Dec. 11, 2015
HARRISBURG – The Pennsylvania Office of Attorney General’s Antitrust Section has filed suit in Bradford County Court of Common Pleas seeking restitution, civil penalties and legal costs from Chesapeake Energy Corporation, alleging underpayment of landowner royalties associated with natural gas drilling. This is being supported by Reps. Garth Everett (R-Lycoming/Union), Sandra Major (R-Susquehanna/Wayne), Matt Baker (R-Bradford/Potter/Tioga), Tina Pickett (R-Bradford/Sullivan/Susquehanna) and Karen Boback (R-Lackawanna/Luzerne/Wyoming).
The members said the filing is welcomed in the region.
“We have repeatedly urged the attorney general’s office to do what other states have done and act to protect the citizens of Pennsylvania from the illegal and predatory practices of Chesapeake and other gas companies. We have been fighting for the landowners who hold natural gas drilling leases for some time and we are happy to see the attorney general’s office join in the fight.”
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.
The lawsuit requests the court 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; and permanently refrain from any practice that violates the Unfair Trade Practices and Consumer Protection Law.
The members have been involved in pursuing legislation to guard natural gas royalty owners from unjustified post-production cost deductions. The legislation,
House Bill 1391, remains in the House Environmental Resources and Energy Committee.
“While we applaud this action by the attorney general’s office, this alone will not solve the problem.” “We now need the leaders in the General Assembly to step up also and help us move House Bill 1391 into law to ensure that our landowners are paid royalties fairly in the future.”
Representative Garth D. Everett
84th District
Representative Sandra Major
111th District
Representative Matthew Baker
68th District
Representative Tina Pickett
110th District
Representative Karen Boback
117th District
Media Contact: Raymond Smith
717.705.1834
rsmith@pahousegop.com
RepEverett.com