M&P BEING SUED / CLASS-ACTION SUIT AGAINST HALCON, M&P & CX

 

Hello everyone:

                         I have not posted anything on here before. I have always just read the comments of others. I thought I would just post some thoughts. After being patient for 8 1/2 months I still have no answers like others in the south east Mercer County area. Is Halcon going to be held responsible for their actions? Are they going to be made to pay for the contracts they signed for? How qualified is M&P when it comes to representing the landowners of group 4 against a company like Halcon with deep pockets. Will we get an honest effort from M&P or will they make it as short as possible and except less than what we deserve to mitigate damages on their behalf. I have just read, in detail, the civil suit against M&P by Terra Energy LLC. Now it seems to me that the landowners not only have to worry about being pushed around by an unethical oil & gas Co, but now we have to worry about the real motives of the law firm we have to represent us. Are they going to treat clients like they treated business partners? I think if given a chance M&P will come back to the land owners after any legal actions against Halcon with a bogus report how they couldn't do much and if we continue it will tie up our lands for years, of course due to a half hearted attempt at getting us what we legally are owed.

                        I only have this attitude after listening to M&P for 8 1/2 months tell us how important it is to stick together as a group but they will break up the group at the drop of a hat to sign a little chunk to this O&G Co and another chunk to a different O&G Co. This sticking together only benefitted them by having all of us available to them for whatever size of lease they could get from any other O&G Co. After seeing an E-Mail to Terra Energy Advisors LLC from Jack Polochak describing how maybe Terra Energy should  get some leases signed by an O&G Co that are less than desirable for landowners to make it look like A Co he was partnering up with was successful in the oil and gas leasing business. That just shows me that he will sacrifice his clients profits to improve his and his associates. I think everyone should read the Lawsuit especially the landowners of group 4. Maybe I am seeing this in a sinister way and I am just swayed by how the rest of the world does things these days. Here is the link to the Lawsuit. I would like to know how many other landowners see it the way I do.

MPLawsuit.pdf

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Permalink Reply by Kevin Senich on February 26, 2013 at 6:08pm

Please find attached Exhibit "A" to the Amended Complaint.

Attachments:
Permalink Reply by Samuel J. Orr on February 26, 2013 at 5:01pm

I hate acronyms and suspect many readers are confused by them. Was not hard to figure out contextually that OOP meant Order Of Payment. Awhile back I figured out that LOI meant LETTER OF INTENT. I think ROI was also used and I at the moment can't come up with what that acronym stood for. Kevin, you always know what your talking about, but I am now in over my head. Is it possible there was no contract at all either subjectively or objectively?? I think your fine analytic work has finally reached the point that it exceeds my capacity to understand. That is no criticism of you. Assuredly the law is technical and has its own technical language. Assuredly I have a better understanding of at least some of the many factual and legal issues involved that must be resolved in  order to decide the lawsuit by the Mount Jackson 4 landowners against Halcon. Of course the absence of the "mlagic document" from the thread makes any legal analysis somewhat perilous.I still hope you will keep posting. 

Permalink Reply by Kevin Senich on February 26, 2013 at 6:32pm

Mr. Orr:

As I have said previously, I have no personal interest in this other than professional curiosity.  I really would like to know how these very large landowners' groups function, and what legal problems arise.

The likely reason your understanding is not complete is because this is very, very difficult subject matter from a legal standpoint.

Your question is incisive and belies your claim of confusion.  "Is it possible there was no contract at all either subjectively or objectively?" 

This deal was at least a three corner contract. That is, there were three separate contracting entities involved in the deal.  The MJLG4 was bound to M&P/CX by an agency contract.  M&P/CX was apparently bound to Halcon by some sort of agreement to which MJLG4 was not a party.  Certain of the MJLG4 landowners were bound to Halcon by accepted leases.

I say "at least" a three corner contract for this reason.  We cannot overlook the fact that each of the individual landowners comprising the MJLG4 was bound to the others. The landowners' groups' reason for being was to contract as a unit by offering individual uniform leases to a developer on condition that all be accepted.  But, did they do that?   

For a contract to form there has to be what is known in law as "mutuality", often stated as "a meeting of the minds".   Query whether the landowners were selling, and Halcon was buying, the same thing.

