FAQ

BACKGROUND QUESTIONS

1. Who Are We And What Do We Do?

We are your advocate in securing your mineral rights in certain neighborhoods in the Barnett Shale. We are a group of three law firms dedicated to obtaining fair compensation for Barnett Shale landowners whose cases we agree to work on. We will investigate your case based on your completed Questionnaire and we will provide a written assessment of your case at no charge or obligation to you within two weeks of receiving the completed Questionnaire, which must be received by September 15, 2010. See question 2 below for more details on this important deadline.

Gas Lease Litigation General Information Bulletin Summer / Fall 2010

 

The three firms that have united their forces are:

PETROFF & ASSOCIATES
3838 Oak Lawn Avenue, Suite 1124
Dallas, Texas 75219
(214)-526-5300
www.petroffassociates.com
RIDDLE & WILLIAMS, P.C.
3710 Rawlins Street, Suite 1400
Dallas, Texas 75219
(214)-760-6766
www.riddleandwilliams.com
MATHIS & DONHEISER, P.C.
2001 Ross Avenue, Suite 2575
Dallas, Texas 75201
(214)-303-1919
www.mathisdonheiser.com

 

2. Are there any deadlines I need to worry about?

Yes. Several of the legal claims against the gas companies have a two year statute of limitations. We have decided that our group will not accept any new gas lease cases after September 15, 2010. Please see the Gas Lease Litigation General Information Bulletin Summer / Fall 2010 for more details.

3. Do You Have Informational Meetings That I Can Attend?

Yes! Please click here for information on our meetings.

 

QUALIFICATION QUESTIONS

4. I Just Bought Some Land In Tarrant County And Was Wondering If I Could Get Involved In This Lawsuit?

In our opinion, one must have owned land in one of the designated areas sometime around October of 2008. It does not matter when you bought the land as long as you owned it sometime around October 2008. Other lawyers may disagree with us on that opinion, but that is our belief at this time.

5. What Neighborhoods Are Affected?

The neighborhoods we are accepting cases from usually involve land in Tarrant and Johnson Counties in North Texas. We are accepting cases from landowners in the geographical areas involving five coalitions of homeowners' associations known as "SEACTX" (South East Arlington Communities of Texas) in Arlington, Texas, "SFWA" (Southwest Fort Worth Alliance) in Fort Worth, Texas, "BC-MRC" (Bedford Colleyville Mineral Rights Coalition) in Bedford, Texas, "BAMCO" (Bransford Area Minerals Cooperative) in Colleyville, Texas, and landowners who reside in the Deer Creek Estates community in Crowley, Texas, as well as certain cases outside these areas in Tarrant and Johnson Counties. We analyze the individual facts of each case and make a decision based on the facts unique to that case.

Also, please see our NEIGHBORHOODS PAGE for links to HOA & Community sites of interest.

6. Where Must I Own Land To Be Involved In This Litigation?

At present time, we are only accepting cases involving land in certain parts of North Texas, specifically the following areas only:

  • (a) property owners in Tarrant County
  • (b) property owners in Johnson County

7. How Do I Know If I Qualify?

A. Click here for more detailed information to determine if you qualify.

Do I qualify for this Barnett Shale Lease Litigation?

 

8. I understand that the lawyers are suing to enforce written agreements that alliances or networks of homeowners' associations negotiated on behalf of large neighborhoods of landowners in Tarrant County, but what if I have a situation that doesn't fit into one of those categories? Will the lawyers consider situations where we had dealings with the gas companies but there was no written agreement negotiated with these networks of homeowners' associations?

Yes, we will evaluate any factual situation in order to determine if you have a case we will accept that does not fit our general criteria. As with all potential gas lease litigation cases, we will evaluate the individual facts of your case and provide a written evaluation of it at no charge or obligation to you within two weeks of receiving the QUESTIONNAIRE, which must be received by September 15, 2010. See question 2 above for more details on this important deadline..

Please Note: Our group has decided not to accept any new gas lease cases after September 15, 2010. You need to provide us with information about your potential case before then.

