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In May 2018, oil and gas industry defendants removed a docket of 42 cases alleging violations of Louisiana’s coastal zone management laws to federal court in the Eastern and Western Districts of Louisiana (“CZM cases”).  One year later, the Eastern District granted motions to remand filed by Plaquemines Parish and the State of Louisiana in Parish of Plaquemines v. Riverwood Production Company, et al. (“Riverwood”), No. 18-5217, 2019 WL 2271118 (E.D. La. May 28, 2019).  The Western District recently joined the Eastern District and granted similar remand motions filed by Cameron Parish and the State of Louisiana in Parish of Cameron, et al. v. Auster Oil & Gas Incorporated, et al. (“Auster”), No. 18-677, 2019 WL 4734394 (W.D. La. Sept. 26, 2019), —F. Supp. 3d—.  Although there are procedural differences between Riverwood and Auster, both district courts found no federal officer or federal question jurisdiction over the CZM cases.  The Fifth Circuit is poised to resolve these jurisdictional issues in the upcoming year. 
Continue Reading Second Remand Order in Coastal Zone Management Cases Pending Before Fifth Circuit

Liskow & Lewis’ Shannon Holtzman, James Brown, and A’Dair Flynt recently secured several key rulings in a putative class action, successfully opposing a complex remand motion under the Tax Injunction Act and the Class Action Fairness Act (“CAFA”) and obtaining a dismissal with prejudice of the claims against Liskow’s clients in Robert J. Caluda, APLC, et al v. The City of New Orleans, Linebarger, Goggan, Blair & Sampson, L.L.P, and United Governmental Services of Louisiana, Inc., No. 19-2497, 2019 WL 3283138, 2019 WL 3291014 (E.D. La. July 22, 2019).Continue Reading Liskow & Lewis Secures Key Rulings in Class Action Litigation

Today the United States Supreme Court issued its decision in this landmark case concerning punitive damages.  The six justices in the majority opinion reversed the Ninth Circuit and resolved a circuit split on this issue.  The question presented was whether punitive damages may be awarded to a Jones Act seaman in a personal injury suit alleging a breach of the general maritime duty to provide a seaworthy vessel.  Justice Alito wrote the majority opinion, joined by Chief Justice Roberts, Justices Thomas, Kagan, Gorsuch, and Kavanaugh.  Justice Ginsburg dissented, joined by Justices Breyer and Sotomayor.Continue Reading SCOTUS Decides Dutra Group v. Batterton

After years of inconsistent rulings, the Fifth Circuit is poised to address a removal issue with significant ramifications for Louisiana tort cases. The previous version of 28 U.S.C. § 1442 authorized removal to federal court of a suit against a federal officer “only when the state suit was ‘for any act under color of such office.’” The Fifth Circuit, interpreting this language, held that the removing party must show a causal connection between its actions and the plaintiff’s claims. The causal connection requirement demands more than “mere federal involvement[;] instead, the defendant must show that its actions taken pursuant to the government’s direction or control caused the plaintiff’s specific injuries.”Continue Reading 5th Circuit Grants En Banc Rehearing to Address Federal Officer Removal

In a victory for the oil and gas industry, the Third Circuit rendered a decision rejecting attempts by the Louisiana Department of Revenue to impose severance taxes on crude oil production based on index pricing.  The Third Circuit reaffirmed that severance taxes should be based on the “gross proceeds” obtained in an arm’s length sale at the lease.  The Department had sought additional severance taxes from numerous Louisiana producers that sold crude oil in arm’s length sales at the lease. The contracts provided that the sales price of the crude oil was based on index pricing, less an amount sometimes designated as a “transportation differential” or simply as a deduction. The Department argued that this “differential” or deduction must be “disallowed” when computing severance taxes, effectively imposing severance taxes on the index pricing.  The Louisiana Board of Tax Appeals, faced with numerous cases raising this same issue, heard a “test case” involving Avanti Exploration, LLC. The BTA held that the Department’s theories were invalid, and severance tax properly was based on the actual “gross receipts” received by the producer in an arm’s length sale.  In a decision issued on April 17, 2019, the Louisiana Third Circuit Court of Appeal affirmed, holding that, pursuant to the Louisiana Constitution, the severance tax statutes, and the Department regulations, in the absence of any “posted field price,” severance taxes must be based on the actual “gross receipts” received by the producer in an arm’s length sale at the lease.Continue Reading Liskow Obtains Victory for the Oil and Gas Industry in the Louisiana Third Circuit

