Justia Energy, Oil & Gas Law Opinion Summaries

A subsidiary of Marathon hired Preston as a relief pumper in Marathon’s coal bed methane well operation. After beginning work, Preston signed an Employee Agreement containing the assignment at issue. Later, Preston worked with Marathon Engineer Smith on a baffle system to improve machinery used to extract methane gas from water-saturated coal in a coal bed methane gas well. Marathon installed the system on wells. After Preston’s employment ended, both Marathon and Preston pursued patents. The district court declared that Preston is the sole inventor of one patent and that Smith was misjoined as an inventor; ordered the PTO to issue a new certificate reflecting Preston as the sole inventor; declared Marathon the owner of other patents pursuant to the employment agreement and that Preston breached the agreement for failing to assign his rights. The court entered summary judgment in favor of Marathon on its shop right claim, finding that, even if Marathon did not own the patents, it had a shop right to practice the inventions. The Federal Circuit affirmed that Preston assigned his rights in two inventions to Marathon pursuant to his employment agreement. Because that assignment was automatic, there was no breach of that agreement. View "Preston v. Marathon Oil Co." on Justia Law

The Regional School District (Mahar), entered into a price watch agreement with Northeast Energy Partners, a licensed broker of energy services based in Connecticut, pursuant to which Northeast would negotiate and secure contracts for the provision of Mahar's electricity from energy suppliers. Mahar did not enter into the agreement to obtain Northeast's services pursuant to the competitive bidding procedures contained in G.L. c. 30B. When Mahar questioned the validity of the agreement, Northeast sought a declaratory judgment that the agreement is valid and enforceable because, under G.L. c. 30B, 1 (b ) (33), the agreement is exempt from the competitive solicitation and bidding procedures set forth in G.L. c. 30B. The Massachusetts Supreme Court ruled in favor of Northeast, holding that a contract between a school district and an energy broker for procurement of contracts for electricity is exempt from the requirements of G.L. [c.] 30B as a contract for 'energy or energy related services' pursuant to G.L. c. 30B, 1 (b ) (33). View "NE Energy Partners, LLC v. Mahar Reg'l Sch. Dist." on Justia Law

Defendant-Appellant James Brown owned interests in several businesses. In late 2004, he acquired and redesigned two convenience stores on opposite sides of Exit 2 on Interstate 29 in North Sioux City, South Dakota. Plaintiff-Appellee Stern Oil, a fuel distributor for Exxon Mobil Corporation, contacted Brown while he was remodeling the properties. Although Brown was negotiating with another fuel distributor, he ultimately elected to do business with Stern Oil. When Brown notified Stern Oil that he would no longer purchase its fuel, Stern Oil initiated this breach of contract action. Brown filed a counterclaim, alleging fraudulent inducement. Stern Oil argued that Brown contracted to purchase a minimum amount of fuel for a ten-year period. The circuit court granted Stern Oil's motion for summary judgment on both the breach of contract claim and on Brown's counterclaim, but the issue of damages proceeded to trial. After trial, the circuit court awarded Stern Oil eight years of lost profits. Brown appealed. Upon review, the Supreme Court reversed the circuit court's grant of summary judgment. Both Brown's fraudulent inducement counterclaim and Stern Oil's breach of contract claim involved disputed material facts. Therefore, the Court concluded the circuit court erred in granting Stern Oil summary judgment. The case was remanded for further proceedings. View "Stern Oil Co. v. Brown" on Justia Law

