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NARO
National Association of Royalty Owners
The ONLY national organization representing, solely and without
compromise, oil & gas royalty interests.


 


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An Important Legislative Update

TUESDAY, 9/27/16: 

RALLY TO SUPPORT HOUSE BILL 1391

 

(HARRISBURG, PA) - The Bradford County Commissioners today invited area residents to attend a rally in support of House Bill 1391, the proposed state law to stop the shale gas royalty ripoff, at the State Capital Building in Harrisburg Tuesday September 27th. The County will provide motor coaches to and from the rally free of charge for attendees and will depart Bradford Towne Center (RR #6 West, Towanda, PA 18848) at 7AM. 

 

The author of the House Bill, Pennsylvania State Rep. Garth Everett (R-Lycoming), will speak at the rally to drive home the importance of closing a loophole that has allowed energy companies to short landowners on shale gas royalty payments.

 

September 27th at 11:30AM

State Capital Building

501 N 3rd St

Harrisburg, PA 17101

 

To reserve a seat, please call 570 265 1727 or send an to email bccom@bradfordco.org. While there is no charge for transportation, donations will be accepted to offset costs.

 


 

Jackie Root, chapter President

Jackie@gaswellguru.com 

570-537-3829

 

 

Board of Directors

Southwest District

Alan Rank

Bob Burnett

Ryan Rupert

 

Northwest District

Lynne Ryan

Tabitha Bean, Chapter Secretary

 

Northeast District

Charlene Tewksbury

Bill Wilson

 

North Central District

Dale Tice

Jackie Root, Chapter President

 

Director At Large 

David Kitner

David DeCristo

Doug Duffield

Joseph Zuber

Kevin Downs, Chapter Treasurer

Thaddeus Stevens

Lynne Seligman

Robert Sher

 

Many thanks to our dedicated chapter board for their leadership and oversight of Pennsylvania.  NARO is volunteer lead and cannot be effective in our mission work without the time and talent of our volunteers.  If you are interested in getting involved in mineral/royalty owner education and advocacy contact PA President Jackie Root.

 

 

 

 


Important Updates

in Pennsylvania Energy News

February 4, 2016, Two objections were filed in the Attorney General's PA Lawsuit against Chesapeake Energy Corp.  The full documents are available here.

Williams Objection.pdf

CHK Objection.pdf



Press Release from the


Pennsylvania Attorney General's Office 
December 9 ,2015


Office of Attorney General lawsuit seeks millions in restitution from energy producer accused of deceptive practices in fracking industry 


HARRISBURG — Pennsylvania Attorney General Kathleen G. Kane's office today announced it has filed a lawsuit against Chesapeake Energy Corp., the country's second-largest producer of natural gas, and its affiliates amid allegations the companies underpaid landowners' royalties associated with fracking.


The lawsuit alleges that Chesapeake and other defendants engaged in deceptive conduct in securing fracking leases from Pennsylvania landowners. These alleged deceptive business practices occurred as part of a rush to lock up acreage in the Marcellus Shale region, the country's largest natural gas field that runs through much of the Commonwealth.


"This alleged conduct amounts to a 'bait-and-switch,'" Attorney General Kane said. "Pennsylvania landowners were deceived in thousands of transactions by a company accused of similar conduct in several other states. This lawsuit should serve as notice that we will not allow our residents to be exploited."


The lawsuit, which was filed in the Bradford County Court of Common Pleas, seeks restitution for thousands of consumers, civil penalties and legal costs. It was the result of an extensive investigation by the Office of Attorney General's Antitrust Section and Bureau of Consumer Protection. The investigation focused on counties in northern Pennsylvania. 


According to the lawsuit, the defendants obtained leases and promised lessors certain amounts of royalties, but then delivered something different in royalty payments after gas wells started producing and the defendants began making royalty payments to landowners. Additionally, the lawsuit alleges that landowners were told certain lease provisions prevented them from incurring charges for the extracting and marketing of natural gas. They said they were later told the leases permitted such charges.


As a result of the misrepresentations, Chesapeake and other defendants allegedly took deductions and, in some cases, made retroactive deductions of post-production expenses from royalty checks. These practices occurred despite landowners' claims that their leases contained the necessary language to prohibit such deductions.


