Replies to This Discussion

Permalink Reply by Port city landman on August 9, 2012 at 4:18

Class Actions against large companies are almost always started by plaintiffs attornys who front all the cost and take a percentage of the award, if you lose, they eat the cost.  It's part of the gamble and part of the equation that almost no one recognizes when they complain about the attorneys making so much money.  Fee structures depend greatly on the size of the class.  Usually the two or three best cases are chosen and they represent the class, those folks are paid more then the other class members because they generally expend more time on the litigation.  Really there is much misunderstanding about what a class action really is.  You need a group of people who have the same complaint and will be conducting the same types of discovery.  You may have anywhere from 1 attorney to 100 attorneys all coming after a company, you don't want to duplicate all the discovery work because the huge companies will literally drown you in paper...thousands of pages of worthless to make it harder to find what you need.  Generally class actions are in federal court and in state court (where individuals are better off) mass joinders are more often used.  Once discovery is over the cases go back to their home court to be tried individually.  Example...file a case in Western District of Louisiana it's consolidated with a case in the Eastern District of Ohio for discovery, a group of plaintiffs and defense attorneys are elected to do most of the work, when discovery is completed your case goes back to LA for your attorney to handle. State cases work a little differently but it's basically the same thing. In either if there is no settlement prior a few cases will go to see how it's going to turn out.  good for company, you're dead in the water, bad for company, settlement happens quickly.

 

I'm going to disagree that the appelate courts always side with the industry, actually it depends on the type of litigation.  Many, many large companies have lost when it comes to environmental contamination which the industry has been fighting in the legislature pretty heavily by trying to have legislation passed that will make it harder to recover damages.  It's actually the USC's stance that punitive damages that are above 3x the general award is against due process, that greatly hampers the ability to punish the oil companies. 

 

If you have proof that they are doing something that is either 1)against statute or 2)in violation of their contract and the potential payoff is big because either 1)you have a lot of people they are doing it to or 2) you own a lot of land you have a possible lawsuit.  However, I don't think there are really any law firms in shreveport that can take on the oil companies.  80% of the plaintiff attorneys in the Valdez where bankrupted before the case had it's final day.  You need to look for a big plaintiffs firm in new orleans, baton rouge or possibly lafayette or find a firm here that has ties with a big firm.

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Permalink Reply by Steve on August 9, 2012 at 4:28

I have never yet seen a class action lawsuit that resulted in anyone getting anything near their claim paid -  the lawyers end up with all the money left after taking out their expenses. I have been involved with  a dozen or more class actions lawsuits in the past 35 years. They can however punish a company financially and reputation wise - but for each individual class member to get any significant damages is almost unheard of. Here is how it works- the lawyers involved always recommend a settlement when they are satisfied with their cut - this nearly always means that you are thrown under the bus. I was personally responsible for started a class action lawsuit on behalf of 1500 employee shareholder back in the late 90's - our attorneys settled for $15 million 7 years later - after the lawyers took their cut, the experts witnesses were paid their fees and the other legal expenditures were taken out - I personally got a check for 37 cents. (actually 2 checks for .37) because they screwed up and paid me twice. I think you will find that almost every time the lawyers will settle as soon as they are satisfied with their cut - they will rarely take a case to trial for you. IMO

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Permalink Reply by Port city landman on August 9, 2012 at 4:36

I agree class actions are not generally good for the plaintiffs however in some cases that's the only way to get anything.  I disagree that plaintiffs always get the shaft.  Look at the dow corning breast implant litigation, the gunderson litigation in la, the latest bayercrop science litigation came out ok for the landowners.  The pharma class actions usually come out well.  It just depends.  Should the attorneys who sue and front all the cost (millions to fight a large company), work for free for up to a decade (the average time of a class), and take all the risk, get nothing?  The law has a business side just like everything else.  A class if probably the last thing you would want as an individual, but sometimes it's the only way anything is going to happen. 

 

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Permalink Reply by Skip Peel - Mineral Consultant on August 9, 2012 at 4:37

In regard to O&G related issues not including environmental the industry has an enviable record at the LA Second Circuit Court of Appeals.  And the hurdle to class status in regard to lease, exploration and production issues is certification.  The guidelines are drawn so tight that it is difficult to include more than a handful of plaintiffs.  There are number of law firms in Shreveport capable of class action in O&G related litigation just few who would risk industry blow back to do so.

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Permalink Reply by Larry G Smith P.E. on August 9, 2012 at 4:39

I agree Steve, what we need is some good information that may show we the royalty owners are being defrauded or at least something that shows an intention on the part of the companies. With that the State Attorney's office will get involved. I will meet with one of the States Attorney General's attorney next week. If you have any thing to add get in touch with me by Mail, lgsmith.pe@gmail.com

But class action will not do us any good, from what I see.

