Longview Energy, a small Dallas-based producer, sued a firm it accused of working with two of its directors to swipe an investment opportunity in the booming Eagle Ford Shale, and a Zavala County jury agreed. According to Law360, a legal news site, directors Bill Huff and Rick D'Angelo were among parties who directed Longview Energy to pursue properties in the Eagle Ford. But instead, Law 360 reported, "the jury found that Huff and D'Angelo breached their fiduciary duty to Longview when they took the corporate opportunities for themselves." The jury also found Huff Energy Fund L.P., a Longview shareholder, and Riley-Huff Energy Group were "responsible for knowingly participating in the directors' failure to comply with their duties." Longview Energy sought damages of $162 million -- $42 million for the current value of the properties and $120 million in past production revenues. Lawyers for the defendants said the amount due is $10.5 million -- the $162 million, minus the $24.5 million the defendants paid for the properties, minus the $127 million they spent developing the properties.
The Law360.com report is here (free registration required).
A Wise County family filed a lawsuit in Dallas today against several companies involved in natural gas drilling, alleging that more than 50 drilling rigs operating around their home poisoned their blood, caused various ailments and forced them to move out.
Lisa and Bob Parr said they have suffered through a two-year nightmare due to the drilling activity around their 40-acre property in Allison, a farm community in eastern Wise County. More than 50 natural gas wells operate within two miles of the property, according to the suit.
The couple blames various spills and emissions of hazardous wastes and toxic gases for their health problems. The suit lists more than 20 symptoms the Parrs say they have experienced since 2008, including nose bleeds, migraines, open sores, arrhythmia, abdominal pain and coughing.
In April, an environmental health specialist conducted various tests on Lisa and Bob Parr and their daughter, Emma, and found “natural gas chemicals, compounds, and/or metals” in their bodies, according to the suit. That prompted the family to move out of their home. Brad Gilde, the couple’s lawyer, declined to identify the specialist.
Speaking at a press conference in Dallas, Bob Parr described the lawsuit as “a last resort.”
“I have no choice,” Bob Parr said. “I need to protect my family and my way of life.”
The suit was filed in Dallas County court against Aruba Petroleum of Plano, Ash Grove Resources of Topeka, KS, Encana Oil & Gas of Calgary, Halliburton of Houston, Republic Energy of Dallas, Ryder Scott Company of Houston, Ryder Scott Oil Company of Wichita Falls, Tejas Production Services of Victoria and Tejas Western Corp. of Granbury.
Ryder Scott Company, a Petroleum Consultant, said their presence in the lawsuit is a mistake, as the company has no ownership or business interest in the drilling operations around the Parr's home. Company spokesman Mike Wysatta said he believed the lawyers thought his company was still connected to Wichita Falls-based Ryder Scott Oil Company. The two companies have not had any connection for over 50 years, Wysatta said.
The Parr family said they don’t want to leave their home in Allison and relocate elsewhere.
“We were forced to move," Lisa Parr said, fighting to speak through tears. “This is our home. This is where we want to be.”
In October 2008, as natural gas prices continued their freefall that began the previous July, natural gas producers and their leasing agents abruptly ceased signing mineral rights leases in Tarrant County. Many homeowners whose neighborhood groups had negotiated rich signing bonuses and favorable lease terms were nevertheless shut out of the bonanza. Now the energy firms' actions are the subject of about 20
Tarrant County lawsuits filed by three Dallas law firms known as the
North Texas Lease Litigation Group on behalf of individual property
owners in southwest Fort Worth and southeast Arlington. The suits
contend that property owners were illegally denied the opportunity to
sign lucrative leases negotiated by the neighborhood coalitions. Kip
Petroff, an attorney for the litigation group, said it expects to
eventually file hundreds of cases on behalf of such residents.
Chesapeake Energy, which is fighting a lawsuit filed by Burleson property owners who claim the company illegally reneged on a lease agreement that would have benefited 408 households, wants to have the case heard in a Dallas federal court. But the property owners filed the lawsuit July 20 in the 18th State District Court in Cleburne and want venue to be there. Burleson is in far northern Johnson County.
