Justia Energy, Oil & Gas Law Opinion Summaries

In this case, the District of Columbia sued Exxon Mobil Corporation and several other energy companies, alleging that these companies violated District law by making material misstatements about their products' effects on climate change. The energy companies removed the case to a federal district court, which determined it lacked jurisdiction and sent the case back to a local court. The energy companies then appealed that decision.The United States Court of Appeals for the District of Columbia Circuit affirmed the lower court's decision, holding that the case was properly remanded. The Court of Appeals held that the case did not fall under federal jurisdiction because the District of Columbia based its lawsuit on a local consumer protection statute, not a federal cause of action. The energy companies' arguments essentially amounted to federal defenses, which the court held were insufficient to establish federal jurisdiction over the District's claims.The court also rejected the companies' argument that the case could be moved to a federal court under the "artful pleading" doctrine, which allows federal courts to hear cases where the plaintiff has attempted to avoid federal jurisdiction by carefully crafting their complaint to avoid mentioning federal law. The court held that this doctrine didn't apply because the energy companies couldn't rely on federal common law governing air pollution since it had been displaced by the Clean Air Act.Finally, the court rejected the companies' arguments that the case could be removed to federal court under the federal officer removal statute and the Outer Continental Shelf Lands Act. The court found that the companies failed to demonstrate a sufficient connection between their actions under color of federal office and the District's suit, and that the District's claims did not arise out of or connect with operations conducted on the Outer Continental Shelf. View "DC v. Exxon Mobil Corporation" on Justia Law

In this case from the Supreme Court of North Dakota, Fonda Jo Powell and Mary T. Henke, as co-personal representatives of the Estate of June A. Slagle, alongside Helen Verhasselt, the trustee of the June Slagle Family Mineral Trust, filed an appeal against Statoil Oil & Gas LP (now known as Equinor Energy LP). The plaintiffs appealed from a judgment of dismissal entered after the district court granted Statoil's motion for summary judgment, concluding that a dispute of title allowed Statoil to suspend royalty payments and that the plaintiffs were not entitled to statutory interest. The plaintiffs argued that the district court erred in concluding there was a title dispute, while Statoil argued that this action was barred by the statute of limitations.The Supreme Court of North Dakota reversed the decision of the district court, concluding that the action was not barred by the statute of limitations and that the court erred in concluding that Statoil lawfully suspended royalty payments. The court determined that a ten-year statute of limitations applied to the claim for untimely payment of royalties under the oil and gas lease, as per N.D.C.C. § 28-01-15(2). Furthermore, the court concluded that, when a dispute is between the mineral developer and the mineral owner, notice of the dispute is required under N.D.C.C. § 47-16-39.4. As Statoil did not provide evidence that it had notified June Slagle of a title dispute, it was required to pay interest on the unpaid royalties at a rate of 18% per annum. The case was remanded for further proceedings consistent with this opinion. View "Powell v. Statoil Oil & Gas" on Justia Law

In the case under review, the plaintiff, Antonio Martinez, acting as executor of the estate of Naomi Gonzales, filed a lawsuit against Agway Energy Services, LLC, alleging breach of contract and violations of New York General Business Law. The case arose from a contract Gonzales had with Agway, an energy supply company, which provided her with a one-month promotional rate and subsequently a variable monthly rate. Gonzales maintained this contract for about two years. After canceling the agreement, she sued Agway, alleging that its monthly variable rate was consistently higher than that charged by the local utility and that Agway had breached its agreement by failing to charge competitive rates and by charging customers for the cost of an included service, EnergyGuard.The United States Court of Appeals for the Second Circuit concluded that Agway had fulfilled the terms of the contract. The court held that the contract language allowed Agway to exercise its discretion to set a variable monthly rate based on several factors, including its costs, expenses, and margins, and that the company was entitled to include the cost of providing the EnergyGuard service in its monthly variable rate. Gonzales' argument that Agway had promised to provide competitive rates was found to be unsupported by the contract's language. The court, therefore, affirmed the district court's decision to grant summary judgment in favor of Agway. View "Martinez v. Agway Energy Services, LLC" on Justia Law