9. If I signed a mineral lease and received my entire signing bonus payment, can the lawyers help me evaluate whether I am in a drilling unit or why I have not received any royalty payments?

No. We receive many questions from homeowners who did sign a mineral rights lease and received a signing bonus (the initial payment), but have not received a royalty payment or heard from the gas company. Unfortunately, we cannot assist each interested homeowner in determining whether their property is in a drilling unit or whether they should be receiving a royalty payment.

PLEASE NOTE THAT THE FOLLOWING INFORMATION IS NOT INTENDED AS LEGAL ADVICE AND ONLY PROVIDES GENERAL GUIDANCE TO ROYALTY OWNERS WHO THINK THAT THEY ARE OWED ROYALTIES BUT ARE NOT RECEIVING PAYMENT.

There are several tools available on the internet that will enable you to determine whether your property is in a drilling unit or pool.

To review information regarding drilling locations, drilling permits and production, please visit the Railroad Commission's web site at http://www.rrc.state.tx.us. In order to view online research tools click on the "Data & Statistics" tab, which is located on the left side of the homepage. Next, click on "Online Research (Queries)."

To locate drill-sites near your property, click on the "Public GIS Map Viewer for Oil, Gas, and Pipeline Data" link. In order to view your property, select the county where your property is located and use the "Zoom In" Option. It is important to note that the symbol for a drill-site location is a and the symbol for the bottom hole location is a .

If you find a drill-site near your property, you can obtain more information on that particular well by clicking on the "Map Tools" Option and selecting the "Identify Wells" Tool. Place the cursor (pointing hand) on the bottom hole location of that particular well. After clicking on the well, a popup will appear providing its GIS wellbore attributes. Additional well information, if available, may be viewed by clicking on the Operator/Wellbore/PDQ, Well Logs, or Drilling Permits links located at the bottom of the popup. However, these links will not be available if the API number has not been identified in the GIS.

To determine whether your property is located in the drilling unit for that well you need to click on the "Drilling Permits" link, if available, on the GIS Wellbore Attributes popup. The link will direct you to a "Search for W-1s" page, which will show one or more listings for that particular well. In general, the result will state: (1) Status Date; (2) Operator's Name/Number, (3) Status Number; (4) Lease Name; (5) Well Number; and (6) Current Status. Click on the most recent Status Date (the link is the Lease's Name). Located at the end of the "Review Page" are attachments, which include a PLAT, depicting the Unit boundaries where the well is located, and a P-12 (Certificate of Pooling Authority). These documents are downloadable and can enable you to determine whether your property is included in that particular Pool.

PLEASE REMEMBER THAT WE WILL NOT BE ABLE TO ANSWER GENERAL QUESTIONS REGARDING ROYALTY PAYMENTS OR WHETHER A PARTICULAR WELL HAS BEEN DRILLED AND/OR IS PRODUCING.

10. If I signed a mineral lease and received my entire signing bonus payment, can the lawyers help me evaluate whether I have a cause of action against the gas companies for their failure to make royalty payments?

No. If your property is included in a Drilling Unit where there is a producing well, you should consider contacting the Operator of the well (the Operator's Name is listed on the Form W-1 Review Page). You can locate the contact information for several Oil and Gas Operators at www.mineralweb.com. When you call the Operator take down notes and write down the names of individuals with whom you speak with during the telephone call. You should consider asking whether the Operator has delegated royalty payments to the purchaser of production or whether there are title curative requirements that must be met before you can receive payment. In addition, under Texas law the party responsible for payment of royalties ("Payor") is entitled to receive a signed Division Order from a royalty owner before issuing any royalty payment. This requirement can be found in Section 91.402 of the Texas Natural Resources Code (the "Royalty Payment Statute"), which is located online at www.statutes.legis.state.tx.us/Docs/NR/htm/NR.91.htm. Furthermore, you should consider asking the Operator the amount that has accrued for your account because a Payor is not required to make royalty payments until the amount owed is at least $100.00 under the Royalty Payment Statute.