While oil and gas company-defendants—and several courts alike—have deemed the applicability of the subsequent purchaser doctrine to mineral leases a settled issue of law, plaintiff-landowners have continued to argue otherwise.  In a unanimous opinion issued July 18, 2018 in Grace Ranch, LLC v. BP America Production Company, et al., the Third Circuit not only provides yet another example of the uniform application of the doctrine in cases involving mineral rights under Louisiana law, but expressly and thoroughly rejects the numerous arguments on which plaintiffs-landowners have continued to rely.
Continue Reading Louisiana’s Third Circuit (Again) Affirms the Applicability of the Subsequent Purchaser Doctrine to Mineral Leases

The Louisiana Supreme Court’s reversal of Gloria’s Ranch, L.L.C. v. Tauren Exploration, Inc., hands a victory to financiers of oil and gas operations and settles a long-running controversy over the amount of damages available for failure to pay mineral royalties.

The Gloria’s Ranch trial court held two mineral lessees and a mortgagee (Wells Fargo) solidarily liable for more than $20 million in damages resulting from failure to release a mineral lease in North Louisiana.  The Second Circuit affirmed the finding of solidarity on the basis that Wells Fargo became an owner of the mineral lease because it “controlled the bundle of rights that make up ownership, i.e., the rights to use, enjoy, and dispose of the lease.” However, a vigorous dissent warned that the majority’s “control theory” to impose solidarity between a mortgagee and a mineral lessee could have “[d]evastating economic repercussions” for the lending industry, and “[s]erious and harmful impact on the oil and gas industry.”Continue Reading Louisiana Supreme Court’s reversal of Gloria’s Ranch clarifies calculation of damages for unpaid mineral royalties, provides relief for holders of security interests in mineral rights

The United States Court of Appeals for the Federal Circuit recently issued a significant opinion in a case in which a takings claim was asserted to redress Hurricane Katrina-related flood damage.  On April 20, 2018, it reversed a decision of the United States Court of Federal Claims (“Claims Court”), which had held the U.S. Army Corps of Engineers liable under the Tucker Act for flood damage to the Plaintiffs’ properties.

In 1968, the Corps completed construction of the Mississippi River Gulf Outlet (“MRGO”) in New Orleans.  The purpose of this navigation channel was to increase commerce between the port of New Orleans and the Gulf of Mexico.  Around the same time, Congress authorized funding for flood control through the Lake Pontchartrain and Vicinity Hurricane Protection Project (“LPV”).  This project was instituted to reduce the risk of flooding in New Orleans, and it resulted in the construction of levees and floodwalls along the banks of MRGO.
Continue Reading Federal Circuit Holds U.S. Army Corps of Engineers Not Liable for Hurricane Katrina Flood Damage

On March 29, 2018, the United States Court of Appeals for the Third Circuit issued its ruling in In re: Petition of Frescati Shipping Co., Ltd., as Owner of the M/T ATHOS I, Nos. 16-3552, 16-3867 & 16-3868 (3d Cir. Mar. 29, 2018).  ATHOS I had its genesis in a 2004 vessel allision and oil spill on the Delaware River between New Jersey and Pennsylvania.  The decision has particular relevance to the types of defenses that may be maintained against reimbursement claims brought by the United States Oil Spill Liability Trust Fund (OSLTF) to recover funds expended in responding to an oil spill.
Continue Reading Third Circuit Issues Long-Awaited Ruling in OPA Liability Case

In a decision issued today, the Louisiana Third Circuit Court of Appeal issued the first appellate court opinion addressing the procedure for approval of settlements in cases governed by Act 312 (La. R.S. 30:29).  Britt v. Riceland Petroleum Corp., is a “legacy” lawsuit in which landowners sued Riceland Petroleum Company and BP America Production Company—the current and former operators on a certain tract of plaintiffs’ property.  Riceland and BP ultimately chose to settle all of the claims that Plaintiffs brought against them, and as part of the settlement they agreed to remediate the landowners’ property to the necessary state standards.  The settling parties then complied with the express mandates of Act 312 as they:  (1) provided notice of the settlement to the Department of Natural Resources (“LDNR”) and Attorney General (“AG”); (2) allowed the LDNR at least thirty days to review the settlement and provide any comments to the trial court; and, (3) sought and obtained the trial court’s approval of the settlement.
Continue Reading Louisiana Third Circuit Issues Decision on the Procedure for Settlements in Cases Governed by Act 312