In the case involving BP America Production Company and Debra Anne Haaland, the United States Court of Appeals for the Tenth Circuit affirmed the district court's ruling upholding the agency order requiring BP to pay nearly $700,000 in correctly assessed royalty underpayments. BP argued that the Federal Oil and Gas Royalty Simplification and Fairness Act shielded it from these payments. However, the court rejected BP's interpretation of the Act. The court found that BP's obligation was a single monetary obligation of $905,348.24, not each of the 443 constituent royalty obligations. Therefore, BP did not meet the statutory condition of less than $10,000 for relief from liability for payments. The court also rejected BP's argument that the Secretary's "deemed" final decision lacked a reasoned basis and thus violated the Administrative Procedure Act. The court found that the Secretary's deemed final decision adopted the ONRR Director's decision on the issues raised. View "BP America Production Company v. Davis, et al." on Justia Law

In the case before the United States Court of Appeals for the Sixth Circuit, Jennings Maynard, a coal miner with severe respiratory issues, filed a claim for benefits under the Black Lung Benefits Act. After his death while the claim was pending, his widow, Elizabeth Maynard, filed a claim for survivor’s benefits. The Administrative Law Judge (ALJ) awarded benefits to Elizabeth Maynard on behalf of her late husband and as his surviving spouse. The Benefits Review Board affirmed this decision. The petitioner, Island Creek Coal Company, sought review of the award.The court denied the petition for review. The court explained that Maynard had worked in the coal mining industry for over forty-three years and had developed severe respiratory issues. Maynard's widow, Elizabeth, filed a claim for survivor's benefits after her husband's death. The ALJ awarded benefits to Elizabeth, both on behalf of her late husband and as his surviving spouse. The Benefits Review Board affirmed this decision.The court held that substantial evidence supported the ALJ's findings that Maynard was totally disabled due to his elevated PCO2 values and that the petitioner failed to provide persuasive contrary evidence. The court also found that substantial evidence supported the ALJ's conclusion that the petitioner failed to rebut the presumption that Maynard's respiratory impairment, which contributed to his total disability, arose out of coal mine employment. The court determined that the ALJ properly discredited the medical opinions offered by the petitioner's experts because these opinions were inconsistent with the regulations of the Black Lung Benefits Act and the Department of Labor's determinations. The court therefore denied the petitioner's request for review. View "Island Creek Coal Co. v. Elizabeth Maynard" on Justia Law

The United States Court of Appeals for the Third Circuit reviewed a consolidated action related to the Federal Energy Regulatory Commission's (FERC) acceptance of a tariff filed by PJM Interconnection, L.L.C. (PJM), a Regional Transmission Organization managing a system that serves around fifty million consumers in thirteen mid-Atlantic and Midwestern states and the District of Columbia. The tariff was challenged by PJM Power Providers Group and Electric Power Supply Association, two nonprofit associations representing energy generators, and Pennsylvania Public Utility Commission and Public Utilities Commission of Ohio. The challengers argued that the tariff, which was approved by inaction due to a deadlock among FERC commissioners, was arbitrary and capricious. The court disagreed, ruling that FERC's acceptance of the tariff was not arbitrary or capricious and was supported by substantial evidence. The court also confirmed that it could review FERC's inaction under the Federal Power Act. View "PJM Power Providers Group v. FERC" on Justia Law

