Legal Suit WIN!

CAIA Wins Summary Judgment against State for Violating Idahoans’ Constitutional Rights 

FEDERAL DISTRICT JUDGE RULES LANDOWNERS WERE DENIED DUE PROCESS IN FORCED POOLING FOR OIL & GAS DRILLING – ORDERS DEPT. OF LANDS TO VACATE ORDER

8/13/2018

Boise – A federal court in Boise today ruled that the State of Idaho violated the U.S. Constitution when it forced homeowners to accept leases allowing an out-of-state gas company to drill for natural gas under their homes against their will.  The ruling requires the State to vacate the leases, and hold a new hearing to determine the terms of any future leases.

The case arose from a 2017 decision by the Idaho Department of Lands and the Idaho Oil and Gas Conservation Commission to allow Texas-based Alta Mesa Services, LP to drill for gas under the homes of hundreds of Fruitland residents.  Many of the Payette County homeowners objected to the proposal, but at a hearing to determine whether they would be forced to lease mineral rights to Alta Mesa, they claimed they were denied any meaningful chance to affect the outcome.  “At the hearing we were told that evidence about how the drilling might contaminate homes and water sources, reduce property values, or make children sick was not relevant to deciding whether the forced leases were just and reasonable,” explained James Piotrowski, the attorney for the group.

In an order issued today, the U.S. District Court found that the homeowners did not receive due process of law because the Hearing Officer appointed by the Department of Lands did not inform the homeowners (or anyone else) what legal standard would be applied before deciding the case.  The Court’s Opinion notes that the Constitutional guarantee of due process requires that the “nonconsenting landowners know the standard which the hearing officer will apply” when deciding whether the forced leases were “just and reasonable.”  Idaho statute requires that such leases be “just and reasonable”, but neither the legislature nor the Department of Lands defined those terms, leaving landowners and regulators to guess what it meant.

The decision by the Court requires the Department of Lands to vacate the Order which compelled landowners to be “deemed leased” even if they did not agree to the leases, and to hold a new hearing to consider “just and reasonable” terms, as well as to provide guidance on how the hearing officer will determine what is “just and reasonable.”

The lawsuit was supported by Citizens Allied for Integrity and Accountability (CAIA), an all-volunteer non-profit advocating against irresponsible oil and gas development in Idaho.  Shelley Brock, President of CAIA’s Board, explained she was thrilled with the Court’s order asserting that “every Idaho landowner should be worried that an outside oil company can come here, drill your land, take your oil or gas while exposing your family and greatest lifetime investment to tremendous risk and pay you a pittance for doing so.  Today’s decision helps provide some protection, but doesn’t change the fact that the Idaho Legislature has not done enough to protect private property.”

The Department of Lands and Oil and Gas Conservation Commission will have 30 days to decide whether to appeal.  In the meantime, the homeowners and CAIA say they will seek to recover their attorney fees and costs and, according to Piotrowski, “we plan to ask the Department of Lands and the Legislature to adopt new laws that will protect private property before any more oil and gas leases are forced on Idahoans.”

TO SEE FULL SUMMARY JUDGEMENT:  CAIA lawsuit 8-13-2018 Winmill SJ Ruling

For additional information please contact:

James Piotrowski
Herzfeld & Piotrowski, PLLC
P.O. Box 2864, Boise, Idaho 83701
(208) 331-9200

Shelley Brock
Citizens Allied for Integrity and Accountability (CAIA)
P.O. Box 2622, Eagle, Idaho 83616
(208) 559-6127
www.IntegrityAndAccountability.org

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[SEE PREVIOUS UPDATE BELOW:]

CAIA’s Suit Against State for Violating Idahoans’ Constitutional Rights Moves Forward

LANDOWNERS FORCED TO SELL MINERAL RIGHTS – ASK FEDERAL DISTRICT JUDGE TO REVERSE DEPT. OF LANDS RULING

5/21/2018

Boise – On 5/21/18, local non-profit CAIA asked a federal judge to find that the State of Idaho and its Department of Lands violated the United States Constitution when it granted a private corporation the right to take natural gas belonging to Idaho citizens without considering fair market value.  The group, Citizens Allied for Integrity and Accountability (CAIA), and two of its members are plaintiffs in a lawsuit challenging the Idaho Oil and Gas Conservation Act.  According to the motions filed on May 15, CAIA claims that the law sets prices for natural gas that do not take into account the value of the natural gas, the costs of drilling, the profits made by out of state corporations, or the costs and risks imposed on local property, all in violation of the Constitution.

The lawsuit began in 2017 after an out-of-state company, Alta Mesa, Inc., began utilizing the Oil and Gas Conservation Act to force Idahoans to sell natural gas under their land to Alta Mesa, even after those landowners had refused to sell.  In a series of hearings in late 2016 and early 2017, the Director of the Department of Lands and the Oil and Gas Conservation Commission approved forcing the Idaho landowners to sell against their will.  The filing this week alleges that the hearing held by the Department of Lands was a sham, and that the price Alta Mesa was required to pay for the natural gas was not based on fair value and would not adequately compensate these landowners for the risks to their property values, water and air quality, and the health and safety of their families.

According to CAIA and its lawyers, although one purpose of the hearings was to set “just and reasonable” terms for the forced sale, the Department of Lands refused to require Alta Mesa to submit evidence about the value of the natural gas they wanted to take, the costs of drilling for that gas, or the profits the corporation would earn from the operation.  According to James Piotrowski, one of CAIA’s attorneys, “Since the 1930s, the Supreme Court has made clear that if you are going to force someone to sell their product at a regulated price, the price has to be based on a combination of fair market values, the financial risks to both the buyer and seller, and the public’s interest in ensuring both access to critical resources, and fair compensation; the Department of Lands told us that evidence of all of those matters was irrelevant and would not be admitted at hearing.”

The motions also allege that the hearing was “meaningless” and a “sham.”  Piotrowski explained, “At several points, the state-hired hearing officer was actually testifying in favor of Alta Mesa, one of the parties before her; yet she was supposed to be providing unbiased assistance to the Director of the Department of Lands.”  In addition, he said “the hearing officer at one point would not allow us to cross examine an Alta Mesa employee about risks to the landowners’ property from drilling and extraction because he was not a geologist; when an geologist was testifying we were told we could not ask him those same questions because he was Alta Mesa’s geologist; when we put our own licensed geologist on the stand, she told us he would not be permitted to testify about risks from drilling wells because he was not qualified.”

The Director of the Department of Lands has filed his own motions claiming the case should be dismissed because landowners’ mineral rights are not “property” and thus the state is not required to provide due process of law before forcing their sale.

The Court will hold oral argument on the cross-motions for summary judgment on July 19, at 1:30 pm in the Federal Courthouse in Boise (550 W. Fort St., Suite 400, Boise, Idaho).

CAIA is a non-partisan, Idaho citizen-based, non profit (501c3) dedicated to representing and educating the public and participating in public processes to promote the preservation of private property rights, public health, safety and critical resources by protecting Idaho communities from the impacts of irresponsible oil & gas development.

TO SEE FULL LEGAL BRIEF:  15 – Pl Brief in Supp of SJ Dkt 23-1

For additional information please contact:

Shelley Brock
Citizens Allied for Integrity and Accountability (CAIA)
P.O. Box 2622, Eagle, Idaho 83616
(208) 559-6127
www.IntegrityAndAccountability.org

James Piotrowski
Herzfeld & Piotrowski, PLLC
P.O. Box 2864, Boise, Idaho 83701
(208) 331-9200

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