Justia Energy, Oil & Gas Law Opinion Summaries

Pennaco Energy Inc. acquired mineral leases beneath a surface estate owned by Brett Sorenson, Trustee of the Brett L. Sorenson Trust. A surface damage and use agreement between the parties granted Pennaco access to and use of the land for exploration and production of minerals, and, in return, required Pennaco to pay for the damage to and use of the surface estate, and to reclaim the land once operations ended. When Pennaco refused to perform its obligations under the contract, Soreson brought this lawsuit. The jury rendered a verdict finding that Sorenson suffered more than $1 million in damages. The district court entered judgment on the jury’s verdict and also awarded Sorenson costs and attorney fees. The Supreme Court affirmed, holding that the district court did not err by (1) ruling that Pennaco remained liable under the surface damage and use agreement after assignment, and (2) using a 2.5 multiplier to enhance the lodestar amount in awarding attorney fees. View "Pennaco Energy, Inc. v. Sorenson" on Justia Law

Appellants (collectively, the Teisingers) claimed a 3/5ths royalty interest in oil, gas, and minerals located on several sections of land in Richland County. The Teisingers’ assert that their 3/5ths royalty interest was reserved in a 1953 warranty deed. The district court denied the Teisingers’ claim and quieted title to the royalty interest in favor of Appellees (collectively, the Sundheims). The Supreme Court reversed, holding that the district court (1) improperly admitted testimony from an English professor interpreting the language of the warranty deed’s royalty interest reservation; (2) erred by resolving the ambiguity in the warranty deed in favor of the Sundheims; and (3) erred in applying the doctrine of laches to bar the Teisingers’ claim to the 3/5ths royalty interest. Remanded for entry of judgment quieting title to the 3/5ths royalty interest reserved in the warranty deed in favor of the Teisingers. View "Wicklund v. Sundheim" on Justia Law

Section 205 of the Federal Power Act (FPA), 16 U.S.C. 824d(a), mandates that all rates and charges demanded, or received by any public utility for the transmission or sale of electric energy subject to the jurisdiction of the Commission shall be just and reasonable. Xcel petitioned for review of three of the Commission's orders denying a retroactive refund for unlawful rates. As a preliminary matter, the court concluded that, to the extent the Commission denied Xcel relief because it lacks authority to order refunds from Tri-County, a non-jurisdictional entity, this was not responsive to Xcel’s request. On the merits, the court concluded that the Commission’s reliance on section 2.4(a) of its regulations and related cases to deny Xcel retroactive relief is misplaced. Because the Commission’s reliance on section 2.4(a) of its regulations as applied in its precedent is inapposite, and its position that its section 205 error of law is irremediable beyond prospective relief under section 206 appears irreconcilable with the authority Congress granted it in section 309 to remedy its errors, the court granted the petition in part and remanded the case to the Commission for appropriate action. View "Xcel Energy Servs. Inc. v. FERC" on Justia Law

Sierra Club brought a citizen suit seeking civil penalties against Oklahoma Gas and Electric Company “(OG&E)” for alleged violations of the Clean Air Act. Sierra Club claimed that in March and April 2008, OG&E, the owner and operator of a coal-fired power plant in Muskogee, modified a boiler at the plant without first obtaining an emission-regulating permit as required under the Act. Because Sierra Club filed its action more than five years after construction began on the plant, the district court dismissed its claim under Rule 12(b)(6) on statute of limitations grounds. The court also dismissed Sierra Club’s claims for declaratory and injunctive relief because these remedies were predicated on the unavailable claim for civil penalties. Finding no error in the district court's conclusions, the Tenth Circuit affirmed. View "Sierra Club v. Oklahoma Gas & Electric Co." on Justia Law

Federal law required electric utilities to purchase power generated by cogeneration facilities that met certain standards. A facility must be certified that it meets the standards. It may self-certify, by filing a form describing the project and asserting that it believes it meets the standards, or it may request a formal determination that it meets the standards. The Regulatory Commission of Alaska implemented this certification scheme on the state level, but the determination whether a facility qualifies fell within exclusive federal jurisdiction. The main issue this case presented for the Alaska Supreme Court's review was whether a self-certification constituted a federal determination that a facility meets the standards and whether the Commission must defer to this self-certification. The Court concluded that a self-certification did not constitute a federal determination and that the Commission’s broad discretion to implement the federal scheme meant it had the power to require a developer to formally certify its projects. View "Alpine Energy, LLC v. Matanuska Electric Association" on Justia Law

