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Royalty Litigation & Class Actions

Vinson & Elkins has assumed the role of national counsel representing domestic upstream E&P companies in royalty litigation in nearly 20 jurisdictions across the United States. We call on our decades of experience in assisting producers in oil, gas, shale, and CO2 royalty disputes in state and federal courts nationwide, as well as in administrative appeals of federal and state royalty claims. In addition to offering superior guidance once a case has been filed, our team actively provides pre-litigation advice and training on royalty-related issues.

Royalty Underpayment Claims & Class Actions

Royalty lawsuits represent one of the most rapidly evolving categories of litigation in the country. V&E’s Energy Litigation team is at the cutting edge of this field, serving as lead counsel across the country in both individual lawsuits and in class action lawsuits that have helped to shape both the procedural law of class actions in many federal jurisdictions and the substantive law related to the payment of royalties. Royalty class action suits can include claims for payment covering thousands of lessors spanning decades, and V&E’s lawyers have the procedural and substantive knowledge necessary to effectively litigate both the class certification issues and merits issues raised by class claims.

Pre-Litigation Advice & Training

In addition to offering superior guidance once a case has been filed, our litigators offer pre-litigation advice on issues such as the royalty implications of acquisitions and new marketing arrangements, recommended changes to royalty payment practices, and calculation and payment of federal royalties. We also provide training on issues relating to lease analysis, division order deck set-up, booking of revenues and costs, and check stub disclosures. Our clients regularly benefit from our thorough counseling and training, which effectively preempts litigation or strategically positions clients in the event litigation is necessary.

Experience Highlights

  • (Tex.) — Obtained a take-nothing judgment and reversal of judgment on jury verdict in Court of Appeals and Texas Supreme Court in royalty case involving claims that processing costs for extraction of CO2 and NGLs from gas stream were non-deductible

  • (Tex.) — Secured a complete victory in the Texas Supreme Court in a jurisprudentially significant royalty underpayment case on behalf of a leading oil and gas producer

  • (Tex. Dist.) — Obtained a take-nothing jury verdict in a six-week trial on behalf of an exploration and production company involving royalty owners’ claims for $75 million based on alleged failure to timely engage in enhanced recovery efforts and alleged royalty underpayments

  • (W.D. Okla.) — Obtained denial of plaintiff’s motion for class certification on state-wide royalty underpayment claims in Oklahoma federal court

  • Obtained a take-nothing arbitration award in Denver related to claims that a CO2 producer improperly paid more than $50 million in royalties on carbon dioxide produced in Colorado and sold for injection into oil reservoirs in the Permian Basin to enhance the recovery of oil

  • (Tex. Dist.) — Obtained summary judgment on behalf of a large oil and gas exploration and production company against overriding royalty owners’ claims related to operator’s use of lease gas 

  • (Tex. Dist.) — Obtained summary judgment on behalf of a group of royalty and working interest owners in Texas state court in a title lawsuit brought by dozens of individuals claiming to be the rightful mineral owners to a producing tract of land with an estimated value of more than $500 million. The judgment was affirmed on appeal

  • Handled multiple administrative appeals of orders to report and pay in which the Office of Natural Resources Revenue contended that a producer underpaid federal royalties on oil and gas production from federal leases located in North Dakota and Wyoming

  • (Kan.) — Obtained a district court order overruling objections to approval of a class action royalty settlement and affirmance of the district court order by the Kansas Supreme Court

  • Obtained a take-nothing arbitration panel decision on behalf of an operator in arbitration filed by royalty interest owners seeking more than $12 million for alleged underpayment of royalties due to alleged improper calculation of pipeline transportation tariff and excessive deduction of transportation charges

  • (N.M. Dist.) — Obtained a “no breach” jury verdict in a class action royalty case in New Mexico state court involving allegations of under-valuation of CO2 produced for injection into oil reservoirs in the Permian Basin