16 Jul 2008 Businesses Strike Back

In an op-ed in the Charleston Daily Mail Tuesday, David Ridenour writes about a business that is fighting back against unfair lawsuits in a creative way:

West Virginia isn’t “almost Heaven,” but “almost Hell” where its judicial climate is concerned.But finally, there’s some good news on the horizon. After years of being battered by the state’s bizarre system of jackpot justice, sucker-punched businesses are beginning to strike back.

In late May, the West Virginia Supreme Court, historically a good friend of the plaintiffs’ bar, voted 5-0 to deny a request by two major natural gas providers – Chesapeake Energy Corp. and NiSource – to hear an appeal of a dubious $405 million jury verdict that found the companies underpaid landowners.

At issue was the firms’ practice of deducting production and marketing costs from the royalties they paid.

The Roane County trial court inexplicably found that leases specifying that the royalties are “an amount one-eighth of the price, net all costs beyond the wellhead” and “less taxes, assessments, and adjustments” are ambiguous.

Ambiguous or not, the court interpreted the language in favor of the owner.

A week later, Chesapeake Energy countered with an eye-opening announcement: It was canceling a $35 million commitment to build a futuristic regional headquarters on the outskirts of Charleston’s airport.

Chesapeake spokesman Scott Rotruck tied the decision directly to the high court’s denial of an appeal request that would have been granted pro forma in most states…

Read the rest here.