Yetter Coleman represented Southwestern Energy and affiliates in contract and fraud class actions concerning post-production expense deductions from royalty payments to landowners.
Through overlapping class actions in Arkansas state and federal courts, various plaintiffs representing more than 12,000 class members alleged that Southwestern’s affiliate was prohibited from deducting the costs of its sister-company’s gas gathering services. The plaintiffs raised claims for contract breach, fraud, and statutory violations. The company reached a reasonable but tentative settlement of the state-court litigation, which was superseded when the federal litigation proceeded to trial. After a two-week trial in Little Rock, the firm and co-counsel achieved a complete defense victory, with the jury rejecting the plaintiff’s claim for $300 million in actual and punitive damages and penalties. The trial was one of the few class action trials in recent history, prior to 2017, and an even rarer class-action jury verdict for the defense.
Following the verdict, Yetter Coleman defended Southwestern from appeals of the 2017 verdict from both the representative plaintiff and a group of purported intervenors. They raised a number of challenges to the verdict, arguing that harmful evidence was erroneously admitted, that a key pretrial ruling was incorrect, and that the defense improperly argued that the class representative’s interests were contrary to those of the class. The U.S. Court of Appeals for the Eighth Circuit rejected the arguments of both plaintiff groups and affirmed the verdict in its entirety.