Royalty and Royally Interests: Underpayment Court Jurisdiction, Procedure and Review: Class Certification

摘要

Plaintiff filed this putative class action for alleged underpayment of royalties based on several theories including the use of the netback methodology, the use of a lower price man BP received in arms-length transactions and failure to pay for all of the constituents contained in the natural gas stream including condensate, nitrogen and helium An initial order prohibited all claims that occurred prior to August 1,2004. A court entertaining a putative class certification order is required to perform a rigorous analysis to see mat all of the requirements of Federal Rule of Civil Procedure 23 are met. The putative class includes "All royalty owners of BP America Production Company.. . . from wells located in Kansas that have produced gas and/or gas constituents.. . .and whose gas was processed at BP's Jayhawk Processing Plant." Rule 23(a) requires plaintiff to meet each of its four requirements, numerosity, commonality, typicality and adequacy of representation. Plaintiffs were able to show that BP operated over 2500 wells in Kansas which satisfies the numerosity requirement. The court also finds that there are common issues of fact and law relating to whether BP properly paid its royalty owners and thus the commonality requirement is met. The court also finds that the named plaintiff's claims are typical of the class and that class counsel can adequately represent the class. The court also finds that plaintiff has met the predominance and superiority requirements under Rule 23 (b).