, abandoning a legal fight to extend those leases (some of which they paid $2-3 per acre for) by using a legal concept called force majeure (see Chesapeake to Release 12K Acres of NY Leases Next Week). Major media outlets from AP to Reuters are reporting Chesapeake, as of Monday, has officially dropped those leases.

One slight update: it was actually 13,000 acres, not 12,000 acres as originally reported…
Read More “Done Deal: Chesapeake Drops Leases on 13K Acres in NY”
Hydraulic Fracturing | Industrywide Issues | Litigation | New York | Regulation | Statewide NY

How Long Before NY High Court Rules on Town Bans? An Answer…
September 9, 2013September 9, 2013

Two weeks ago MDN told you the encouraging news that the New York Court of Appeals (New York’s highest court) will hear the Dryden and Middlefield town ban cases (see Anti-Drillers Attempt a Brave Face with NY Appeals Court Decision). Anti-drillers, like former Gannett and Binghamton Press & Sun-Bulletin reporter Tom Wilbur, are understandably shaken by this turn of events. They believe they had won (using NY’s courts) where they couldn’t win (in the political arena and the arena of ideas)–so when the high court said “yes” to hearing the case, they took it as a bad omen. They continue to put on a brave face, but make no mistake–they’re scared.

What about the timing for a decision in these twin cases being heard together as a single case? Wilbur does a good job of tracking down just how long the appeal to the high court will take to run its full course…
Read More “How Long Before NY High Court Rules on Town Bans? An Answer…”
Broome County | Chesapeake Energy | Energy Companies | Industrywide Issues | Lease & Royalty Payments | Litigation | New York | Tioga County (NY)

Chesapeake to Release 12K Acres of NY Leases Next Week
September 5, 2013September 5, 2013

About a month ago, MDN told you that Chesapeake has decided to end their fight with New York landowners over extending their leases (see Chesapeake Energy Throws in the Towel on NY Shale Drilling). Although it’s taken the past month to iron out the paperwork, it seems that Chesapeake (and NY landowners) will finalize and sign an agreement “sometime next week” to release 12,000 acres of leases in Broome and Tioga counties.

Chesapeake walking away from these leases is bittersweet. Sweet because it releases landowners from old leases signed before fracking was even contemplated, allowing them to re-sign a new lease with better terms. Bitter because it indicates Chesapeake is unwilling to put up with Gov. Andrew “Ditherer” Cuomo any longer as he agonizes over whether he will or whether he won’t allow fracking…
Read More “Chesapeake to Release 12K Acres of NY Leases Next Week”
Industrywide Issues | Litigation | Preston County | Statewide WV | West Virginia

Landmen & Drillers: 6 Steps to Keep a Lease Out of WV Court
September 5, 2013September 5, 2013

The JDSupra Law News website reports on a West Virginia court case that may have far-reaching consequences for landowners in WV and for landmen and drillers operating in the state. The case is called Barber v. Magnum Land Services, LLC, a recent case filed in Preston County, WV, now transferred to the Northern District. The Barber case, according to JDSupra, has the potential to settle many other outstanding cases along the same lines and is being used as a proxy and precedent for other cases.

The Barber case alleges a landman (from Magnum Land Services) pressured a landowner into signing a lease to allow drilling with the statement that if the landowner did not sign, their land would be drilled under anyway and they would not receive any royalties–a veiled (and inaccurate) reference to “the law of capture” in WV. The landman also did not make the landowner aware of other signed offers, withholding important information about the potential value of the lease. The plaintiffs in Barber are using several legal arguments to nullify the lease. We won’t delve into the technicalities of the case (click below to read about it on the JDSupra website). However, JDSupra’s conclusion offers six steps landmen and drillers should adopt in the way they interact with landowners–steps that will help keep their leases out of court:
Read More “Landmen & Drillers: 6 Steps to Keep a Lease Out of WV Court”
Hydraulic Fracturing | Industrywide Issues | Litigation | New York | Regulation | Statewide NY

JLCNY Fact Sheet on “Takings” Lawsuit – We Need More $$
September 5, 2013September 5, 2013

The Joint Landowners Coalition of New York (JLCNY) is ready to sue New York State on behalf of landowners for “takings”–the concept that the state has illegally stopped property owners from using their land and therefore must compensate them for it. The only thing the JLCNY needs now is money–and lots of it–to pay legal and research expenses. Once they have the cash, the lawsuit will go forward.

