Seeligson v. Devon Energy: Gas Processing Fee Class Certified
Seeligson v. Devon Energy Prod. Co., L.P., Civil Action No. 3:16-CV-00082-K, 2020 U.S. Dist. LEXIS 23166 (N.D. Tex. 2020).
In this royalty class action case, the class plaintiffs alleged that DEPCO improperly passed a 17.5% “gas processing fee” on to all class members by reducing their royalty payments by 17.5% thereby breaching the duty to market. In certifying the class, the court reasoned that because the gas is bought and sold under one contract and determining the rate a reasonably prudent operator would have received (“RPO Rate”) did not require proof of other sales, determining the RPO rate was subject to generalized proof and applicable to the class as a whole. The court also noted that the entire class was comprised of proceeds leases, making it distinguishable from the Texas Supreme Court’s decision in Union Pac. Res. Grp., Inc. v. Hankins, 111 S.W.3d 69 (Tex. 2003).Read More »