IF YOU HAVE DETERMINED THAT (A) OIL OR GAS IS BEING PRODUCED ON LAND YOU OWN A MINERAL INTEREST WITHIN, (B) YOU HAVE SIGNED AND RETURNED A DIVISION ORDER SHOWING YOUR INTEREST, AND (C) THERE ARE NO TITLE PROBLEMS PREVENTING PAYMENT, THEN YOU POTENTIALLY HAVE A CLAIM AGAINST THE PAYOR FOR FAILURE TO PAY YOUR ROYALTY. IF YOU BELIEVE THAT YOU HAVE A POTENTIAL CLAIM AGAINST THE GAS COMPANIES, KEEP IN MIND THAT A STATUTE OF LIMITATIONS MAY APPLY IN YOUR CASE AND YOU SHOULD ACT PROMPTLY IF YOU DECIDE TO SEEK REPRESENTATION.

PLEASE REMEMBER THAT WE WILL NOT BE ABLE TO ANSWER GENERAL QUESTIONS REGARDING ROYALTY PAYMENTS OR WHETHER A PARTICULAR WELL HAS BEEN DRILLED AND/OR IS PRODUCING.

11. Will the lawyers be able to help me locate a copy of any gas lease that I may have entered into with the gas companies?

No. If you do not have a copy of your existing lease or royalty agreement, you can locate it at the courthouse of the county where the land is located. Moreover, you may be able to locate this information online at your county's web site. For instance, Tarrant County provides access to all property deeds, liens and leases filed after 1970. For this information go to the Clerk's web site, which is http://tcweb.tarrantcounty.com/eCountyClerk, and click on the "Online Searches" link located on the left-side tool bar. Then click the "Real Property Search" link (Note: Be sure to enter your name in the Grantor field when looking for a Oil & Gas Lease or Lease Memorandum).

 

LAWSUIT QUESTIONS

12. What Is This Lawsuit Against The Gas Companies All About? What Are You Suing For?

We are suing certain gas companies and land service organizations for breach of contract, fraud, conspiracy, negligent misrepresentation, and violations of the Texas Deceptive Trade Practices Act. We are only making these claims on behalf of landowners who own land in certain geographical areas of North Texas. Not everyone living over the Barnett Shale in North Texas has a case, but we will investigate your case based on your completed questionnaire, which must be received by September 15, 2010. See question 2 above for more details on this important deadline.. Copies of certain court documents provide additional details. See the Plaintiff's Original Petition filed in the Myles and Booth cases, which can be found on the Litigation Documents page of this site. Petitions we have filed on behalf of other individuals and businesses can also be found on the Litigation Documents page.

13. Is This A Class Action?

No. We currently are suing on behalf of individuals who we believe have cases based on the unique facts of their individual cases. We sometimes combine several landowner's cases into one lawsuit because they are similar, but we currently believe that filing the gas lease lawsuits in this manner is better than filing them as a class action.

14. How much will it cost me to get involved in this lawsuit?

Nothing. We work strictly on a contingent fee. There are no costs or expenses unless there is a recovery or settlement in your favor. Our Attorney-Client Agreement specifically states the following: "If the claim is such that the fee allowed to an attorney is set by law, the Client hereby assigns to the Firms the maximum provided by that law, but there shall be no fee unless there is a recovery and the total amount of fees and expenses shall never exceed fifty percent of the total monetary recovery. It is further understood and agreed that the client will not owe the firms any money for expenses unless the firms successfully obtain a recovery for the client." We will investigate your case based on your completed Questionnaire and we will provide a written assessment of your case at no charge or obligation to you within two weeks of receiving the completed Questionnaire, which must be received by September 15, 2010. See question 2 above for more details on this important deadline..

15. I understand the lawyers will not charge me if there isn't a recovery, but what about the gas companies? Could they countersue me and make me pay their lawyers' fees and expenses in defending this case if the gas companies win it?

It is theoretically possible that this could happen, but under current law, you would only be required to do this if there was a finding that your case against the gas companies is frivolous and groundless. As your lawyers, we would not file a lawsuit if we did not believe it was a good one, and we will stand behind any lawsuit we choose to file.