Until 1997, Illinois residents could only purchase power from the local public utility, whose rates were regulated by the Commerce Commission (ICC). The 1997 Electric Service Customer Choice and Rate Relief Law allows residents to buy electricity from their local public utility, another utility, or an Alternative Retail Electric Supplier (ARES). The ICC was not given rate-making authority over ARESs, but was given certain oversight responsibilities, 220 ILCS 5/16-115. The Law did not explicitly provide a mechanism for recovering damages from an ARES related to the rates. In 2012, Zahn began purchasing electricity from NAPG, after receiving an offer of a “New Customer Rate” of $.0499 per kilowatt hour in her first month of service, followed by a “market-based variable rate.” Zahn never received NAPG’s “New Customer Rate.” NAPG charged her $.0599 per kilowatt hour for the first two months, followed by a rate higher than Zahn’s local public utility charged. Zahn filed a class-action complaint, claiming violations of the Illinois Consumer Fraud and Deceptive Business Practices Act, breach of contract, and unjust enrichment. The court dismissed for lack of subject-matter jurisdiction, or for failure to state a claim. The Seventh Circuit certified, to the Illinois Supreme Court, the question of whether the ICC has exclusive jurisdiction to hear Zahn’s claims, noting that Illinois appellate courts are in conflict. View "Zahn v. N. Am. Power & Gas, LLC" on Justia Law

Environmental contamination from Shell Western Exploration and Production, Inc. and Shell Oil Company's operations was discovered in Hobbs. Residents near the area brought a toxic tort action against Shell for personal injury damages, alleging the contaminants cause their autoimmune disorders. Plaintiffs challenged the district court's exclusion of the scientific evidence and expert testimony they offered in support of their theory, and they challenged the grant of partial summary judgment in favor of Shell. After review, the Supreme Court concluded the district court applied an incorrect standard of admissibility in its evidentiary rulings, and that plaintiffs' causation evidence should have been admitted. Because summary judgment to Shell's culpability for autoimmune disorders was granted because of this improper exclusion, the Supreme Court reversed and remanded for further proceedings. View "Acosta v. Shell W. Expl. & Prod., Inc." on Justia Law

The dispute in this case centered on the ownership of subsurface mineral rights to coal-rich land located in Musselshell County. Plaintiffs filed this action against Musselshell County to quiet title to the property. The district court granted summary judgment in favor of the County and awarded costs but not attorney fees. Plaintiffs appealed, and the County cross-appealed. The Supreme Court affirmed, holding (1) the district court did not err in concluding that the pertinent statute of limitations barred Plaintiffs’ quiet title action; and (2) the district court did not abuse its discretion in denying the County its attorney fees. View "Bergum v. Musselshell County" on Justia Law

Four oil and gas leases were assigned in one instrument. At issue in this case was how to calculate a production payment reserved in the assignment of the four leaseholds. When two of the leases terminated, the payor asserted that the production payment should be reduced to reflect the loss of the underlying mineral-lease interests. The payee responded by asserting that the production payment burdened the four leases jointly and that the assignment included authorization to adjust the payment. The trial court construed the assignment as allowing for the production payment’s adjustment based on the expiration of an underlying lease. The court of appeals reversed, concluding that the production payment could not be reduced because the assignment failed to include “express language providing for a piecemeal reduction of the production payment.” The Supreme Court reversed, holding that the trial court rendered the correct judgment in this case. View "Apache Deepwater, LLC v. McDaniel Partners, Ltd." on Justia Law

Hapag‐Lloyd filed an Interpleader Complaint and moved ex parte for an anti‐suit injunction under 28 U.S.C. 2361. The district court granted the motion and enjoined named defendants. The court concluded that adjudication of Hapag‐Lloyd’s obligation to pay for the fuel bunkers at issue involves inextricably intertwined claims, and interpleader jurisdiction is proper under the broad and remedial nature of 28 U.S.C. 1335. The court also concluded that by initiating an interpleader concerning certain in rem claims and posting adequate security for those claims, Hapag‐Lloyd consented to the district court’s jurisdiction over its interests, which is sufficient to confer jurisdiction. However, the court remanded to the district court with instructions to enter an order that eliminates or retains the foreign scope of the injunction, with specific determinations applying the test in China Trade & Dev. Corp. v. M.V. Choong Yong. View "Hapag-Lloyd Aktiengesellschaft v. U.S. Oil Trading LLC" on Justia Law