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Federal District Court Denies Dismissal of Landowner Lawsuit Against Gas Company

Posted: June 20, 2010

A recent case in federal district court in western Pennsylvania denied the motion of Range Resources to dismiss a lawsuit for breach of a gas lease contract. The case will continue to mediation this summer.

by Michael A. Magee, Research Assistant

The United States District Court for the Western District of Pennsylvania recently denied a gas company’s motion to dismiss a suit for the breach of a gas lease brought by Joseph and Donna Valentino of Washington County (Valentino v. Range Resources—Appalachia, LLC, No. 2:09‐cv‐01615, 2010 WL 2034550 [W.D. Pa. May 21, 2010]).

The Valentinos allege that they executed the lease of 114.2 acres to Range Resources‐Appalachia (Range) on August 28, 2008, in return for a bonus payment of $456,800.00, and that Range failed to pay within the specified period. The agreement between the Valentinos and Range included language thanking the Valentinos for entering into a natural gas lease as well as providing that the lease would not be valid until approved by Range management. The Valentinos argued that this writing constituted Range’s acceptance of the lease. Range countered that the lease was unenforceable because it had not been approved by company management. Finding that the Valentinos had made a facially plausible claim for the lease’s enforcement,
the Court declined Range’s motion to dismiss. The dispute is slated for a mediation conference no later than July 27, 2010.

For more information on legal aspects of natural gas issues, please visit the Agricultural Law Center’s Natural Gas Exploration Resource Area.