16. What Happens After I Sign Up?

This first thing you need to understand about "signing up" with us is that we have decided not to accept any new gas lease cases after September 15, 2010. You need to provide us with information about your potential case before then.

After sending us your completed Client Questionnaire, which must be received by September 15, 2010 (see question 2 above for more details on this important deadline), and signed Attorney-Client Agreement, we will verify that your address and other details are within our specific criteria before taking further action. We will investigate your case based on your completed Questionnaire and we will provide a written assessment of your case at no charge or obligation to you within two weeks of receiving the completed Questionnaire, which must be received by September 15, 2010. See question 2 below for more details on this important deadline. The next step will most likely be to send a Notice letter to the defendants on your behalf under the Texas Deceptive Trade Practices Act (DTPA). A sample DTPA Notice letter is available on the Litigation Documents page of this site.

17. How Can I Obtain More Information About My Legal Rights Without Committing To Hiring An Attorney First?

We want all clients to make an informed decision about their involvement in gas lease litigation, and there are several ways you can do that without incurring any obligation. You can contact us by going to the Contact Us page on this site.

You can also make an appointment to meet with us individually in person at one of our Dallas offices or you can talk with us by phone if you prefer.

We also hold informational meetings on Tuesday evenings in Arlington from 4 P.M. to 7 P.M. (There are no formal meetings or "start times"; just try to come between 4 pm and 7 pm.) Click here for more details | Click here to reserve an appointment

Please note that we have decided not to accept any new gas lease cases after September 15, 2010 and you need to provide us with information about your potential case before then.

18. What is going on with the lawsuits that have been filed so far by your firms?

We strive to keep the "News and Updates" Section of our web site current. Click on NEWS AND UPDATES for more recent information concerning these cases.

19. How many lawsuits has your group filed so far on behalf of Tarrant County landowners? Where were they filed, and are there more to come?

As of July 2010, we have lawsuits filed on behalf of well over 200 Tarrant County landowners. Our lawsuits typically contain several landowners in one lawsuit, and that is why there is sometimes confusion about the difference between the number of lawsuits filed and the number of landowners included. All of the lawsuits we have filed as of July 2010 are pending in Tarrant County Courts. We plan to file numerous additional lawsuits. Other client/landowners will have their lawsuits filed as soon as their pre-suit notice period (explained in FAQ # 16 above) expires.

20. What do the gas companies have to say about these lawsuits?

Other than declining to comment, we are unaware of any public statements about the specific lawsuits our group is involved in; however, lawyers for XTO have made certain statements during court proceedings that shed light on the company's position. For example, during a Temporary Restraining Order hearing on August 31, 2009, Jeff King, an attorney representing XTO, explained the company's position as follows:

" . . . the price of natural gas just fell . . . And when it got to $4 per MCF, yes, companies pulled their leasing offers off the table, because that's what good business people do. They don't enter into agreements when the minerals aren't worth what they originally thought they were going to be worth."

You can see this quote for yourself on page 34 of the 08-31-09 Myles TRO Hearing Transcript which is located on the Litigation Documents page of this web site.

On May 6, 2010, Donald Herrmann, an attorney representing Vantage Energy Company and certain other Defendants, explained his clients' positions as follows:

"... But it is significant to me that at the time period that we are discussing, the spot prices at the Henry Hub location dropped in the most dramatic fashion, at least, in this six-year history. And therein, I think, is where the plaintiff's problem lies."

 You can see this quote on page 28 of the May 6, 2010 Hearing Transcript which is located on the Litigation Documents page of this web site.

In December 2009, XTO and Permian Land Company issued subpoenas and sent demands for production of documents to the homes of at least two of the people who volunteered to work with SEACTX and XTO in securing leases from individuals living in the SEACTX area. These document demands and subpoenas can be found in the Litigation Documents section. Several depositions of gas company representatives have been taken and more are scheduled. A hearing concerning certain aspects of the Antitrust allegations has been scheduled in Tarrant County District Court on May 6, 2010 and the Court ruled in favor of the gas companies and dismissed the Antitrust and conspiracy allegations. This put an end to the Antitrust and conspiracy causes of action but the Court's ruling has no bearing on the underlying breach of contract, fraud, and misrepresentation claims. Our NEWS AND UPDATES page is updated regularly, and you should check there for more details about ongoing events in this litigation.

