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Notices mailed in Tawney case
By David Hedges, Publisher
thetimesrecord.net
Nearly six months after the case was settled for $380 million, thousands of royalty owners in a class action lawsuit are now learning what their share will be.
Claim forms were mailed out last week in the Tawney vs. Columbia Natural Resources case, Marvin Masters, one of the attorneys who represent the plaintiffs, said.
Aside from the attorneys, who received one-third of the total, beneficiaries include more than 12,000 natural gas well royalty owners statewide shortchanged by CNR dating back to 1990.
With expenses, the attorneys' share amounted to more than $128 million, leaving more than $250 million to be divided among the royalty owners.
"That's a quarter of a billion dollars," Masters noted.
The forms royalty owners are receiving in the mail notify them exactly how much they stand to receive as result of the lawsuit.
They can either accept that amount or file an objection with the claims administrator, an accounting firm in Putnam County.
Some claims are hardly enough to buy a cup of coffee, while others are more than a million dollars.
Masters said one royalty owner told him the amount he stood to receive from one well was more than what he had gotten from the well in all the years he owned it.
"For the most part, the people who have called me have been very satisfied with what they got," Masters said. "I'm sure there will be some who won't be."
The amounts royalty owners will receive vary based on several factors, including the number of wells involved and the production from those wells.
The verdict includes seven types of claims, only some of which are entitled to punitive damages.
Royalty owners include heirs who may own only a small percentage in a single well to large land companies with interest in several wells. According to testimony at the settlement hearing, the largest single royalty owner is Cotiga Development Co. of Philadelphia, which owns nearly 40,000 acres in Mingo County alone.
Daisy Dingess, 91, of Titusville, Fla., was notified she would receive $174.95 for her interest in a well in Roane County.
"I told her not to spend it all in one place," said her daughter, Elizabeth Oleson, also of Titusville, who said her mother inherited interest in the well from her great-grandmother.
The suit filed in 2003 alleged CNR deducted production and other expenses from royalty checks, and hid that from royalty owners who were entitled to a one-eighth share before expenses.
The suit also said CNR was paying several flat rate leases, some of which gave royalty owners only $100 a year, although those had been prohibited for years.
After the verdict the successors to CNR â Chesapeake Energy and NiSource â appealed the judgment. The W.Va. Supreme Court of Appeals refused to hear the case, which was then appealed to the U.S. Supreme Court.
Last November, just days before the Supreme Court was to issue a ruling on whether it would accept the appeal, the case was settled for $380 million. That reduced the original verdict of $404 million and nearly two years of interest.
Masters said he had hoped the royalty owners would have been paid sooner, but details proved to be complicated.
"CNR was sold three times," Masters said. "Record-keeping and computer systems were changed. It has been very, very difficult to go through the millions of records to get the data the claims administrators needed.
"Hopefully it will go smoothly, but it's going to have some wrinkles," he said of the claims process. "I know they have done the best they could with what they had, but you are talking about over 12,000 people."
Masters said Chesapeake and NiSource are paying for administration of the claims.
"That was part of the settlement," he said. "That means everything net of the attorney fees and costs will be sent out to the royalty owners."
He said those who receive claim forms should review them to make sure the information is correct.
Once the signed forms are returned, he said the claims administrator would have 30 days to send out a check.
thetimesrecord.net
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