PPGMR Law Client Awarded Summary Judgment in Royalty Class Action Case

PPGMR Law is pleased to share that the firm's client, SWN Production (Arkansas), LLC, f/n/a SEECO, Inc., was awarded summary judgment in a royalty class action case in the U.S. District Court for the Eastern of Arkansas on February 2, 2016.  PPGMR Law's Alan Perkins and Jeffrey Swann successfully achieved a defense judgment against allegations of breach of contract, unjust enrichment, and violation of the Arkansas Deceptive Trade Practices Act. 

Plaintiffs' causes of action were based on "affiliate sales" language in their oil and gas leases with non-operating working interest partners.  Plaintiffs alleged that SWN Production, as operator of drilling units in the Fayetteville Shale, underpaid royalties in violation of their leases.  The Court summarily held that no privity of contract existed between Plaintiffs and SWN Production, and Plaintiffs "cannot bind [SWN Production] to 'affiliate sales' language in contracts to which [SWN Production] is not a party."  The Court also rejected Plaintiffs' arguments related to (i) the terms of Joint Operating Agreement between SWN Production and other non-operating working interest owners within the operative drilling units and (ii) Arkansas' oil and gas conservation statutes.

A copy of the Court's Order granting SWN Production summary judgment, which includes recitations of the "affiliate sales" language and conservation statute relied on by Plaintiffs, is available for review here.