FAIRMONT, W.Va. — A Fairmont brother and sister’s dispute with Chesapeake Appalachia over alleged gas well royalty underpayments is far from unique.
Chesapeake Energy and its various subsidiaries — Chesapeake Appalachia is one — is engaged in similar litigation with mineral owners across the country. The Department of Justice is investigating the company’s alleged practice.
Chesapeake states in its most recent quarterly report to the U.S. Securities and Exchange Commission: “Chesapeake and other natural gas providers have been named in various lawsuits alleging royalty underpayment.” The allegations include below-market prices, improper deductions, improper measurement techniques, arrangements with affiliates to ensure underpayments.
A review of federal court records across the country showed 15 additional active royalty cases…