A Cabot Oil & Gas sign stands at the entrance to a natural gas well drilling site in Dimock, Pennsylvania. Photographer: Daniel Acker/Bloomberg
There is a great, overriding bias in corporate America that favors entering into settlement agreements in litigation rather than engage in the trial process. The oil and natural gas industry is no exception to this corporate inertia.
[…]
Most often, such decisions are made within companies on a simple cost/benefit analysis: Unless a case is tossed out by the presiding judge in a summary judgment, it is almost always less expensive to settle than to engage in a long, drawn-out trial process. The bottom line impacts all decisions in corporate America – as it should – and thus, this bias towards settling should surprise no one. Corporations also fear incurring negative press coverage, knowing that the media always will tend to portray such litigation as big corporate America vs. the “little guy.”
All of which is a long way of getting around to saying that I was pleasantly surprised when I read that Cabot Oil & Gas Corporation didn’t just go into settlement mode when a landowner named Ray Kemble and his lawyers filed a nuisance suit against the company on allegations that had already been dealt with in prior litigation involving Mr. Kemble that was settled in 2012.
The easy thing to have done with such a case would have been to offer the plaintiff a token settlement, even though the company believed the case was clearly frivolous. Instead, Cabot’s management chose to challenge what it saw as a double-dip filing, and the judge rewarded the company by dismissing the suit in a summary judgment. In normal corporate behavior, that would have been the end of things.
But Cabot’s management had, in the words of company spokesman George Stark, “grown weary of this ‘sue and settle’ racket” that it believes this case represents. So, rather than just let the matter drop, Cabot’s management chose instead to file a counter-suit against Mr. Kemble and his lawyers. “We aren’t suing a landowner,” says Stark, “We’re suing a big law firm.”
The main firm targeted by the suit is the Speer Law Firm, a Missouri-based firm headed by plaintiff attorney Charles F. Speer. The suit also includes the Pennsylvania firm of Ciarimboli, Boylan and F&C, which partnered with Speer in Mr. Kemble’s filing.
[…]
So, this is what it looks like when a U.S. corporation declines to play the ‘sue and settle’ game any longer, and chooses to aggressively defend itself on the merits instead. It is interesting to note that, to this point anyway, Cabot has received very little in the way of negative press related to this counter-suit, despite the company’s high profile as one of the largest operators in the Marcellus Shale region. More could certainly come as the case goes to trial, and if that happens it will be interesting to see how the company handles it.
Regardless, it is refreshing to see one company’s management reject taking the easy way out, and take a principled approach to what it sees as frivolous litigation instead. It’s a risk, but one that could benefit the entire industry should it be seen all the way through to a successful conclusion.
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Old England
August 24, 2017 12:45 am
Problem with Greenpeace, as it seemingly is with eco-activists generally, is that the act as if they are above the law . They appear to believe that they have some moral superiority, some moral justification that sets them apart from and outside of society’s rules and laws.
There is nothing wrong with people campaigning about something they believe in, but they must be restrained to do so honestly and lawfully with truth and facts as opposed to careless propaganda that has little regard for facts.
It is the courts and judges which must defend society against those types of behaviour with salutory penalties to make it clear this cannot continue; it is the law enforcement agencies that must robustly bring to justice any and all who threaten blackmail, violence or enter into corrupt or criminal partnerships to achieve their aims.
It does seem to me that when a campaigning organisation uses falsehoods to raise funds then it is a fraudulent and thus criminal activity which must be stamped out.
Maybe society urgently needs to develop a robust process which is capable of swiftly separating fact from fiction where scientific or quasi-scientific claims are made, and without the need for long, drawn out law suits. Given the apparent extent of pal-review that would need to be established outside of the scientific community as a well-toothed watchdog.
One of the best ways to take them down would be to challenge their charity status. Losing that will hurt them.
Gerry, England
August 24, 2017 3:57 am
Many years – decades even – I read an article in Compressed Air magazine about the culturing of suing for every little mishap in the US. An example was of suing a t-shirt manufacturer for not warning that his product was not resistant 25kV when worn working on electricity pylons. Common sense would have seen this thrown out but it wasn’t. The article then highlighted that there was only one volume helmet manufacturer in the US – Bell. Their existence was due to a hard policy of counter-suing anyone who sued them and as they are still here today it suggests it works. They got particularly angry about being sued over a helmet that wasn’t even a Bell – probably what tipped them over the edge.
I also recall a session with some people in a local council regarding being sued. The subject of false cases came up and the two people said they wouldn’t fight back. The consensus of us engineers in the room was that this would just result in more false cases.
2hotel9
August 24, 2017 5:00 am
Using the court system to smack around environwackjobs. Win/win.
MarkW
August 24, 2017 8:16 am
Since these “slip and fall” law firms tend to sue lots of people, I wonder if they could get a class action going here?
sadbutmadlad
August 24, 2017 10:05 am
Not counter suing is the equivalent of Danegeld. You never stop paying it once you start.
Louis
August 24, 2017 12:06 pm
“Cabot has received very little in the way of negative press related to this counter-suit…”
They just haven’t figured out how to connect this to Trump yet. When they do, it will get plenty of negative press.
Problem with Greenpeace, as it seemingly is with eco-activists generally, is that the act as if they are above the law . They appear to believe that they have some moral superiority, some moral justification that sets them apart from and outside of society’s rules and laws.
There is nothing wrong with people campaigning about something they believe in, but they must be restrained to do so honestly and lawfully with truth and facts as opposed to careless propaganda that has little regard for facts.
It is the courts and judges which must defend society against those types of behaviour with salutory penalties to make it clear this cannot continue; it is the law enforcement agencies that must robustly bring to justice any and all who threaten blackmail, violence or enter into corrupt or criminal partnerships to achieve their aims.
It does seem to me that when a campaigning organisation uses falsehoods to raise funds then it is a fraudulent and thus criminal activity which must be stamped out.
Maybe society urgently needs to develop a robust process which is capable of swiftly separating fact from fiction where scientific or quasi-scientific claims are made, and without the need for long, drawn out law suits. Given the apparent extent of pal-review that would need to be established outside of the scientific community as a well-toothed watchdog.
One of the best ways to take them down would be to challenge their charity status. Losing that will hurt them.
Many years – decades even – I read an article in Compressed Air magazine about the culturing of suing for every little mishap in the US. An example was of suing a t-shirt manufacturer for not warning that his product was not resistant 25kV when worn working on electricity pylons. Common sense would have seen this thrown out but it wasn’t. The article then highlighted that there was only one volume helmet manufacturer in the US – Bell. Their existence was due to a hard policy of counter-suing anyone who sued them and as they are still here today it suggests it works. They got particularly angry about being sued over a helmet that wasn’t even a Bell – probably what tipped them over the edge.
I also recall a session with some people in a local council regarding being sued. The subject of false cases came up and the two people said they wouldn’t fight back. The consensus of us engineers in the room was that this would just result in more false cases.
Using the court system to smack around environwackjobs. Win/win.
Since these “slip and fall” law firms tend to sue lots of people, I wonder if they could get a class action going here?
Not counter suing is the equivalent of Danegeld. You never stop paying it once you start.
“Cabot has received very little in the way of negative press related to this counter-suit…”
They just haven’t figured out how to connect this to Trump yet. When they do, it will get plenty of negative press.