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Permalink Reply by LN on August 9, 2012 at 5:09

Thanks for this valuable information.

I know that you will continue to keep us posted.

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Permalink Reply by GoshDarn on August 9, 2012 at 7:23

Steve, even though your personal experiences with class actions have proven negative, one shoe don't fit all.

Now true -- your thinking might, indeed, be correct (in a general context), being as the probabilities are high that few plaintiffs will receive much of a payout from such litigation.

Yep, that can and does happen.  So true.

Yet regardless of your assessment of such court cases -- there have, indeed, been numerous class actions where a segment of harmed plaintiffs did receive hefty remunerations of up to five-figure sums or even higher.  (Of course, there also were confidentiality agreements that had to be signed which prevented the plaintiffs from sharing the details of their awards with others.)

But note:  I'm not referencing the oil business, per se.

So, in today's rather complex world, it's best to keep an open mind and to also be willing to consider all avenues if you or anyone you know has the opportunity to join a class action suit.

GD 

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Permalink Reply by John Brewster on August 9, 2012 at 6:11

As Henry says in his July 17 post, and this applies to all of you who expree displeasure with CHK, why are you unhappy? You will get nowhere with CHK, a lawyer (my profession), or a state AG, if you cannot articulate a legitimate complaint. While irritating, most delays in initial royalty payments can be justified. If an Operator violates a specific lease provision, that is most commonly a result of carelessness or ignorance of the lease. Reputable Operators like CHK and XTO do not knowingly disregard their legal obligations. So LN and all of you who enjoy complaining without explanation, please skip the emotion which is counterproductive, and detail what it is that you believe occurred that may be illegal.

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Permalink Reply by Roy Austin Smith on August 9, 2012 at 6:23

too bad you are not one of the Chk royality owners. All who are complaining have it right, but the problem is proving it. No question about what Chk is to doing to the small landowners. chk is not a reputable operator. No question about that either. Prove it is a different question.. don't know about xto but i do know about exco. they are not a reputable company either. every one has the right to claim at the present time, although that right is well on its way to be taken away from us.

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Permalink Reply by Roy Austin Smith on August 9, 2012 at 6:29

PS: Brester:  I am sure ln and all; of you(me for one) do not enjoy complaining as you say , and also it is not counter productive.  We still have freedom of speech despite the lawyers of the aclu. I cannot detail what is , but i can in plain layman's language tell you that chk is short changing the the landowner on payments and expense. that is the whole thing in a nutshale. Unless you and the aclu get it stopped, they will keep complaining, because they know it is true. Provening it to a company on the verge of bankruptcy is a little tuff for a layman also tuff for a lawyer.

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Permalink Reply by Larry G Smith P.E. on August 9, 2012 at 7:50

Mr Brewster, I was interessted in what you had to say, that is, until you referred to CHK and XTO as Reputable Operators. You know nothing of the problems we, the Royalty Owners are going through with these companies.  I have found that anyone that will LIE, will also Cheat and Steal.

I for one in here would not consider going to you  for Legal Advise. I am a Registered Professional Engineer with over 50 years in the oil business and deal with Oil Companies and contracts many times a month. 

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Permalink Reply by Roy Austin Smith on August 9, 2012 at 9:37

Chesapeake is not and has never been a reputable company from start to finish. I have many stories i can tell you about concerning chk. I can tell you about the rude  and lying employees. Not downing the employees, because the have to lie or have no job.Mr Brewster is either a lawyer for oil companies or he is a little bit on the igronant side. It is pretty obivious to any one that can read the Chesapeake is a crooked company.  they paid the wheels and the politicans in Desoto really good royalitiies. the gave away approximately one million(guessing, could be more) to the sheriff's office , to the city, to the school board, but when it comes down to the small landowner, they get very stingy. Mr Brewster obivioully never did any manual labor. I and my father did a lot of manual labor on the land i now own. My father never made much off land except for leaseing , sometimes at $1.00 per acre. i was fortuante to do a little better till they dropped the prices way below other companies, cut the production way back. I could go along with that, but all this lying and covering up the hidden expenses, no i do not go along with it. I am sure xto is about the same, but i do not know.

Exco is turning in false reports to sonris . they are not reputable at all. I have have some stories that i can easily prove on them because i went to the wells and checked them. and photographed them also. This my wife's acreage or i would be glad to tell what liars and false info they are giving out. i do not like to down anyone on these post, but i think Mr Brewster has just made a case for that.

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