Commonwealth Court Clears The Way For Attorney General To Pursue Unfair Trade Practices Case Against Chesapeake, Anadarko On Drilling Royalties, Payments

On March 15, Commonwealth Court issued a decision allowing Attorney General Josh Shapiro to pursue Unfair Trade Practices Act cases against Chesapeake Energy and Anadarko for promises they made to landowners when leasing their land for natural gas drilling.

The Court found that natural gas leases were in fact “trade” and “commerce” and therefore covered by the state Unfair Trade Practices and Consumer Protection Act.

With respect to a second claim based on anti-trust by the Attorney General that the companies made an unlawful market sharing agreement to not lease properties for drilling in areas where one or the other company was operating intrinsically violated the Unfair Trade Practices Act, the Court said the law does not support that conclusion.

However, with respect a separate count argued by the Attorney General that the companies allegedly disingenuous and misleading behavior constitutes unfair methods of competition and unfair or deceptive acts or practices under the Unfair Trade Practices Act, the Court sided with the Attorney General.

The Court remanded to the Bradford County trial court for further action on the counts upheld by Commonwealth Court.

“Today’s Commonwealth Court ruling is a victory that upholds our lawsuit against Chesapeake Energy Corporation and Anadarko Petroleum Corporation,” said Attorney General Shapiro.  “The court’s decision allows our action to move forward and address the misconduct by these companies against landowners in oil and gas leases under the Unfair Trade Practices and Consumer Protection Law. I’m fighting for landowners who we charge have been ripped off, and my Office will continue to pursue this case on behalf of Northeast Pennsylvanians.

Click Here for a copy of the decision.