Chesapeake contends the proposed class action lawsuit should be in federal court in part because the Class Action Fairness Act authorizes such jurisdiction for class actions with more than $5 million at stake. Chesapeake, represented by the prominent Fort Worth law firm of Kelly, Hart & Hallman, notes that the lawsuit seeks nearly nearly $6.7 million just for lease bonuses.
Another well-known Fort Worth law firm, Whitaker, Chalk, Swindle & Sawyer, represents two named plaintiffs, Leslee Dawn Ahrend and Buster Ray Williams, and wants the lawsuit to be declared a class action that would include the hundreds of Burleson properties that would have benefited from a lease agreement reached in 2008 between representatives of Chesapeake and an alliance of homeowners .
Under the agreement, property owners would have received a lucrative lease bonus of $27,200 per acre and a 25.25 percent royalty, the lawsuit states. It contends that Chesapeake was guilty of breach of contract in aborting the agreement by refusing to sign lease agreements with individual property owners based on the terms of the agreement. The plaintiffs cite a letter, dated Oct. 16, 2008, that a senior landman representing Chesapeake sent to representatives of Burleson homeowners. The landman said that, as a result of the deep economic recession and plunging natural gas prices, Chesapeake was "withdrawing previous offers to lease your minerals." The ,lawsuit contends that Chesapeake this year has offered a lease bonus of only $1,000 an acre and a 25 percent royalty.
An attorney told a southwest Fort Worth neighborhood association Tuesday night that a litigation group formed by three Dallas law firms might seek hundreds of millions of dollars in damages against energy companies that reached lease agreements with alliances of neighborhood associations, but then declined to enter into individual lease contracts with many property owners.
"The promises they (energy companies) made to Fort Worth were maybe $150 million," attorney Kip Petroff told members of the Meadows of CandleRidge Neighborhood Association who packed a meeting at a Knights of Columbus hall. Petroff said the companies could be sued for triple damages, plus attorneys' fees, under provisions of the Texas Deceptive Trade Practices Act.
The litigation group has filed a lawsuit in Dallas on behalf of an Arlington couple, Willie and Carmen Booth, that it contends is due a lease bonus of nearly $5,000 from XTO Energy as a result of an agreement that the South East Arlington Coalition of Texas, an alliance of neighborhoods, reached for lease bonuses of $26,517 per acre. The Meadows of CandleRidge association was part of the Southwest Fort Worth Alliance, which reached an agreement with Vantage Energy for lease bonuses of $27,500 per acre. Meadows of CandleRidge Association President Eva Bonilla stressed Tuesday night that the organization was not endorsing the litigation group's legal effort, but only allowing it to hold an informational session.
The energy companies sued by the Booths are expected to contend that they were not bound to pay lease bonuses negotiated with alliances of homeowner groups unless the companies had entered into binding lease contracts with individual property owners.
It's not tough to find property owners who've struck landmen from the ol' Christmas card list. But we haven't seen any litigation yet over alleged misrepresentations in the Barnett Shale neighborhood leasing game. (If this surfaces and we overlook it here at the S-T, we're sure somebody will tip us off.)
"The discovery of the Barnett Shale natural gas field offers land owners the possibility of income based on the amount of natural gas on their property," BarnettShaleLawsuit.com says. "However, some companies may deceive land owners by having them sign oil and gas leases that are unfair, duping landowners with leases that cannot be read, offering royalty payments far below market rate, and/or defrauding landowners with numerous other types of misrepresentations."
"Every night before going to bed, I always say my prayers. For the past two years, I have repeatedly petitioned the Lord...Please, Lord, let somebody in the Barnett Shale sue somebody. Why has it taken so long?"
-- Scott Nishimura
(Photo: Jeff Rasansky, courtesy of Rasansky Law Firm)