In 2016 Watchous Enterprises, LLC contracted with one of the five individual defendant companies, Pacific National Capital, paying it a $7,600 nonrefundable deposit to secure help finding a lender or a joint-venture partner. Pacific introduced Watchous to companies affiliated with Waterfall Mountain LLC (collectively referred to as "Waterfall"). Watchous and Waterfall eventually executed a letter of intent to enter into a joint venture to which Waterfall would contribute more than $80 million. As part of the arrangement, Watchous paid Waterfall a $175,000 refundable deposit. Waterfall said that it would fund the venture through proceeds of loans backed by billions of dollars in Venezuelan sovereign bonds in the name of Waterfall or its lender (RPB Company). But Waterfall never funded Watchous, and Watchous was never refunded the $175,000. Watchous then filed suit under the federal Racketeer Influenced and Corrupt Organizations Act (RICO) and common-law claims under Kansas law against Pacific and Waterfall as well as against the five Appellants sued individually. The district court granted partial summary judgment in favor of Watchous on its fraud claims (leaving damages for the jury to decide), essentially on the ground that Appellants misrepresented and failed to disclose “the historic and contemporary facts about Waterfall’s dubious finances, loan defaults, and consistent lack of success in funding similar projects.” Watchous’s remaining claims proceeded to trial, where a jury found that Appellants engaged in a civil conspiracy to defraud Watchous, and had violated RICO. Appellants appealed, but finding no reversible error, the Tenth Circuit affirmed. View "Watchous Enterprises v. Mournes, et al." on Justia Law

Plaintiffs filed this action as unleased mineral owners whose interests are situated within forced drilling units formed by the Louisiana Office of Conservation and operated by Chesapeake. Plaintiffs have not made separate arrangements to dispose of their shares of production, so the unit operator can sell the shares but must pay the owners a pro rata share of the proceeds within one hundred eighty days of the sale. Chesapeake timely removed this action to the district court, based on diversity jurisdiction. The district court certified its ruling for interlocutory appeal pursuant to 28 U.S.C. Section 1292(b).   The Fifth Circuit explained that this case concerns the interplay between Louisiana’s relatively new conservation laws and its deeply rooted negotiorum gestio doctrine. The court wrote that because it cannot make a reliable Erie guess as to the applicability of Louisiana’s negotiorum gestio doctrine. Accordingly, the court certified the following determinative question of law to the Louisiana Supreme Court: 1) Does La. Civ. Code art. 2292 applies to unit operators selling production in accordance with La. R.S. 30:10(A)(3)? View "Johnson v. Chesapeake Louisiana, L.P." on Justia Law

The Supreme Court affirmed in part and reversed in part the judgment of the district court ruling in favor of the Montana Environmental Information Center and Sierra Club (collectively, Conservation Groups) and vacating the Montana Department of Environmental Quality's (DEQ) permit for Westmoreland Rosebud Mining, LLC's proposed coal mine expansion, holding that the Board of Environmental Review (Board) made several errors when it upheld DEQ's findings.Specifically, the Supreme Court held (1) the district court erred in concluding that reversal of the burden of proof was prejudicial error; (2) the Board committed reversible error in limiting the Conservation Groups' evidence and argument; (3) the district court erred in determining that it was reversible error to admit certain testimony as proper rebuttal; (4) the Board erred when it concluded that no water quality standard violation could occur; (5) the Board properly considered cumulative impact of mining activity in its analysis; (6) the Board properly relied on evidence regarding aquatic life; (7) the attorney fee award was improper; and (8) the district court erred in ruling that the Board was properly included as a party on judicial review. View "Mont. Environmental Information Center v. Westmoreland Rosebud Mining" on Justia Law

This case concerns the interpretation of two oil and gas leases negotiated in Boulder County, Colorado in the 1980s. In 2014, during the secondary terms of the leases, necessary repairs to a third party’s sales pipeline forced the lessee to shut in otherwise commercially viable wells on the leased properties for approximately four months. The question before the Colorado Supreme Court in this case was whether this four-month shut-in caused the leases to terminate under their respective cessation-of-production clauses. Examining the specific leases at issue here, the Supreme Court concluded the four-month shut-in did not trigger termination under their cessation-of-production clauses. Accordingly, the Court affirmed the judgment of the court of appeals, but vacated the division’s opinion to the extent it adopted the commercial discovery rule to universally define the term “production” in Colorado oil and gas leases as “capable of production.” View "Board of County Commissioners v. Crestone Peak Resources" on Justia Law