Dan Fitzsimmons, president of the JLCNY, sent an email yesterday with a “fact sheet” about the lawsuit (see it below). The fact sheet attempts to clear up lingering questions about the lawsuit–its purpose, the way it will go forward, and when it will go forward. Please take time to donate to the JLCNY’s legal fund (MDN is a proud contributor)…
Read More “JLCNY Fact Sheet on “Takings” Lawsuit – We Need More $$”
Energy Services | Heckmann | Industrywide Issues | Litigation

Nuverra Environmental Sued Over Stock Price Tumble
September 4, 2013September 4, 2013

At the end of July, MDN told you (sort of tongue-in-cheek) that Nuverra Environmental Solutions (formerly Heckmann), a company that recycles and otherwise disposes of shale drilling wastewater and leftover rock and dirt from drilling, was blaming “too much success” in the Marcellus/Utica for their poor quarterly earnings report (see Wastewater Company Nuverra: Too Much Success in Marcellus/Utica). Nuverra’s rapidly expanding Marcellus operation led to more outsourcing and less profitability, it seems. It also seems Nuverra now has a much bigger problem than a bustling Marcellus–they’re being sued in a class action by investors.

The class action, filed by very active law firm Robbins Geller, alleges that Nuverra previously “issued materially false and misleading statements regarding the Company’s financial performance and future prospects.” Because of the alleged false statements, Nuverra’s stock traded at artificially inflated prices. What went up (the stock price) has now come down (see the chart below), and investors (or at least the lawyers) are not pleased…
Read More “Nuverra Environmental Sued Over Stock Price Tumble”
Chesapeake Energy | Energy Companies | Industrywide Issues | Lease & Royalty Payments | Litigation | Pennsylvania | Statewide PA

Chesapeake Settles PA Royalty Lawsuit for Pittance: $7.5M
September 3, 2013September 3, 2013

In July, MDN told you about a class action lawsuit by some Pennsylvania landowners against Chesapeake Energy over the issue of deducting certain costs from post-production when calculating royalties–costs that the landowners say are not listed in the original lease and for which Chessy does not have the right to deduct (see Some PA Landowners Mull Decision to Sue Chesapeake over Royalties). A number of landowners joined the class action lawsuit. The lawyers worked feverishly and both sides have now settled.

Chesapeake will pay $7.5 million to settle the lawsuit, to be share with the lawyers (of course) and then amongst the landowners. Apparently the settlement will benefit “several thousand leaseholders” who have the option to either accept the settlement or continue on their own by filing their own lawsuit…
Read More “Chesapeake Settles PA Royalty Lawsuit for Pittance: $7.5M”
Energy Services | Industrywide Issues | Litigation | Pennsylvania | Pipelines | Regulation | UGI Energy Services | Wyoming County (PA)

UGI Victory: Judge Rules in Favor Marcellus Gate Station in NE PA
September 3, 2013September 3, 2013

MDN told you back in April about UGI’s (a Scranton-area public utility) plan to build a new pipeline connector–called a gate station–so they could tap into abundant, cheap and locally produced Marcellus Shale gas to sell to its customers. UGI’s plan will lower the gas bill for thousands of its customers and use local Marcellus gas instead of gas piped in from the Gulf Coast. Fantastically, some hardened anti-drillers opposed the new gate station with claims of air pollution, dire consequences, blah blah–the usual banal excuses–even though there has been another gate station operating in the area for more than 50 years (see Anti-Drillers Try to Stop Pipeline Connector in NE PA).

Anti-drillers tried to stop the UGI gate station by invoking local zoning ordinances at the town level. Fortunately, a level-headed administrative law judge has put a stop to those efforts and has ruled that UGI may go ahead and build the new Marcellus gas gate station…
Read More “UGI Victory: Judge Rules in Favor Marcellus Gate Station in NE PA”