21. I understand the lawyers only get a fee on the signing bonus and the renewal bonus if there is one, but I am more concerned about getting a good lease so that I can have defined, written, legal rights in case the gas company doesn't do things the way I want them to in the future. Can you help me with that aspect of this situation?

We believe the work we are performing on the cases we agree to work on will probably result in obtaining a better lease agreement than you could obtain from the gas companies on your own. Our position is that there has to be a binding legal agreement as the foundation of a lawsuit that we will agree to work on. We believe binding written agreements exist in many situations in Tarrant County where alliances or networks of homeowners and homeowners' associations negotiated written agreements with the gas companies. These written agreements provide terms that we believe provide superior protection to the landowners who were left unsigned when the companies backed out of these agreements back in October of 2008. Our goal is to enforce those written agreements exactly as they were written, and we think this will provide far better protection than you are likely to be able to negotiate on your own today.

22. I noticed that your ATTORNEY-CLIENT ENGAGEMENT AND FEE AGREEMENT on your web site has changed since it was originally posted. There appear to be several provisions removed from the original one and there also have been some additions made. Why?

The attorney-client contract is one that is very important to us, and we have removed certain provisions that were confusing or not applicable to the unique facts surrounding the gas lease litigation. We also have added the following two sentences because of questions that were raised about our fees and expenses: "If the claim is such that the fee allowed to an attorney is set by law, the Client hereby assigns to the Firms the maximum provided by that law, but there shall be no fee unless there is a recovery and the total amount of fees and expenses shall never exceed fifty percent of the total monetary recovery. It is further understood and agreed that the client will not owe the firms any money for expenses unless the firms successfully obtain a recovery for the client." We also revised the contract to eliminate any reference to "non-monetary recoveries" which existed under earlier versions of the contract. All of the changes were made for the benefit of the clients and prospective clients. All clients who signed the original, longer fee agreements are automatically entitled to enforce the later version of the contract which has removed confusing or less favorable provisions. The newest version of our contract is on our web site at

http://www.ntxleaselitigation.com/barnett_shale_qualify.cfm

 and

http://www.ntxleaselitigation.com/barnett_shale_litigation_docs.cfm

Any questions about our Attorney-Client Engagement and Fee Agreement that are not answered above will be answered on an individual basis in consultation with one of our attorneys.

23. I understand the lawyers only get a fee if there is a recovery, but I am worried about the expenses they say I will be responsible for in addition to the one-third fee. What assurance do I have that the expenses won't eat up my two-thirds and I'll end up with nothing and the lawyers get everything?

Our Attorney-Client Engagement and Fee Agreement provides specifically that "there shall be no fee unless there is a recovery and the total amount of fees and expenses shall never exceed fifty percent of the total monetary recovery." While we believe it is unlikely that the fees and expenses will amount to fifty percent of the total recovery, we have agreed in writing to limit it to fifty percent. Keep in mind that we are also suing for attorneys' fees and three times your actual damages in addition to reimbursement for certain costs of the litigation. Some of your expenses will also be shared among other clients with similar cases. We think all these factors should make the out of pocket expenses on a given case relatively minor in comparison to the overall recovery, if any.

24. It looks to me like the total amount of attorneys' fees could end up amounting to much more than my signing bonus. Won't the lawyers be the only ones making money if that happens?

No, that cannot happen. That cannot happen because the fees we are awarded are added to the signing bonus and other recovery we obtain for you and then you receive two-thirds of the total recovery, minus expenses and costs incurred in pursuing your case.

25. Your Attorney-Client Engagement and Fee Agreement provides that the lawyers can withdraw from the case under certain circumstances. Can the lawyers withdraw and then make me pay their expenses and other costs that they incurred before withdrawing?

