BG Wins Federal Appeal in Oil & Gas Contract Dispute

Bailey Glasser won affirmance of a $10 million class action before the United States Court of Appeals for the Sixth Circuit on behalf of a certified class of landowners in Grissom v. Antero Resources. In this case, our client Elaine Grissom sued the Antero Resources Corporation for wrongful deductions of certain costs from royalty payments due under oil & gas contracts with her family as well as other landowners in Ohio. Antero counterclaimed for declaratory relief, claiming they had the authority to deduct costs involved in the gas processing procedures before any royalties were paid out under the contracts.

At the trial level before the United States District Court for the Southern District of Ohio, the district court certified a class of affected landowners, and all parties then moved for summary judgment on liability. The district court granted our clients’ motion for summary judgment and denied Antero’s cross-motion.  The parties then stipulated that damages for any alleged breach was worth $10 million, and the parties appealed to the federal appellate court.

Upon analysis of the record, the Sixth Circuit confirmed what we argued all along: that under the lease, gas must be transformed into a marketable product before any costs can be deducted. Thus, under the text of the lease and the “market realities of this operation” the court ruled that “Antero …may not deduct these costs from the royalties.”

Partner John Barrett, who argued the appeal, stated:  “The Sixth Circuit affirmed what we always knew: Antero was cheating mineral owners like Elaine Grissom out of their share of the proceeds. We’re pleased to finally win justice for Elaine and the class members and look forward to distributing the money Antero owes them.”

Bailey & Glasser was privileged to co-counsel the case with Ohio counsel—Warner Mendenhall and Logan Trombley of Mendenhall Law Group; Daniel Karon of Karon LLC; and Larry Shenise.

The Bailey Glasser team was led by partners Brian Swiger and John Barrett, and Of Counsel Vic Woods, with able assistance from BG land specialist Wayne Bowman, associates Jack Budig and Adam Wilson, and paralegal Christy Satterfield.

Bailey Glasser’s Oil & Gas team has decades of experience litigating on behalf of landowners involved in energy disputes.  To learn more about our work, please visit this link.

To read the decision, please click here.