United States District Court, W.D. Louisiana, Shreveport Division
J & L FAMILY, L.L.C.
BHP BILLITON PETROLEUM PROPERTIES (N.A.), L.P, ET AL.
HORNSBY, MAGISTRATE JUDGE
ELIZABETH ERNY FOOTE, UNITED STATES DISTRICT JUDGE.
the Court is Defendants' Motion for Partial Summary
Judgment. [Record Document 48]. Defendants, BHP Billiton
Petroleum Properties (N.A.), L.P., Petrohawk Energy
Corporation, BHP Billiton Petroleum (KCS Resources), L.L.C.,
and BHP Billiton Petroleum (TxLa Operating) Company
(collectively “BHP”) seek summary judgment on
several narrow issues related to the availability of attorney
fees: (1) Plaintiff's claim for penalties and attorney
fees under La. R.S. 31:212.21-.23; (2) Plaintiff's claim
for contract fraud and associated attorney fees; (3)
Plaintiff's claim for attorney fees for tort fraud; and
(4) Plaintiff's claim for attorney fees under La. R.S.
31:212.31. For the reasons discussed below, the Court
GRANTS BHP's motion and
DISMISSES WITH PREJUDICE each of these four
there are numerous factual disputes between BHP and
Plaintiff, J & L Family, L.L.C. (“J &
L”), both parties agree on the facts relevant to this
motion. [Record Documents 48-1 and 58-1]. J & L owns land
that lies within two drilling units-the Jestma Unit and the
Powers Unit-created by the Louisiana Commissioner of
Conservation (“Commissioner”), but J &
L's interest is not subject to any oil and gas lease.
[Record Documents 48-1 at 1-2 and 58-1 at 1-2]. BHP operates
wells on the drilling units. [Record Documents 48-1 at 2 and
58-1 at 2-3]. J & L and BHP have neither signed formal
contracts concerning the wells nor executed division orders,
formal joint operating agreements, or formal marketing
election letters. [Record Documents 48-1 at 3 and 58-1 at 3].
Instead, the parties' relationship is controlled by
statute such that BHP is required to pay J & L its pro
rata share of the proceeds from the sale of the oil and gas
extracted from the units. [Record Documents 1-2 at 5, 10, 12
and 5 at 2]. See La. Stat. Ann. §§ 30.10,
L filed suit alleging the following: (1) that BHP's
regular reports to J & L regarding production from the
units did not satisfy statutory requirements, (2) that BHP
improperly sought operating expenses from J & L, (3) that
BHP improperly calculated J & L's ownership interest,
(4) that BHP failed to properly pay J & L its pro rata
share of revenues, and (5) that BHP engaged in fraudulent
conduct in its dealings with J & L. [Record Document 1-2
at 3-15]. Of particular relevance to the instant motion, J
& L sought attorney fees “based upon [BHP's]
fraudulent actions, ” as well as under La. R.S.
31:212.21-.23, La. R.S. 31:212.31, and “other
applicable provisions of the Louisiana Mineral Code.”
[Record Document 1-2 at 16]. Both parties moved for partial
summary judgment on the issue of whether BHP had adequately
complied with the reporting requirements of La. R.S.
30:103.1-.2. [Record Documents 12 and 22]. Following oral
argument, the Court denied the motions, finding that
unresolved questions of fact precluded summary judgment.
[Record Document 57]. Shortly before oral argument, BHP filed
the instant motion seeking partial summary judgment on the
issue of J & L's ability to recover attorney fees.
[Record Document 48].
Summary Judgment Standard
Rule of Civil Procedure 56(a) directs a court “to grant
summary judgment if the movant shows that there is no genuine
dispute as to any material fact and the movant is entitled to
judgment as a matter of law.” Summary judgment is
appropriate when the pleadings, answers to interrogatories,
admissions, depositions, and affidavits on file indicate that
there is no genuine issue of material fact and that the
moving party is entitled to judgment as a matter of law.
See Celotex Corp. v. Catrett, 477 U.S. 317, 322
(1986). If the movant satisfies its initial burden of showing
that there is no genuine dispute of material fact, the
nonmovant must demonstrate that there is, in fact, a genuine
issue for dispute at trial by going “beyond the
pleadings” and designating specific facts for support.
Little v. Liquid Air Corp., 37 F.3d 1069, 1075 (5th
Cir. 1994) (citing Celotex, 477 U.S. at 325).
judgment is always appropriate “where the only issue
before the court is a pure question of law.”
Sheline v. Dun & Bradstreet Corp., 948 F.2d 174,
176 (5th Cir. 1991). Questions of statutory interpretation
are questions of law. Khanh Nhat Thuy Le v. Holder,
732 F.3d 425, 427 (5th Cir. 2013).The availability of
attorney fees, either as a general matter or under a
particular statute, is a question of law. AG Acceptance
Corp. v. Veigel, 564 F.3d 695, 701 (5th Cir. 2009). Here
J & L's claims for attorney fees turn on the
interpretation of various statutes and thus present pure
questions of law appropriate for summary judgment.
Law and Analysis
Penalties and Attorney Fees Under La. R.S.
Louisiana Mineral Code provides for penalties and, in certain
instances, attorney fees when a mineral lessee fails to
timely pay royalties or other production payments to the
“owner of a mineral production payment or a royalty
owner other than a mineral lessor.” La. Stat. Ann.
§§ 31:212.21-.23 (2000). Because J & L is an
unleased owner, BHP argues that J & L falls outside the
class of persons protected by the statute and so can claim
neither penalties nor attorney fees. [Record Document 48-2 at
3-4], In support it cites Adams v. Chesapeake Operating
Co., a recent Fifth Circuit case holding that the
statute is inapplicable to unleased mineral interest owners.
561 Fed.Appx. 322, 326 (5th Cir. 2014). In response, J &
L concedes that the case is binding upon the Court, but
insists that it was wrongly decided. [Record Document 58 at
it is not clear that an unpublished Fifth Circuit opinion
necessarily binds this Court,  the Court finds that the Fifth
Circuit panel reasonably resolved the ambiguity in the
statutory language by looking to the enacting
legislation's title, which states that the new law will
“provide for the remedies and procedures for obtaining
payment by a royalty owner other than a mineral
lessor and by the purchaser of a mineral
production payment.” Adams, 561 Fed.Appx.
at 326 (emphasis added). On the basis of this language, the
Adams does not fall within the scope of Sections
31.212.21-.23 because he is not a “purchaser of a
mineral production payment.” Rather, he is an unleased
mineral interest owner. While Adams is correct that a
section's title does not constitute part of the law, it
does provide some aid in interpreting legislative intent
where the language of the statute is unclear. Section
31:212.21 merely states that it covers “the owner of a
mineral production payment or a royalty owner.”
“[O]wner” could refer to a party who recently
purchased a production payment or to someone who acquired the
production payment through some other means. Because Section
31:212.21 is ambiguous as to the parties encompassed within
the statute, we examine the title of that section of the
Mineral Code to determine the scope of the statute. Based on
the title to Sections ...