No. If the unique circumstances were to arise where we would have to withdraw from your case for the specific reasons stated on page 4 of the Attorney-Client Engagement and Fee Agreement, we will not charge a fee or seek reimbursement of expenses or other costs that we incurred in your case before withdrawing.

26. Why does your Attorney-Client Engagement and Fee Agreement ask for my social security and driver's license numbers?

According to Texas law, a party in a civil action must include in its initial pleading the last three numbers of the party's driver's license number and the last three numbers of the party's social security number. Tex. Civ. Prac. & Rem. Code 30.014.

 

BARNETT SHALE QUESTIONS

27. What Is The Barnett Shale?

The Barnett Shale is a hydrocarbon-producing geological formation of great economic significance to Texas. It consists of sedimentary rocks and the productive part of the formation is estimated to stretch from the city of Dallas west and south, covering 5,000 square miles and at least 18 counties. (source)

The field name for the productive portion of the Barnett Shale formation has been designated as the Newark, East Field by the Texas Railroad Commission.

The Barnett Shale is a large natural gas reserve encompassing more than 5,000 square miles and including portions of at least 18 counties in North Texas. In recent years, advances in drilling technology have made it possible for energy companies to extract large amounts of natural gas from the Barnett Shale. (source)

The Barnett Shale rock deposit is a rock formation deep below the Texas surface. It was discovered in the 1950's by wildcatters. In 1980, technological advances enabled companies to extract natural gas from the Barnett Shale.  (source)

Over the years the Barnett Shale Natural Gas Field received fame when new drilling technology came into existence.  This technology, which uses various fracturing techniques, is used during horizontal drilling.  The Barnett Shale  was the first major operation to extract gas from shale.  Many companies are using this technology in other shale plays in the United States. (source)

The Barnett Shale is named after John W. Barnett, an early day settler who homesteaded in San Saba County Texas, where he named a local creek the Barnett Creek. During the early 20th century during a geological mapping expedition a geologist noticed the black shale outcropping in Barnett Creek and named it the Barnett Shale after the creek. In that area of the state the formation outcrops or touches the surface. (source)

What creates gas and condensate in the Barnett Shale is organic matter called kerogen that lies embedded in the shale. Through biogenic and thermogenic action, natural gas is given off. The Barnett Shale is rich in organic matter and some believe that biogenic action is still producing natural gas even now. The Barnett Shale is known as a "tight" gas reservoir meaning that the gas is not easily extracted. The formation is a very hard shale and it was virtually impossible to produce gas in commercial quantities from this formation until recent improvements were made in fracturing technology and directional drilling. (source)

28. What Is The History of The Barnett Shale?

Mitchell Energy drilled the first gas well in the Barnett Shale in 1981. After studying the Barnett Shale, the company could see its potential but knew drilling would be difficult because the natural gas was literally hiding in the source rock layers, which would have to be broken up to release the gas. After 20 years of research, the introduction of horizontal drilling earlier this decade made it possible to access the gas reserves contained within the Barnett Shale. (source)

The Barnett Shale has acted as an important source and sealing cap rock for conventional oil and gas reservoirs in the area. It was thought that only a few of the thicker sections close to Fort Worth would support economic drilling. It was not until the 1980's with new advances in horizontal drilling and well fracturing technology that the potential of the Barnett Shale was realized. Significant drilling activity did not begin until gas prices increased in the late 1990's. (source)

29. How Old Is The Barnett Shale and How Large Is It?

It consists of Mississippian age (354-323 million years ago) sedimentary shale rocks and stretches from Dallas to west of Fort Worth and southward, covering at least 5,000 square miles in the Fort Worth Basin. The Barnett Shale is also found as far West as Pecos County in West Texas. (source)

30. What Is Horizontal & Directional Drilling?

Horizontal Drilling is a technique used to cause the drill to turn in a horizontal direction after reaching the intended vertical depth. Directional Drilling is a technique by which the drill bit is caused to turn in a specific direction as the horizontal drilling proceeds.

31. Who Are Some Of The Primary Natural Gas Producers In The Barnett Shale?