Yes, in a strictly legal sense, there is a substantial possibility that there was no contract at all.

 

 

 

Permalink Reply by Samuel J. Orr on February 27, 2013 at 12:06am

The Payment Order Exhibit A of Halcon's amended answer is in fact different because of the word GEOLOGY  that appears therein and which word is absent from Exhibit 2 to plaintiff Mount Jackson 4's class action suit against Halcon brought by Jeffrey Vodenichar et al as representatives of the class. If I were an aggrieved landowner I would print out these two documents, the first of which is  found on page 16 of this thread and the second on page 27. (I graciously again thank Mr. Senich for posting these documents.) With documents in hand I would be calling, and / or writing to M&P to explain what the explanation is for the difference in the 2 versions of the payment order! I think I would also go to the next M&P / CX energy roadshow in Venango County armed with said documents. I would probably have the press there as I understand M&P / CX may be prohibiting disaffected landowners from Mount Jackson 4 in Mercer County from being admitted. I would give a copy of the 2 documents to the attending members of the press. But of course the leviathan of M&P / CX probably has an explanation and Mr. Moraczyk can prevent any and all of this by posting his firm's explanation to this thread and doing it post haste!

Permalink Reply by Mike C. on February 27, 2013 at 12:24am

I have attended a CX roadshow and in the paperwork I was given and even in the presentation (at least the presentation prior to a deal with Halcon) it was stated that they would not make a company take all of the acreage signed up.  This was done in a very slick and somewhat underhanded way because in the next sentence they start talking about "sticking together" and "strength in numbers".  The rub is that once a deal was struck with Halcon they changed their tune but not their documents.  They started stating very matter-of-factly that if you signed up that Halcon had to take you, this includes are boards own Jim L.  Where the landowners messed up is that they never asked to see any documentation which could have proven this assertion.  I know I keep beating a dead horse but I said this last fall when CX was signing up acreage after the agreement.  CX screwed the people of Mercer by signing up so much acreage after the deal was done.  By taking everyone they made the group less attractive and perhaps scared off Halcon in the process.  The CX greed in this situation is at least 90% of the problem.  When fronting a landowner group the priority line should be 1. Landowners 2. Halcon 3. CX.  Unfortunately I think CX had it 3, 2, 1 instead.

 

 

Permalink Reply by Mike C. on February 27, 2013 at 12:52am

Here are some posts from that original CX thread over on the Mercer board, in my opinon Jim's attitude is about the same as most CX reps.  Arrogant and certain a deal would get done with no plan in place if things went south.  Which happens more than one might think with Landowner groups.  Enjoy:

 

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Reply by Jim Litwinowicz on May 14, 2012 at 10:44pm

Ok here's the deal.  Cx-Energy and M & P Law have announced a deal with Halcon for $3850/acre and 18.5% royalty...no deductions. It is for the entire county, all parcels that clear title work must be accepted. All members must have a signed agreement faxed by Monday 10 AM. After 10 AM Monday, Halcon has the right to not accept your parcel and the fee will be 8% of the bonus...no royalty based fee. (Before Monday the fee is 6%)

Email me if you need forms.  I can fax them or mail them to you. Include name, address, acreage, and fax number. Put "Mercer Lease" in the subject box.

landownerslease@hotmail.com

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Reply by Jim Litwinowicz on May 17, 2012 at 10:45am

Where are all the Nattering Nabobs of Negativity?  For months I have been hearing how evil I and my associates are.  For months you've insulting me, M & P, and Cx-Energy. You've been telling everyone to stay away, we will never do it.

Now we have announced a deal that exceeds the goals we set  for and what others have gotten in Mercer Co. And I am pretty confident in saying that exceeds what all the naysayers got by going it alone.

Where's all the congratulations on a job well done? Where's the apologies for all the insults? Hows about a mea culpa...... or two...... or three?

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Reply by Mike C. on May 17, 2012 at 11:44am                Delete

Congrats on that 7.5 million dollar commission. I will congratulate further if everyone gets paid.
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Reply by Jim Litwinowicz on May 17, 2012 at 12:28pm

Again with the wealth envy.....and ignoring that we got the landowners a better deal than anyone else.