In August of 2009, Samson Resources Company owned oil and gas leases covering 87.78 mineral acres in Roger Mills County, Oklahoma, including the Schaefer Lease. The Schaefer Lease covered 70 net acres in the Southwest Quarter of Section 28 and had a three-year primary term that ended on November 22, 2007. If drilling operations were commenced by the end of the primary term, the lease would continue so long as such operations continued. On August 2, 2007, Newfield sent a letter to Samson, proposing to drill a well in Section 28. The estimated cost of the well was over $8.5 million dollars. On August 9, 2007, Newfield filed an application with the Commission, seeking to force pool the interests of Samson and other owners in Section 28. Newfield sent an e-mail dated April 14, 2008, to Samson that informed Samson that Newfield had commenced operations prior to the expiration of the Schaefer Lease. Newfield's e-mail stated that Samson had underpaid well costs and that an election to participate with 87.78 acres would require prepayment of $1,411,982.45. Samson responded by e-mail on the same date, informing Newfield its intent was only to elect its 17.78 acres. On April 28, 2008, Samson filed an Application seeking to have its election to participate in the well limited to 17.78 acres rather than 87.78 acres. After an administrative hearing, the Administrative Law Judge determined that Samson's timely election to participate only covered 17.78 acres of its interest and that Samson accepted the cash bonus as to its remaining 70 acres. The Oil and Gas Appellate Referee reversed the ALJ's determination, finding that the ALJ improperly relied on actions which occurred prior to the issuance of the pooling order. The Commission issued Order No. 567706, which adopted the Referee's report, reversed the ALJ, and declared that Samson had elected to participate to the full extent of its 87.78 acre interest in the unit. The Commission found Samson made a "unilateral mistake" when it elected to participate to the full extent of its interest. Samson appealed the Commission's order to the Court of Civil Appeals, which affirmed. Before COCA issued its opinion affirming the Commission, Samson filed an action in the district court alleging actual fraud, deceit, intentional and negligent misrepresentation, constructive fraud, and breach of duty as operator. Samson also alleged Newfield's actions amounted to extrinsic fraud on the Commission, rendering Pooling Order No. 550310 invalid as to Samson's working interest attributable to the 70-acre Schaefer Lease. The trial court granted Newfield's motion to dismiss for lack of subject matter jurisdiction, finding the petition to be an impermissible collateral attack on a valid Commission order. The Court of Civil Appeals affirmed. After its review, the Supreme Court found that Samson's actions for damages sounding in tort were beyond the Commission's jurisdiction, and the district court in this case was the proper tribunal for Samson to bring its claims. The trial court's order granting Newfield's Motion to Dismiss was reversed, and the case was remanded for further proceedings. View "Samson Resources Co. v. Newfield Exploration Mid-Continent, Inc." on Justia Law

Plaintiffs invested in oil-and-gas exploration companies and lost money when the companies’ wells produced little oil or gas. They sued the companies and their officers, claiming violations of state and federal law in selling unregistered securities and in making other material misrepresentations and omissions. They also sued Durham, the lawyer who represented the companies. Durham drafted the documents, including joint-venture agreements and private placement memoranda that provided details about the investment opportunity, and told prospective investors he was available to answer questions. Plaintiffs allege that Durham knew the documents contained material misrepresentations and omissions and that the securities were neither registered nor exempt from registration. District courts ruled in favor of Durham. The Sixth Circuit affirmed. The Kentucky Securities Act imposes liability on anyone who “offers or sells a security” in violation of its terms and any “agent” of the seller who “materially aids” the sale of securities, defined as someone who “effect[s] or attempt[s] to effect” the sale. Ky. Rev. Stat. 292.480(1),(4); 292.310(1). An attorney who performs ordinary legal work, such as drafting documents, giving advice and answering client questions, is not an “agent” under the Act. View "Bennett v. Durham" on Justia Law

The Vermont Department of Public Service and the New England Coalition petitioned for review of a decision of the Nuclear Regulatory Commission (NRC) issuing to Entergy Nuclear Vermont Yankee, LLC and Entergy Nuclear Operations, Inc. a renewed license to operate the Vermont Yankee Nuclear Power Station. Petitioners contended the license renewal was unlawful because Entergy failed to furnish a state water quality certification, which they asserted was required under the Clean Water Act. The D.C. Circuit Court of Appeals denied the petitions for review, concluding that Petitioners failed to exhaust their administrative remedies before the NRC and thereby waived the right to raise their water quality certification objection on judicial review. View "Vt. Dep't of Pub. Servs. v. Nuclear Regulatory Comm'n" on Justia Law

