American Oil and Gas Reporter - August 2021 - 16

IndustryDigest
opinion issued by the Louisiana
Supreme Court, " affirms LOGA
Communications and Media Relations
Specialist Stephen Lewerenz. " Legacy
litigation has harmed the Louisiana oil
and gas industry and has contributed to
the unfriendly business environment in
the state. "
Becker and Brown note that the
case deals with interpretation of Act
312, legislation passed by the 2006
Louisiana Legislature in response to
the landmark 2003 remediation case
Corbello v. Iowa Production, in which
plaintiffs claimed their property
should be returned to its prelease
condition. " The landowners prevailed
at trial on their breach of contract
claim-and on their argument that it
would cost tens of millions of dollars
to restore the property, " the attorneys
recount. " However, there was no
mechanism to ensure that a penny of
the $33 million awarded in Corbello
would be spent on cleanup. "
Although Act 312 was designed to
ensure that funds awarded for property
remediation would go toward that end,
Becker and Brown continue, the
relationship between Act 312 and
legacy lawsuits has evolved constantly.
" In 2013, the decision in LL&E I
marked a key development, " the
attorneys relate. " LL&E I held that even
without a Corbello-like express
contractual provision, defendants who
operated unreasonably accrued an
implied obligation under the mineral
code to restore property above and
beyond regulatory environmental
standards. And, LL&E I determined that
these 'excess remediation damages'
were awards landowners could keep for
themselves under Act 312. "
According to the court's majority
opinion in LL&E II, the LL&E I ruling
erred in a few ways, particularly in its
interpretation of the plain language of
the law. " Act 312 did not allow for
juries to determine the amount of
damages necessary to fund remediation
of land to government standards, " the
ruling states. " It also did not allow for
petitioner-landowners to obtain an
award for remediation damages in
excess of the amount necessary to fund
the remediation plan, except in specific
and expressly allowed exceptions.
" The rules of statutory construction
provide that when the words of a statute
are clean and unambiguous, and the
application of the law does not lead to
absurd consequences, the statute should
be applied as written and no further
effort should be applied to determine
the legislature's intent, " it adds.
The upshot, LOGA indicates, is that
LL&E II adheres to the law. " This ruling
corrects the past decision of LL&E I,
which left oil and gas companies open
to extraneous lawsuit damages that
overstepped the power of Act 312, "
Lewerenz says. " These lawsuits took
away from Louisiana's economy by
forcing companies to relocate to more
business-friendly states.
" Though the fight to remediate our
state's lawsuit culture has a long way to
go, this ruling is one step closer to
making Louisiana into a hub for energy
investment, " Lewerenz concludes. ❒
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American Oil and Gas Reporter - August 2021

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