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Ohio Utica Shale

Beck Energy sues attorneys, law firms over Monroe County fight

By Bob Downing Published: October 30, 2013

A Portage County drilling company has sued two Akron attorneys and two Akron law firms for defamation, tortious interference and conspiracy.

Named in the lawsuit filed by Beck Energy Corp. of Ravenna were attorneys Richard V. Zurz Jr. and Mark A. Ropchock and their firm, Slater and Zurz LLP. Also named defendants were Roetzel and Andress LPA.

The suit, filed last Thursday in Summit County Common Pleas Court, also named attorney James W. Peters and the Peters Law Office Co. LPA in Woodsfield in Monroe County in southeast Ohio.

It also named up to five John or Jane Does.

The suit seeks a temporary restraining order and permament injunction against the defendants and also seeks damages in excess of $25,000 plus punitive damages and attorneys’ fees.

At the center of the legal battle are 30-year-old leases signed by landowners in Ohio’s Monroe County and Beck Energy to develop vertical-only wells into the shallow Clinton sandstone for natural gas. The landowners got $50 an acre. Most of the wells were never drilled, but the leases remained in place. That kept the landowners from signing new and potentially more lucrative leases.

The Monroe County legal battle drew widespread attention across eastern Ohio as lucrative Utica shale developed.

According to the new suit, the defendants from 2010 to the present contacted landowners in Monroe County and through "unsolicited correspondence detailing a scheme to encourage landowners to retain defendants as counsel, terminate the binding legal agreements with Beck Energy and negotiate new lease agreements with other companies with the defendants’ assistance and for which defendants would receive a substantial share in the financial outcome of the new negotiations."

The suit charges that those actions took place even though the defendants were aware of existing contracts from 1983 between the landowners and Beck Energy.

The three law firms "joined forces" to interfere in the existing Beck Energy contracts, the suit alleges.

They allegedly told the landowners that the new agreements would produce bigger lease signing bonuses and bigger royalty payments, says the suit, filed by Canton attorney Craig Conley.

The correspondence with landowners said the defendants’ fees would be a percentage share of the increased signing bonus and higher royalty fees, the suit says.

The defendants would get 30 percent of the initial signing bonus, 20 percent of a second bonus (if applicable after five years) and 2 percent of royalties on natural gas, oil or liquids produced by wells.

According to the suit, the defendants hoped to sign new leases with BBJ2 LLC (Angus Oil and Gas) or Eclipse Resources I LP.

The three firms also worked together, the suit says, "to defame Beck Energy in an attempt to encourage the landowners to breach their contractual and business relationships with Beck Energy for the financial gain of defendants and to the detriment of Beck Energy."

According to the suit, the defendants allegedly told the landowners that Beck Energy was "not capable of exploring for oil and gas in the Marcellus and Utica shale formations."

Beck Energy says in the suit it "continues to have the capability to further explore the Marcellus or Utica shale formations."

According to the suit, six landowners represented by the defendants filed a class-action lawsuit in 2011 in Monroe County Common Pleas Court to terminate lease agreements between the landowners and Beck Energy.

Judge Ed Lane vacated Beck Energy’s leases on 21,000 acres. The judge ruled that Beck Energy had breached the contract by failing to develop wells in a timely fashion. Beck Energy then sold the deep mineral rights on about 13,200 acres of that land to XTO Energy, an ExxonMobil subsidiary.

The Monroe County decision has been appealed to the 7th District Court of Appeals in Youngstown.

The new suit was assigned to Summit County Common Pleas Judge Lynne S. Callahan.

Messages were left with the attorneys and law firms named in the new suit. None responded.

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