Puget Sound Energy (PSE) maintains and operates a hydroelectric power plant at Snoqualmie Falls in Washington state. PSE sought verification from the U.S. Army Corps of Engineers (Corps) that it could proceed with upgrading and modifying its plant under a series of general nationwide permits (NWPs) authorizing certain discharges rather than applying to the Corps for an individual permit. PSE had already obtained a license for the project from FERC. The Corps verified that it could. Downstream property owners formed the Snoqualmie Valley Preservation Alliance (Alliance) to challenge this decision. The district court granted summary judgment for the Corps. The Ninth Circuit court of appeals affirmed, holding (1) this suit was not an improper collateral attack against the FERC license and amendment; (2) NWP 17, the only nationwide permit which specifically references hydropower projects, is not exclusively applicable to hydropower projects; (3) the Corps did not err in verifying that NWPs 3 and 39 authorize the project; and (4) the Corps' verification letter contained a sufficient articulation of the basis for its decision. View "Snoqualmie Valley Pres. Alliance v. U.S. Army Corps of Eng'rs" on Justia Law

Grand Valley Citizens' Alliance filed a complaint alleging that it was entitled to a hearing on an application for permit to drill pursuant to section 34-60-108(7), C.R.S. (2011), of the Oil and Gas Conservation Act. The district court dismissed the complaint. The court of appeals reversed the district court, holding that under subsection 108(7), Grand Valley Citizens were entitled to a hearing because it had a filed a petition on a matter within the jurisdiction of the Commission. After its review, the Supreme Court reversed the court of appeals judgment, holding that section 34-60-108(7) requires a hearing only for rules, regulations, and orders. Permits are governed by section 34-60-106(1)(f), which grants the Oil and Gas Commission broad authority to promulgate rules governing the permitting process, including the authority to determine who may request a hearing. View "Colorado Oil & Gas Conservation Commission" on Justia Law

With the approval of the Public Utilities Commission (PUC), in 2005 the Public Service Company of Colorado (Xcel) began constructing a coal-fired electric power unit known as "Comanche 3." When Xcel sought to recover a portion of its construction costs nearly four years later in a rate proceeding, Petitioner Leslie Glustrom intervened. Petitioner sought to introduce testimony that Xcel acted improperly and, consequently, should not recover its costs. The PUC excluded most of her testimony, a ruling that Petitioner challenged. Petitioner separately challenged the depreciation rate and the possibility that Comanche 3 might not be "used and useful" at the time rates went into effect. The PUC denied her challenges, and the district court affirmed. Upon review, the Supreme Court held that the PUC did not abuse its discretion when it struck substantial portions of Petitioner's testimony pursuant to the Colorado Rules of Evidence. Further, the depreciation rate approved by the PUC was established pursuant to law and in accordance with the evidence. Lastly, the PUC was free to exercise its discretion in departing from a strict application of the "used and useful" principle. Petitioner failed to meet her burden in showing why such a departure here would result in a rate that is unjust and unreasonable in its consequences. View "Glustrom v. Colorado Public Utilities Commission" on Justia Law

The issue before the Eleventh Circuit concerned a challenge to an exploratory drilling plan under the Outer Continental Shelf Lands Act (OSCLA). The Bureau of Ocean Energy Management (BOEM) approved the Shell Exploration Plan S-7444 (Shell EP) to conduct drilling in the Gulf of Mexico. The Plan covered ten exploratory wells on offshore Alabama leases in the central Gulf. This case was a consolidated appeal in which Petitioners the Defenders of Wildlife, the Gulf Restoration Network and others filed comments on the Shell EP, participated in the ancillary administrative proceedings, and then filed a petition with the Court for review. The only issues for the Court's review were whether the Shell EP violated the National Environmental Policy Act (NEPA) and the Endangered Species Act (ESA). After review of the parties' briefs and the record below, the Court denied the petition for review, finding the BOEM's decision to approve the Shell EP was not arbitrary or capricious and instead, "reflected the agency's balance of environmental concerns with the expeditious and orderly exploration of resources in the Gulf of Mexico." View "Defenders of Wildlife, et al v. Bureau of Ocean Energy Managem, et al" on Justia Law