Justia Class Action Opinion SummariesArticles Posted in Energy, Oil and Gas
Krug v. Helmerich & Payne, Inc.
Helmerich & Payne, Inc. (H&P) appeals a judgment in favor of the plaintiffs, who are a class of oil and gas royalty owners. The class alleged that the defendant breached contractual and fiduciary duties by allowing uncompensated drainage of natural gas to occur from the leases and that the defendant engaged in constructive fraud and was unjustly enriched by failing to pay royalty amounts that the class alleged were included in a settlement between the defendant and ANR Pipeline. The jury returned verdicts on three alternative theories of recovery. The trial court judge granted judgment that included disgorgement of profits based on a sum the trial court found unjustly enriched H&P. On appeal, the Court of Civil Appeals affirmed in part and reversed in part, and remanded with instructions. H&P argued on appeal to the Supreme Court that: (1) the trial court erred in its jury instructions for uncompensated drainage that barred consideration of counterdrainage; (2) the appellate court erred by allowing a breach of contract claim to be recast as an equitable unjust enrichment claim; (3) the appellate court erred in affirming a "mathematically impossible" jury verdict on plaintiffs' constructive fraud claims; and (4) the appellate court erred in affirming the constructive fraud damage award notwithstanding that no fraud claim was ever certified. After review, the Supreme Court found: (1) the trial court committed no reversible error; (2) the jury found that plaintiffs did not prove by clear and convincing evidence that H&P acted in reckless disregard for the rights of others, nor that H&P acted intentionally and with malice toward others; (3) because the Court reversed the judgment based on equity, the third reason for granting certiorari was answered; and (4) having reversed the constructive fraud damage award, the Court held this issue was moot. View "Krug v. Helmerich & Payne, Inc." on Justia Law
Phillips Petroleum Co. v. Yarbrough
This suit was filed as a putative class action on behalf of Texas royalty owners alleging that Phillips Petroleum Company underpaid oil and gas royalties. The trial court certified three subclasses of royalty owners. The court of appeals reversed. The Supreme Court affirmed as to two of the subclasses but reversed as to the third subclass, which alleged breach of a uniform express royalty provision contained in gas royalty agreements that amended the class members' leases. On remand, Respondent, class representative of the remaining subclass, amended her petition to add a claim for breach of the implied covenant to market. Phillips unsuccessfully filed various motions contending that there was no class claim for breach of the implied covenant to market. The court of appeals dismissed Phillips' interlocutory appeal for lack of jurisdiction and denied Phillips' petition for writ of mandamus. The Supreme Court reversed, holding (1) the court of appeals erred in dismissing the interlocutory appeal for lack of jurisdiction; and (2) the trial court abused its discretion in allowing the addition of a class claim for breach of the implied covenant to market without requiring Respondent to file an amended motion for class certification or holding a certification hearing.View "Phillips Petroleum Co. v. Yarbrough" on Justia Law
Coulter v. Anadarko Petroleum Corp.
Plaintiffs in this case were royalty owners entitled to receive a share of the production of natural gas in a gas field. Plaintiffs brought a class action against Anadarko Petroleum Corporation (APC) and its affiliates challenging the manner in which APC was paying royalties on natural gas production under the respective oil and gas leases. Timothy Coulter represented the plaintiff class and negotiated a settlement agreement. More than 6,000 members made up the settlement class, one of whom was Stan Boles. Boles objected to the amended class certification and the class settlement agreement negotiated by Coulter. The district court approved the settlement despite Boles' objection. Boles appealed. The Supreme Court affirmed, holding the district court did not abuse its discretion in assessing the adequacy of the class representation or the character of the settlement agreement.View "Coulter v. Anadarko Petroleum Corp." on Justia Law