Archives: Royalty

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Louisiana Second Circuit Finds Holder of Mortgage Encumbering a Mineral Lease Solidarily Liable with Mineral Lessees for Damages Under the Louisiana Mineral Code

In Gloria’s Ranch, L.L.C. v. Tauren Exploration, Inc., the Louisiana Second Circuit upheld a trial court’s ruling that the holder of a security interest in mineral leases was solidarily liable for damages under the Louisiana Mineral Code stemming from its mineral lessees/mortgagors’ actions.[1] In the case, a landowner sued its mineral lessees for: (1) failure … Continue Reading

Louisiana Second Circuit Provides Clarity on Production in Paying Quantities and Affirms Lease Cancellation Under Mineral Code Article 140 for Failure to Pay Royalties

On June 2, 2017 the Louisiana Second Circuit Court of Appeal affirmed a trial court’s judgment cancelling a mineral lease under Mineral Code article 140 and provided further clarity on a production in paying quantities analysis under Louisiana Mineral Code article 124.[1]  The dispute in Gloria’s Ranch, L.L.C. v. Tauren Exploration, Inc., arose from a … Continue Reading

Louisiana Third Circuit Addresses Payment of Royalties in Situations Involving Production Under a Mineral Lease Pursuant to a Conditional Allowable Prior to Unitization

In Gladney v. Anglo-Dutch Energy, L.L.C., the Third Circuit addressed the question of whether or not a mineral lessee must pay its lessor full lease-basis royalties for production undertaken during the effective period of a conditional allowable but prior to the effective date of a unit order.[1] In the case, the Plaintiffs granted a mineral … Continue Reading

Texas Supreme Court Says You Can’t Disclaim Your Heritage, But Maybe You Can Ignore It

Like the final season of ABC’s hit series Lost, the Texas Supreme Court’s opinion in Chesapeake Exploration, L.L.C. v. Hyder, No. 14-0302, was highly anticipated, but left many of us scratching our heads.  The 5-4 decision, authored by Justice Hecht, is the latest in a series of cases from high courts across the country addressing … Continue Reading

Houston Court Rejects Weighted Average Royalty Payment Calculations Under Lease Agreement

By Natalie Barletta:             In Shell Oil Co. v. Ross, No. 01-08-00713-CV (Tex. App.—Houston [1st Dist.] February 25, 2010, no pet. h.), Ross, a mineral interest owner, brought a breach of contract, unjust enrichment, and fraud action against natural gas lessee, Shell. Ross alleged that Shell failed to pay royalties in accordance with the lease agreement … Continue Reading

Maxwell v. Kerr-McGee: Tenth Circuit Upholds Right Of MMS Auditor To Bring Qui Tam Action

By Jonathan Hunter: In a highly anticipated decision, the Tenth Circuit held this week that the district court had subject matter jurisdiction over a qui tam action filed by an MMS auditor concerning royalty payments on crude oil produced from offshore federal leases. The district court had dismissed the case on the grounds that the … Continue Reading

Texas Supreme Court Again Addresses Royalty Class Actions

In Bowden v. Phillips Petroleum Co., No. 03-0824 (Feb. 15, 2008), the Texas Supreme Court again addressed the propriety of class actions for gas royalty claims.  The class affirmed the denial of two subclasses, but reversed the denial of a third subclass of royalty claimaints.  The Court followed its prior holding in Yzaguirre in concluding … Continue Reading

Court Addresses Sufficiency of Demand Letter Under Mineral Code Articles 212.21-23

In CLK Company, L.L.C. v. CXY Energy, Inc., No. 07-834, 2007 WL 4409686 (La. App. 3d Cir. 12/19/07), the court addressed the payment of royalties and penalties under Mineral Code article 212.23(c) and concluded that plaintiff’s letters were insufficient to trigger the provisions of that article.  In CLK Company, the parties entered into a confidentiality … Continue Reading

Res Judicata Bars Relitigation of 1938 Buras Levee District Lease’s Validity

      On November 21, 2007, the Louisiana Fourth Circuit Court of Appeal affirmed the trial court’s ruling in favor of Chevron U.S.A., Inc. (“Chevron”), the Plaquemines Parish Government (“PPG”), and others in a dispute with the State of Louisiana over the validity of a 1938 mineral lease granted by the Buras Levee District (“BLD”). The State … Continue Reading

Louisiana Extends Abandonment Period For Litigation Affected by Katrina or Rita

By Joe Giarrusso:  In Louisiana, a lawsuit is generally deemed abandoned when the parties fail to take any step in its prosecution for three years.  This rule is operative without any formal order.  La. Code Civ. P. art 561.  However, Act 361 of 2007 extended the period for abandonment to five years where (1) the … Continue Reading
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