General Norman W. Marden, all of the office's Antitrust Section. The Antitrust Section is tasked with protecting the free enterprise system by detecting anti-competitive practices and taking legal action to stop them. Senior Deputy Attorney General John Abel, of the office's Bureau of Consumer Protection, also worked on the investigation.  

The Office of Attorney General is also filing an amicus curiae brief in the U.S. District Court for the Middle District of Pennsylvania advising the court of this lawsuit. The brief urges the court to reject the proposed settlement of the Demchak class action in its current form.


 

The office requests that the court modify the Demchak Settlement Agreement and Release to clarify that the class does not have standing to bring the claims asserted by the Office of Attorney General and therefore cannot release the office's claims through the settlement.


The Office of Attorney General's investigation of this matter required a significant examination of the fracking industry to identify the unfair methods of competition and alleged deceptive acts or practices in violation of the Unfair Trade Practices and Consumer Protection Law.

Hundreds of landowners also played an integral role in the investigation by sharing information with the Office of Attorney General.


"This investigation would not have been possible without the cooperation of landowners who spoke with our staff," Attorney General Kane said.  


The lawsuit requests the court to order the defendants to:

·         Pay restitution to all persons who have suffered losses as a result of the defendants' conduct.


·         Pay civil penalties of $1,000 for each violation of the Unfair Trade Practices and Consumer Protection Law, and $3,000 for each violation involving a person 60 years old or older.


·         Permanently refrain from any practice that violates the Unfair Trade Practices and Consumer Protection Law.

In addition to Chesapeake Energy Corp., the other affiliates named as defendants in the lawsuit are Chesapeake Appalachia, LLC; Chesapeake Operating, Inc. and Chesapeake Energy Marketing, Inc. Williams Partners, LP, which owns and operates infrastructure used in the fracking industry, is also named as a defendant.

Pennsylvanians who feel they were victimized by these or other companies should file a complaint with the Office of Attorney General's Antitrust Section by calling 717-787-4530 or by submitting a complaint at www.attorneygeneral.gov.


The lawsuit was filed by Chief Deputy Attorney General Tracy Wertz, Senior Deputy Attorney General Joseph S. Betsko and Senior Deputy Attorney General Norman W. Marden, all of the office's Antitrust Section. The Antitrust Section is tasked with protecting the free enterprise system by detecting anti-competitive practices and taking legal action to stop them. Senior Deputy Attorney General John Abel, of the office's Bureau of Consumer Protection, also worked on the investigation. 


The Office of Attorney General is also filing an amicus curiae brief in the U.S. District Court for the Middle District of Pennsylvania advising the court of this lawsuit. The brief urges the court to reject the proposed settlement of the Demchak class action in its current form.

The office requests that the court modify the Demchak Settlement Agreement and Release to clarify that the class does not have standing to bring the claims asserted by the Office of Attorney General and therefore cannot release the office's claims through the settlement.


Message from Jackie Root, NARO PA President

          Several public meetings were held in Northeast PA regarding the Demchak Proposed Settlement with Chesapeake. One thing that I heard loud and clear is that potential class members do not understand how they can be a part of the settlement when they did not choose to participate in this action. Like it or not, this is how Class Action Law works! The notice you did or did not receive failed to include the entire complaint, key definitions defining potential financial recovery are only included in the 89 page complaint. We have included all the documents from the case here for you to review.


Whether or not you received a notice:

  •  If you are a class member and DO NOTHING, YOU ARE INCLUDED AND BOUND BY THE TERMS FOR NOW AND FOR AS LONG AS THE LEASE IS EFFECTIVE.


  •  If you do not want to be included you MUST OPT OUT by December 17, 2015 according to the instructions included in the notice. We have provided a form that may be used. We are not providing legal advice, you must assess you own situation and suggest getting expert advice if you do not understand it.

We have had many questions about how to properly opt out of the Demchak settlement.


These two attachments provide a sample Opt Out form with the appropriate addresses as well as instructions.


Chesapeake Demchak Instructions for Submission of Request for Exlcusion .pdf


Chesapeake Demchak Form of Request for Exlcusion from Settlement Class.pdf





All forms are from the www.chesapeakepagasroyaltysettlement.com

site

Demchak_Complaint.pdf



Demchak_Amended_Class_Action_Settlement_Agreement.pdf

This, above, is the Amended Settlement proposed in 2015



Preliminary_Approval_Order.pdf

This, above, is the preliminary approval order
signed by the judge 10-2-15.



