CARROLLTON, Ohio — A lawsuit representing 75 landowners and 3,000 acres of land in Carroll County has been filed against Chesapeake Exploration for unfair lease practices.
The lawsuit was filed by Attys. Lee Plakas, Gary Corroto and Josh O’Farrell of the Canton law firm of Tzangas Plakas Mannos and Raies Ltd. It was filed March 22 in Carroll County Common Pleas Court.
The landowners are trying to enforce their right to receive fair value for the use of their land, claiming horizontal drilling techniques will be “dramatically more disruptive.”
The lawsuit also seeks to cancel the leases that Anschutz Exploration obtained because landowners contend that Anschutz misrepresented how disruptive the drilling process would be to their property.
The lawsuit seeks to have all the leases recorded by the Carroll County Recorder’s office that were what is described as “robo-notarized” voided. The group claims since the leases were not properly notarized, they should not have been sold to Chesapeake.
According to the Ohio State Attorney General Mike DeWine’s office, there is no term as “robo-notary.” However, there is the term of “robo-signing,” which in the context of a lawsuit indicates someone notarizing a bunch of documents not in the presence of (in this case) the landowner.
The attorneys filing the lawsuit stated that Anschutz Exploration used shortcuts to get leases notarized, and some were not signed and notarized in front of a notary public, which makes them invalid.
The landowners also claim they weren’t notified in a timely manner that Anschutz sold their leases to Chesapeake.
Ohio law requires the landowner holding an oil and gas lease be notified in writing within 30 days after a lease is sold or transferred to another company.
The 75 landowners filing the lawsuit stated they believe the oil company has not and does not want to honor the company’s lease obligations.
Chesapeake Exploration was contacted by the Farm and Dairy for comment about this lawsuit, but the company declined.
However, in a federal case filed against landowners in January, Chesapeake told the court it has the right to extend leases beyond the original time period under the same terms and conditions.
The company also stated, in the federal lawsuit, that leases provide Chesapeake with a preferential right to renew the lease after the primary term, should the landowners receive another offer to lease property during the primary term or during the one-year period following the lease expiration. This is considered a right of first refusal, which is granted to Chesapeake.
Plakas said in a written statement the landowners were relying on a provision that was supposed to protect the landowners’ right to receive fair value for their land in the event the oil company attempted to hold the land without drilling.
Sitting on leases
According to Plakas, any oil company would be able to sit on the land and hold it, while at the same time denying landowners the ability to realize fair value for their land created by new drilling technology, which dramatically increased the value of oil and gas leases.