ROANE JURY NOT 'DAZZLED BY BRILLIANCE' IN ROYALTY SUIT - Company Says WV Court System Unfair

(01/30/2007)

By Bob Weaver

Chesapeake Energy officials said yesterday that Roane County jurors listened to the plaintiff's lawyers and their "histrionic behavior," awarding $405 million dollars to 8,000 royalty holders.

The class-action suit, filed in 2003, ended Saturday in circuit court, the jury agreeing that the company failed to pay royalty owners what was due them and tacking on $271 million in punitive damages.

"The lawyer's brow-beat the defendants," said Chesapeake vice president Henry Hood...WVs reputation precedes it, and this verifies it," he said, claiming the state's court system is unfair and calling for tort reform.

Chesapeake paid $3 billion to Columbia Natural Resources for the operation, and is currently erecting a new office building in Charleston, indicating they have created 400 jobs.

"We had high hopes for West Virginia, but this is a step in the wrong direction," Hood said.

The late Garrison Tawney, a Roane County teacher, filed the first complaints regarding royalty underpayment against Columbia, prompting the huge lawsuit. He died in 2004 at age 91.

His daughter, Anne Tawney Goff of Hurricane, said the jury was not "dazzled by brilliance or baffled by bull----."

"Open for business means open for honest business!" said Goff, "Good common folk deserve to be treated fairly and honestly by big corporations."

Responding to a media blitz by vice-president Hood yesterday, Goff asked "Is he trying to tell us that the gas producers can't make any money unless they cheat us?"

"My father would be proud of the verdict and the award ... that justice has been served for the royalty holders in Roane County and in the state of West Virginia," Goff concluded.

Chesapeake Energy claims "The parties (producers) were really doing what all other operators in the state of West Virginia have done for years and acted consistently with other operators in other states."

The suit claimed the producers leased gas-rich land from the plaintiffs in order to drill, but then failed to pay the owners market rates for the gas, based on contracts.

The suit said the producers cheated royalty owners by deducting post-production and processing costs, by making volume deductions and by not paying for gas that its lines lost, according to the plaintiff's attorney Mike Carey.

Carey is going to be on the Hoppy Kercheval Talkline show today on WCHS Radio 580 AM at 10:00 a.m. to respond to comments made by Chesapeake.