Demchak v CHK Notice.pdf

This, above, is the notice of Proposed Settlement

sent in early November 2015 to potential class members.

You may have received this if "records show that you (or someone in your family) have received, or potentially will receive royalty payments from Chesapeake form current or future wells in Pennsylvania." It has been noted that a recent discovery of additional potential class members will result in 216 new notices going out with an extended deadline. It is also conceivable that you may be a potential class member and failed to receive a notice due to mail issues, address changes, ownership changes, etc. If you leased with Chesapeake or Chesapeake now owns a lease you signed with another company, you may want to regard the notice as pertaining to you and your oil and gas rights.



 




Demchak in the News

Chesapeake Lawsuit Involves 4,000 PA Landowners;

Other Operators Could Face Charges

Jamison Cocklin

December 10, 2015


The Pennsylvania Attorney General's (AG) office said Thursday that its lawsuit against Chesapeake Energy Corp. and its affiliates, including Williams Partners LP, could involve at least 4,000 landowners, a number that could grow exponentially as the case unfolds and if the state takes action against other operators.

The lawsuit, which came after what the office called an "extensive investigation" that took more than a year to complete, might not be the only result of those efforts. On Thursday, a day after it filed the complaint against Chesapeake in the Bradford County Court of Common Pleas, the AG's office did not rule out the possibility of legal action against other operators in the state.


"We really can't get into what may be coming in the future in regard to other companies," said spokesman Jeffrey Johnson. "At the moment, this lawsuit is what we're prepared to discuss." He added that the AG made a "very extensive review" of the oil and gas industry "as a whole" and said the office was already receiving phone calls from landowners it had not spoken to.


Just days before the office filed the lawsuit, a source with knowledge of the investigation, who agreed to speak on the condition of anonymity because they were not authorized to share information publicly, said the investigation would likely uncover "excessive" and "improper" royalty deductions made by Chesapeake and some other operators. The source said the AG's investigation became "much more complicated than the office ever expected it was going to be," adding that it was forced to conduct in-depth auditing of royalty payments and other records.


The complaint accuses Chesapeake of unfairly deducting post-production costs from royalty checks to cover marketing costs, including compression, dehydration and transmission (see Shale DailyDec. 9). It is seeking restitution for thousands of landowners, as well as civil penalties and legal costs, adding to Chesapeake's legal problems in the state and elsewhere where it has been accused in various courts of underpaying royalties. In addition to Williams, which moves and processes gas for the company, the state's lawsuit names as defendants Chesapeake Appalachia LLC, Chesapeake Operating Inc. and Chesapeake Energy Marketing Inc.


The AG is seeking restitution for all persons affected, civil penalties of $1,000 each and $3,000 for each violation involving people 60 years of age and older. Taken together, Johnson said, the office has conservatively estimated that Chesapeake could be forced to pay "tens of millions" of dollars in damages if the lawsuit is successful. It also comes ahead of a Feb. 2, 2016 hearing in federal court at which a judge is expected to approve a class action lawsuit against Chesapeake (see Shale DailyDec. 8). Known as the Demchak settlement, involving more than 15,000 landowners, that case has taken years to resolve.

When Chesapeake first agreed to settle in 2013, they offered.....


To read the rest of this article, CLICK HERE.

Pennsylvania Royalties Settlement Swells to $17M-Plus And Growing For Chesapeake

Jamison Cocklin

December 8, 2015

A long-delayed class action settlement between Pennsylvania landowners and Chesapeake Energy Corp. to resolve claims that the company improperly deducted post-production fees from royalties has received preliminary approval from a federal judge, ballooning to more than $17 million and now involving thousands of property owners.

Originally reached in August 2013, the $7.5 million settlement between Chesapeake and a little more than a dozen landowners now includes in excess of 15,000 people, who are expected to receive portions of an estimated $17 million. Attorney Michelle O'Brien of the O'Brien Law Group, who represents the lead plaintiff, Demchak Partners LLP, and who has been negotiating the settlement for years now, said the estimate could grow. It's unclear, she said, how many landowners could ultimately be included in the class.

"The settlement is based on the actual deduction taken out of each individual class member's royalty check," she said. "Every single day that amount increases and now it will increase further until Feb. 2 if the settlement is approved. We don't know the final number yet, so that was a rough estimate from several months ago."


Click here to read the full article.



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