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Reply by Mike C. on May 17, 2012 at 12:36pm                Delete

Puff your chest out when everyone is paid.

 

Permalink Reply by Samuel J. Orr on February 27, 2013 at 1:13am

Jim's communication of May 14, 2012 seems to say Halcon has to accept all parcels that clear good title, and then to say just the opposite. From all the various threads, it seems that at the least M&P / CX fostered the belief that Halcon had to take all or none of Mount Jackson 4 and that this belief by the landowners was the very reason that so many landowners signed up! It also seems clear that after Halcon began to reject acreage M&P took the position that Halcon had no legal right to accept some but not all of the acreage. M&P also advanced its belief that the aggrieved landowners had to attempt to mitigate their damages caused by Halcon, and M&P said it would help the aggrieved landowners do this by attempting to find alternative leases for the rejected parcels.That being said I have challenged M&P to explain the different language in the payment orders.!!     

Permalink Reply by Samuel J. Orr on February 27, 2013 at 1:21am

If I were one of the aggrieved landowners from the Mount Jackson 4 group I would also inquire of the attorneys representing the landowners how the difference in the language of the 2 payment orders affects the chance of prevailing in their class action suit against Halcon. Obviously they should not disclose such information to anyone else or publish it to the website. Presumptively the lawyers believe they have a reasonable chance of winning and I still hope Halcon is forced to pay everyone. Class actions are expensive and time consuming and the good news for the landowners is that it is difficult to believe that the suit would have been filed had these lawyers not believed there was a good chance of winning!

Permalink Reply by Kevin Senich on February 27, 2013 at 5:32am

The statements "all parcels that clear title must be accepted" and "Halcon has the right to not accept your parcel" are not inconsistent.  Certainly this could, and obviously was, understood to mean that Halcon had the right to reject a parcel only if that parcel had a title problem.  This would have accorded with the language of the uniform offer of lease.

The irony is that the landowners who did receive the bonus money got paid not because they were part of the MJLG4 group, but rather because they were separable from the group.  Halcon valued the leases at the amount of the bonus money ($3,875/acre?) not because it had to buy all the acreage, but precisely because it could buy select parts. 

Think of it this way.  If you are buying beef on the hoof for slaughter and you are paying $0.89 per pound (obviously I am not a farmer), but come time for slaughter you only have to pay the per pound price for whatever select cuts you want -- you have a pretty good deal.  That is exactly what Halcon did with the MJLG4, with the help of M&P/CX (who got 6% or 8% of the select cuts).  But, that defeats the whole purpose of buying/selling the beef on the hoof.

Once some members were separable from the group, the MJLG4 effectivley ceased to exist.

Permalink Reply by j. rick on February 27, 2013 at 1:44am

mike c.  that was NICCCCE. how do we say it in the country? dont count your chickens till they HATCH. I dont think these people ever worked an honest day to pay for their own land so they wanna jump on a band wagon an make money off honest hardworking people. that jim guy is kinda quiet, maybe hes out spending his free bonus money.

Permalink Reply by Deven Dittrich on March 1, 2013 at 12:56am

Just a reminder to the MJLG4 members... the CX/M&P marketing agreement renews automatically and it is for a 4 month period, plus it includes the 4 month period immediately after your agreement ends.  So, if you want to be removed from the group, you should send them a letter ASAP letting them know that you do not wish to renew your agreement.  The letter should probably include the description/identification that is used to describe your property on your "lease" (i.e. acreage amount, tax assessment map parcel number, physical address, etc.) so that there is no confusion (I know..."confusion" in regard to a contract would be highly unlikely when dealing with CX/M&P).  If you act now, it'll probably still be July or August until you are out of your agreement but at least you'll be putting yourself in a position to act in your own best interests if another O&G company comes along.  If CX/M&P bring somebody new to the table, you can always contact that company directly.  Or if a company like Shell- which, reportedly, doesn't like to deal with large landowner groups- starts moving in to the area you aren't burdened by worrying if CX/M&P is cutting a deal behind your back looking out for their interests rather than yours.

Permalink Reply by ShaleAdvice (Steven C. Townsend) on March 1, 2013 at 1:11am

Can you post the marketing agreement with CX/M&P? 

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